Time for N.B. Power to shop around for nuclear options, ex-CEO says
Former head of ARC Clean Energy says successor’s departure is ‘confusing,’ may indicate funding shortfall
A former CEO of Arc Clean Energy Canada says it's time N.B. Power looks at other options for small modular nuclear reactors beyond two companies looking to build them in New Brunswick.
Norm Sawyer says indications of trouble at ARC, including the departure of its most recent CEO, are "a bit confusing. It doesn't seem to match up with what they're doing."
But it indicates that N.B. Power should consider shopping around to get more nuclear generation on the provincial grid by 2030 or 2035, he told CBC News.
"I would say yes, I think it's maybe time to do that, if indeed 2030 is critical," he said.
"Strategically N.B. Power needs to think this out and say, 'If I need power by this time, what's the highest probability I have if I want nuclear to be ready?' Obviously some technologies will be there a lot quicker than others."
Sawyer left ARC in 2021 and is now an independent consultant to the nuclear industry.
He was responding to news that his successor as CEO, Bill Labbe, has left the company.
ARC is "re-aligning personnel and resources to strengthen our strategic partnerships and rationalize operations to best prepare for the next phase of our deployment," the company said in a statement this week.
Last year Labbe told a legislative committee that ARC's 100-megawatt small modular nuclear reactor would be ready by 2030.
But at Energy and Utility Board hearings this week, the Crown corporation's vice-president of business development and strategic partnerships, Brad Coady, said SMRs "probably won't be ready by 2030."
The Higgs government gave ARC $20 million in 2021 to help it develop its reactor, and the previous Liberal government gave it $10 million.
Spokesperson Laverne Stewart said the government wasn't told of Labbe's departure in advance.
The provincial funding was "contingent on several benchmarks being reached," Stewart said.
"We are aware that the technology is still advancing and understand that restructuring is part of that process."
The province has pitched ARC and another company in Saint John, Moltex Energy, as key to the transition to non-fossil-fuel emitting electricity generation by 2035, the deadline established under the federal government's climate action plan.
The government and N.B. Power are also racing to find replacement electricity for the Belledune generating station, which must stop burning coal by 2030.
Politicians have touted the jobs and economic spin-offs of having two New Brunswick-based SMR developers building reactors.
But Sawyer says the first priority must be to get more generation in place, and it may make sense to look at companies further along and better able to build more units sooner.
"Having that supply chain in place and having the fleet in place, you're going to be a lot better off," he said.
"It's a balance of economic growth versus energy security, and I guess at the end of the day, at one point you just gotta decide to move forward."
Otherwise, he said, "the supply of electricity and the price of electricity is being put at risk here."
Allison Macfarlane, a former chair of the U.S. Nuclear Regulatory Commission and a professor at the University of British Columbia, said small light-water reactors being developed for Ontario's Darlington nuclear station are "closer to maturity."
"These are the ones that actually will probably be built first," she said.
Sawyer's comments echo what Liberal MLA René Legacy said in 2022, when he suggested the utility look at SMR models from outside New Brunswick to meet emissions deadlines.
"Obviously we want to do New Brunswick first, but if there are other opportunities out there, explore it," Legacy said Wednesday.
"As much as we want to create that industry, we're going to have a real energy crunch soon. It's coming up on us real fast."
In a statement Wednesday, N.B. Power said it's "in a period of disruptive change that requires it to look at all options" to meet a growing demand for electricity, but did not say whether those options include other SMR developers.
Seven First Nations communities that are part of the North Shore Mi'kmaq Tribal Council are investors in ARC's SMR development.
And the Port of Belledune said in 2022 it would use an ARC reactor to power a proposed hydrogen power export facility as part of its green energy hub project.
ARC said in its statement that Labbe won't be replaced as CEO but that the chief operating officer of ARC's U.S. company, Bob Braun, will lead the company "during the next period."
ARC did not respond to a question about whether anyone else is leaving the company.
The company said it recently completed the second phase of a vendor design review required under the Canadian Nuclear Safety Commission's regulatory process — another reason Sawyer questions the timing of ARC's plan to "rationalize operations."
"You would think that if you're planning forward, you would at least maintain what you have, or if there's a project, you would be growing," Sawyer said.
Potential investors may be hesitating because the company must find an alternative source of enriched uranium now that the supplier it was counting on, Russia, is subject to economic sanctions because of its war on Ukraine, he said.
Sawyer emphasized repeatedly that his comments are based on his expertise and experience in the nuclear sector as an independent consultant, not on any inside information about what is happening at ARC. He is not consulting for ARC, he added.
Some kind of additional nuclear generation is essential to New Brunswick's ability to reduce greenhouse gas emissions that contribute to climate change, Sawyer said.
"Just because one project may be hitting rough seas doesn't mean all nuclear is bad."
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