Ontario hydro costs set to double over next 20 years
Published Tuesday, November 23, 2010 6:16PM EST
TORONTO - Electricity bills will double in Ontario over the next 20 years under an $87-billion plan to modernize the province's electricity system unveiled Tuesday by Energy Minister Brad Duguid.
Anyone who says Ontario can update its system, turn off coal-fired generation and bring in more renewable forms of energy without raising rates is misleading people, said Duguid.
"We're being very straight up with you about this. You cannot build a clean, modern, reliable energy system without making these important investments," he said.
"We're asking Ontario families over the next 20 years to contribute."
The long-term energy plan calls for $33 billion in investments by government and the private sector to build two new nuclear reactors at Darlington and refurbish 10 older units.
Critics said the estimated price seemed unrealistic -- the last estimate was $26 billion just for two new reactors. The refurbishment of two reactors at Bruce Power is $2 billion over budget, nearly double original estimates, and years behind schedule, noted the critics.
"Premier (Dalton) McGuinty's plan to double our hydro bills to pay for high cost, unreliable nuclear power simply does not make sense," said Jack Gibbons of the Ontario Clean Air Alliance.
"We can keep the lights on at a much lower cost by investing in energy conservation and efficiency, by buying water power from Quebec and by investing in combined heat and power."
Greenpeace Canada was concerned there would be no limits on the cost of refurbishing the older nuclear reactors.
"They are willing to have a cost analysis on new (nuclear) builds, so hopefully that will be transparent and public and can be compared against green alternatives," said spokesman Shawn-Patrick Stensil.
"They are unwilling to do any public scrutiny or cost analysis on the refurbishment projects, so that means we'll build it no matter the cost."
The long-term plan confirmed Ontario's intentions to keep getting half of the province's electricity from nuclear and to phase out coal-fired generation by 2014 at the latest, with two coal burning units at Nanticoke set to close next year.
The New Democrats were concerned about spending billions on nuclear projects that they say always come in over budget.
"We're still paying for the hangover of the last big investment in nuclear with the debt retirement charge on people's bills," said NDP energy critic Peter Tabuns.
"This is much bigger than that. They are putting Ontarians, their household economies and the economy of the province at risk with the plan they put forward."
The province is forecasting moderate growth in demand for electricity, rising only 15 per cent over the next two decades.
Still the plan calls for the average homeowner's electricity bill to double in that time.
The government admitted last week that green energy programs will be responsible for more than half of the expected 46 per cent increase in electricity rates over the next five years.
The plan calls for $14 billion to be spent on wind power, $9 billion on solar projects, $4.6 billion on new hydro-electric, $4 billion on biomass energy, $1.8 billion on natural gas plants, $9 billion on transmission lines and $12 billion on conservation programs.
The Canadian Wind Energy Association said more renewable energy projects will mean economic benefits for municipalities and landowners.
"It provides a long-term signal for investors that we think will accelerate investment in this sector going forward," said CWEA president Robert Hornung.
"We've seen dramatic growth, but we're really only scratching the surface of what's possible here in Ontario."
The Progressive Conservatives, who support nuclear power, said the Liberal government's green energy policies, such as paying 80 cents a kilowatt hour for small solar projects, are making electricity too expensive.
"What you've seen today is an energy system that's going to cost families across this province significantly more as a result of the decisions this government is making," said Opposition energy critic John Yakabuski.
"The choices they've made and the prices they're willing to pay since the advent of the Green Energy Act is a big part of the reason we're paying exorbitant prices for electricity."
Ontario's commercial sector will be responsible for 50 per cent of the government's conservation target to reduce usage by 7,100 megawatts by 2030. The industrial sector will be responsible for 20 per cent of the conservation targets, which Duguid described as "among the most aggressive in North America," and the residential sector the remaining 30 per cent.
The Liberals feel people will accept higher electricity prices in exchange for the cleaner air that results from phasing out coal-fired generation, and claim the opposition parties have no energy plan.
"I think Ontarians know that those thousands of clean energy jobs we're creating are important for our future and our future prosperity," said Duguid.
"And I think Ontarians ought to know that (Opposition Leader) Tim Hudak is against getting out of coal, he's against cleaning our air and he's against those thousands of clean energy jobs that we're creating."
In the end, getting out of coal-fired generation will save Ontario about $3 billion a year in health-care costs, added Duguid.
"Our determination to eliminate the use of dirty coal will have the same effect as taking seven million cars off the road," he said.
"Just think about that for a minute; that's like taking almost every car in the province of Ontario off the road. That's huge."