Jun 29, 2009 - 03:38 PM

By Reka Szekely

CLARINGTON -- The provincial government is postponing plans to build new nuclear reactors at Darlington after the best bid came with too hefty a price tag.

On Monday morning, energy and infrastructure minister George Smitherman said Atomic Energy of Canada Ltd. (AECL), a federal crown corporation, delivered the best bid for the contract for reactors that were to have been built for 2018, but said the price is a substantial challenge. As a result, the Province has suspended the process to procure a vendor for the new reactors.

"Emission-free nuclear power remains a crucial aspect of Ontario's supply mix," Mr. Smitherman stated. "Unfortunately, the competitive bidding process has not provided Ontario with a suitable option at this time."

He called on the federal government "to clarify the future ownership of AECL," which may be put up for sale, before Ontario will proceed.

Though no dollar figure was attached to AECL's bid, Amy Tang, a spokeswoman for Mr. Smitherman, confirmed the price needed to come down by billions.

"First of all their future is uncertain, so they need to figure out whether or not they're going to privatize and the cost needs to come down," Ms. Tang said. She added the minister would not name exact figures because he wouldn't negotiate through the media.

The existing plant at Darlington is operated by Ontario Power Generation (OPG) and the company is currently conducting an environmental assessment for the new build. Spokesman Ted Gruetzner said OPG is assessing what the announcement means for them.

"We've really just seen the announcement so there's not much we can say beyond that we know the minister has acknowledged new build will be part of the future."

He reiterated it was up to the Province to go over the bids and select a vendor.

"We follow the process," he said. "I mean we've always taken the position that what the government and Infrastructure Ontario says about the process, we'll just follow that along."

Ms. Tang said the environmental assessment should be able to continue and the move to suspend the procurement process didn't necessarily mean the project would be delayed.

"The decision to suspend it shouldn't have an impact on the overall timeline. These are projects that take years to deliver," she said.

Clarington Mayor Jim Abernethy said he got a call from the minister this morning at about 8 a.m. informing him the procurement process was being postponed.

"I think it's a good news and a bad news announcement. Certainly the good news is AECL delivered the best bid for the contract to build the two new reactors here in Clarington; the bad news is the price tag is too high."

Mayor Abernethy said he encourages the Province and AECL to continue negotiating and look at solutions to the ownership issue including the Province possibly purchasing part of AECL.

As for the jobs and economic development new build would generate in Clarington, Mayor Abernethy said he expected it to happen.

"(Minister Smitherman) indicated that they were committed to the project, but when the project moves forward and how it moves forward is very up in the air right now."

The other two companies submitting bids were France's Areva and Westinghouse.