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HomeMy WebLinkAboutPLN 02-16PLN 02-16 Subject: Pickering Nuclear Generating Station - Status of Activities February 8, 2016 Page 2 In response to the original announcement, the City retained HDR Corporation to undertake an economic and financial impact study to understand how the retirement will impact The Corporation of the City of Pickering, and its local businesses. This Study was funded by OPG and managed by the City. The Study's key findings were: that the economic impact of the retirement of PNGS will be distributed across the Greater Toronto Area; that the Seaton employment lands will play a critical role in offsetting job losses from the retirement of PNGS; and that annual Payments in Lieu of Property Taxes (PILTs) that are retained by the City of Pickering start to decline after closure of the station. The projected loss in PIL Ts is based on information provided by OPG that has not been confirmed or verified by staff. A copy of HDR's study has been provided under separate cover. The Executive Summary of the Study is provided as Appendix I. It is recommended that Council receive the results of the HDR Report and that staff continue to monitor the various activities related to the retirement of PNGS and report back to Council. Financial Implications: No direct costs to the City are anticipated as a result of the recommendations of this report. Discussion 1.0 The Pickering Nuclear Generating Station is expected to shutdown in 2024 In 2010, the Province of Ontario announced that the Pickering Nuclear Generating Station (PNGS) would not be refurbished and that its shutdown be planned for 2020. Since then, the operator, Ontario Power Generation (OPG) has undertaken technical work and investigations into safely extending the life of the station. An environmental assessment and integrated safety report confirmed the strength of the station's condition for continued operation past 2020. In January 2016, the Province announced that the operation of the station will be extended to 2024 to ensure the generation of electricity during the upcoming refurbishments of the Darlington and Bruce nuclear plants. After shutdown, work will begin to place the station in a safe storage state. Safe storage involves removing the fuel from the reactors and draining the water and liquids from most systems in the station. After approximately 30 years of safe storage, the next step in the process is dismantling of the structures, with the final step of restoring the site to a developable state. As the full process takes several decades, the site is not expected to be ready for full reuse until after 2065. However, some existing structures and areas of the site outside of the protected area may become available earlier for reuse. PLN 02-16 Subject: Pickering Nuclear Generating Station - Status of Activities February 8, 2016 Page 3 1.1 OPG will present extended operations and decommissioning plans as part of their license renewal in 2018 PNGS' current five year operating license expires on August 31, 2018. Extended operations and decommissioning plans will be part of OPG's next license renewal application to the Canadian Nuclear Safety Commission (CNSC). Staff will continue to monitor the license renewal approval process and report to Council as required. 2.0 Used nuclear fuel is stored on an interim basis at the Pickering Waste Management Facility The Pickering Waste Management Facility is located within the protected area of the PNGS. Used nuclear fuel resulting from the operation of the station is processed and securely stored at the facility on an interim basis. Other waste from the operation of the station is shipped to the Western Waste Management Facility in Kincardine and will continue to be shipped to the Kincardine facility throughout the safe storage and decommissioning periods. 2.1 Nuclear waste will be permanently stored at deep geological repositories that have yet to be built Ultimately, all used fuel currently stored at the Pickering waste facility and any future waste from the decommissioning and dismantling of the station will be transferred and permanently stored at one of two proposed deep geological repositories. One repository is for low and intermediate level of nuclear waste, and the other is for high level waste. In November 2015, the federal government announced that a decision on OPG's proposed deep geological repository near the Bruce nuclear site to permanently store low and intermediate level nuclear waste will be delayed until March 2016. The earliest that construction of the OPG deep geological repository could start is in 2018/2019. Used nuclear fuel currently stored at the Pickering waste facility and future used fuel resulting from the extended operations of the station will be stored at the deep geological repository to be proposed by the Nuclear Waste Management Organization (NWMO). The earliest that this facility may be available is in 2043. Once the used fuel deep geological repository is in operation, fuel will be transported from the Pickering waste facility through the City to the permanent deep geological repository. It is expected that all used fuel will be removed from the Pickering site before completion of decommissioning. Staff will monitor the progress of the NWMO and OPG deep geological sites and will report back to Council at important milestones. PLN 02-16 February 8, 2016 Subject: Pickering Nuclear Generating Station - Status of Activities Page 4 2.2 The Pickering Waste Management Facility is proposed to be expanded to accommodate used fuel from its operations In preparation for the station's shutdown and decommissioning, OPG is assessing plans that could result in an application for an amendment to the Pickering waste facility license to construct a new replacement processing building, and a new used fuel dry storage building. The Pickering waste facility holds a ten year Class 1 B Waste Facility Operating License that is valid until March 31,2018, and which is separate from the license for the PNGS operations. OPG's future plans for the waste facility will be presented to the CNSC in their license renewal application in 2017/2018. 