Cost of cancelling gas plants at least $828M, energy expert says
TORONTO - The cost of cancelling two gas plants in Oakville and Mississauga is closer to $828 million, more than three times what the governing Liberals insist taxpayers will bear, an energy expert said Wednesday.
The cost of the Oakville plant -- which was cancelled in 2010 -- is about $638 million, not $40 million as the Liberals have said, Bruce Sharp told a legislative committee that's looking into the gas plant cancellations.
The mechanical engineer, who says he's spent 25 years in the energy sector, said relocating the plant will cost $40 million, but there are extra costs, said Sharp, who works for Aegent Energy Advisors.
He's pegged gas delivery and management costs at $313 million and transmission costs at $359 million.
"My view is that there are so many people making money in so many different ways in the sector, that when something goes wrong, no one wants to talk about it," he told the committee.
"When the Oakville settlement details were made public in September, it was clear to me that the additional costs quoted of $40 million was low, so I felt the whole subject deserved some attention."
Sharp said he agreed that the cost of relocating another plant in Mississauga will cost about $190 million, but that could have been at least $28 million lower because it will cost less money to deliver natural gas to its new site in Sarnia.
It's unfortunate that Ontario is seeing the "negative outcomes" of abandoning power system planning, he said.
"On the subject of politics, I would just say that we're sitting here today because of the siren call of political intervention and we really need to get away from that political intervention and swear a blood oath to not meddle in electricity policy in Ontario," Sharp added.
His testimony bolstered opposition claims that the costs of cancelling the two plants cost much more than the $230 million the governing Liberals have maintained.
But Premier Kathleen Wynne said she was unaware of any additional costs to the Oakville plant cancellation.
"I've been very clear that getting all of the information into the public realm is what needs to happen, that's why we moved to have the mandate of the committee broadened," she said.
"I've been very clear about the information that I have been given, so the numbers that I've talked about are the numbers that I knew."
The NDP and Conservatives have accused the Liberals of relocating the Oakville gas plant and then the Mississauga plant in the dying days of the 2011 election campaign to save Liberal seats in the face of local opposition to the projects.
The Liberals knew that it would cost much more than they let on, both parties said.
"There's no way that you can make a private deal on a gas plant with a private person and expect that at the end of it, if you break the deal, it's going to be $40 million," said New Democrat Rosario Marchese.
"It's impossible. I think they all knew that."
Progressive Conservative energy critic Vic Fedeli said he doesn't believe Wynne either.
"A proven energy expert irrefutably proved now that this is in almost a billion dollars, and the government has gone to great pains to cover it up," he said.
"And they'll pay the price for the coverup."