Two Canadian government funds announced a commitment to help finance a small modular nuclear reactor project at Ontario Power Generation Inc.'s Darlington site with a total investment of up to C$3 billion.
The Canada Growth Fund and Building Ontario Fund plan to make equity investments of up to C$2 billion and C$1 billion, respectively, and each will take a minority ownership position in the Darlington SMR Nuclear Power Plant project, according to an Oct. 23 news release from the funds and Ontario Power Generation (OPG). The project will remain majority-owned and operated by OPG.
The Canada Growth Fund will own 15% of the project, and the Building Ontario Fund will own 7.5%.
The Darlington small modular reactor (SMR) project, to be located adjacent to the existing Darlington nuclear plant, includes four grid-scale commercial SMRs expected to deliver up to 1,200 MW. The funds intend to invest in the project to "temporarily share certain risks that currently limit private sector interest" and to "spur private sector and Indigenous investment in the [project] over time," according to the announcement.
Specifically, the SMR project has limited access to traditional financing, and the funds are investing at a stage when the project is "exposed to certain construction and technological risks."
Capital from the funds will be made available subject to satisfaction of conditions for OPG, beginning with the first SMR unit and proceeding to subsequent units once the project meets certain milestones.
OPG expects to complete construction of the first SMR by the end of the decade and connect it to the grid by the end of 2030. Construction of units 2-4 is expected to be complete by the mid-2030s.
The cost to construct all four SMR units is C$20.9 billion, including interest, escalation and contingency.
OPG is using GE-Hitachi Nuclear Energy Inc.'s BWRX-300 design, a boiling-water SMR.
"Other Canadian provinces and global jurisdictions are seeking our expertise to deploy SMRs as a solution for their energy security needs, making this project a platform for further growth," OPG President and CEO Nicolle Butcher said in a statement.
The Canada Growth Fund is a C$15 billion investment vehicle designed to attract private capital to build Canada's clean economy. In the 2023 budget, the government of Canada appointed PSP Investments, through a wholly owned subsidiary, to act as the asset manager for the fund.
Canadian Prime Minister Mark Carney in August established a Major Projects Office to speed up review of "nation-building" projects and also assist in financing. The Darlington SMR project, called the "Darlington New Nuclear" project, was one of five initially identified for consideration for the expedited review.
"We're building big things to build Canada Strong," Carney said in an Oct. 23 statement.
The Building Ontario Fund is an C$8 billion, board-governed Crown agency with a mandate to invest in revenue-generating infrastructure projects in the province.
OPG and the Tennessee Valley Authority partnered in 2023 to expedite development of the BWRX-300 design for use in the US and Canada. The TVA submitted a construction permit application to the Nuclear Regulatory Commission earlier this year.
Other new nuclear in Ontario
The Ontario government asked OPG in January to consider new nuclear generation at the site of a shuttered power plant to meet growing energy demand.
The Wesleyville site, where an oil-fired power plant was partially built in the 1970s but never completed, has been maintained by OPG. It is near existing transmission and transportation infrastructure, is already zoned for new power generation and could host a large new nuclear development, according to the Ontario government. OPG's early assessments determined the location could host up to 10 GW of new nuclear.
It is one of three sites where OPG is considering new power generation resources. The Lambton site, near Sarnia in southwestern Ontario, hosted a coal-fired power plant that was retired in 2013. The Nanticoke site, on the eastern end of Lake Erie, also hosted a coal-fired power plant that has been decommissioned. A small solar plant began operating at the site in 2019.
Nuclear provides more than half of Ontario's electricity, according to the province.
Also on Oct. 23, Ontario signed an agreement with the province of Nova Scotia to collaborate on the development of SMRs. Ontario has signed similar collaboration agreements with the provinces of New Brunswick, Saskatchewan and Alberta.
