It now seems likely that Canada’s federal government will sell its entire stake in the Candu reactor division of Atomic Energy of Canada Ltd, a move first flagged up last summer when the government that it planned to split AECL and sell off the Candu division. The sale could have profound implications for Canada’s nuclear industry and billions of dollars in plant refurbishments across the country.
The federal government has pumped about $434 million into the development of next-generation Candu reactors since 2003. However, it appears it is no longer willing to bankroll AECL, which has received $1.74 billion in public funding since 2006.
When the government announced in December that it was formally inviting bids for the Candu division, federal officials said Ottawa was open to a range of investment options, including a 100 %. It appears that that is still the government’s official position, but stakeholders who have been briefed by investment bank Rothschild, which is overseeing the bidding process, have been told the government has now decided to unload its entire stake.
“We had been led to believe … that this would be some form of public-private partnership with some government control,” said Michael Ivanco, vice-president of the Society of Professional Engineers and Associates, a union that represents AECL engineers and scientists. But without the government retaining at least some ownership, it’s difficult to see how the Candu technology will survive, Ivanco said. Companies such as French government-owned Areva have expressed interest in acquiring the division, but there is no real prospect that such a company would continue to develop next-generation Candu technology in competition with its own designs. And there is no interested private Canadian company that can compete with the big players in this industry, according to Ivanco.
The government has concluded the candu division was too small to compete with global nuclear giants such as Areva, Toshiba and General Electric. Some industry insiders argue government involvement is key to building a globally competitive nuclear technology firm, and offer as evidence companies such as Areva, which is majority owned by the French government, and AtomEnergoProm, which is controlled by Russia’s government.
The sale will not affect AECL’s Chalk River, Ontario, labs, which produce medical isotopes.