Creating the future together – Annual Report 2023
Creating the future together – Annual Report 2023

A key aspect of our commitment to accountability is ensuring that the funding necessary to pay for the long-term management of Canada’s used nuclear fuel will be available when needed. The roles and responsibilities of financial surety are summarized in the diagram below.

Total cost estimate

One of the NWMO’s important responsibilities is determining the lifecycle cost of the project so we can ensure the funds will be available when needed. Updated every five years based on the latest information, the lifecycle cost estimate explains what we anticipate the project will cost from beginning to end and why. It helps ensure accountability and transparency as we implement Canada’s plan for the safe, long-term management of used nuclear fuel.

The NWMO completed a full update of the cost estimate for the Adaptive Phased Management project in 2021, with the next update planned for 2026.

The estimate includes costs to develop, construct, operate, monitor and decommission a long-term facility, including the deep geological repository and Centre of Expertise, and to transport the used nuclear fuel to the repository. As this is a 175-year estimate, many assumptions have been taken for planning purposes to ensure sufficient funds are available, and where possible, have been and will continue to be revised and made more specific as the plan advances.

Many factors impact the eventual cost of the project. They include the type and volume of used nuclear fuel to be managed, the facility’s location, the surrounding infrastructure, rock type and characteristics, the design of the repository, and the length of time allocated to monitoring the site following fuel placement.

The total amount of used nuclear fuel in Canada, which is currently about 3.3 million fuel bundles, could be impacted by factors such as the longevity and productivity of nuclear reactors, and decisions on refurbishments or new nuclear reactors. Every year, we update fuel bundle volume estimates and trust fund balances that impact the project’s cost estimates and funding requirements, based on fuel bundle estimates provided by the nuclear energy producers. We then determine the trust fund contribution requirements for the following year to ensure sufficient resources for future use.

Our 2021 cost estimate was based on an expected volume of 5.5 million fuel bundles, the anticipated volume at the end of the planned operation of Canada’s existing nuclear reactors.

Based on this expected volume, the cost for construction of the facility is approximately $4.5 billion (in 2020 dollars). The total lifecycle cost of the project — from the beginning of the site selection process in 2010 to regulatory approval, construction, operation, long-term monitoring and closure — is approximately $26 billion (in 2020 dollars). This amount covers many decades of lifecycle activity.

It is important to determine the amount that is required, in today’s dollars, in order to have the necessary funds in place when needed in the future. The funds in place today will grow to cover the full cost of the project over the long term, based on continued additional payments from the funders of the project and through expected investment income that will also grow over time. The funding required to manage approximately 5.5 million fuel bundles from 2024 onwards is $11 billion (using Jan. 1, 2024, present value).

Pre- and post-construction costs

The $11 billion funding requirement (using Jan. 1, 2024, present value) includes $3 billion to select a site for the repository, complete a detailed design, develop the Centre of Expertise, acquire the site, evaluate environmental impacts, and obtain the site preparation licence and the construction licence under the Nuclear Safety and Control Act (NSCA). These pre-construction nuclear facility costs are paid for by the waste owners based on the annual NWMO budget, as approved by the Board of Directors.

The remaining $8 billion funding requirement is to construct the facility, transport existing and future fuel bundles to the repository, and operate, close and monitor the repository. The Nuclear Fuel Waste Act (NFWA) requires that costs after the Licence to Construct is granted must be funded through contributions to the NFWA trust funds established by Ontario Power Generation (OPG), Hydro-Québec (HQ), New Brunswick Power (NBP) and Atomic Energy of Canada Limited (AECL). As of December 2023, the total value of the NFWA trust funds was approximately $5.3 billion.

Waste owners continue to contribute annually as the used fuel inventory increases, to ensure that the full $11 billion funding requirement for existing and future inventory of used fuel bundles is fulfilled. The costs of interim storage at the reactor sites and retrieval of the used fuel from storage are not funded through the NWMO because they are the responsibility of the waste owners.

Financial reporting requirements

The NFWA specifically addresses the future financial obligations expected for managing used nuclear fuel over the long term, as described in the box below. All the requirements defined in Subsection 16(2) of the NFWA are addressed in this section Ensuring funding is in place.

Requirements of the NFWA (2002)

The NWMO is required to provide a range of financial information in each of our annual reports following the government’s decision, as defined in Subsection 16(2) of the NFWA.

