November 13, 2002
A government investigation into costly delays in restarting several nuclear reactors at Pickering, Ont. – shutdowns that helped create a supply crunch and soaring power prices – will offer little more than finger pointing, critics of the probe said Wednesday.
The inquiry will only further delay work on the project, which would bring about 2,000 megawatts of power back into the province’s supply – about 8 per cent of what’s needed at peak demand times, an electricity consultant said.
“By holding an inquiry, you’re essentially distracting the attention of management and the other people who are involved with the actual work and arguably, you’re delaying the return to service date as a result,” said Jan Carr, with Barker Dunn & Rossi in Toronto.
“To me, the important thing would not be to hold an inquiry, but to get the job done.”
Ontario Energy Minister John Baird will release details in the next few days on how the province plans to proceed in an independent investigation into delays at restoring power at the Pickering A station east of Toronto, said the minister’s spokesman Dan Miles.
The “significant initiative,” Miles said, will also find out why total costs to retrofit four nuclear reactors at the station – which has been out of service since 1997 – are estimated at $2.5 billion, more than twice the original budget estimate.
The restoration is intended to bring units built in the 1960s and 1970s to today’s standards. But Miles said progress reports on the revamp gave the provincial government a “gross underestimation” of the project’s scope and cost.
The stations were originally supposed to be back on line in time for this past hot summer, when rising air conditioner use helped create shortages and forced Ontario to import higher-cost electricity to meet demand. Combined with electricity market deregulation that began May 1, those shortages produced soaring prices that created a political backlash by consumers against the government.
Last month, Ontario Power Generation – the Crown-owned company that owns the Pickering plant – announced a third major delay of the restart. It said that one of the four A units would reach the “commissioning” stage in the first quarter of 2003, a testing process which the utility says could take one to three months.
The remaining three units are to be reassessed once the first unit is back online.
OPG spokesman John Earl said the big power producer isn’t commenting on the proposed investigation, announced Monday as part of a broad plan by Ontario’s Conservative government to cap soaring electricity prices, promote alternative energy and attract more private power producers to the province.
Last month, OPG chief executive Ron Osborne said the delays and higher expenses were from “overly optimistic” early budgets, too much outsourcing of project management and lengthy environmental assessments which create higher salary and other costs.
That’s about all an inquiry would reveal, said Jonathan Dickman-Wilkes, a senior analyst at Navigant Consulting in Toronto.
“It’s kind of more of a finger-pointing exercise than anything else,” he said, noting that it would be unfair to suggest retrofitting the decades-old stations is an easy task.
“This is 1970s technology,” he said. “They need to sort of overhaul a 1970 Chevy. That hadn’t been done before.”
This week, the Tory government of Premier Ernie Eves blamed rising prices partly on Ontario Power Generation’s failure to get the nuclear plants running again. OPG is the electricity producing successor to the former Ontario Hydro and accounts for nearly three quarters of electricity generated in Ontario.
Others blame the provincial government for not being more directly involved in the Pickering project.
“The government is blaming everybody but themselves and they are responsible for putting this (market) together,” said Arthur Dickinson, president of the Association of Major Power Consumers in Ontario, which supported energy market competition but only if it lured more suppliers.
Private power producers have said that confusion over when the huge reactors would come back online left them unable to predict whether it would be worth it for them to build new plants in Ontario. New plants would reduce supply concerns and in the long term lead to more stable prices.
Dickinson said that in retrospect, the May 1 opening of Ontario’e energy market to competition should have been held off until the Pickering A reactors were back on stream.
“Why were they asleep at the switch?” he said of the government. “It’s not good enough to say, ‘that’s not what we were told.'”
“When the delay was repeated, why didn’t they get more interested then?”
Tom Adams of Energy Probe – whose group claims nuclear energy is too costly and unreliable – said the Pickering project should be cancelled. He said the government “should never have bet on Pickering in the first place.”
He also said the probe would reveal that problems were discovered during Pickering A’s retrofit, partly because there were discrepancies between on-paper designs of the station drawn up decades ago and the actual reactors. That left federal safety regulator officials asking more questions.
“We know that the scope of the project has been steadily expanding,” Adams said. “But I don’t suspect that there’s a lot of wrongdoing here.”
Dickinson said a panel of politicians at an inquiry would provide little insight into OPG’s problems.
“Running a nuclear station is highly technical. If they have a panel of MPPs, what are they going to know? The easiest thing in the world is to snow MPPs on something as technical as this,” he said.
“You need people that understand nuclear facilities to have any chance at reasonable analysis.”