Wedoany.com Report-Oct. 27, Canada Growth Fund (CGF) and the Building Ontario Fund (BOF) have signed an equity commitment agreement to finance up to CAD3 billion (€1.8bn, $2.1bn) for a small modular reactor (SMR) project at the Darlington nuclear power station site in Ontario. Under the agreement, CGF and BOF will invest up to CAD2 billion and CAD1 billion respectively, each taking minority ownership stakes in the Darlington New Nuclear Project (DNNP), which will be majority owned and operated by Ontario Power Generation (OPG).

OPG is building four BWRX-300 nuclear plants at Darlington, where site work has begun.

CGF, a government-backed fund, aims to attract private capital to support Canada’s clean energy development, while BOF is a state agency financing large-scale, revenue-generating infrastructure projects in Ontario. Through this deal, CGF and BOF will hold up to 15% and 7.5% of the project, respectively.

The estimated cost to build four SMR units at Darlington is CAD20.9 billion, including interest, escalation, and contingency. Once completed, the DNNP is expected to deliver up to 1,200 MW of electricity, sufficient to power 1.2 million homes, potentially marking the first deployment of SMRs in a G7 nation.

OPG explained the investment rationale: “As a first-of-its-kind project, DNNP has a higher risk profile that limits access to traditional financing. In line with their mandates, CGF and BOF are investing at a stage where the project is exposed to certain construction and technological risks.” The organizations are introducing innovative financial arrangements to temporarily share risks that currently limit private sector involvement. This structure is expected to encourage private sector and Indigenous investment in the project over time.

In May, the Ontario government and OPG approved the plan to build the first of the four SMRs at the Darlington site. Construction of the BWRX-300 unit will begin soon, with the first reactor scheduled for completion by the end of the decade. The announcement followed Canada’s nuclear regulator issuing a construction licence for the unit, which will be designed and supplied by GE Vernova Hitachi Nuclear Energy (GVH).

OPG had previously selected the BWRX-300 reactor for deployment at Darlington in December 2021. The DNNP will feature grid-scale commercial SMRs designed to enhance the region’s energy security while supporting clean energy targets.

Only a limited number of SMRs have been completed worldwide, with deployments previously reported in Russia and China. The Darlington project is therefore seen as a significant step in advancing SMR technology in North America and supporting Canada’s broader clean energy goals.