July 6, 2009

Procurement

Decision to delay Darlington nuclear power plant carries job cost

AECL produces only compliant bid

VINCE VERSACE

staff writer

Ontario trumpeted a year ago that expansion of the Darlington nuclear facility would generate 3,500 construction jobs. But now those jobs, along with the project, are on hold.

George Smitherman, deputy premier and energy and infrastructure minister, announced recently that the building of two new reactors at Darlington has been temporarily shelved because of a high price tag and uncertainty with the company that delivered the best bid.

“Unfortunately, the competitive bidding process has not provided Ontario with a suitable option at this time,” said Smitherman in a statement. “Emission-free nuclear power remains a crucial aspect of Ontario’s supply mix.”

The expansion project was projected to cost $26.3 billion and 3,500 construction and engineering jobs would have been created during an anticipated five-year construction period. Atomic Energy of Canada Limited (AECL) provided the only submission that was compliant with the terms of the province’s request for proposals and project objectives. Proposals were also received from AREVA NP and Westinghouse Electric Company.

The three firms were evaluated on their lifetime cost for power, ability to meet Ontario’s timetable to bring new supply online in 2018 and their level of investment in the province. Smitherman said “uncertainty” regarding AECL’s future prevented continuing with the procurement.

The Council of Ontario Construction Association’s say the provincial announcement is disappointing but it believes the province will still move ahead at some point in the future with the expansion project.

“They still seem committed to doing but it should be built on best projections,” said COCA president Ian Cunningham.

“There are future (energy) load demands to be met. The project would be a huge economic generator and a huge boost for our construction industry.”

The province intended the expanded Darlington facility to be generating an extra 3,200 megawatts of electricity by July 2018, doubling current capacity.

The new reactor units are part of Ontario’s strategy to renew its nuclear generating assets. Nuclear power accounts for about 50 percent of Ontario’s electricity needs.

When Darlington was originally built it employed 10,000 construction workers during peak project construction. It currently has four Candu reactors generating 3,500 megawatts and was engineered by AECL.

The new reactors would be operated by the publicly owned Ontario Power Generation. Darlington was chosen for expansion by Ontario because its transmission capacity is more accessible than the Bruce power plant site in Kincardine.

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