Electricity policy of Ontario
Policymakers are presented with a range of policy choices in addressing the situation, both in terms of overall system design and structure, and specific electricity generating technologies.
From this early beginning until the postwar economic boom of the 1950s, Ontario Hydro was able to meet growing demand for electricity by expanding its network of hydraulic generating facilities.
In response to the concerns of the public health impacts of increased coal-fired generation, all three major provincial political parties included a coal-phase out plan in their 2003 election platforms.
[15] Regulations and other tools needed to fully implement the legislation were introduced through the month of September 2009, as part of a ten step plan to bring the GEA to life.
[citation needed] On 13 June 2006 Dwight Duncan, Ontario's Minister of Energy, issued a directive for the preparation of a 20-year integrated power system plan for the province.
[20] The Minister's directive included minimum goals for conservation (increased substantially from the Supply Mix Advice report) and renewable energy, and a maximum limit for nuclear power production at approximately the capacity of the existing 20 reactors.
Howard Hampton, former leader of the Ontario New Democratic Party, argues that this averaging out of the cost of power ensures supply meets demand in a cost-effective manner.
Under a deregulated system, in which each generating station "must stand on its own two financial feet", the cost of ensuring such reliability would be considerably higher, as peaking plants would charge as much as the market will bear, as they are rationally expected to do.
Furthermore, central planning, which seeks to improve economies of scale, has historically "led to a nearly universal strategy of rapid capacity expansion and promotion of demand growth, with little consideration of the necessity or efficiency of energy use".
[35] This is true of Ontario Hydro, which, faced with the threat of cheap natural gas in the late 1950s, made the ill-fated decision to protect its market share by encouraging consumers to use more electricity.
[36] Therefore, simply in terms of scale of operations, it can be argued that central planning in Ontario, by overestimating future demand and building unnecessary capacity, has been economically inefficient and has imposed unwarranted costs upon the environment.
Ronald Daniels and Michael Trebilcock, for example, argue that a premium should be placed on incrementalism and decentralization in terms of decision-making, rather than planning for "some once-and-for-all, system-wide set of collective decisions as to the future of the [electricity] industry".
Moreover, they argue that competitive markets have the added advantage of being able to rely on the knowledge and expertise possessed by investors to generate a more rational assessment of the alleged merits of a given project.
[44] While this may be good news in terms of conservation and demand-side management (C&DM) objectives, it has made competitive markets unpopular among consumers and politically troublesome.
Naing Win Oo and V. Miranda[45] used intelligent agent simulation to show that in moving from a vertically integrated to a competitive electricity market, retail consumers were heavily disadvantaged and suppliers used this to steadily increase both prices and profits.
An unattractive environment for private investors, in turn, threatens overall supply in a competitive market regime, as planning for and building new generating capacity becomes an increasing risk.
In its 2005 Supply Mix Advice Report, the OPA estimated that electricity demand will grow at a rate of 0.9% annually between 2006 and 2025, rising to approximately 170 TWh per year by 2025.
This target was based on "economically prudent" and "cost effective" conservation and renewables, and by setting a lower priority for both options in comparison to nuclear.
[64] The largest potential for energy savings in Ontario has been identified in lighting, space heating, air conditioning, manufacturing machinery, and commercial equipment.
[70] In this scheme, distributed energy sources are more numerous and sufficiently smaller than central generating plants so as to allow interconnection at nearly any point in the electricity system.
Conversely, large hydropower plants and offshore wind parks, with substantial production capacities of 50–100 MW or more which feed into high-voltage transmission grids, cannot be considered distributed generation.
[75] A cost-benefit analysis released by the provincial government in April 2005, found that emissions from all Ontario coal-fired stations are responsible for up to 668 premature deaths, 928 hospital admissions, 1,100 emergency room visits, and 333,600 minor illness (headaches, coughing, respiratory symptoms) per year.
[76] New 'clean coal' technologies—such as Flue Gas Desulphurization (FGD) "scrubbers" for SO2 removal and Selective Catalytic Reduction (SCR) for NOX—can be used to reduce toxic releases, but have no effect on carbon emissions and are expensive to install.
Groups such as the Ontario Clean Air Alliance are quick to point out that fluctuations in uranium prices have made operational costs associated with nuclear generation rise higher than those of natural gas plants and renewables.
[20] The result is that nuclear is projected to make up approximately 37% of generation capacity in Ontario and produce 50% of the power in 2025, similar to its role in the current supply mix.
[92] The Auditor General of Ontario released a report on 5 April 2007, criticizing the high costs associated with the Bruce Power refurbishment agreement.
Particular emphasis will be placed on developing hydroelectric plants with large storage capacities that can be used to provide dispatchable energy, which are equally capable of meeting peak electricity demand or offsetting the intermittent nature of other renewable sources such as wind.
Bioenergy production from sustainable biomass sources is considered to be carbon neutral because CO2 emitted during combustion or natural degradation processes is captured by growing plants.
GHPs operate like refrigerators to transfer absorbed heat energy from below the frost line (about 1.2m soil depth for Southern Ontario) to connected buildings.
Hydro-Québec TransEnergie and Ontario's Hydro One, each province's electricity delivery company, signed a C$800 million agreement in November 2006 to construct a new 1,250 MW Quebec-Ontario interconnection by 2010.
