Executive Summary 

Ontario Power Generation's $20.9 billion CAD programme to construct four GE Hitachi BWRX-300 small modular reactors at Darlington represents Canada's (and G7's) first commercial SMR deployment. Construction licence issued April 2025; provincial final investment decision May 2025; Major Projects Office priority designation September 2025. First unit targets 2029 completion and 2030 grid connection. Project watched globally as cost and schedule indicator for SMR sector viability. Independent observers note $20.9 billion cost substantially higher than necessary for widespread SMR adoption, yet OPG cites Darlington refurbishment on-time/on-budget track record as execution confidence basis. 

Project Overview 

Location: Darlington, Ontario (adjacent to existing Darlington Nuclear Generating Station) 

 Proponent: Ontario Power Generation (OPG) - provincial Crown corporation 

 Ownership: 100% Ontario government 

 Technology: GE Hitachi BWRX-300 (boiling water small modular reactor) 

 Status: Construction licensed (April 2025); construction approved (May 2025); Major Projects Office priority (September 2025) 

Project Description 

Four small modular reactors, each 300 megawatts electric (MWe) capacity, totaling 1,200 MWe. Located immediately east of existing Darlington nuclear station on Lake Ontario. First-of-kind deployment of GE Hitachi BWRX-300 design, positioning Ontario as global SMR leader. Modular construction approach with factory-fabricated components assembled on-site. 

Site Advantages: 

• Adjacent to operating nuclear station (shared infrastructure) 

• Existing nuclear-trained workforce 

• Established regulatory relationship with Canadian Nuclear Safety Commission 

• Transmission infrastructure in place 

• Community acceptance (40+ years nuclear operations) 

Investment Value & Cost Structure 

First Unit: $6.1 billion CAD 

 Common Infrastructure: $1.6 billion CAD (shared by all four units) 

 Subsequent Three Units: $13.2 billion CAD 

 Total Programme: $20.9 billion CAD (2024 dollars) 

Cost Inclusions: 

• Interest on borrowed funds during construction 

• Inflation and wage increases over 10-year programme duration 

• Contingencies 

• All-in lifecycle cost basis 

Cost per Megawatt: Approximately $17.4 million CAD per MW 

 Comparison Context: 

• Historic nuclear builds: US $17.5M/MW, France $12.5M/MW (inflation-adjusted) 

• 377 MW Saskatchewan gas plant: $825M ($2.2M/MW) 

• International Energy Agency SMR target for rapid adoption: US$4.5M/MW by 2040 

Independent Analysis: "It's an eye-popping figure, but not unexpected given what we know about the poor economics of small nuclear reactors. It's certainly a boutique unit that's going to produce electricity for a very expensive price." - Ed Lyman, Union of Concerned Scientists 

OPG Response: Cost estimates include factors often absent in comparisons (interest, inflation, contingencies). Darlington refurbishment ($12.8B) remains on-schedule and on-budget, demonstrating execution capability. 

Timeline & Milestones 

2022: Site preparation activities commenced 

 October 2022: Construction licence application submitted to Canadian Nuclear Safety Commission 

 April 2025: Construction licence issued by CNSC 

 May 2025: Ontario government final investment decision; construction approval 

 September 2025: Major Projects Office priority designation 

 End 2029: First unit construction completion target 

 2030: First unit grid connection and commercial operations 

 2030s: Units 2, 3, 4 staged construction 

Staged Approach Rationale: Apply learnings from first unit to subsequent units, improving efficiency and reducing costs (similar to Darlington refurbishment experience). Second, third, fourth units expected to cost substantially less per unit as efficiencies gained. 

Indigenous Partnerships & Consultation 

Treaty Context 

Territory: Southern Ontario historic treaty territories 

 Consultation Required: Multiple First Nations with treaty relationships in region 

 Rights Impacts: Potential effects on Lake Ontario fisheries, traditional use areas 

Consultation Process 

Canadian Nuclear Safety Commission Oversight: 

• CNSC confirmed consultation obligations fulfilled for construction licence 

• Section 35 Constitution Act consultation requirements 

• UNDRIP principles applied throughout process 

• Indigenous knowledge incorporated into environmental assessment 

Consultation Activities: 

• Engagement with First Nations throughout licence application 

• Environmental assessment Indigenous participation 

• Ongoing consultation commitments during construction and operations 

• Traditional knowledge integration 

Status: Construction licence issuance indicates CNSC satisfied with consultation adequacy 

