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Hey Australia, Ontario is no model for energy and climate policy

Energy and climate strategy should prioritize options with lowest economic, environmental, technological and safety risks. Ontario’s does the opposite.

by Mark Winfield October 4, 2024,  https://policyoptions.irpp.org/magazines/october-2024/ontario-energy/

Over the past few weeks, word has begun to reach Ontario of a series of stories in the Australian media in which the province is being held up as a model for climate and energy policy Down Under.

It seems that Peter Dutton, the leader of the federal opposition Liberal (the conservative party in Australian politics), has been promoting Ontario’s nuclear heavy energy plans as a pathway for Australia.

For those in the province familiar with the ongoing saga of its energy and electricity policies, the reactions to the notion of Ontario being an example of energy and electricity policymaking have ranged from “bizarre” to “you couldn’t make this up.”

Poor maintenance and operating practices led to the near-overnight shutdown of the province’s seven oldest reactors in 1997, leading to a dramatic rise in the role of coal-fired generation and its associated emissions of greenhouse gases (GHGs) and smog precursors. The refurbishment of the “laid-up” reactors themselves went badly. Two ended in write-offs, and the others ran billions over budget and years behind schedule, accounting for a large portion of the near doubling of electricity rates in the province between the mid-2000s and 2020.

Towards a $100-billion nuclear binge?

Only two other provinces followed Ontario’s lead on nuclear. Quebec built two reactors and New Brunswick one, each of them completed in the 1970s or the early 1980s. The Gentilly-1 facility in Quebec was barely ever operational and closed in 1977. The Gentilly-2 facility was shut down in 2012, and assessed as uneconomic, particularly in light of Ontario’s experiences in attempting to refurbish its own. The construction and then refurbishment of the Point Lepreau facility has repeatedly pushed New Brunswick Power to the brink of bankruptcy.

The current government of Ontario, led by Conservative Premier Doug Ford, has seemed determined to ignore the nuclear experiences of these provinces, and its own history of failed nuclear megaprojects. The government’s July 2023 energy plan includes the refurbishment of six reactors at the Bruce nuclear power facility (owned by OPG), and four reactors at the OPG’s Darlington facility. It subsequently added the refurbishment of four more reactors at OPG’s Pickering B facility, an option that had previously been assessed as unnecessary and uneconomic. The plant had originally been scheduled to close in 2018. There are also proposals for four new reactors totaling 4,800 MW in capacity at Bruce and four new 300MW reactors at Darlington. (The current capacity is 6,550 MW at Bruce, and 3,512 MW at Darlington.)

The total costs of these plans are unknown at this point, but an overall estimate in excess of $100 billion would not be unrealistic:

• $13 billion for the refurbishment at Darlington;
• approximately $20 billion for the refurbishment at Bruce;
• $15 billion for Pickering B (based on Darlington costs and plant age for both this case and Bruce);
• about $50 billion for the new build at Bruce, based on previous new build proposals;
• and the Darlington new build (unknown, but likely $10 billion or more).

Even this 100$-billion figure would assume that things go according to plan, which rarely happens with nuclear construction and refurbishment projects.

The government’s ambitious nuclear plans have not been subject to any form of external review or regulatory oversight in terms of costs, economic and environmental rationality, or the availability of lower-cost and lower-risk pathways for meeting the province’s electricity needs. Rather, the system now runs entirely on the basis of ministerial directives that agencies in the sector, including the putative regulator, the Ontario Energy Board, are mandated to implement.

The province’s politically driven policy environment is very advantageous to nuclear proponents. When previous nuclear expansion proposals had been subject to meaningful public review, the plans collapsed in the face of soaring cost estimates and unrealistic demand projections. This was the case in the early 1980s with the Royal Commission on Electric Power Planning – aka the Porter commission, at the turn of the 1990s with the Ontario Hydro demand and supply plan environmental assessment, and in the late 2000s, with the Ontario Power Authority’s integrated power system plan review.

A halt to renewable energy

There is a second dimension to Ontario’s electricity plans that also should not be overlooked. Upon arriving in office the Ford government promptly terminated all efforts at renewable energy development,  including having completed wind turbine projects quite literally ripped out of the ground at a cost of hundreds of millions of dollars. It then scrapped the province’s energy efficiency strategy for being too effective at reducing demand. Repeated offers of low-cost electricity from the hydropower-rich neighbouring province of Quebec were ignored. The results of studies by the province’s own electricity system operator on energy efficiency potential and the possible contributions of distributed generation, like building and facility-level solar photovoltaics (PV) and storage, have been largely disregarded.

These choices have left the province with no apparent option but to rely on natural gas-fired generation to replace nuclear facilities that are being refurbished or retired. With existing facilities dramatically ramping up their output, and new facilities being added, GHG and other emissions from gas-fired generation have more than tripled since 2017, and are projected to continue to increase dramatically over the next years. On its current trajectory, gas-fired generation will constitute a quarter of the province’s electricity supply, the same portion provided by coal-fired plants before their phase-out, completed in 2013. The province has recently announced a re-engagement around renewable energy, but the seriousness of this interest has been subject to considerable doubt.

Given all of this, it would be difficult to see Ontario as a model for Australia or any other jurisdiction to follow in designing its energy and climate strategy. The province has no meaningful energy planning and review process. Its current nuclear and gas-focussed pathway seems destined to embed high energy costs and high emissions for decades to come. And it will leave a growing legacy of radioactive wastes that will require management of timescales hundreds of millennia.

A rational and transparent process would prioritize the options with the lowest economic, environmental, technological and safety risks. Higher-risk options, like new nuclear, should only be considered where it can be demonstrated that the lower-risk options have been fully optimized and developed in the planning process. Ontario’s current path goes in the opposite direction. To follow its example would be a serious mistake.

October 5, 2024 Posted by Christina Macpherson | Canada, politics | Leave a comment