Premier Dalton McGuinty is grasping at green straws to desperately garner the southern Ontario environmental vote regardless of the economic damage and uncertainty his inept energy policies will cause the provincial economy, especially the north.
"But let's remember that Ontario is the only place in the world
that's getting rid of coal, at a time when almost every other
place in the world is expanding their reliance on it," McGuinty
proudly boasted at the Shared Air Summit last week.
He omitted the very important fact that the main reason every
industrialized economy in the world is expanding their reliance
on coal is because of a global energy shortage - due to the
industrialization of China, India and other developing
countries - unprecedented in human history.
The premier used the Shared Air Summit to unveil his
government's green commitments and once again promised to close
the province's four coal-fired power plants by 2014, as opposed
to the original 2007 date. The highly-trained and non-political
technocrats at OPG and Hydro One probably told the premier that
he would destroy the Ontario economy if he kept the original
date. Many are skeptical that the 2014 date can be met.
I have never really understood the Liberal party's blind hatred
with coal. Obviously it is not the cleanest source of energy
production, however, it does provide Ontario with roughly 20
percent of its power needs at one of the lowest costs. At a
time of global energy shortages, what are we going to use
instead?
Water hydro, another very inexpensive form of power production
contributes about 25 percent, but there are very few rivers
left in the province that could replace our reliance on coal.
Oil and gas supply approximately 15 percent to the grid but
shortages and high costs prevent expansion in that field. Even
oil-rich Alberta uses coal for about half its power
production.
Finally, very expensive nuclear energy provides the remaining
40 percent of Ontario's energy demands, yet billions will have
to be spent over the next decade or two replacing or
retrofitting the entire fleet. And again the environmental
movement isn't happy about any nuclear expansion plans.
That leaves wind and solar. Regardless of what environmental
advocates tell you, costly and intermittent wind and solar
energy cannot power southern Ontario's auto economy or the
north's mineral and forestry sectors. Just exactly what is GM,
Ford or CVRD Inco supposed to do when the wind stops blowing or
the sun is not shinning.
And green fantasies about demand reduction through conservation
efforts, although worthy, will not meet the needs of a growing
Ontario population expected to increase by an additional three
million people over the next two decades.
Coal provides the Chinese economy with 70 percent of their
power requirements. They are building 550 new coal-fired power
stations to meet their voracious energy appetite. Even
environmentally conscious Denmark - well known for its
commitment to wind power - is not foolhardy enough to close its
coal-fire power plants, getting about half of the country's
energy from the ugly black rock.
And notwithstanding, what Al Gore and Arnold Schwarzenegger
say, 50 percent of American power production still comes from
coal. The United States is Ontario's chief export market for
our manufactured products. If power rates climb too high in
Ontario, the 140,000 manufacturing jobs the province lost over
the past few years are going to be a drop in the bucket.
Ontario's four coal-fired power plants cost the taxpayers of
this province billions of hard-earned tax dollars.
Depending on the location - Atikoken, Thunder Bay, Sarnia, Nanticoke there are still decades of life left in these important infrastructure facilities. In addition, the transmission lines that crisscross the province were built to service these power plants. Any newly built power facilities that are not at these locations would require brand new transmission lines at a cost of further billions. In the congested Greater Toronto Area, there is no place to put new transmission corridors without enormous public opposition.
If there is one sector of the northern economy that has been
blindsided by the premier's inept energy policies, it surely is
the forestry sector. Thousands of high-paying jobs have been
lost and many towns are economically devastated.
Notwithstanding a rising Canadian dollar, make no mistake it was high energy costs that were the final blow in most of these plant closings.
It did not have to be this way.
The Northern Ontario energy market is probably less than 10
percent of the entire province. Why couldn't there be a cheaper
electricity rate for Northern Ontario? Or perhaps just for the
industry in the north. In Quebec, the government uses
subsidized power rates to ensure that there is a healthy
aluminum industry in the Saguenay region.
Lower power rates are widely used as a tool for economic
development in Quebec's resource-rich north. The same can be
said for Manitoba. With these unsustainably high power rates in
Northern Ontario, there is little possibility of new smelters,
refineries, pulp and paper or forestry mills ever being built
in the region. Companies will locate new facilities in Manitoba
or Quebec and ship Ontario's raw resources and jobs there.
Ironically, much of northern Ontario's power supply comes from
hydro developments that produce some of the lowest cost power
in the province.
McGuinty's commitment to close the province's coal-fired power
plants is economically reckless, especially when global energy
shortages are threatening every major industrialized economy in
the world.
And the lack of a subsidized energy policy for Northern Ontario
industry will leave a legacy of joblessness and continued
depopulation in a region that could contribute so much more to
the provincial economy.
Stan Sudol is a Toronto-based communications consultant and policy analyst who writes extensively on mining issues.[email protected]
