Canada’s Nuclear Renaissance, Continued

Today, Energy and Natural Resources Minister Tim Hodgson unveiled Canada's first-ever sectorwide Nuclear Energy Strategy. Spanning the full nuclear value chain from fuel and waste management to technology deployment and exports, the Strategy lays out a four-pillar roadmap for the role of nuclear in Canada's economic and energy security future:

1. Enabling new domestic builds;
2. Strengthening export leadership;
3. Securing uranium fuel cycle and waste management; and
4. Driving innovation for fission and fusion technologies.

Over the past decade, the conversation around nuclear energy in Canada and abroad has evolved, both in terms of technological advancement and public buy-in. The Angus Reid Institute reports that support for nuclear power in Canada has increased from 51% in 2021 to 63% in 2026. This trend coincided with increasingly vocal support for nuclear from the federal government, driven by former NRCan Minister Jonathan Wilkinson, including an expanded Canada Infrastructure Bank (CIB) mandate, a $970 million loan for the Darlington New Nuclear Project (DNNP), the extension of the Clean Electricity ITC to include nuclear, and a further $3 billion in export financing. This trend has been mirrored on the global stage, including the establishment of the 2023 "Sapporo 5", a $4.2 billion pledge to rebuild Russia-free enrichment capacity and the first-ever G7 communique wherein all parties explicitly committed to supporting multilateral efforts to strengthen resilience of nuclear supply chains in 2024.

Today's strategy formalizes several years' worth of incremental groundwork on the part of the federal government and seeks to present an ambitious and coordinated path forward for Canadian nuclear leadership at home and abroad.

What the Strategy is

The Strategy proposes Canada's first-ever targets for nuclear build-up and timelines, as well as a suite of proposed delivery mechanisms to back these objectives:

• Energy security as national security: the government characterizes Canada's nuclear sector as a pillar of ongoing nation-building work to ensure that Canada's energy future is sovereign, resilient, and secure. The Minister specifically highlighted a desire to reduce Canada's reliance on others in this endeavour.
• Technology recognition and optionality: the Strategy acknowledges that Canada now has two recognized domestic large-scale nuclear technologies (CANDU and AP1000), while also referencing several Generation IV technologies as part of the country's broader innovation pathway. This reinforces a more technology-inclusive federal posture.
• Domestic build targets: up to 10 new large-scale domestic reactors by 2040, with 2 under construction by 2035; at least 1 deployment (large or SMR) outside Ontario by 2035; and a Canadian microreactor demonstrated by 2035.
• Export targets: at least 4 new international CANDU markets secured by 2040, with 6-10 new nuclear-entrant countries engaged over a 15-year horizon. The Strategy also frames reactor exports pertaining to AP1000 and BWXT-300 technologies, emphasizing that they create multi-decade commercial and geopolitical partnerships that can advance Canada's broader foreign policy, energy security, and trade diversification interests.
• A fleets-based procurement model "where it makes sense": federal support will be concentrated behind a limited number of reactor designs per use case (on-grid, industrial heat, remote). This is framed primarily as a way of streamlining the approvals and the regulatory process, very much a part of the government's desire to build large projects faster across the country.
• New financing commitments: a draft Policy on Federal Financing of New Nuclear Power Projects is due by April 2027, alongside a new Canadian Nuclear Export Financing and Commercial Framework.
• Coordination on trade and regulatory reviews: the strategy is explicit about a "Team Canada" approach to nuclear exports, as well as a stated intent to narrow federal regulatory review to 2 years (pending legislation to enact these and other proposed regulatory reforms this coming Fall, which include positioning the CNSC as the lead federal authority on nuclear impact assessments). While supporting existing and future CANDU exports is mentioned, so too is positioning the Canadian supply chain for participation in SMR and light-water reactor projects (e.g. the Cameco AP1000) globally.
• A defence-anchored microreactor program: the strategy proposes a feasibility program led by the Department of Defence to spearhead the development of a Canadian-controlled Generation IV microreactor, aimed initially at remote defence facilities.

What the Strategy Isn't

• It does not include a dedicated new funding envelope: by and large, commitments lean on existing tools (e.g. Green Bonds, CIB participation, loan guarantees) and on "prioritizing existing sources of government funding." New financing instruments won't be defined until a Financing Policy is released in April 2027.
• It does not make a bet on one technology over another: whereas CANDU remains central to the Canadian nuclear story, the Strategy is equally inclusive of the AP1000, BWRX-300, and other Generation IV designs.
• It does not seek to encroach on provincial jurisdiction: electricity generation remains provincial and territorial. The federal role is consistently framed as "complementary and enabling", not directive.
• It identifies, but does not solve for key supply chain gaps: the Strategy identifies several known gaps (e.g. heavy water production, heavy forgings, and nuclear-grade materials) that require assessment and potential international partnership but does not propose specific or funded solutions.
• It does not commit to fusion deployment: to the extent that fusion is integrated into the strategy, the focus is on the fuel cycle, specifically tritium supply and expertise, rather than a commitment to getting a Canadian fusion reactor built.

Why, and Why Now?

The Strategy reflects the federal government's desire to address pressures, and seize opportunities:

• Canadian electricity demand is projected to roughly double in the next 25 years, and the National Electricity Strategy spells out what the federal government thinks is required to double Canada's grid capacity in that timeframe. Nuclear will play a central role in this.
• Globally, 38 countries support a pledge to triple nuclear energy by 2050, and the IEA projects annual nuclear investment could more than double by 2030. This presents an opportunity and an imperative for Canadian nuclear exports.
• The continued shift on the part of many Western economies away from Russian-based nuclear supply chains presents another significant opportunity for Canadian players.

Taken together, these factors suggest a significant opportunity set for Canada, but only if Canada moves swiftly to accelerate build-out and enable more extensive export pathways. The Strategy suggests that without significant growth and expansion of Canada's nuclear sector, we risk missing these windows of opportunity.

The Bottom Line

The Strategy's most tangible take-aways are the establishment of Canada's first-ever nuclear build-out targets, a commitment to new financing and export mechanisms (to be defined in a new federal financing policy next spring), and clear signals that nuclear will be treated as a whole-of-government strategic priority embedded within the government's major projects framework.

In this sense, the Strategy should be read very much as another chapter in the federal government's book on building big things better, faster, and stronger. The Strategy locates its work and objectives squarely within the ambit of the Building Canada Act, the Major Projects Office, the recently-announced National Electricity Strategy, and the Canada Strong Fund announced as the flagship initiative of the most recent Spring Economic Update, as well as legislation to enact significant proposed regulatory reforms this coming Fall. For example, the Darlington New Nuclear Project has already been referred to the Major Projects Office as a nation-building project, and the Strategy outlines the criteria by which future nuclear projects could receive similar treatment.

The Strategy takes stock of all the tools and strategic advantages that the Canadian nuclear sector brings to the table and offers the federal government's vision for how Canada can most effectively leverage these advantages to drive economic growth, job creation, and competitiveness on the international stage.