16(2) Each annual report after the date of the decision of the Governor in Council under Section 15 must include:

(a) the form and amount of any financial guarantees that have been provided during that fiscal year by the nuclear energy corporations and Atomic Energy of Canada Limited under the Nuclear Safety and Control Act and relate to implementing the approach that the Governor in Council selects under Section 15 or approves under Subsection 20(5);

(b) the updated estimated total cost of the management of nuclear fuel waste;

(c) the budget forecast for the next fiscal year;

(d) the proposed formula for the next fiscal year to calculate the amount required to finance the management of nuclear fuel waste and an explanation of the assumptions behind each term of the formula; and

(e) the amount of the deposit required to be paid during the next fiscal year by each of the nuclear energy corporations and Atomic Energy of Canada Limited, and the rationale by which those respective amounts were arrived at

Based on the NFWA’s requirements, trust funds were established in 2002, and each waste owner has made annual contributions since. The total value of these funds, including investment income, was approximately $5.3 billion as of the end of 2023. Additionally, the companies have set aside other segregated funds and financial guarantees for nuclear waste management and decommissioning. The NFWA built in explicit provisions to ensure the trust funds are maintained securely and used only for their intended purpose. The NWMO may have access to these funds only for the purpose of implementing the management approach selected by the government once a construction or operating licence has been issued under the NSCA.

Owner Trust fund balance ($ million)
December 2023
OPG 4,867
NBP 207
HQ 183
AECL 76*
Total 5,333

All figures in the table above are approximate.

* NOTE: AECL is not a member of the NWMO and is required to contribute to a trust fund for used nuclear fuel under the NFWA. See next section for more detail.

As required by the NFWA, the NWMO makes public the audited financial statements of the trust funds when they are provided by the financial institutions annually.

Canadian Nuclear Safety Commission (CNSC) financial guarantees reporting

As mandated under the NSCA, the CNSC requires waste producers to provide financial guarantees to cover the cost (in present value terms) associated with decommissioning, interim storage and the long-term management of radioactive waste (including used nuclear fuel) produced to date. The guarantees available for 2024 total $23 billion. They are reviewed independently by the CNSC as part of the waste owner licence requirements and are satisfied by segregated funds (totalling approximately $27 billion as of year-end 2023) and in the form of Provincial Guarantees, as needed.

The status of these guarantees is presented as follows:

Ontario Power Generation (OPG)

In accordance with the NSCA, the CNSC requires OPG to have sufficient funds available to discharge its existing nuclear waste management and nuclear-decommissioning obligations. The CNSC process requires the CNSC Financial Guarantee requirement to be updated once every five years, and OPG to provide an annual report to the CNSC on the assumptions, asset values, and resulting financial guarantee requirements. The CNSC Financial Guarantee requirement calculation takes into account nuclear waste expected to be generated to the end of each year.

The CNSC Financial Guarantee requirement continued to be satisfied, in part, by the forecast fair market value of the federally mandated Ontario NFWA Trust, and the remainder by the two segregated funds governed by the Ontario Nuclear Funds Agreement (ONFA) between OPG and the Province of Ontario (collectively, the “Nuclear Funds”) without the requirement of a Provincial Guarantee for 2024. As per the terms of the ONFA, the province is committed to providing a Provincial Guarantee to the CNSC as required, on behalf of OPG, should there be a shortfall between the CNSC Financial Guarantee requirement and the fair market value of the Nuclear Funds during 2024.

The CNSC Financial Guarantee requirement for 2024 is $21,149 million (Jan. 1, 2024, present value). This will be satisfied by the 2023 year-end fair market value of the Nuclear Funds of $25,794 million without the requirement of a Provincial Guarantee. The Nuclear Funds of $25,794 million include $4,867 million in the Ontario NFWA Trust.

NB Power (NBP)

NBP has provided the CNSC with a Decommissioning Financial Guarantee that covers the costs associated with the long-term management of used fuel projected to be produced from the Point Lepreau Generating Station and the cost of station decommissioning, including the long-term management of low- and intermediate-level radioactive waste.

  • The Financial Guarantee requirement is based on the present value of future costs to manage used fuel produced to the end of 2023 and the present value of future estimated costs for station decommissioning.
  • The Financial Guarantee requirement is satisfied by three separate funds: a Used Fuel Fund, a Station Decommissioning Fund, and the NFWA Trust Fund.
  • The total market value of the funds at Dec. 31, 2023, was approximately $929 million and was comprised of the following:
    – Used Fuel Fund – $245 million;
    – Station Decommissioning Fund – $477 million; and
    – NFWA Trust Fund – $207 million.

