Liability limits raised; SMR class added

Summary#

This is a proposed change, published in the Canada Gazette on May 2, 2026, that would update Canada’s nuclear liability rules. It would raise the operator liability limit for large power reactors from $1 billion to $1.2 billion, add a new liability class for small modular reactors (SMRs), update liability amounts for smaller facilities, and add the Darlington New Nuclear Project (DNNP) site to the list of designated installations once it receives an operating licence.

What it does#

• Says it is a proposal open for comment for 30 days after publication.
• Raises the maximum operator liability for large power reactors from $1 billion to $1.2 billion, with the change proposed to come into force on January 1, 2027.
• Creates a new class for commercial SMRs (reactors of 1,400 MW thermal power or less) and sets a formula for their operator liability: A × $600,000 + $60,000,000, where A is the reactor’s thermal power in MW.
• Increases liability limits for lower-risk installations (to reflect inflation). Key figures include:
  • Reactor of over 7 MW: $226.8 million
  • Nuclear fuel waste processing facility: $50.4 million
  • Nuclear fuel waste management facility: $16.4 million
  • Nuclear fuel conversion facility: $4.2 million
  • Nuclear fuel production facility: $2.9 million
  • Reactor of 1 MW to 7 MW: $1.6 million
  • Radioactive waste management facility: $1.3 million
  • Reactor of less than 1 MW: $0.6 million
• Adds the Darlington New Nuclear Project (DNNP) as a separate designated site in the regulations. That designation would only take effect on the day an operating licence for the DNNP is issued by the Canadian Nuclear Safety Commission (CNSC).
• Makes a technical wording change replacing “thermal output” with “thermal power” in the English definitions; the government says this has no effect on liability amounts.

Who's affected#

• Operators of Canada’s existing power reactors, including Bruce Power, Ontario Power Generation and NB Power.
• Potential and future SMR operators (for example, the planned SMR at the DNNP site).
• Insurers that provide nuclear liability insurance and the approved-insurer market under the Nuclear Liability and Compensation Act and the Nuclear Liability and Compensation Regulations.
• The federal government, because it provides indemnification above the operator limits for lower‑risk installations and stands to have its potential exposure change with a higher ceiling.
• Electricity ratepayers in provinces with nuclear reactors — the analysis estimates an average household impact of less than $0.50 per year in Ontario and under $1 per year in New Brunswick from premium pass-throughs.
• Indigenous peoples and communities near nuclear sites: the document says no adverse treaty or Indigenous-rights impacts were identified in the assessment, and that engagement continues.

Why it matters#

• More money available after a serious nuclear incident: increasing the cap to $1.2 billion raises the maximum compensation pool by $200 million. That means more funds would be available to compensate people, businesses, and communities if something went wrong.
• Brings rules closer to international practice and keeps pace with inflation. The government says the change aligns Canada more closely with international liability standards and the inflation that has occurred since the last increases.
• Treats SMRs differently. The new SMR formula recognizes that many SMR designs are lower-risk than large reactors. That should make insurance costs for SMR projects more predictable and, in many cases, lower than if SMRs were treated the same as big reactors. The first commercial SMR at DNNP could be operating as early as 2030, according to the document.
• Small, measurable cost to operators and ratepayers. The government’s analysis estimates an annualized net cost to industry (primarily via higher insurance premiums) of about $1.5 million to $2 million over a 10‑year period, dropping to about $1 million per year once SMRs begin operating. These costs are presented as modest and likely to be partly passed to customers.
• It is a proposal, not yet final. The changes are subject to the public comment process and could be changed before they become law.