The Hormetic Dose-Response Model is more common than the Threshold Model in toxicology

(Sep. 12, 2002) The threshold dose-response model is widely viewed as the most dominant model in toxicology. The present study was designed to test the validity of the threshold model by assessing the responses of doses below the toxicological NOAEL (no observed adverse effect level) in relationship to the control response.

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Concern voiced over Bruce Power

Ken Warn
Financial Times – U.K.
September 10, 2002

The financial crisis at British Energy, the U.K. nuclear generator, has raised concerns over the long-term safety of the Bruce Power nuclear facilities in Ontario and over a possible supply crunch in the province’s energy market, according to Toronto analysts.

British Energy owns just more than 82 per cent of Bruce Power, which operates four nuclear generators under licence in Ontario, and is working to bring two mothballed nuclear generators back on stream. Canadian uranium miner Cameco owns 15 per cent of Bruce.

The concerns come as the Canadian Nuclear Energy Commission, which regulates the industry, was on Tuesday reviewing Bruce Power’s ability to meet financial guarantees that cover its obligations in the event of a shutdown for safety reasons.

The commission wrote to Bruce Power last month expressing concerns over the C$222m (U$144m) safety guarantee in the light of British Energy’s problems. The commission is also due to conduct its mid-term review of Bruce Power’s overall compliance with its two-year licence this week.

The Canadian regulators appear unlikely to revoke the licence any time soon. “There does not appear to be any urgency. Bruce Power is operating safely,” said Michel Cleroux, commission spokesman.

However, Toronto-based energy think-tank Energy Probe has written to the commission urging it to tighten safety inspections at Bruce Power.

“We are concerned that British Energy’s financial problems might put pressure on safety spending at the Bruce installations over the long term,” said Tom Adams, executive director of Energy Probe.

Bruce Power has assured the Ontario government that it “will continue to meet all its regulatory and financial commitments,” according to John Baird, provincial energy minister.

Under the terms of its lease, Bruce Power must make annual payments to the province rising from C$62m in 2001 to C$92m in 2018. It also faces debt repayments of C$112.5 million plus interest in both 2005 and 2007.

While Bruce Power appears to be in no danger of not meeting current financial commitments, efforts to bring two mothballed reactors back into service could be delayed by the crisis at its parent. Costs of the restart have already escalated this summer from an estimated C$340 million to C$400 million.

“Those expenditures represent an additional cost drain on the parent and I would not be surprised to see some delay in restarting those units,” said Mr Adams.

Any delay in restarting the reactors, due to take place in April and in the summer of 2003, would deprive the already over-stretched Ontario system of much-needed power. This July and August saw record-breaking demand for power.

To read the letter Energy Probe wrote to the Canadian Nuclear Energy Commission, please see: http://www.energyprobe.org/energyprobe/index.cfm?DSP=content&ContentID=5363.

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Financial Update on Ontario Electricity Financial

Tom Adams

September 9, 2002

Ontario Electricity Financial Corporation (OEFC), the legal continuation of Ontario Hydro, released its 2001-2002 financial results on Aug. 29, two months behind the schedule required by law, but a marked improvement over its first two years of operations – which commenced with the breakup of Ontario Hydro in April 1999.

In its latest report, OEFC declares a loss of $69 million compared with a restated net income of $18 million last year. Prior to restatement, OEFC had claimed a net income of $244 million last year. OEFC’s reported “unfunded liability” rose to $20.085 billion this year from $20.016 billion in 2001 – an increase from $19.433 billion in April 1999.

OEFC’s statement of “unfunded liability” should be treated as an estimate. The “unfunded liability” represents the net figure of OEFC’s total liabilities: mostly Ontario Hydro bond obligations, and its estimated costs for dealing with nuclear waste and getting out of high-priced power purchase contracts, some of which extend until 2042 – offset by notes receivable from the Province, Ontario Power Generation, Hydro One, and a small amount from the Independent Market Operator. Although, both OPG and Hydro One have seen their financial positions decline, the impact of these declines on the notes held by OEFC is difficult to judge.

OEFC’s financial losses were sustained despite the Ontario government’s decision last year to break one of its promises to ratepayers by accelerating the implementation of a special electricity tax earmarked for OEFC debt repayment to start collection prior to Market Opening. The Debt Reduction Charge (DRC) was first implemented on June 1, 2001, but renamed as the Wholesale Market Surcharge.

