Ontario leaders play loose with the real cost of juice

Derek DeCloet
Globe and Mail
September 29, 2007

John Tory does not speak in sentences, even paragraphs. The man who wants to be Ontario’s next premier speaks in chapters. Ask him about health costs, and prepare for a dissertation on why emergency rooms are stuffed with people who shouldn’t be in them. Ask about his scheme to fund religious schools, and Mr. Tory will take you on a tour of history, back to 1867 and the Fathers of Confederation.

Ask him about nuclear power, and … on second thought, don’t ask him about nuclear power. The province’s creaking electrical grid is one of the hidden issues of the Oct. 10 election campaign. The leaders would rather talk about other things, and that goes even for the verbose chief of the Progressive Conservatives.

Naturally, he’s pleased to remind us all of Liberal Premier Dalton McGuinty’s busted pledge to shut down all of Ontario’s coal-fired generators by 2007. "He wasted four years trying to cover up for what was a grossly irresponsible promise that he made," Mr. Tory said. All right, then, what would the Conservatives do? The answers aren’t reassuring.

That the province is heading toward a power crunch, with or without coal plants, is obvious. Norm Rubin of Energy Probe, an energy and utility watchdog, says the province can credit "dumb luck" for the fact blackouts are so rare. Government-owned Ontario Power Generation last year relied on nukes for 44 per cent of its power. Hydroelectric represented 32 per cent and dirty, rotten fossil fuels most of the rest. Renewables are still a marginal source of electricity in Ontario.

The problem is the nukes are getting old, and they’ve never been terribly reliable to begin with. Coal has become politically incorrect; natural gas is expensive and so is wind. By 2025, the gap between what the province will need and what its current generators can provide will be huge, perhaps 15,000 megawatts (MW). It’s going to take tens of billions of dollars to fill the need.

Who takes the risk, and how will it be built? Those are two huge questions but you’d never know it from reading the pap in the parties’ platforms. If wishful thinking built generators, Ontario’s politicians would have enough power to keep the Eastern Seaboard from freezing in the dark.

The New Democrats want "safe, green, renewable energy instead of nuclear mega-schemes." Well, don’t we all? The Liberals’ policy book doesn’t even mention the word nuclear. (It does talk about getting rid of coal – seven times in 42 pages.) Nuclear is a modest part of the Grit solution, once you get past all the rhetoric about "cleaner and greener."

Then there’s Mr. Tory’s plan, which in some respects is the bravest, or at least the most honest. It contains the usual nod to windmills and other renewable sources of energy. But it admits eliminating coal isn’t going to happen soon, so the Conservatives propose to install clean air technology at Nanticoke, OPG’s biggest coal-fired plant, to remove some of the nastier smog-producing stuff. As for nukes? We need new ones, says the PC leader, while keeping the details fuzzy.

"I will say this – Mr. McGuinty has suggested he thinks two reactors will be sufficient. I believe the number is in excess of that," Mr. Tory told The Globe and Mail’s editorial board this week. He says that if elected, he’d go to Jan Carr, head of the Ontario Power Authority, and ask for an opinion. "I am absolutely confident that the number that will come back, in terms of how much nuclear you have to invest in, will be more in the order of six or eight reactors, as opposed to two."

That’s quite a statement in a province where voters still remember Ontario Hydro’s nuclear-fuelled bankruptcy and the disastrous, multibillion-dollar effort to restart the Pickering reactors east of Toronto – even more so when Mr. Tory says he doesn’t really know how much it will cost. "If John Tory really thinks he’s going to make the [power] grid better by expanding nuclear power in Ontario, he and his genius advisers haven’t been paying attention," Mr. Rubin says.

But the bigger mystery is why all of the parties leaders seem to believe that, having failed dismally with a centrally planned power system, the solution is even more central planning, with Queen’s Park demanding windmills here, nukes there and solar panels over there. Oh, and don’t forget the price caps. Even if you own the most ancient, juice-sucking appliances, and run them on the hottest day of July when the power grid is groaning, you can’t be forced to pay more than 6.2 cents per kilowatt-hour under the province’s price rules. Smart meters, which allow utilities to charge more for electricity at peak times, are being rolled out, but even those prices are fixes.

Some have estimated the cost of rebuilding Ontario’s power supply at $40-billion or more. Private money would come in handy, but most of it’s going to be invested in places that no longer use Soviet-style utility policy. The McGuinty Liberals, it seems, don’t understand this and the New Democrats have never understood it. The Conservatives could have distinguished themselves with a plan to bring market economics back to the power grid, but they missed it.

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