Hydro-Québec (HQ)

The fair value of the NFWA Trust Fund as of Dec. 31, 2023, was estimated at $183 million. HQ has also provided the CNSC with a Decommissioning Financial Guarantee of $685 million that includes a guarantee associated with used fuel arising from the operation of Gentilly-2 and the cost of station decommissioning, including the long-term management of low- and intermediate-level radioactive waste. The guarantee is in the form of an expressed commitment of the Province of Quebec to HQ that provides a guarantee of payment.

The NFWA Trust Fund and the Financial Guarantee provided by the Province of Quebec covered the future financial obligations as follows:

  • $493 million for decommissioning and long-term management of low- and intermediate-level radioactive waste; and
  • $300 million for used fuel.

Atomic Energy of Canada Limited (AECL)

AECL is not a member of the NWMO and is required to contribute to a trust fund for used nuclear fuel under the NFWA. Its Financial Guarantee is in the form of an expressed commitment by the Government of Canada to the CNSC, combined with supporting estimates of the financial liability and the basis for same. The AECL NFWA Trust Fund contained approximately $76 million as of Dec. 31, 2023.


The guarantees and current and future contributions to the Nuclear Funds provided by OPG, NBP, HQ and AECL are sufficient to cover the lifecycle costs estimated for the nuclear waste management and nuclear decommissioning obligations.

Budget forecast for 2024

For 2024, the NWMO Board of Directors approved a budget envelope of $187 million to continue implementing Adaptive Phased Management. Annual costs beyond 2024 are subject to further review. Sharing of these costs will be in accordance with the percentages defined in the Membership Agreement, as amended from time to time. The 2024 cost-sharing percentages among the waste owners are OPG: 93.68%, NBP: 3.66%, HQ: 2.07%, and AECL: 0.59%.

Funding formula

The NWMO funding formula has been in place since its approval by the Minister of Natural Resources (now the Minister of Energy and Natural Resources) in April 2009. The formula allocates liabilities and trust fund contribution requirements to each waste owner. Costs common to all waste owners are shared based on a cost-sharing percentage agreed to by the members. The nuclear fuel waste owner is responsible for expenses that are owner-specific.

Possible future reactors

The NWMO has begun initial reviews of the technical and funding requirements related to the potential for used fuel from new reactors, including small modular reactor (SMR) projects. Preliminary analysis of some of the proposed reactor technologies and fuel types has been completed. Some of these technologies use existing fuel types that are also used by other countries planning for a deep geological repository.

The proponents that are developing these new reactors fund this work directly, and most of them are not waste owners at this time.

As potential SMR projects are still in the early stages of development and regulatory decision-making, it is too early to include their potential used nuclear fuel in our forecasting. As these projects advance to later stages of development, including construction and operations, this will be addressed in the NWMO’s planning and projections.

Trust fund deposits for 2024

The 2024 NFWA trust fund deposit requirements have been developed based on the NWMO’s project cost estimate completed in 2021. Under the approved funding formula, the funding for post-construction licence costs is divided into two parts:

  1. Funding for historical used fuel bundles (committed liability); and
  2. Funding for used fuel to be produced each year (future liability).

Committed liability represents all costs that will be incurred regardless of whether any further used fuel bundles are generated in the future. This liability includes all fixed costs for the facility and variable costs attributed to the historical used fuel bundles. Considering the deep geological repository would be available between 2040 and 2045, contributions for the committed liability are to be amortized to the midpoint year 2043 in equal present value payments. This funding method has the advantage of distributing the funding obligations evenly to each year, while considering the time value of money. Future liability represents the incremental cost of transferring used fuel bundles to the repository, facility expansion, and additional operating and monitoring costs associated with used fuel bundles to be produced each year. Each future used fuel bundle would incur the same cost in present value terms, taking into account the time value of money.

The 2024 trust fund deposit requirements are shown in the table below.

Total trust fund deposits: Year 2024

Owner Trust fund balance ($ million) Deposit to trust funds (committed and future bundles) ($ million)*
December 2023 2024
OPG 4,867 86
NBP 207 6
HQ 183 0
AECL 76 0.4
Total 5,333 93

* Annual trust fund deposits are required to be made within 30 days of the submission of the annual report. A deposit date of April 25 is assumed for illustrative purposes.