OEFC reports $524 million in accounts receivable from OPG and Hydro One as assets offsetting some of OEFC’s liabilities. These accounts receivable correspond to the retained earnings of OPG and Hydro One accumulated since their creation in April 1999. OPG has invested more than its total retained earning in the restart of the Pickering A nuclear station, a project now three years late and about 175% over budget. Additional funds for the Pickering A project appear to have come from the liquidation of Mississaugi hydro-electric assets, lease payments from Bruce Power, and deferring debt payments to OEFC. Hydro One has invested more than its retained earnings in the acquisition of municipal distribution utilities, where it bought assets worth $385 million for regulated cost recovery purposes at a price of $555 million. Additional funds for the acquisitions appear to have come from the issuance of new debt, which has diluted the Province’s interest in Hydro One. This year, OEFC’s accounts receivable were adjusted downward by $122 million relative to last year. Further downward adjustment of OEFC’s accounts receivable cannot be ruled out.

Consumers were promised that the DRC would be temporary, in place long enough to recover Ontario Hydro’s unfunded liabilities. Since the unfunded liabilities are growing, the outlook for the DRC is that it will become a larger, longer lasting or permanent tax. In future, the rate charged for the Debt Reduction Charge is likely to increase from 0.7 cents/kWh to at least 1 cent/kWh.

OEFC has claimed since its first annual report to have a plan that shows the unfunded liability being eliminated. The plan is secret. In 2000, the Provincial Auditor asked that the plan be subject to independent review. The reviewer retained was Ernst & Young, the same company that signed off on Ontario Hydro’s financial statements, statements we now know were materially inaccurate. This year, OEFC claims that the date at which its unfunded liabilities are defeased has slipped from 2010 until 2012, but no supporting explanation is provided.

OEFC’s financial statements raise a number of questions:

• How high will the unfunded liabilities rise to before they start declining?

• With OEFC failing dramatically to live up to its original debt reduction mandate, why was the consultant Michael Gourley, who played a key role in setting up OEFC as a former Deputy Minister of Finance under Eves, now vice-chair of OEFC?

• Will the full impact of the deteriorating financial position of OPG, Hydro One and OEFC be reflected in the province’s financial statements, expected later this fall?

 

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British Energy troubles called lesson for Point Lepreau

Andrew Philips
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.”

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Energy Probe’s letter to the Canadian Nuclear Safety Commission

Tom Adams

September 6, 2002

September 6, 2002

Linda J. Keen
President and CEO
Canadian Nuclear Safety Commission

Faxed to: (613) 995-5086

Dear Ms. Keen:

Energy Probe is concerned that the deteriorating financial condition of British Energy could have negative safety implications for the operation of the Bruce Nuclear Power Development.

We suggest that the CNSC immediately and significantly expand its on-site inspection staff located at the Bruce Nuclear Power Development. NSC site staff should be directed to be particularly alert to those instances where the interests of safety and production conflict, such as the scheduling of inspections, the provision of resources for preventative maintenance, and control room operations. CNSC site staff should also be alert to human factors such as morale and the availability and attention of executive staff.

Historically, the structure of nuclear regulation in Canada put the responsibility for safety on the shoulders of the licensed operator, with the safety regulator performing an audit role. Following from this approach, on-site regulatory staff was small in number. We believe that this approach is not appropriate in circumstances when the licenced operator is suffering extreme financial distress.

Sincerely,

Tom Adams
Executive Director

cc: Mr. Duncan Hawthorne, Bruce Power, Fax: (519) 361-3340

 

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Energy Probe’s letter o the Canadian Nuclear Safety Commission

September 6, 2002

September 6, 2002

Linda J. Keen
President and CEO
Canadian Nuclear Safety Commission

Faxed to: (613) 995-5086

Dear Ms. Keen:

Energy Probe is concerned that the deteriorating financial condition of British Energy could have negative safety implications for the operation of the Bruce Nuclear Power Development.

We suggest that the CNSC immediately and significantly expand its on-site inspection staff located at the Bruce Nuclear Power Development. NSC site staff should be directed to be particularly alert to those instances where the interests of safety and production conflict, such as the scheduling of inspections, the provision of resources for preventative maintenance, and control room operations. CNSC site staff should also be alert to human factors such as morale and the availability and attention of executive staff.

Historically, the structure of nuclear regulation in Canada put the responsibility for safety on the shoulders of the licensed operator, with the safety regulator performing an audit role. Following from this approach, on-site regulatory staff was small in number. We believe that this approach is not appropriate in circumstances when the licenced operator is suffering extreme financial distress.

