Perspective on Gas Plant Scandal

The Ontario Liberals have been widely condemned for the moving of two gas plants from Mississauga and Oakville, to save two seats last election. They did this before knowing the cost of the move, which the Auditor General estimated at $1 billion over the 20 year life of the plants. How does this compare in the overall scheme of the electricity system in Ontario?
The total revenues of the electricity system in Ontario, including generation, transmission, debt recovery charges (to deal with past nuclear cost overruns), etc. is $17 billion/year. So when we consider the billion dollars spent to move gas plants, and we amortize this cost over 20 years, it is $40 million per year, or about 1/4 of 1% of annual electricity cost. This compares with the current cost of the debt recovery charge $980 million per year, which pays for past nuclear scandalous cost overruns, under all three political parties.

The $40 million/year can also be compared to other expenditures. For example, OPG (owned by the Province) paid $26 million to nuclear suppliers to pay for bid preparation for new nuclear plants (all other generation sources pay their own way to prepare a bid). The government is not proceeding with new nuclear. And OPG has paid $793 million to prepare to do the Darlington refurbishment, which we haven’t even contracted to do yet. This included the construction of a mock reactor, so workers could practice replacing parts in a radiation free environment before they entered the radioactive areas to do the real work. And OPG has proposed a 30% increase in rates to cover the cost of the Darlington refurbishment. This increase in rates, if approved, would amount to $1.4 billion per year, considerably more than the $40 million per year for the gas plant move. And we haven’t even begun to consider the cost of storing waste for 100,000 years, the cost of which is unknowable.

Do we all hate the cost of the move of the gas plants? Of course. It was a crass political move that cost a lot more than the politicians estimated. The fact is that all three parties said they would move the plants during the last election. And the Progressive Conservatives remain committed to an extremely costly new nuclear build, and cancelling wind and solar contracts, with its associated lawsuits and settlements.

The true scandals of Ontario electricity system lie not in the gas plants, but in our nuclear follies.

We are focused on a hill, not the mountain.

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