SMRs: Potential Game-Changer for Cost-Benefit Conversation on Energy Intensive Projects

This blog follows our previous entries on the topic of Small Modular Reactors (SMR). Our first blog was about the obstacles this new technology faces to commercialization, and the second was about misconceptions and perceptions that limit the potential for a more broad use of nuclear power. This installment will focus on one aspect of building the SMR business case: the potential for SMRs to reduce emissions for large, energy intensive projects including oil and gas production. The final installment of this SMR blog series next month will then focus on SMR development and deployment.

The public discussion in Canada around oil and gas production is very topical. Canada faces tough choices about resource development projects and how the emissions from those projects effect federal emissions targets. There are many stakeholders in these discussions, including provincial governments, environmental advocates, energy companies and advocates, the people living near resource projects and Indigenous communities. All are passionate on the subject and are trying to convince Canadians of their perspective. Multiple legal actions have been filed, some successful and others not. This issue is, to say the least, contentious.

A recent project garnering public attention is the Teck Resources’ Frontier Project. The proposed project is for oil production on a site 110 kilometres north of Fort McMurray, built on roughly 24,000 acres of boreal forest. The project leader expects the project to produce about 4.1 million tonnes of GHG emissions annually, with environmental groups estimating the total is closer to 6.0 million tonnes annually. The $20-billion project is expected to generate $70 billion in royalties and taxes for all orders of government over its lifetime and produce about 260,000 barrels of oil per day.

Different opinions on the issue are fundamentally about the costs and benefits of these projects, with emissions as a central consideration. Supporters of resource projects point to economic benefits and a reduction of emissions over time, while detractors point to the increased emissions now and how that will impact Canada’s climate targets. With strong, polarized opinions on the issue, there is little common ground. What if we could reduce the emissions from the project? What if we could switch to electricity to power energy projects?

Small Modular Reactors (SMRs) offer the potential to supply local, sustainable nuclear power for energy projects. SMRs offer the possibility of generating power locally to sustain any energy intensive project with zero-emission electricity. This could be a game-changer for determining the emissions output of resource projects.

When we say “small,” SMRs can range from approximately the size of an SUV to the size of a school bus. SMRs take up much less space and offer much more versatility than what we traditionally think of when we talk about nuclear power reactors. SMRs can be transported and installed as stand-alone units wherever needed.

In all cases SMRs provide, clean, reliable electricity locally. This means reducing the need for a costly network of maintenance-intensive, high-tension lines to transmit power. An SMR can be set up close to where the power is used, meaning fewer transmission lines and associated loss.

Using SMRs as the source of power for energy intensive resource projects has the potential to be a game-changer in the cost-benefit conversation regarding emissions. If the Frontier project only emitted a quarter, or a tenth, of the emissions that are projected, what does that do for the conversation about costs and benefits? What does that mean for planning and sustainability?

SMRs are hardly a panacea that puts to rest any disagreement on resource projects. However, they do offer a major shift in the calculus for costs and benefits. The potential to shift the conversation from emissions means talking about broader issues about economic sustainability, benefits to communities, land usage and remediation. The promise of significant reductions in emissions from energy projects through clean power at the point of production could fundamentally shift the conversation about the costs and benefits of these projects. The potential benefits are not restricted to energy intensive resource projects alone. SMRs could provide reliable power to remote communities reliant on diesel power.

SMR roll-out would require both regulatory and environmental approvals following the same stringent practices and protocols used for our current nuclear power generating stations—from the initial evaluation on the site for an SMR through to construction and operation, regulatory and environmental compliance, stakeholder communication, to safety and environmental sustainability. This is essential to maintaining public trust in the viability and safety of SMRs located near or in their community.