Sincerely,

Tom Adams
Executive Director

cc: Mr. Duncan Hawthorne, Bruce Power, Fax: (519) 361-3340

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How meeting Kyoto goals can save Canada money

Lawrence Solomon
National Post
September 4, 2002

Now that Canada seems certain to commit to the Kyoto treaty by the end of the year, the choice before Canadians is stark. We can cut greenhouse gases in ways that gut the economy and impoverish Canadians – such reforms could cost 450,000 jobs, according to estimates from business lobby groups – or we can reduce gases by modernizing and liberalizing the economy.

Reducing our greenhouse gas emissions by 20% – a goal of the Kyoto treaty – is not a near-impossible technical feat that can only be accomplished at great cost to the Canadian economy, and to Alberta in particular. Reductions on an even larger scale can be readily accomplished while saving money and lowering taxes, while increasing wealth and productivity, and while reducing state intervention. Albertans would be winners along with almost everyone else.

Canada should have an easier time than most other countries in reducing our energy emissions because our industries are more wasteful than those of most others. Our entire energy infrastructure – Hibernia, the tar sands, natural gas pipelines and power plants – has become vastly oversized due to state subsidies of all descriptions. Remove the subsidies and the existing energy operations begin to shrink while new energy developments – most of them subsidy-dependent – largely disappear. Once this happens, our energy sector – among the largest in the world – will become leaner, Canada will become cleaner, and taxpayers will be pocketing the handouts governments had been giving our energy companies to encourage them to make risky investments.

Although Canada’s energy sector is bloated through subsidies, it nevertheless deserves credit for being a major net contributor to the Canadian economy. Not so for the rest of Canada’s resource economy, which would shrink to irrelevance without subsidies. Most mining, logging, and pulp and paper operations are marginal at best, while large-scale agriculture is wildly unprofitable – for every dollar of profits that a Canadian farmer earns, the agriculture sector receives $3.50 in subsidies.

Removing subsidies to these resource industries would do more than cut them down to size, it would impressively chop our greenhouse gas emissions because these sectors rank among Canada’s leading energy gluttons. The nitrogen fertilizer used throughout Canada’s agricultural lands depends on natural gas as a feedstock, for example, while mining and pulping operations consume inordinate amounts of all fossil fuels.

While the government was ending subsidies to the resource sector, it could end corporate subsidies across the board. The chief losers would be outdated steel companies and other smokestack industries whose usefulness to the economy has all but vanished. The chief winners, apart from the environment, would be the corporations and individuals now paying to prop them up. While ending subsidies would create dislocations, and one-time costs, these would be spread across the economy, and not be limited to Alberta.

Ending corporate subsidies alone would likely reduce Canada’s greenhouse gases by 1% or more per year – all that Canada would need to meet the time lines likely to be acceptable to Kyoto signatories. But further savings are available throughout the economy merely by doing what we should be doing anyway – ending the subsidies that ports receive to ship our raw resources, for example, and recovering the full cost of providing employment insurance to loggers and other seasonal workers.

The very largest reductions in emissions, however, would come from ending what may be the most wasteful product of all – free roads. Rather than willy-nilly expand the Trans Canada Highway, as the federal government plans to do, governments should end the free ride that Canadians have had on the Trans Canada and all other roads. Tolling our roads to recover the full cost of their construction and maintenance, even if we simultaneously reduced gasoline taxes, would greatly reduce the fuel consumed by vehicles by applying the forces of supply and demand to road use.

While gasoline taxes collect small fortunes from vehicle owners, the taxes do little to reduce the demand for road building because they don’t reflect which roads are used, and when. The modern toll roads now being built in Canada and around the world can send intelligent economic signals to drivers by charging vehicles more at peak times, and by charging cars much less than trucks, which cause most of the roads’ wear and tear.

Once roads are properly priced, the economy would slowly but profoundly adjust. To lower shipping costs, manufacturers would locate closer to markets, and to lower commuting costs – rush-hour commuters would pay $1 or more per mile travelled in high-cost areas such as Toronto – people would tend to relocate to work closer to home. Canadians wouldn’t necessarily own fewer cars – we would just use them less often in polluting stop-and-go traffic.

