Privately owned Bruce Power will invest $13 billion to refurbish the world’s largest nuclear station.

In a first for Ontario, the company will assume all the financial risk from any cost overruns in the overhaul of six of Bruce’s eight reactors on Lake Huron that is to begin in 2020.

While that is four years later for a refurbishment expected to start in 2016,‎ the delay is because the company has determined there is additional life in the reactors, the oldest of which were built in the 1970s.

“The agreement makes 23,000 jobs possible and supports an estimated $6.3 billion in annual, local economic development,” Energy Minister Bob Chiarelli said Thursday.

“These actions will save the electricity system $1.7 billion and provide important relief for electricity consumers,” said Chiarelli.

“All of the risk, basically, of operations and what the impact might be are on Bruce — we pay for the power that we receive and not anything else,” he said.

No public money‎ will go into the Bruce refurbishment, but the company will earn a premium for the power it sells to the system.

If the 15-year overhaul comes in under-budget the savings will be split between the company and hydro ratepayers‎.

But cost overruns — which are the norm on Candu reactor projects — would be Bruce’s problem alone.

Bruce Powe‎r president and CEO Duncan Hawthorne stressed “we are 100 per cent accountable for over-budget or late — no ambiguity.”

“If it costs us more — $7 billion or $70 billion — Bruce Power will bear the cost of that,” said Hawthorne.

The announcement is the first phase of updating Ontario’s aging nuclear fleet, which supplies almost two-thirds of the province’s electricity.

Bruce, which accounts for 30 per cent of Ontario’s power generation, is slated to be in operation until the 2060s.

Early in the new year, government-owned Ontario Power Generation is expected to announce the refurbishment of the two reactors at Darlington at a cost of around $10 billion.

“It’s in the process of being finalized — probably January or February. It’s a different transaction than this one . . . I can tell you that the Darlington transaction is extremely cost-effective,” said Chiarelli.

Don MacKinnon, president of the Power Workers’ Union, said the Bruce announcement is “good news for Ontario.”

“It also means tens of thousands of good, high-skilled jobs right here in Ontario,” said MacKinnon.

Loading... Loading... Loading... Loading... Loading... Loading...

But Jack Gibbons, chair of the Ontario Clean Air Alliance, noted the $13-billion figure is a “preliminary” cost estimate.

“According to the contract, the final cost estimate is to be determined at a later date. Unfortunately for consumers, the price we pay will be based on the final cost estimate, not the preliminary one,” said Gibbons.

“So once again a politician is committing to nuclear without knowing the final cost,” he said.

New Democrat MPP Peter Tabuns (Toronto Danforth) worries that the government is “doubling down” on atomic energy when the disposal of radioactive waste remains a challenge.

“They have the opportunity as electricity technology changes to go for other options and that’s not where they’re going,” said Tabuns, who argues in favour of renewable power and increased conservation measures.

However, Progressive Conservative MPP John Yakabuski (Renfrew-Nipissing-Pembroke) said “this is a pretty reasonable deal — this is good, clean, emission-free electricity that is reliable.”

“I’m thankful that the government will have less involvement in this refurbishment because everything they have done up to date has not worked out well,” said Yakabuski.

‎The nuclear announcement comes as the Ontario government is scrambling to reduce the emission of greenhouse gases that contribute to climate change.

The Independent Electricity System Operator calculates that within a decade Ontario will only rely upon emissions-free nuclear power for 41 per cent of the province’s electricity production.

The IESO forecasts that ‎solar, wind and bio-energy will account for 17 per cent of power, up from around 9 per cent today.