 Ongoing: Continued engagement throughout construction and operational phases 

Regulatory & Approval Status 

Canadian Nuclear Safety Commission 

Construction Licence: Issued April 2025 

 Significance: First SMR construction licence in Canada 

 CNSC Decision Criteria Met: 

• OPG qualified to carry out authorized activity 

• Adequate provision for environmental protection 

• Health and safety of persons protected 

• National security measures adequate 

• International obligations implementation 

Public Hearing: Multi-day hearing in January 2024; public input considered 

Provincial Approval 

May 2025: Ontario government final investment decision 

 Minister: Todd Lecce, Energy and Electrification 

 Cabinet Decision: Authorization for OPG to proceed with construction 

Federal Support 

Major Projects Office: Priority designation (September 2025) 

 Investment Tax Credits: Federal ITCs anticipated (included in OPG cost estimates) 

 Policy Support: Canada's SMR Action Plan (2020) identified SMRs as priority technology 

Environmental Assessment 

Completed: Environmental impact statement reviewed by CNSC 

 Key Issues Assessed: 

• Radiological and non-radiological emissions 

• Lake Ontario water use (once-through cooling) 

• Aquatic ecosystem impacts 

• Socioeconomic effects 

• Cumulative effects with existing Darlington station 

• Accident scenarios and emergency preparedness 

Technical Specifications 

BWRX-300 Technology 

Design: GE Hitachi boiling water reactor (smaller version of proven ABWR) 

 Capacity: 300 MWe per unit (1,200 MWe total) 

 Fuel: Enriched uranium (differs from Ontario's CANDU fleet using natural uranium) 

 Cooling: Once-through cooling using Lake Ontario water 

 Safety: Passive safety systems; simplified design reducing component count 

Modular Approach: 

• Factory fabrication of major components 

• Reduced on-site construction time 

• Quality control in manufacturing environment 

• Transportable modules assembled on-site 

Power Output: Each 300 MW unit sufficient to power approximately 300,000 homes 

Site Configuration 

Location: East of existing Darlington station along Lake Ontario shoreline 

 Land Use: Approximately 40 hectares 

 Elevation: Soil pile adjacent to Highway 401 (clean excavated soil relocated for site leveling) 

 Shared Infrastructure: Administration buildings, cooling water intake/discharge tunnels, security systems, emergency preparedness facilities 

Grid Integration 

Connection: Ontario electricity grid via existing Darlington infrastructure 

 Capacity Factor: Nuclear baseload operation (90%+ capacity factor expected) 

 Reliability: Continuous 24/7 generation (unlike intermittent renewables) 

Economic Analysis & Power Costs 

Levelized Cost of Electricity (LCOE) 

SMR Average Cost: 14.9 cents CAD per kilowatt-hour (kWh) over lifetime 

 Assumptions: Includes federal investment tax credits; 65-year operational life 

Independent Electricity System Operator (IESO) Comparison: 

Alternative: Wind/Solar/Battery 

• Capacity Required: 5,600 to 8,900 MW (versus 1,200 MW SMR) 

• Rationale: Intermittency requires 5-7× capacity to match baseload SMR 

• LCOE: 13.5 to 18.4 cents per kWh 

• Additional Requirements: Extensive new transmission infrastructure; significant land use 

IESO Conclusion: SMR represents lower-risk option considering reliability, land use, transmission requirements 

Critical Perspectives: 

Clean Prosperity (Think Tank): "SMRs are actually the highest-cost option to keep our lights on. They're going to lead to higher electricity rates." 

MIT Nuclear Engineering Professor: SMRs "will never be able to approach a large reactor" in cost per kilowatt capacity. Limited to two purposes: first reactor for countries with no nuclear experience, or grids too small for large reactors. 

BloombergNEF: Cost figures "not horrifying" and could attract utilities seeking to avoid large reactor financial risks. 

