* Canadian province cites uncertainty about costs
* Says more information and consultation needed
* Bruce Power, gov't panel had urged reactor be built
By Cameron French
TORONTO, Dec 17 The Canadian province of
Saskatchewan, a top uranium producing region, said on Thursday
it will not go ahead with construction of Western Canada's
first nuclear power plant due to uncertainty about costs.
However, the government left the door open to future
development and raised the possibility of co-operation with the
neighboring Prairie provinces of Alberta and Manitoba.
The decision comes as rising upfront costs appear to be
becoming a deterrent for construction of some reactors, a point
of concern for a nuclear industry that has enjoyed a
renaissance in recent years.
Construction of a 3,000 megawatt nuclear plant in
Saskatchewan had been recommended by a government advisory
panel earlier this year, while nuclear generating company Bruce
Power said in a 2008 study that a 1,000 megawatt reactor would
be a good fit for the province's energy needs.
The province currently consumes 3,600 megawatts annually,
and is expected to have to generate another 1,200 to 1,750
megawatts for domestic use by 2020, due in part to the need to
decommission some of its coal-fired plants.
"We carefully evaluated (Bruce Power's) initial plans,
however uncertainty around long-term costs to consumers remain
a lingering concern," provincial Energy and Resources Minister
Bill Boyd said.
He said the large scale of the proposed plant requires a
regional approach that would ideally involve Alberta and
Alberta, home to energy-hungry oil sands developments, said
this week it would examine the merits of proposals to build
nuclear power plants on a case-by-case basis.
Nuclear power has enjoyed a global renaissance in recent
years, helped by soaring oil prices and tightening regulations
on greenhouse gas emissions associated with coal-fired
However, Saskatchewan is not the first region to balk at
the multibillion-dollar up-front costs to build reactors.
The province of Ontario, home to most of the country's
nuclear stations, recently shelved plans to build two new
reactors, citing high costs.
Ray Goldie, a uranium equities analyst at Salman Partners,
said the continuing rise of costs could be cause for concern on
other nuclear projects.
"It's certainly a possibility that existing (projects)
under way could be scaled back because of cost pressures," he
The right-leaning Saskatchewan Party government, led by
Premier Brad Wall, has pushed for further nuclear development
to create more revenue and jobs from the province's rich
In its statement on Thursday, the government said it would
continue to push uranium exploration and mining and direct
provincial utility SaskPower to continue looking at nuclear
power as an option for additional generation capacity in the
long term beyond 2020.
"We're still optimistic that Saskatchewan sees a role in
the future for nuclear energy," said John Peevers, a spokesman
for Bruce Power, which is part-owned by Saskatchewan-based
uranium miner Cameco (CCO.TO) and pipeline company TransCanada
Corp (TRP.TO). The company operates the eight-reactor Bruce
nuclear station on Lake Huron, northwest of Toronto, which has
a generating capacity of more than 7,200 MW.
Saskatchewan's decision comes as the Canadian government
said on Thursday it is looking to sell its Candu commercial
nuclear division, which is operated by government-owned Atomic
Energy of Canada Ltd, saying it needs outside investors to
boost its chances for growth and help cut costs to taxpayers
Candu heavy-water technology represents almost 10 percent
of reactor capacity around the globe, including all of Canada's
installed nuclear capacity.
(Reporting by Cameron French; editing by Rob Wilson)