New Brunswick Telegraph-Journal
September 7, 2002
MONCTON — New Brunswick would be foolish to throw any more money into Point Lepreau in light of the troubles now plaguing nuclear power giant British Energy, an Ontario-based energy observer says.
Tom Adams, who heads Energy Probe, said the British firm’s current troubles should paint an important picture for NB Power and its proposed $845-million refurbishment for the New Brunswick nuclear generating station.
In a statement released Thursday, British Energy PLC, which is the majority owner of Ontario’s Bruce nuclear reactor, said it could default on its financial obligations should talks aimed at obtaining British government support fail.
“They might not be able to manage come March,” Mr. Adams said. “This paints an atmosphere of acute concern. In the U.K., competition has driven down power prices so dramatically that revenues have dropped.
“In Ontario, it’s pretty dramatic because now we have a nearly-bankrupt nuclear operator and that’s created legitimate nervousness.”
And that could spell trouble for the entire Canadian nuclear industry, according to Mr. Adams, who noted that if British Energy can’t make a financial go of nuclear energy no one else likely can.
“These are bright people,” he said, noting the Edinburgh-based company is run by highly-skilled engineers and physicists.
“They started with a great workforce and leadership and got their generators for next to nothing. To see this team fall on their faces shows that nuclear power is not economic and that’s the lesson New Brunswick has to learn fast.”
Mr. Adams said the only other potential suitor to work with Lepreau appears to be Atomic Energy of Canada Limited, “a Crown corporation on life support.”
Since the New Brunswick government announced this spring it would seek investors for two of NB Power’s largest generating stations, British Energy was often seen as a likely suitor for Point Lepreau.
The proposal, which also features a plan to split up NB Power into four separate operating units, involves spending $1.6-billion to renovate Lepreau and convert Coleson Cove away from heavy oil fuel.
But Mr. Adams said NB Power and the provincial government should set aside their initial euphoria over the Lepreau refit and think realistically.
“At the time, (Natural Resources and Energy Minister) Jeannot Volpé and whoever else could grab a microphone was heaping praise on what a great project this was,” Mr. Adams said. “But without subsidies from the private sector, Point Lepreau is a dead duck.”
In 1998, former NB Power CEO James Hankinson said that British Energy had made informal inquiries about possibly operating Lepreau. Mr. Volpé has also suggested that the company could be in a good position to get involved in the New Brunswick market.
“Now they’ve got some plants in Ontario, so there’s a base. . . . So now it really looks like it would make sense for them to expand their operations from Ontario,” Mr. Volpé said during an interview shortly after unveiling the NB Power plan.
Mr. Adams said pouring more money into Point Lepreau beyond the initial $40-million study could help turn the facility into New Brunswick’s answer to Montreal’s infamous Olympic Stadium.
“The Big O is going to be a modern relic and so is Point Lepreau,” he said, noting refitting Lepreau doesn’t make sense when one considers “Hydro Quebec is sitting on the border with very low-cost power.
“Point Lepreau is a relatively small reactor and this is a relatively huge amount of money, all in the context of an uncertain provincial power market.”