Ontario needs a frank and public debate on how to protect electricity consumers from the rising costs of the McGuinty government’s nuclear plans.
The government’s decision to restrict public consultation on revisions to its long-term electricity plan to a web-based survey simply dodges any meaningful public debate. This will end up costing the ratepayer and the environment.
We were told in 2007 it would cost $26 billion to keep nuclear at 50 per cent of electricity supply. That would repair 12 operating reactors and build two new ones. Since then, we’ve learned that building just two new reactors would cost $26 billion — sucking up the entire 20-year nuclear spending plan.
It takes 10 years to build new reactors and up to five to repair old ones, so the full cost of the government’s nuclear plan hasn’t hit our bills yet. But painful price hikes are coming unless the Ontario government reins in its nuclear plans.
Four trends point to need for a plan to protect the ratepayer from nuclear cost increases. These require meaningful consultations with the public.
Rising reactor repair costs: All of Ontario’s Candu reactors must be rebuilt or closed over the next decade. In the last 10 years, the estimated costs of repairing a Candu have jumped to $2.5 billion from $300 million. This means repairing both Darlington and Bruce B reactors over the next decade would top $20 billion before the inevitable cost over-runs.
Rising new reactor costs: The cost to build two new reactors in Ontario has jumped to a reported $26 billion from $6 billion. Yet the government’s response was to reaffirm its commitment to new reactors.
Aging reactor maintenance costs: Keeping Ontario’s old reactors operating safely costs a lot of money. The cost of operating the province’s oldest reactors at Pickering (ignoring the billions it cost to repair them just five years ago) is three times more than the newest reactors at Darlington. We can expect these costs to continue rising.
Privatization of Atomic Energy of Canada Limited (AECL): Ontario has always enjoyed subsidized maintenance and repair services from AECL, the federally backstopped reactor vendor. After more than $20 billion in subsidies, the Harper government is rightfully pulling the plug. Ontario will increasingly face the true costs of reactor operation and repair.
Politicians are ignoring these trends because voters won’t feel the impact until after the next election. A more responsible approach, however, would be to prevent future nuclear rate hikes by expanding the province’s existing impressive but limited green energy and conservation programs, which would have the side-benefit of creating more green jobs across Ontario.
First, the province’s conservation programs need to start prioritizing the reduction of total energy consumption and not just shifting when it is used. This will deliver lower bills and less pollution.
Second, the government should expand the use of new green energy above its current target of 10 per cent of supply. Analysis and international experience show that green energy at current prices would be cheaper than building new reactors to replace the retiring Pickering reactors.
Finally, put measures in place to protect the ratepayer from the risks of reactor repair, construction and operation. Tell Ontario’s nuclear operators — OPG and Bruce Power — they can’t pass cost over-runs on to the ratepayer — just like renewable operators under the Green Energy Act.
Luckily, while nuclear costs have only risen over the industry’s 50-year history, the costs for modern green power technologies are dropping rapidly. The government’s Green Energy Act is admirably designed to lower the prices paid for new green power over time.
Ontario’s other political parties should be asked how they will protect ratepayers from nuclear rate-hikes.
Tory Leader Tim Hudak is positioning himself as the defender of tax- and ratepayers. He should tell reactor operators they can’t pass their cost over-runs on to Ontarians. Hudak should also explain how his calls for increasing nuclear reliance beyond the government’s plans won’t drive up electricity prices.
Andrea Howarth’s NDP, the self-appointed defenders of public power, should be demanding why the McGuinty government has prohibited OPG from developing wind and solar power projects — and potentially doomed it to extinction by limiting it to running expensive aging reactors.
Ratepayers are still paying off the decades-old nuclear debt from building the first generation of reactors. We should not repeat that mistake again.
With nuclear costs increasing as green costs decrease, it’s time we had an honest and transparent debate on the best path forward. A web survey doesn’t cut it.
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