News in Depth: Deploying SMR Technology in Canada’s Northern Communities

In mid-April, 2015, Peter Lang, President of Dunedin Energy Systems Ltd, gave a presentation at the Nunavut Mining Symposium, arguing for a radical shift in the way we provide energy to remote communities and mining operations. Traditionally, northern communities have relied upon diesel generators that produce substantial pollution and require costly infrastructure for fuel transport to maintain energy production.

Lang suggests a new approach, one that utilizes new, small modular reactor (SMR) technology to produce energy from floating nuclear power ships. In this week’s News in Depth, we explore Lang’s idea and the potential opportunities and challenges that are ahead.

An Old Idea Given New Life

As Lang noted in his presentation, the idea of utilizing nuclear reactors in unique contexts is not new: small, self-contained nuclear reactors have been providing energy on military ships and submarines (103 in the US Navy alone), and ice-breakers for decades and have been deployed in northern Russian communities since the 1970s.

Lang’s Dunedin Energy believes that their SMART (Small Modular Adaptable Reactor Technology) system would provide a more sustainable and consistent energy source for remote communities in Canada. They describe the systems as a “nuclear battery”:

When the fuel in a nuclear battery is consumed, the entire reactor module (which contains the spent fuel) is removed and shipped to a processing facility for fuel recycling. A new, freshly fuelled reactor module is installed to replace it. The reactor module is a sealed unit and cannot be opened for any reason at the operating site.

In his presentation, Lang compares diesel and nuclear, using a 16MWe common production rate. Notably, the annual fuel logistics of diesel include moving and storing over 31 million litres of fuel and annual greenhouse gas emissions are estimated to be 85,000 tonnes. Compare those figures to the zero fuel logistics and greenhouse gas emissions of their nuclear SMART system. Lang also highlights the issue of carbon taxes, arguing that while diesel may cost up to $1.2 Million for a 16MWe plant, a nuclear SMART reactor would gain a credit of $1.2 Million.

The Challenges Ahead

The incredibly favourable comparison above belies some of the deeper challenges that SMR development may face in northern communities.

The first set of challenges relate to cost and public resistance. Dunedin presents two business cases – a full-ownership option and a “zero-capital cost” option wherein Dunedin handles the operation and logistics of deployment, operation, and decommissioning, and the customer pays approximately 29 cents/kW in return.

However, northern communities and mine operators may be tempted to continue to rely on diesel – owing to the current low price of oil and, in essence, because of the stickiness of the status quo. In addition, northern communities, including many Aboriginal groups, continue to be locked in debates over energy development, mining, and socio-economic development; introducing any new nuclear energy plan may provide more fodder for political debate. Dunedin appears to be aware of these challenges and addresses the regulatory and safety issues on their website. However, as we suggested in a piece on April 23, better public engagement and education would be required to quell any genuine fears or uncertainty that exist.

Lastly, northern communities may demand a clearer set of guidelines and regulations relating to decommissioning and remediation. Lang noted in his presentation that decommissioning funds would be held in escrow, effectively guaranteeing that even if a community or mine is bankrupt, that the money for cleanup and restoration is not subject to claims by creditors or other parties. Dunedin’s approach is unique – in that the whole reactor-in-a-ship concept allows for relatively easy site cleanup – but questions still remain. How much would be necessary for cleanup? What does full restoration look like?

In other words, this ambitious idea is not without issues. However, there appear to be tremendous economic and environmental arguments in favour of SMR development in northern and remote communities. These arguments carry over to other contexts – including Mexico, for example – and may one day translate to a new energy future for Canada’s North.

US Deparement of Energy agrees to fund NuScale SMR to commercialization

The US Department of Energy (DOE) announced this week that it will invest $217 million over five years in the development and commercialization of the NuScale Small Modular Reactor (SMR).  The DOE expects their investment to be matched by private sector investment in the project.  NuScale intends to use the funds to test their reactor and to complete the process of certification through the Nuclear Regulatory Commission with hopes of having the first NuScale reactor online by 2023.

NuScale’s 45MW pressurized water reactor is a unique design making use of an unconventional fuel assembly which is passively cooled and more inherently safe than existing reactors.  In the event of an overheating, the reactor is designed to cool without any human input, without any additional water, and without electricity.  The NuScale SMR will be mass produced in a factory and shipped by truck, rail, or barge in sets of up to twelve for power stations between 45MW and 540MW.

Here, the Chief Commercial Officer of NuScale Power explains some of the benefits of a small modular reactor generally and the NuScale reactor specifically.

If NuScale is able to keep to its schedule for commercialization, it could play a major role in achieving US President Barack Obama’s recently stated goal of reducing the emissions of all US power plants 30% by 2013.


The Future of Nuclear Power and The Long View

Below is a comment from Future of NuclearChair Henry Vehovec on his opening remarks and in response to post-event press coverage:

“The day after Wednesday’s Future of Nuclear 2013 Conference in Toronto the Premier Kathleen Wynne and the Province of Ontario announced that new build nuclear reactors would not be pursued at this time. Articles in the press cited pricing pressure from cheap shale gas, a decline in energy demand, and increased resistance to nuclear power in the post-Fukushima world as reasons for the decision. Although there has been a recent decline in nuclear power in the global energy mix it would be premature to dismiss nuclear in the longer term.

Henry Vehovec, Chair, Future of Nuclear

Henry Vehovec, Chair, Future of Nuclear

The global mix of major energy sources evolves over decades and plays out in time frames of a century or more. The first oil well was drilled in Pennsylvania in 1859, however, it wasn’t until the development of the Model-T Ford fifty years later that oil truly took off as a major global energy source. Similarly, civilian nuclear energy started about fifty years ago and the industry now needs game changing innovation if it is to compete with shale gas and address concerns of radioactive waste, safety and proliferation.

Are there any such game changing innovations on the horizon? At the Future of Nuclear Conference we heard about several nuclear technologies that hold the paradigm shifting potential to compete with shale gas.  New nuclear technologies that are on the drawing board can burn spent fuel, are incapable of meltdown, and do not produce fissile material. We heard about fusion from General Fusion, thorium and molten salt reactors (MSR) from Terrestrial Energy, small modular reactors (SMR) from Babcock and Wilcox, portable reactors, travelling reactors, floating reactors and more. These technologies have attracted investors such as Jeff Bezos and Bill Gates as well as some of the wealthiest sovereign funds. The only problem with most of these technologies is that they require at least a decade to develop and would cost several billion dollars to produce their first prototype let alone a commercially available product. In this era of short term pressures for quarterly results in business and governments that rarely think beyond the horizon of a 4-year election term it is difficult to find jurisdictions that plan decades into the future as is required when considering energy infrastructure.

China, India, Russia and UAE are examples of countries that are taking an appropriate long view to energy planning. Not coincidentally, these are also among the countries that are proceeding aggressively with their plans to build nuclear power capabilities. China alone has 29 reactors currently under construction. Although some jurisdictions in the west do not have local demand to support new reactors it would certainly make sense to stay engaged with the industry and act as a supplier to international markets where possible. As a commodity, shale gas will not be cheap and plentiful forever.”