Alberta’s route to massive carbon reduction: a winnable war

Fighting the climate change war in Alberta is a two-front proposition. There’s power generation and there’s the oilsands. Both are the biggest emitters of their kind in Canada (see article). And unless there is progress in both, or at least a credible plan for progress, customers for the province’s major export, petroleum, will become increasingly hostile. Alberta has chosen to attack power generation first. Smart move.

The strategy on this front is carbon capture and sequestration (CCS). I have scoffed at this idea in the past, because power plants in Alberta emit roughly 50 million tonnes of greenhouse gases (GHGs) annually and there is simply no way that amount of gas can be pumped underground year after year.

But if that CO2 were used as feed for Fischer-Tropsch fuel, the picture changes completely. Suddenly, we’re looking at the realistic prospect of wiping out an entire GHG inventory category, either power plants or motor vehicle transportation (see article). Recycle that carbon rather than pumping it into the ground, and carbon capture transforms from a cost to a vital profit-centre component.

Needless to say, Alberta’s power sector emissions will also drop if Bruce Power succeeds in its effort to introduce nuclear power to the province. A single 1,000 megawatt nuclear generator would directly offset coal-fired generation, to the tune of about 8.3 billion kilowatt-hours per year, thereby avoiding roughly 8.3 million tonnes of GHGs.

On the oilsands front, the chief strategic aim is to drastically cut back the use of natural gas. Many have suggested nuclear energy as a way to do this. In my previous post I mentioned that small reactors, such as the Hyperion, would be more appropriate than large reactors for oilsands applications. But a proponent would have to overcome some significant regulatory hurdles.

Introducing nuclear energy to the Alberta oilsands is not for the faint of heart. First, the basic economics have to make sense. Is it cheaper to make steam and hydrogen by fissioning uranium than using natural gas? Perhaps. World petroleum prices are dropping, cutting into oilsands profitability. The continental natural gas price (not to be confused with world petroleum prices) has been all over the place, but is generally higher than a few years ago. A carbon costing scheme, either cap-and-trade or an outright tax, could give nuclear an unequivocal and permanent advantage. This would likely be the case whether or not Alberta joins a carbon-costing scheme: witness the growing hostility in the U.S. to “dirty” oilsands petroleum.

If the economics of nuclear energy are judged favorable, you then have to find an interested proponent. This means finding an oilsands operator who is willing to step up, in public, and go through the process of finding an interested and accepting host community. No proponent will step up unless he or she has a particular reactor design in mind. And that won’t happen until a reactor vendor steps up and runs their design by the Canadian Nuclear Safety Commission (CNSC) in a process called a Pre-Project Design Review.

This could take a year and a half and cost over three million dollars, with no guarantee of success. Of course, every vendor should be confident their machine will pass with flying colours, otherwise why would they be in this business in the first place. So far, only AECL has been confident enough to submit a design, the ACR 1000, to this review.

A small-reactor vendor like Hyperion could reap huge benefits from going through this process. Not only is this a necessary prerequisite to generating serious interest on the part of an oilsands operator, but the stamp of approval from a major western regulator would show the rest of the nuclear world that the company is serious. Besides, when it comes to nuclear regulation, ~$3 million for a necessary first step is small change.

But let me be clear. After the Pre-Project Design Review, the real work begins. Like I said, nuclear power in the oilsands is not for the faint of heart.

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