Bruce Power has pulled the plug on an ambitious plan to construct two new nuclear power stations in Ontario.
The company says the stations, which it had hoped to build at Nanticoke on Lake Erie and at its existing nuclear complex near Port Elgin on Lake Huron, are not needed because of plunging electricity demand in the province.
The cancellations follow a decision late last month by the Ontario government to shelve a plan to build a new nuclear plant. The province cited the high cost of constructing the station as part of the reason for its decision.
Bruce Power operates two nuclear stations it leases from the Ontario government at the Port Elgin site. In a statement, the company said it will focus on refurbishing reactors at these stations rather than embarking on new construction.
The decision will have no impact on the company's interest in building nuclear power stations in Alberta and Saskatchewan. Both provinces are expected to issue policy statements on nuclear power this year, according to the company.
"These are business decisions unique to Ontario and reflect the current realities of the market," said Duncan Hawthorne, Bruce Power's president. "For more than five years, we've examined our options and refurbishing our existing units has emerged as the most economical."
Bruce Power said it has notified the Canadian Nuclear Safety Commission and the Canadian Environmental Assessment Agency that it will withdraw its site licence applications and suspend its environmental assessments in Bruce County and Nanticoke.
Mr. Hawthorne said the company's research indicated both sites "held great promise for new build if the market conditions were more favourable" but the company must do what is "best for us, for Ontario and its ratepayers."
There have been hopes among nuclear energy proponents that interest in atomic power is about to undergo a revival after worries over the Three Mile and Chernobyl accidents caused construction of new plants to cease in North America for the past two decades.
But recently, some of that optimism has faded.
Besides the cancellations in Ontario, major utilities in the United States, including Entergy Corp. and Exelon Corp., have suspended some of their plans for new nuclear power plants. Last month, Moody's Investors Service, a credit rating firm, warned that it is considering taking a more negative view on utilities considering new nuclear stations.
Shawn-Patrick Stensil, a spokesman for Greenpeace, said the rapidly escalating price tag on new nuclear plants is undermining investor confidence in the technology. He said he believes cost worries are the real reason Bruce Power decided to cancel its Ontario projects, noting that it can take 10 years or more to build a nuclear power plant and utilities normally don't cancel plans because a recession temporarily cuts electricity use.
"I think they're using that as an excuse," said Mr. Stensil, adding he doubts Bruce "would be able to convince private investors to take on [the]kind of risk" that comes with building two new plants.
Murray Elston, Bruce Power's vice-president of corporate affairs, rejected Mr. Stensil's assertion, saying "it really is the fact that right now the capacity of our system to generate is well beyond what our demand is."
He said the company had not sought cost estimates for the two new plants.