SMRs: The solution to Ontario's strained power grid?

It's no secret that Ontario's electricity grid is under strain amid rising power consumption. With the G7's first Small Modular Reactors underway in the province, the technology is being positioned as a blueprint for relief.

In December 2022, Ontario Power Generation (OPG) broke ground on preparations for the first grid-scale SMR in Canada and the G7 at the Darlington plant in Bowmanville, Ont. In 2023, citing the first increase in energy consumption in the province since 2005, Ontario announced the construction of an additional three SMRs at the Darlington New Nuclear Project site.

The initial reactor will come online in 2030, and the additional SMRs could come online between 2034 and 2036. The rewards are estimated at 1,200 megawatts (MW) of electricity generation. For reference, the Canada Energy Regulator estimates the province's electricity generation capacity at 39,569 MW as of 2021.

Ahab Abdel-Aziz, Global Director, Nuclear Power Generation at Gowling WLG, said Canada has a scaling problem. While estimates show global energy consumption will require 100 large reactors between now and 2035, he says that represents only a quarter of current capacity.

"We are currently, around the entire planet, deploying between six and seven large reactors a year. To meet climate change objectives, the pace to get there by 2050 requires us to deploy between 32 and 40 a year. We don't have a way to do that. So now we're adding another 100 reactors that makes it in a much shorter timeframe. So there is a tremendous challenge," he said.

Last month, Tim Hodgson, Canada's Minister of Energy and Natural Resources, announced that Natural Resources Canada would develop a new Nuclear Energy Strategy to be released by the end of this year to solidify a strong nuclear future, or at least an in-writing plan.

In a study released by the Canadian Nuclear Association last year, in nine years' time, Canada could need an additional 30 to 36 gigawatts of new energy capacity, including around four gigawatts from already announced nuclear projects. 

While energy is necessary, the method for pursuing it is debated. Markus Piro, Associate Professor of Engineering Physics at McMaster University, said SMRs are just one small piece in the province's energy puzzle. Piro's company works directly with OPG on the Darlington project.

"Bruce C and Wesleyville out in Port Hope - those are major projects. Way bigger, not only in terms of the financial commitment, but also the contribution to the grid. So, if we're talking about AI data centres and all that, SMRs are just a drop in the bucket compared to these mega projects."

The Bruce C Project, by Bruce Power Generation in Kincardine, Ont., is set to build up to 4,800 megawatts of nuclear capacity. OPG's Wesleyville site in Port Hope, Ont., will host the world's largest nuclear site once online in the early to mid-2040s. It will hold a potential capacity of up to 10,000 MW.

"SMRs and large reactors can fill the demand. But the problem we need to solve is, how do we scale up the pace of deployment?" added Abdel-Aziz. "We are an order of magnitude below the pace that's required for any of us."

He said that while large reactors are effective, they often come in delayed and over budget due to various factors, including complex regulatory approvals and supply chain vulnerabilities.

In the United States, Georgia Power's Vogtle reactors three and four finished roughly USD $17 billion over budget and seven years late due to a lack of experienced nuclear labour and supply chain infrastructure. 

In terms of SMR construction costs, the four 300-megawatt reactors being built at the Darlington site are forecast to cost CAD $20.9 billion, with the first reactor at around CAD $7.7 billion.

"So the theory of SMRs ultimately is that they will be modular, which means you cut out construction. Think of [prefabricated] housing versus construction. So we're not there yet. We don't yet have a genuinely "modular reactor" rolling off any lines. But that's the goal. Construction is where you get a very significant time delay and substantial project risk," said Abdel-Aziz. "So if you can take construction out and basically install a reactor, SMRs can then bring a new dimension to the scaling and be deployed faster than large reactors."

While data centres are increasingly looking to build their own off-the-grid or, rather, behind-the-meter energy solutions, most to date have included hydro or solar capabilities. The GW Ranch project, currently under construction in Texas, will see over 8,000 acres of site without a connection to the larger electricity grid. Albeit, natural gas turbines, battery storage, and solar power are the sources.

Piro says SMRs wouldn't work behind the meter in Ontario. 

"What's going to happen if you have this data centre that needs 24/7 electricity, but you have to turn the reactor off to do maintenance or to refuel it?  " Those are practical problems," said Piro. " It's one thing to build these things, but it's another thing to license them ...The qualification and licensing process is longer, in several cases, than actually building, so how much sense does that make?"

Many licensing cases to date are rooted in U.S. projects and must face approval by the Nuclear Regulatory Commission's Atomic Safety and Licensing Board.

Piro added that SMRs could work better integrated in the grid in other provinces with lower energy consumption. 

"If we take Saskatchewan as an example, they're on a different grid than we are in Ontario. It's a lot smaller than Ontario. So if we put even one of these large reactors that we're talking about in Ontario into Saskatchewan, and that has to go down for maintenance. If you have one of these giant reactors in Saskatchewan, and you have to take it down for maintenance, then that's your grid [gone]," said Piro. "In contrast, you could have four of these small reactors, with roughly the same size of electrical output, but then you'd only take one at a time off the grid, and that becomes more manageable."

Ontario seems interested in sharing its SMR experiences within Canada's coasts. Late last month, Ontario announced it would be working with Yukon, which has 152.1 MW of grid capacity, to explore the viability of SMR generation in the territory. "Energy is a scarce resource in the Yukon, and our electricity grid is under strain and will soon be unable to meet the needs of the territory," said Ted Laking, Yukon Minister for Energy, Mines and Resources.

Abdel-Aziz emphasised the importance of consistency for power, adding that clean energy mixtures just won't cut it.

"You can go to intermittent forms of clean energy, but you need a consistent base load for data centres, so that doesn't cut it," said Abdel-Aziz. "So what you're left with is hydro sources - we don't have new ones - and nuclear. I think that's a shoot that's hard to change the outcome on."