June 18, 2008

Talk of Building a Nuclear Reactor Has Energy Companies Circling Saskatchewan

By Jennifer Graham, THE CANADIAN PRESS

REGINA - A "bonanza" of uranium and a government keen on opening the door to nuclear power has energy companies circulating Saskatchewan in hopes of flipping the switch on a reactor.

A day after Bruce Power (TSX:CCO, TSX:TRP) announced plans to study the feasibility of building a reactor in the province, the head of Atomic Energy of Canada Ltd. was in Regina touting nuclear energy.

"The economics of nuclear power for this province in my mind are unquestionably solid," said AECL president and CEO Hugh MacDiarmid.

"It will prove itself to be the right answer for a significant portion of your future electricity generation ... and we at AECL would be very, very happy and willing partners with you in that."

MacDiarmid, a self-described "nuke fan," noted that Saskatchewan sits on "a literal bonanza of uranium."

The province is the world's largest producer of the radioactive element.

But mining the raw material is as far as Saskatchewan has progressed in the nuclear cycle. Plans to develop a uranium refinery or build a nuclear reactor have been shelved in the past in the face of stiff public opposition and concerns about feasibility - that is until Bruce Power's announcement Tuesday.

As part of its Saskatchewan 2020 initiative, the Ontario-based company will look at the economic impact of and public attitudes about adding nuclear energy to the province.

It's a move warmly welcomed by the provincial government.

"We had certainly sent a message out that our new government was interested in this opportunity," said Premier Brad Wall, whose Saskatchewan Party took office in November.

"I signalled months before the last election that it was time for this province to have a discussion about the potential of nuclear power and also a much more aggressive plan to add value to uranium."

"I'm sure Bruce Power and others were listening carefully," said Wall.

Wall said he was surprised by the amount of interest and how quickly the study came about. Although the government knows that companies and the industry understand that there's "underlying support in our province for this like there is perhaps not elsewhere," he said.

MacDiarmid suggested that if Bruce Power gives the project the green light, AECL would bid to become the reactor supplier. Other big name vendors include American giant Westinghouse and Areva NP of France.

All three companies have been asked to submit bids for a new nuclear reactor in Ontario.

Despite the desire to eliminate Saskatchewan's reliance on coal-fired power, not everyone backs the idea of the Prairie province going nuclear.

Peter Prebble, with the Saskatchewan Environmental Society, says there are better ways to address the province's energy needs through renewable power sources such as wind and conservation.

As a former New Democrat member of the legislature, Prebble also objected to the idea due to cost concerns.

"I thought that it was not a wise investment for Saskatchewan and an investment that was likely to leave taxpayers on the hook for hundreds of millions of dollars in terms of cost overruns," said Prebble.

"That's been the pattern right across the country."

"We've seen it in the U.S. where there's a longer record of private corporations pursuing this. The pattern is that the federal government and sometimes state governments run to the aid of private nuclear utilities undertaking reactor construction projects."

Prebble said the public needs to be educated about the issue.

Wall said he believes the public supports the idea of adding value to the uranium cycle. The premier added that the feasibility study will give the public "plenty of opportunity" to make its voice heard, but stopped short of saying whether that consultation will include a referendum.

And Wall suggested that in the face of climate change concerns and rising prices on energy bills, it's logical to examine the nuclear option.

"I think it's foolish not to be open to this opportunity. It would be foolish for the government not to be open to the opportunity and explore it and that's exactly what we're going to do," he said.