Less soot, less waste, more intelligent devices, more intelligent design. A more efficient society would rely less on raw resources and more on value-added services, employing fewer people to crush rocks and more to crunch numbers. A modernized economy has much to recommend it, whether or not the Kyoto treaty is the driver.

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Kyoto double game

Andrew Coyne
National Post
August 31, 2002

Someone once asked Jean Chrétien who his favourite hockey player was. Jacques Plante, he replied: the Hall of Fame goaltender who played professionally until well into his 40s. Why Plante – other than longevity? “Because he never made the first move.”

That is Mr. Chrétien’s political career in a nutshell. Like a goalie defending his net against an onrushing winger, he waits, and waits, until the other guy commits himself, or makes a mistake, or just loses interest. Then, and only then, does he make his move.

Actually, he takes it further than that. Mr. Chrétien is content not merely to wait to achieve his objective, but even to travel in the opposite direction for a time, on the theory that the shortest distance between two points is sometimes a large U. Should his original plan run into some obstacle, his position will describe a long, slow arc, like some orbiting comet.

For awhile he will retreat, perhaps even disavowing his previous position, or seeming to, until the issue subsides. His opponents may not be so foolish as to think they have won. But lacking an immediate casus belli, they will inevitably become less vigilant, or find reasons to fight amongst themselves – until the day, months or even years later, when Comet Chrétien comes hurtling back from the far side of the sun, on the same trajectory on which he had been headed from the start.

I have watched Mr. Chrétien turn this trick on any number of issues, from Quebec to the deficit. So it was hardly surprising to read of his sudden quickening of interest in ratifying the Kyoto climate accord. The Liberals’ early rush of enthusiasm for the accord long ago seemed to fade, especially in light of the fierce opposition it had aroused in Alberta – or more particularly, owing to the very different reception it had been given in Quebec. (If you want to know Mr. Chrétien’s position on any given issue at any given time, you have only to look at it through the prism of national unity.)

Wary of being whipsawed between the two, the Liberals took refuge in a statement of quite masterful ambiguity. “We want to sign Kyoto . . .” ministers would always begin. And? And? And, er, that was about it: At that point, the sentence would trail off into meaningless vapour. Pro- and anti-Kyoto forces were left to draw their own conclusions. Either it meant “we want to sign, and we will, eventually.” Or it meant “we want to sign, but as it stands, we can’t.”

The addition, years after the Liberals had first signed on to Kyoto in principle and months after they had promised to ratify the final agreement, of a new “condition” on Canada’s signature added a further layer of ambiguity. Suddenly, Mr. Chrétien was demanding that reductions in carbon dioxide emissions in the United States arising from the replacement of coal with Canadian natural gas be credited against Canada’s emission totals – a dubious notion on the merits, and almost certain to be rejected by the other parties to Kyoto, notably the European countries, who might be expected to take a firm line against unilateral, retroactive revisions to a text, many years in the making, on which 178 countries had already agreed.

So what did Mr. Chrétien’s new position mean? Was he saying that we will sign, just as soon as we get the credits we demand? Or was it, we won’t sign unless we do? Was the provision a deal-breaker, or merely a fond wish? Was Canada striking a hard line on the credits, which are not greatly significant in themselves, in order to give Mr. Chrétien the political cover he needed, especially in Western Canada, to ratify the accord? Or were they the pretext for the government to walk away from it, blaming the intransigence of the Europeans?

As the months wore on, the latter interpretation seemed to take hold, even in the wilder political reaches of Alberta, where there is always “another National Energy Program” lurking just around the corner. The more various government ministers insisted “we want to sign Kyoto . . .”, the more savvy oil-patch executives, who had once feared Kyoto would become a reality, winked to each other.

Indeed, they had still another reason to feel complacent; another level of ambiguity. The Chrétien government had promised it would not move to ratify the accord without “consultation” with the provinces and the energy industry. Or perhaps, that it would ratify, after they had been consulted. At the time, it didn’t seem to matter. Kyoto was going nowhere.

Only now they wake up to find that they’ve been had. The Prime Minister, we learn from a volley of leaks, intends to bulldoze legislation ratifying the accord through the Commons this fall, as part of his farewell tour. Alberta is furious, the oilpatch is up in arms, but what can they do?

And besides, what does “consultation” mean, anyway? If it means advised or informed, the government can plausibly argue they’ve been “consulted” to death. If it means their consent has been obtained or even sought, well, they can’t say they weren’t warned.

