Ontario Opposition Leader Patrick Brown may need a bit of a refresher on energy economics if he thinks it’s a bad deal for Ontario to import surplus hydroelectricity from Quebec, Ontario Clean Air Alliance Chair Jack Gibbons writes in an opinion piece in the Orillia Packet.
Earlier this month, after Le Devoir reported details of an emerging deal for Ontario to buy eight terawatt-hours per year of electricity from Quebec, Conservative energy critic Todd Smith cast the 6.12¢/kWh offer as a bad deal and Energy Minister Glenn Thibeault quickly disavowed it. But Gibbons says Brown “seems unaware the fuel and operating costs alone of the Pickering Nuclear Generating Station amount to 9¢/kWh, and that Ontario Power Generation is asking the Ontario Energy Board to increase the rate it is paid for nuclear power to 16.5¢ by 2025 to pay for rebuilding Darlington’s aging reactors.”
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Even with a 2% annual escalator in the 20-year contract, “Quebec water power will remain an excellent deal compared to nuclear,” Gibbons adds. “Every nuclear project in Ontario’s history has gone massively over budget. When the final bills are in for the Darlington rebuild project, Quebec power at these rates will look incredibly attractive.”
While Gibbons acknowledges that closing the Pickering plant will cost jobs—many of which appear on the provincial Sunshine List of public employees earning more than $100,000 per year—he notes that the industry itself is becoming obsolete, with no new Canadian nuclear reactors sold in the last 40 years. That means the best transition for nuclear workers is to build their expertise in nuclear decommissioning—the only part of the industry that is growing.
The first step in that process would be to shut down the Pickering plant in 2018 and “return a large part of the Lake Ontario waterfront to the people of Pickering.”
Brown may consider the power purchase a high-risk venture, but with “nuclear projects in Ontario running 2.5 times over budget on average, the real risk is massive nuclear project cost overruns,” Gibbons writes. “Turning our back on Quebec’s offer of power at a fraction of the cost of electricity from rebuilt nuclear reactors would be equivalent to shooting ourselves in the foot, because the bullets were made in Ontario. The only reason to say no to Quebec is to keep a dying nuclear industry on life support for a few more years.