Ontario Electricity Context 

Current Subsidy: Ontario budgeted $7.3 billion CAD for electricity rate subsidies (2024) - over 4× higher than 2018 

 Demand Growth: 75% increase expected by 2050 (IESO projection) 

 Supply Gap: Current generation insufficient for projected demand 

 SMR Role: Baseload clean generation avoiding 45 million tonnes CO2 annually (nuclear fleet-wide) 

Employment & Economic Impact 

Construction Phase 

Average Annual Employment: 3,700 jobs per year over 65-year project horizon 

 Peak Construction: Thousands of workers during major build phases 

 Trades: Heavy involvement of skilled nuclear trades (pipefitters, electricians, instrument technicians, welders) 

 Training: Apprenticeship and training programmes for nuclear sector 

Operations Phase 

Per Unit: 200+ permanent high-paying jobs 

 Total Programme: 800+ permanent operations, maintenance, engineering roles 

 Specialized Skills: Nuclear operators, radiation protection technicians, maintenance craftspeople 

 Career Pathways: Long-term nuclear sector careers; existing Darlington provides training infrastructure 

Economic Development 

Fiscal Impact: $13 billion CAD in municipal/provincial/federal taxes over 65 years 

 Durham Region: Concentrated employment and economic activity 

 Supply Chain: 80% of spending to Ontario companies; 15% European/Asian; 5% US (primarily GE Hitachi design/development) 

Export Opportunities 

International Agreements: $1+ billion in agreements with Estonia, Poland, Czech Republic 

 BWRX-300 Interest: Multiple countries evaluating technology 

 Canadian Expertise: OPG Darlington project demonstrates capabilities for international partnerships 

 Supply Chain Export: Canadian companies supplying components to global SMR projects 

Key Investment Risks 

Material Risks 

1. First-of-Kind Technology Risk

• Issue: BWRX-300 never built at commercial scale 

• Nuclear Precedent: Nuclear projects historically face cost overruns and schedule delays 

• Learning Curve: First unit likely encounters unforeseen challenges 

• Mitigation: GE Hitachi design based on proven ABWR technology; OPG nuclear experience 

2. Cost Escalation

• Issue: $20.9B budget substantially higher than SMR adoption threshold ($4.5M/MW IEA target) 

• Risk: Actual costs exceed budget (nuclear industry precedent) 

• Impact: Ontario electricity rates; OPG financial capacity 

• Mitigation: Risk-sharing with partners (GE Hitachi, AtkinsRéalis, Aecon); OPG Darlington refurbishment on-budget experience 

3. Schedule Risk

• Issue: 2029-2030 timeline aggressive for first-of-kind deployment 

• Nuclear Precedent: Delays common (Vogtle US, Hinkley UK, Flamanville France) 

• Impact: Ontario electricity supply gap; carrying costs 

• Mitigation: Modular construction reduces schedule risk versus stick-built; OPG project management experience 

4. Federal Investment Tax Credits

• Issue: OPG economics assume federal ITCs provided 

• Dependency: 14.9 cents/kWh LCOE contingent on ITCs 

• Policy Risk: Federal government commitment to ITCs; potential changes 

• Impact: Without ITCs, electricity costs higher affecting competitiveness 

Moderate Risks 

5. Enriched Uranium Supply

• Issue: BWRX-300 requires enriched uranium (Ontario's CANDUs use natural uranium) 

• Supply Chain: Establishing reliable enriched fuel supply 

• Geopolitical: Uranium enrichment concentrated in few countries 

• Mitigation: Long lead time for fuel supply arrangement; Canadian uranium mining sector 

6. Workforce Availability

• Issue: Skilled nuclear trades in high demand 

• Competition: Multiple nuclear projects (Darlington refurbishment, Pickering refurbishment, Bruce expansion) 

• Impact: Labour costs; schedule if trades unavailable 

• Mitigation: Existing Darlington workforce; apprenticeship programmes; regional nuclear expertise concentration 

7. Public Acceptance & Anti-Nuclear Opposition

• Issue: Nuclear projects face public opposition 

• Context: Darlington community has 40+ years nuclear experience (general acceptance) 

• Environmental Groups: Criticism of nuclear costs and environmental justice 

• Mitigation: Established community relationships; CNSC public consultation process; climate benefits messaging 

8. Small Unit Economics

• Issue: Multiple smaller units versus single large reactor 

• Economics: Economies of scale favor larger units 

• MIT Critique: SMRs cannot match large reactor costs per MW 

• Counterpoint: Smaller units reduce financial risk; modular fabrication could reduce costs at scale 

