This morning Ontario’s Energy Minister, Bob Chiarelli, announced that the Government of Ontario is signing a contract with Bruce Power to pay for the re-building of six of its aging, outdated nuclear reactors.
According to Minister Chiarelli’s preliminary estimate, the project will cost $13 billion. However, according to the actual wording of the Government’s contract with Bruce Power, the final capital cost and price of electricity from the re-built reactors of the project is still to be determined.
In other words, this deal continues the long tradition of leaving ratepayers on the hook for capital cost overruns, whether it is through absorbing debt or paying a fat premium for power or both.
Every nuclear project in Ontario’s history has been approved by politicians on the basis of low preliminary cost estimates. But these estimates, and promises that “this time it will be different,” are just pie in the sky. Every Ontario nuclear project has gone massively over-budget – on average by 2.5 times. And the cost overruns have inevitably been passed on to Ontario’s electricity consumers and taxpayers. Minister Chiarelli’s announcement is déjà vu all over again.
Meanwhile, the Government of Ontario has signed more than 21,000 contracts with renewable and natural gas-fired power producers. All of these contracts are fixed price contracts that do not allow the renewable and gas-fired generators to increase their prices if their final capital costs are greater than their preliminary cost estimates. Minister Chiarelli should subject Bruce Power to the same market discipline.
Minister Chiarelli has provided no evidence to demonstrate that re-building the Bruce reactors can keep our lights on at a lower cost than by importing water power from Quebec and investing in energy efficiency and cost-effective Made-in-Ontario green energy. And he has not demonstrated why, at a time when electricity demand is steadily dropping and renewable energy is getting cheaper and cheaper, we would want to lock in inflexible nuclear power until 2060.
This is a 1950s electricity solution that will fit our evolving electricity needs and our changing system like a square peg in a round hole.
The only way we can accurately assess the government’s deal with Bruce Power is to send it to the Ontario Energy Board for a full public review.
Simple assurances that a contract with “fill in the blanks” for costs and prices is good value just don’t cut it any more.
Please contact Premier Wynne and ask her to send the Bruce Power contract to the Ontario Energy Board for a full public review to determine if we should remain dependent on high-cost nuclear power for another generation.
Chair, Ontario Clean Air Alliance