September 8, 2024
Version published in Policy Options, October 4, 2024
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 a model for climate and energy policy in Down Under. It seems the leader of the federal opposition Liberal (the conservative party in Australian politics) has been promoting the Ontario’s nuclear heavy energy plans as a pathway for Australia.
The reactions of those in the province familiar with the ongoing saga of its energy and electricity policies, to the notion of Ontario being an example of energy and electricity policy-making, have ranged from “bizarre” to “you couldn’t make this up.”
The Australian opposition leader seems to be operating on the basis of a very limited understanding of the history and current state of electricity, energy and climate policy in Ontario. A good starting point (Ch.5) would be to realize that the delays and cost overruns flowing from the province’s initial 20-reactor nuclear construction program, running from the 1960s through the early 1990’s effectively bankrupted the provincially owned utility Ontario Hydro. Its successor, Ontario Power Generation, could only be made economically viable by offloading $20 billion in mostly nuclear-related debt onto electricity ratepayers.
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 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.
Only two other provinces followed Ontario’s lead on nuclear. Quebec and New Brunswick built one reactor each, both completed in the early 1980s. The Gentilly-2 facility in Quebec was shut down in 2012, assessed as uneconomic, particularly in light of Ontario’s experiences, to attempt to refurbish. 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 6 reactors at the Bruce Nuclear facility (owned by OPG), and four reactors at the OPG 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 necessary and uneconomic. The plant had originally been scheduled to close in 2018. There are also proposals for four new reactors totaling 4800MW in capacity at Bruce and four new 300MW reactors at Darlington.
The total costs of these plans are unknown at this point, but an overall estimate in excess of $100 billion ($13 Billion Darlington refurbishment; ~$20 billion Bruce refurbishment (6 reactors, based on Darlington costs and plant age); ~$15 billion Pickering B refurbishment (based on Darlington costs and plant age); ~$50 billion Bruce new build (based on previous new build proposals); Darlington new build unknown but likely $10 billion+) would not be unrealistic. Even that figure would assume that things go according to plan, which they rarely have 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 (Ch.10) 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, as in the early 1980s (the Royal Commission on Electric Power Planning (a.ka. the Porter Commission), mid-1990s (the Ontario Hydro Demand Supply Plan Environmental Assessment) and late 2000s (Integrated Power System Plan review) the plans collapsed in the face of soaring cost estimates and unrealistic demand projections.
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 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 doubled since 2017, and are projected (Table 48) to continue to increase dramatically over the next decade. 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 imagine a worse model for another 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 first. Higher-risk options, like new nuclear, would 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 is the very opposite of such a process. To follow its example would be the height of folly.