Investment Opportunities & Strategic Value 

Demonstrated Execution Capability 

OPG Track Record: Darlington refurbishment ($12.8B) on-schedule and on-budget 

 Nuclear Experience: Decades operating Canada's largest nuclear fleet 

 Project Management: Proven capability on complex nuclear projects 

 Confidence: Provincial government willing to commit $20.9B based on OPG track record 

First-Mover Advantage 

G7 First: Canada first G7 country with operational SMR 

 Global Attention: International utilities and governments monitoring closely 

 Technology Validation: Success proves BWRX-300 commercial viability 

 Export Platform: Demonstrates Canadian capabilities for international partnerships 

Climate & Energy Security 

Emissions Avoidance: Nuclear avoids 45M tonnes CO2 annually (Ontario fleet) 

 Baseload Generation: 24/7 reliable power (versus intermittent renewables) 

 Supply Security: Domestic uranium; operational independence 

 Grid Stability: Frequency and voltage support; system reliability 

Economic Development 

High-Paying Jobs: Construction and operations employment 

 Supply Chain: 80% Ontario content; manufacturing sector support 

 Export Opportunities: $1B+ international agreements; Canadian expertise showcase 

 Regional Benefits: Durham Region concentrated economic activity 

Policy Alignment 

Federal Support: Major Projects Office priority; expected ITCs; SMR Action Plan 

 Provincial Commitment: $20.9B investment; nuclear expansion strategy (Bruce, Pickering, Wesleyville) 

 Climate Policy: Aligns with net-zero commitments; clean baseload generation 

Investment Intelligence Summary 

Risk Profile: Moderate to High (first-of-kind technology, cost concerns, but OPG execution track record positive) 

 Timeline: First unit 2029-2030 (optimistic but defendable given 2025 construction start); full programme mid-2030s 

 Probability: High (75-85%) - construction approved, licensed, and commenced; OPG execution capability; provincial commitment demonstrated 

Investment Thesis: 

 Darlington SMR represents Ontario's response to 75% electricity demand growth by 2050, choosing nuclear baseload over intermittent renewables despite higher costs. $20.9B budget substantially exceeds SMR adoption threshold identified by IEA, yet OPG's Darlington refurbishment on-budget track record provides execution confidence. First-of-kind technology risk balanced by GE Hitachi design pedigree and OPG nuclear expertise. Global attention positions Ontario as SMR sector leader; success would catalyze international deployments. 

UK/European Investor Considerations: 

1. Technology Validation: Darlington success or failure determines global SMR sector trajectory 

1. Cost Learning: First unit costs inform economics for subsequent deployments 

1. Nuclear Supply Chain: European companies (15% spending) participate; export opportunities 

1. Climate Strategy: Nuclear baseload role in net-zero transition 

1. Execution Capability: OPG track record versus broader nuclear industry cost/schedule challenges 

Due Diligence Priorities: 

1. Monitor construction progress versus 2029 target (quarterly updates from OPG) 

1. Track cost management and contingency draw-down 

1. Assess first unit learnings application to subsequent units 

1. Review federal ITC confirmation and terms 

1. Evaluate global SMR market response to Darlington costs 

1. Compare actual performance to IESO cost and schedule assumptions 

1. Monitor GE Hitachi BWRX-300 international deployment progress 

Critical Questions for Investors: 

• Can OPG deliver on-time and on-budget despite first-of-kind challenges? 

• Will cost-per-MW decline for subsequent units as OPG claims? 

• Does $20.9B cost support or undermine global SMR sector viability? 

• What happens if costs escalate or schedule delays occur? 

• Is nuclear baseload economically justified versus renewable alternatives? 

Recommendation: 

Moderate optimism warranted. OPG's execution track record (Darlington refurbishment) provides confidence unusual in nuclear sector. Construction licence and provincial FID demonstrate committed path forward. First-of-kind risks substantial but mitigated by design pedigree and operator experience. Global significance: Darlington success would catalyze SMR sector; failure would set sector back significantly. Position as long-term hold monitoring construction progress; first unit completion timeline and cost performance will determine sector trajectory and subsequent unit viability. 

Investment Positioning: 

Best SMR investment opportunity globally based on proponent execution capability, regulatory progress, and government commitment. However, recognize $20.9B cost challenges broad SMR adoption thesis. Suitable for investors with long time horizons, tolerance for first-of-kind technology risk, and belief in nuclear's role in net-zero transition.