Big things in small packages: Small modular nuclear reactors featured in Canada's plans for economic growth and decarbonization

03 February 2021

Following on the heels of the recently-released federal Climate Plan, the Government of Canada has unveiled its Small Modular Reactor Action Plan (the "Action Plan"). Recognizing the potential of nuclear innovation to reduce emissions, decarbonize heavy industry, address energy needs in more remote communities and resource extraction locations, and spur economic development, the Action Plan sets out Canada's vision for the development, demonstration, and deployment of Small Modular Reactors ("SMRs") for multiple applications at home and abroad.

For more analysis of the federal government's new comprehensive climate change plan, see our articles on the Climate Plan, the Hydrogen Strategy, and the Clean Fuel Standard.



What are SMRs?

SMRs are a new class of nuclear reactors that are considerably smaller in size and power output than conventional nuclear power reactors. Given their portability and scalability, SMRs have a range of potential applications: from grid-scale units that can generate non-emitting reliable electricity and power remote communities, to smaller units suitable for heavy industry.

As with larger-scale nuclear generation facilities, SMRs do not emit greenhouse gasses, meaning they have significant potential to decarbonize electricity production and mitigate climate change.

What's in the Action Plan?

The Action Plan builds on the federal government's SMR Roadmap released in 2018, and reflects a pan-Canadian partnership involving the federal government, provinces and territories, Indigenous communities, power utilities, industry, innovators, laboratories, academia, and civil society. In total, over 100 partners from across Canada contributed chapters to the Action Plan, with each partner describing the actions they are taking to make SMR deployment a reality.

In its chapter, the Government of Canada begins by highlighting some of the major developments since the release of the SMR Roadmap.

  • On the political front, the premiers of New Brunswick, Ontario, and Saskatchewan signed a Memorandum of Understanding in December 2019 in which they committed to collaborating on the development and deployment of SMRs. In August 2020, Alberta announced its intention to sign the MOU.
  • On the regulatory front, the Canadian Nuclear Safety Commission ("CNSC") – Canada's nuclear regulator – has published regulatory information for SMR licence applicants. The CNSC also offers optional pre-licensing engagement with potential applicants, as well as a pre-licensing vendor design review service that provides SMR vendors with feedback on their designs at an early stage, with 12 currently involved. The CNSC has also implemented a regulatory readiness strategy for advanced reactor technologies, including SMRs, under which the CNSC affirms its readiness to license new nuclear technologies by committing itself to risk-informed processes, a robust and flexible regulatory framework, and capable regulatory staff.

The remaining sections of the Government of Canada's chapter survey the key opportunities presented by SMR technology:

  • First, Canada outlines the expertise and research infrastructure available to support the development of SMR technology. The Action Plan highlights Canada's longstanding nuclear expertise: a quarter of our Nobel Prizes have been related to nuclear science.
  • Second, Canada describes how SMR technology can expand the role of nuclear energy in the national energy mix, and ultimately help Canada meet its ambitious goal of reaching net-zero emissions by 2050. The Action Plan notes that a range of SMR opportunities are being explored across the country – from supporting cleaner grids and replacing coal power generation, to ending the reliance of remote communities on diesel. Being a baseload, dispatchable, and non-emitting source of energy, SMRs could also facilitate deeper integration of renewables (e.g. wind and solar) into Canada's energy mix.
  • Third, the Action Plan highlights the economic growth potential of SMRs. The Action Plan points to the economic importance of the ongoing projects in Ontario to extend the life of the Darlington and Bruce nuclear plants. As these long-term projects end in the late 2020s and early 2030s, newly-launched SMR projects could offer sustained opportunities for nuclear energy based engineering, procurement, and construction businesses. The Action Plan also notes that the mining industry has a particular interest in SMR technology, owing to SMR technology's potential long-term cost savings and environmental benefits for off-grid mining operations.
  • Fourth, the Action Plan touts the potential for SMRs in the global export market. The SMR Roadmap estimated this market at more than $150-300 Billion per year by 2040. The Action Plan projects that SMRs will help to build on Canada's internationally-recognized nuclear technology reputation created in the wake of our CANDU reactor technology.

The remaining chapters in the Action Plan, written by the other 108 partner governments and organizations, flesh out the economic and environmental potential of SMRs. The Action Plan also features a list of 450 actions being taken by the various partners to develop SMR technology.

SMRs and Canada's Climate Plan

The Action Plan was a feature of Canada's recently announced $15 billion Climate Plan, as discussed in our recent bulletin on the Plan. While the Action Plan does not itself contain funding for SMRs, SMRs may be eligible for several funding programs intended for low carbon technology and innovation, including:

  • a $3 billion "Strategic Innovation Fund" for clean energy solutions and industrial decarbonization projects;
  • $750 million provided to "Sustainable Development Technology Canada" to support clean technology development and commercialization; and
  • $300 million over five years for clean energy solutions in rural, remote and Indigenous communities.

SMRs: finally a reality?

For years, SMR technologies - and their decarbonization potential - have been the subject of much speculation and debate. Yet those technologies have never been piloted in Canada, let alone deployed at scale.

Through the Action Plan, Canada is looking to finally make SMRs a reality, with several provinces signalling that they're on board.

In coming years, watch for SMR technology to be piloted at remote mining and resource extraction projects, and considered as an alternative to diesel generation among Canada's 280 off-grid communities.

Should you have questions about SMRs and their applications in Canada, please contact members of Gowling WLG's Nuclear or Energy sector teams.


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