Politics·Analysis

Weston: AECL pulls plug on costly reactor project

The federal government has quietly shelved development of a new Canadian nuclear reactor that has already cost taxpayers more than $300 million, and now may never leave the drawing board.

The federal government has quietly shelved development of a new Canadian nuclear reactor that has already cost taxpayers more than $300 million, and now may never leave the drawing board.

CBC News has learned the government-owned Atomic Energy of Canada Ltd. pulled the plug on the project about six months ago, despite the huge public investment in the technology.

This week, the government sold Atomic Energy's reactor division to a Quebec-based engineering firm that says it, too, has no plans to take the project out of mothballs anytime soon, if ever.

For years, the federal government has been pumping money into development of the proposed ACR-1000 reactor, a first-of-its-kind hybrid technology touted as the future of the Canadian nuclear industry.

But the project's successful launch depended largely on the Ontario government agreeing to buy two of the proposed reactors at a cost of more than $30 billion.

In 2009, with a number of unrelated Atomic Energy snafus already in the headlines, Ontario got the jitters over buying untested nuclear technologies without a guarantee the federal government would cover any cost overruns.

When the feds refused, the Ontario government simply suspended its bid to buy reactors, and has yet to restart the process.

Leslie Quinton, a spokesperson for SNC-Lavalin, the Quebec-based company that is buying Atomic Energy’s money-losing reactor division, says the firm has no plans to do anything further on the ACR-1000 reactor project unless a client specifically wants to buy one.

Even then, Quinton is emphatic that SNC-Lavalin is an engineering firm and has no intention of embarking on expensive research and development projects, including completion of the ACR-1000.

Instead, the company appears to be pinning its near-term sales hopes on an enhanced version of Atomic Energy’s proven and internationally acclaimed CANDU reactor.

Focus on smaller reactor

The deal inked this week between the government and SNC-Lavalin specifically gives the company $75 million from the public purse to complete development of the so-called Enhanced CANDU reactor, or "EC6."

SNC-Lavalin spokesperson Quinton says there was no provision in the deal to complete the ACR-1000.

While Quinton would not comment on any possible sales to Ontario, nuclear industry insiders say the company will almost certainly try to sell the province a couple of the smaller and less risky Enhanced CANDUs.

If taxpayers wind up with nothing to show for the hundreds of millions of dollars invested in the shelved ACR-1000 reactor, it wouldn’t be the first time.

Over the past decade, Atomic Energy has become notorious for botched reactor projects that have generated mainly red ink for taxpayers.

Three years ago, the Conservative government killed the development of two new medical isotope reactors that were years late, wildly over-budget and didn’t work.

Canadian taxpayers wasted more than $600 million on that project.

More recently, Atomic Energy's refurbishment of some of its aging reactors in Canada and abroad has left taxpayers with potentially billions of dollars of cost overruns and lawsuits.