Ontario is making a $1B bet on the future of nuclear power.
The C$8B Building Ontario Fund is partnering with the C$15B Canada Growth Fund Inc. in backing the Darlington New Nuclear Project, an Ontario Power Generation-led effort to build North America’s first commercial grid-scale small modular reactor.
The BOF is contributing up to C$1B and the Canada Growth Fund is investing as much as C$2B, with each taking minority stakes, according to a joint statement. The Darlington project will comprise four grid-scale SMRs that are expected to deliver up to 1,200 megawatts of reliable, affordable low-carbon electricity — enough to power 1.2 million homes, noted a press release. The project, which is expected to be completed by the mid-2030s, will also reinforce Canada’s nuclear supply chain and fuel Ontario’s industrial supply chain.
The Darlington project fits hand in hand with the BOF’s mandate to catalyze investment in revenue-generating infrastructure projects, said Michael Fedchyshyn, the crown agency’s chief executive officer, in an interview with Markets Group.
To meet its mandate, the BOF steps into projects that traditional investors might avoid because of early-stage technology risks, exiting once those assets are stabilized. “This was a once-in-a-lifetime opportunity to be involved in and enable something of real national strategic significance. We’re helping de-risk a technology that can be replicated across the province and beyond. Our role is to bring the project to a place where it’s investable, then monetize out and redeploy capital into other projects.”
The agency, established in 2024, has flexibility to use a mix of financing tools — including loans, guarantees, and equity — to accelerate investment in strategic sectors such as energy, housing, and transportation.
Powering growth, fueling innovation
The Darlington project’s economic ripple effects could be substantial, noted Fedchyshyn, pointing out the Conference Board of Canada expects the investment will create roughly 18,000 jobs during construction and 3,700 jobs during operation.
More than 80 Ontario-based firms are supplying components or services, representing about 80% of total project inputs, he added. Indeed, the Conference Board pegged the project’s overall contribution to the country’s gross domestic product at roughly C$38.5B over its life span, he said, adding that
“Ontario has decades of leadership in nuclear technology,” the CEO continued, noting the province’s history with [Canada deuterium uranium (CANDU)] reactors. “This keeps us at the forefront of that innovation curve — and positions us to export not just power but expertise.”
He added that the province’s new generation of SMRs could eventually support energy-intensive sectors such as artificial intelligence computing, critical minerals processing, or supply remote industrial operations where traditional grid access is limited. “Bringing power to those types of users is a real challenge in this province and elsewhere and having this type of technology in the toolkit is of immense strategic importance.”
The Canada Growth Fund’s involvement reflects Ottawa’s push to attract private investment into clean energy infrastructure. The fund, whose investments are managed by the Public Sector Pension Investment Board (PSP Investments), was established with a mandate to deploy capital into projects that accelerate Canada’s low-carbon transition.
“By structuring this investment in partnership with BOF and OPG, we’re building a model for how public capital can pave the way for institutional capital,” said Deborah K. Orida, CEO of PSP Investments, in a statement.
This deal opens the door to new markets, asset classes and partnership models, and it demonstrates — to Ontario and to the world — how the BOF and similar infrastructure banks can be deployed to make a real difference in their economies, said Fedchyshyn.
“Our investment focus is defined by our mandate, but the province has been an incredible partner in giving us the flexibility to operate within it. For an agency that’s been operating for less than a year, completing a transaction of this scale while still building our organization shows our ability to deliver across all of our investment areas.”
