Ontario’s Liberal government says we need to refurbish our province’s nuclear fleet and build another major plant near Toronto. The opposition Progressive Conservative leader, confident he will win this October’s election, says nuclear will be a cornerstone of his party’s energy policy. Indeed, as countries such as Japan, Germany and Switzerland vow to phase out their nuclear fleets or rely less on nuclear power, Ontario appears intent on not only preserving the 50-per-cent share of electricity that nuclear power generation supplies in this province; it is open to giving nuclear an even larger share of the power mix.
There are many reasons to oppose nuclear: high cost, toxic waste, risk of disaster, uranium mining, etc… What I haven’t seen raised so far is the ability of a province like Ontario to carry out an aggressive nuclear refurbishment and new-build strategy. In other words, do we have the skilled labour at our disposal to take on such an initiative?
It doesn’t appear that way.
Recent data from the industry-led Construction Sector Council has raised a red flag, warning that Ontario will face an extremely tight labour market between the period 2014 and 2019. During this time about 85,000 new construction workers will be needed. Problem is, 73,000 existing workers are expected to exit the labour force because of retirement (or mortality), and only 60,000 new entrants are expected. “This leaves a gap of almost 100,000 workers that need to be recruited from either other industries or outside the province,” according to the Council.
Don’t let the recent recession fool you. Ontario is only a year or two away from reaching pre-recession construction employment levels, largely because of new mining and processing facilities planned for Northern Ontario, the need for new facilities in time for the 2015 Pan American games, the deployment of renewable-energy projects that have been enabled by the Green Energy and Green Economy Act (and FIT program), and plans for the refurishment of several nuclear reactors over the period. The Council estimates this will carry construction employment “to new record levels,” with non-residential construction activity more than double that enjoyed in pre-recession years.
The Greater Toronto Area will be hit particularly hard, and the Council pegs much of that to nuclear refurbishment and new-build plans. This is supported by comments from Mark Arnone, vice-president of nuclear refurbishment execution at Ontario Power Generation. “For those working on the nuclear plants, supply will be particularly tight,” Arnone is quoted as saying in the Council press statement.
How tight will it be? The Council’s report ranks a number of different construction trades in each region of Ontario, including the GTA. It ranks them on a scale of 1 to 5, with 1 representing no problems with the labour pool and 5 representing severe shortages. Specifically, a ranking of 5 means “Needed workers meeting employer qualifications are not available in local or adjacent markets to meet current demand so that projects or production may be delayed or deferred. There is excess demand, competition is intense and recruiting reaches to remote markets.”
In the GTA, four key trades carry a 5 ranking between 2012 and 2019: boilermakers, construction managers, construction millwrights and industrial mechanics, and industrial instrument technicians and mechanics. In all cases, blame is placed on major industrial and utility projects, with particular troubles occurring between 2015 and 2018 as planned nuclear projects enter high gear. Electricians, gasfitters, pipefitters and welders will also be in short supply.
So what does this all mean? First, the Ontario government and its opposition are underestimating the impact of baby boomer retirements during a period of what is expected to be high construction activity. Big projects, such as nuclear refurbs and new reactor builds, will suffer and will be at serious risk of delay. Getting the necessary skilled trades will mean bringing in workers from distant locations. In this environment of tight labour supply wages will surely skyrocket, causing project costs to rise. Ontario will be competing with other jurisdictions, such as Alberta, and this will cause both labour markets to overheat.
Simply put, Ontario will have a very difficult time refurbishing its fleet of reactors AND building a new plant at Darlington. It will be difficult enough trying to refurbish the existing fleet and keep it on schedule. Adding a new build into the mix could spell major trouble for an industry already struggling to keep up with the backfilling of its retiring workforce. Sure, skilled workers can be imported — at a premium. It makes one wonder: Do we need these jobs? How can job creation be a justification for these large projects, which create jobs but not necessarily ones that Ontarians can/will fill?
You might be thinking that this applies equally to other power-sector projects, such as the building of wind farms and big solar plants. To a certain extent it will, but there will be less of an impact because of the small scale and distributed nature of renewable-energy projects. Labour tightness might delay a few small projects, but that will have much less impact than the delays and cost-overruns associated with massive centralized projects that currently lie at the beating heart of our electricity system.
So when Tim Hudak, leader of the Progressive Conservatives, says he wants to go full steam ahead with nuclear power, one must wonder if he’s setting up the market for failure and promising something he won’t be capable of delivering. He has said that “a PC government will stop dithering and delays and invest in nuclear power,” but a PC government will be powerless in that regard. Perhaps he’ll address some of the dithering, but the delays will be imposed by the market.
All of this isn’t to suggest Ontario shouldn’t go forward with some nuclear refurbishment projects. What it does suggest is that building new reactors at Darlington, while at the same time tackling a logistically difficult refurbishment program, will cause delays, cost-overruns and market stresses that could have been avoided. Sound familiar?
Ontario, in other words, must be careful that it doesn’t bite off more than it can chew. Sure, it means many jobs won’t be created. But those jobs will be more expensive to fill, and there’s a good chance it wouldn’t be Ontarians filling them. In my humble opinion, the province would be far better off ditching its plans to build a new nuclear plant at Darlington and re-evaluating its existing fleet refurbishment plans. More thought should be put into industrial efficiency, conservation, hydroelectric imports from Quebec (or Newfoundland and Labrador), combined heat and power plants, offshore wind and community power projects based on renewables.