3.0 Ontario Power Generation's Repurposing Study is to develop a long-term strategy and action plan OPG owns approximately 200 hectares of land on or directly adjacent to the PNGS plus 100 hectares of water lots. This includes lands that are currently leased to Hydro One and licensed to the City for park land and recreational use. The Repurposing Pickering Study initiated by OPG is intended to gather information and ideas from the community to develop a long-term strategy and action plan for repurposing available lands during and after decommissioning. Guiding principles of the Study include ensuring the reuse of the site continues to benefit both OPG and the surrounding communities, is consistent with OPG's decommissioning and used fuel management obligations, and that flexibility is retained for long-term uses once decommissioning has been completed. 3.1 City staff are engaged in the development of a long-term strategy Staff from City Development and Engineering & Public Works departments along with representatives from the broader business, research, energy, transportation, health, and environmental communities are participating on a Technical Advisory Committee. The purpose of the Committee is to provide advice on future land use options. A preliminary assessment of more than 600 land use opportunities identified during a series of public engagement activities has been completed. The options recommended for further study all relate to the following four land use categories: power related; recreational; industrial; and institutional. Options related to residential, retail and commercial office land uses were not recommended for further study as these were deemed unsuitable during the decommissioning period. The Study's next steps include the development of scenarios for a long- term strategy and action plan to be presented to OPG's Board of Directors. PLN 02-16 Subject: Pickering Nuclear Generating Station - Status of Activities February 8, 2016 Page 5 4.0 The City has undertaken an initial review of the economic and financial impact on the City of the retirement of Pickering Nuclear Generating Station In late 2013, following a commitment from OPG to fund a City managed study, the City retained HDR Corporation to undertake an economic and financial impact study. The Executive Summary of the Study is attached (see Executive Summary, Appendix 1). The purpose of the study was to assess and estimate the economic and financial impact on the City of Pickering. The retirement of the station is scheduled to take over 40 years and involves shutdown, safe storage, decommissioning and site restoration. This Study looked at the five year period leading up to shutdown and then the subsequent five year period where the site is prepared for safe storage and decommissioning. An economic and financial model was developed using data collected by the City and OPG, to assess the impacts on the City. 4.1 A key finding of the study shows that the retirement of PNGS is not expected to significantly impact Pickering residents and local businesses Because of Pickering's diversified local economy, HDR's analysis concluded that the impact from the retirement of the station will not significantly impact local businesses and residents. As well, since only 8% of PNGS employees reside in Pickering, the analysis concluded that the economic impact of the retirement of the station will be distributed more broadly across the Region of Durham and the GTA than the City of Pickering. The analysis also noted that the Seaton employment lands will play an important role in further diversifying Pickering's economy and offsetting job losses from the station's closure. HDR recommended that the City continue to work with and engage the Province of Ontario in marketing and promoting the Seaton employment lands to attract high skilled and well paying jobs to the City. The City is currently undertaking a sector analysis study for the Seaton employment lands. The purpose of that study is to identify potential target sectors for the employment lands in Seaton. Staff is preparing a subsequent report to Council on this report. 4.2 Although the shutdown of the station may not have a significant economic impact on the City, it could have a significant financial impact On most of OPG's lands, instead of paying property taxes to the Region of Durham and the City of Pickering, OPG makes payments in lieu of property taxes (PIL Ts). OPG does pay property tax for the lands the City leases for park use. However, the City reimburses OPG for all of the property taxes including the Regional share. According to OPG, the annual PIL Ts collected by the City is expected to steadily decline over the study period by approximately $0.5 million after shutdown, and significantly more by the end of the decommissioning period. PLN 02-16 Subject: Pickering Nuclear Generating Station - Status of Activities February 8, 2016 Page 6 This projected loss in PIL Ts is significant and is based on information provided by OPG that ha.s not been confirmed or verified by staff. There is the risk that the loss of PIL Ts could be even greater. As the time gets closer to the (now) 2024 shutdown, the City may need to retain qualified experts to review the potential financial impact on the City of the closure and decommissioning of the station. In the longer term, there may be an opportunity at PNGS to offset or replace the loss of PIL Ts caused by the shutdown of the plant by strategically repurposing the site. In addition, construction of long-term facilities for interim waste management may add a new source of assessment. 5.0 Future Reporting to Council To ensure that Council is kept up to date on activities related to the retirement of the PNGS, staff will report at key stages during the station's extended operation, shutdown, decommissioning, and repurposing. Appendix Appendix I Executive Summary, Economic and Financial Impact of the Retirement of Pickering Nuclear Generating Station Report, prepared by HDR Corporation, dated June 2015 Executive Summary Appendix I to Report PLN 02-16 Economic and Financial Impact of the Retirement of Pickering Nuclear Generating Station Report