(December 9, 2011) Renewables lobby tackles nuclear subsidies — but not its own.
Thirty years ago, ragtag environmentalists idealistically opposed nuclear power and the monopoly utilities that kept it in business, arguing that wind, solar, biomass and ethanol were more economic as well as cleaner. It was a David versus Goliath battle, and also a battle between free markets and government regulation, because in those days, before the unions hijacked much of the renewable energy movement, environmentalists wanted only a fair contest in which governments didn’t pick winners.
Today, environmentalists are still fighting the nuclear industry. But they’re no longer ragtag and their beloved renewable energy industry is no longer different from the nuclear industry. Now it’s Goliath vs. Goliath, and also a grotesque beauty contest, with each parading its figures in front of government judges, each hoping the government will pick them as winners.
A press release this week from the Ontario Sustainable Energy Association — local representatives of what has become a multi-billion-dollar, multinational-dominated industry — marks the start of the latest contest. “Ontario must phase out all power subsidies,” this lobby organization demands, in announcing the release of its study, Nuclear Power: Where is the Business Case?
The Green Goliath claims its books look better than nuclear’s because it relies on fewer subsidies. “An apples to apples comparison is not only fair, it is the smart thing to do,” Green Goliath says, while refusing to compare apples to apples. “Currently, new green power purchases for hundreds of feed-in tariff program projects collectively will cost Ontarians $220-million per year — but pending repairs at the Darlington nuclear plant alone will cost $10-billion,” it says disingenuously, comparing apples (the ongoing annual costs of renewables) to oranges (the one-time capital costs of nuclear). “Building new nuclear reactors at Darlington is calculated to add a minimum of $26-billion or more to public debt.”
Green Goliath’s self-serving idea of fair competition is to have the government instantly strip the nuclear industry of its subsidies, thus killing it, while slowly stripping subsidies from renewables. During this tease, the renewables would take over nuclear power’s market share. To sweeten its allure, Green Goliath argues its superiority on societal grounds
The renewables industry is correct to blame the nuclear industry for catastrophic costs. As its study claims, nuclear power cost overruns did indeed bankrupt the Ontario power system — a bankruptcy that Ontarians are still paying off through high power rates. The Ontario government’s decision to go nuclear — based on the ideology of the 1960s and 1970s — had nothing to do with economics and everything to do with the politics of the day.
But the renewable industry is wrong to claim that it is cost effective. If anything, the Green Goliath is even more ruinous than nuclear power. As the provincial auditor-general showed in a report released just days before the OSEA press release, Ontario’s power generation costs are set to soar by close to 50% in the next four years, largely because of ill-advised green power contracts. The amount that Ontario customers will be paying for power generation by 2014, in fact, will be almost three times the market price.
Longer term, the picture becomes bleaker still. According to a peer-reviewed study earlier this year by University of Guelph economist Glenn Fox and retired banker Parker Gallant, two Energy Probe directors, by 2018 the average ratepayer’s annual electricity bill will exceed $4,000, making Ontario one of the highest-cost electricity jurisdictions in the developed world. This gives ironic meaning to the term sustainable energy — in its name, Ontario’s power system again faces bankruptcy.
Neither can green energy any longer claim the moral high ground in terms of public health and safety, or of community acceptance. Green Goliath has become the worst nightmare of those facing the prospect of living near wind turbines and transmission corridors. As health concerns over nuclear power have diminished — not only have past predictions of high cancer rates failed to materialize, but new evidence actually points to health benefits from low levels of radiation — health concerns steadily mount over living in proximity to ever-churning wind turbines. The grassroots anti-wind movement of today rivals that of the anti-nuclear movement of a generation ago.
The Bible tells us that the days of the powerful are numbered, and that the meek shall inherit the earth. It spoke truth in the case of renewable energy: Many of the once-ragtag environmental idealists of 30 years ago now dress in pinstripes, and they do now rule the power sector. The Bible didn’t tell us that when the meek take over, we will be the worse off for it.
Lawrence Solomon is executive director of Energy Probe and the author of The Deniers.
To see Green Goliath’s anti-nuclear case, click here.
To see the Provincial Auditor’s anti-green power case, click here.
This article first appeared in the Financial Post.