 

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Romanians want western help for second CANDU

Stephen Salaff
US Electricity Daily
August 30, 2002

Export Development Canada (EDC) is negotiating with France’s Société Générale, a private bank, over support for the Cernavoda 2 nuclear plant in Romania. The plant is a Canadian Candu 600 MW reactor which Atomic Energy Canada Ltd. is building in the country. Construction is reportedly about 50 percent complete, but Romania needs another $600 million to finish the plant.

Société Générale is said to be ready to lend some $100 million to French firms, including Alstom, for nuclear equipment and services to the plant. EDC is considering a loan guarantee to support AECL’s bid to complete Cernavoda 2. EDC, a quasi-governmental Canadian funding agency, previously supported AECL’s construction of Cernavoda 1, which ground to a halt in 1989 during the regime of dictator Nicolae Ceausescu. Ceausescu aspired to build a major fleet of nuclear plants, which may have contributed to his downfall, as well as the collapse of the Soviet Union.

Official details of the Cernavoda 2 negotiations are confidential, according to EDC’s spokeswoman Daniela Pizzuto, because financing has not been completed. According to Pizzuto, the full AECL environmental assessment of the project is available on the U.S. Export-Import Bank website at www.exim.gov/envproj.html. The Ex-Im Bank is also being asked to support the project. Romanian developers have also asked Euratom, the European Community’s nuclear power promotion agency, for some $350 million in aid to the project.

 

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Coal industry dealt big blow

Chisholm Pothier
Daily Gleaner
August 20, 2002

As NB Coal dismantles its cutting dragger before it gets shipped to Florida, some people in the Grand Lake area are wondering what happened to a community report on the future of the coal industry in the region.

The Lady of the Lake dragger was sold to a Florida operation for $1 million after sitting idle near Chipman for two years.

The piece of equipment was worth more than that, many people in Minto and Chipman believe, and they worry the provincial government is phasing out the coal operation sooner rather than later.

NB Coal is a Crown corporation, owned by the provincial government.

Although once a thriving industry that employed hundreds of people and shipped its coal out of the province, the coal-mining operation is now down to fewer than 100 employees with only one customer: the NB Power generator at Grand Lake.

The previous Liberal government had unveiled a plan to phase out NB Coal’s operation by 2004.

When the Progressive Conservatives were elected in 1999, they cancelled the plan but also cancelled NB Coal’s contract to supply coal to the Belledune power generator in northern New Brunswick, reducing the coal-mining operation by half.

In place of the Liberal plan, the Tories convened a working committee to make recommendations on the future of NB Coal.

The committee, comprised of residents of the Minto-Chipman area and government representatives, came up with a number of recommendations and submitted a report to Jeannot Volpe, minister of natural resources and energy, some 18 months ago.

There has been no response from the provincial government since then.

Volpe was on vacation this week and unavailable for comment.

People in the community are worried, said Lawrence Wasson, a retired miner and former president of the United Mine Workers local at NB Coal.

There has been no pronouncement from government on the future of the coal industry in the area and the dragger was sold for far less than it’s worth, he said.

The Crown corporation should have got some $7 million or $8 million for the dragger, he said.

But Murray Doherty, who was on the committee studying the industry’s future, said there’s not much demand for draggers, which cut into the coal seam and scoop out the coal, these days. If NB Coal could get anything for the dragger, Doherty said, it might as well have accepted the offer.

Still, Doherty said, he would like to hear the government’s response to the report he worked on.

The committee recommended some upgrades to the Grand Lake power generator to keep it going to 2009 or 2010, rather than 2004, thus allowing NB Coal to operate longer.

The coal found in the Minto-Chipman area is high in sulphur, which, when burnt, contributes to acid rain.

Nobody wants to buy that kind of coal anymore, Doherty said, acknowledging the reality that NB Coal will inevitably be wound down at some point.

But in the meantime, he said, the people in the area would put up with the pollution because the operation still employs a significant number of people.

Doug Tyler, who represented Grand Lake as a Liberal MLA for 12 years, was the Liberal energy minister when the government decided to phase out NB Coal but it also proposed an economic diversification plan.

The Tories fought their campaign in Grand Lake in 1999 on a pledge to keep the coal operation going, Tyler said.

But now the Tories are doing things such as selling the dragger without indicating any plan for the future of the coal industry, without responding to the community report or proposing any kind of economic diversification, he said.

“All the government’s really doing is buying time to get through an election,” Tyler said. “It’s time for the government to say what they’re going to do.”

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