Green Daulton

Daulton McGuinty was on CBC’s The House today and asking for a fair deal from the feds on green energy support.  He argued that if the feds were getting in on the NL-NS Muskrat Falls project, they should be helping Ontario – the province that has the highest commitment to green energy (in the Premier’s view).

The host asked him to comment on Ignatieff’s musings about significantly expanding hydro-power in Northern Quebec and Labrador and using that clean power to completely replace all coal and gas fired generation in Ontario, Quebec and Atlantic Canada.

Daulton bristled at this and stated “we have our own plan”.

The truth is that green power in Ontario was only ever partially about carbon reduction and ‘green’ energy.  I believe the main driver was that Ontario wanted to build green energy as an economic development driver for the economy.

People that look at these things will say that hydro power coming out of northern Quebec and Labrador – if scaled – will be 40% – 50% cheaper than the solar, wind, gas, etc. electricity mix that Ontario has going now.

But, as I have discussed numerous times, McGuinty is willing accept the 40% premium in cost (not on gas but certainly on wind/solar) as a trade off to create tens of thousands of green jobs in Ontario and hundreds of millions in tax revenue.  I heard one Ontario cabinet minister saying this would be Ontario’s next auto industry.

In many ways it is a fascinating example of industrial policy.  If Ontario added a point to the HST and said that money was going directly as a subsidy to build a new industry, the public would likely be outraged but blending this premium into rates and wrapping it in a green blanket has so far been accepted by most Ontarioians.  Most households in Ontario are less exposed to the cost of electricity because of the wide use of natural gas (as compared to a place like New Brunswick) but the cost of building the green energy sector in Ontario will eventually cost the province billions over cheaper energy source (including clean hydro) but it will also generate billions in economic activity that otherwise wouldn’t have been there (over 20-30 years).

This fact is the main reason why I have been somewhat reluctant to support wind and tidal energy in New Brunswick.  Because here, like most other sectors, we just end up buying the technology and systems produced elsewhere so we pay the higher costs and don’t get the economic development benefits.  In that scenario, I would much rather have done a deal with Hydro-Quebec to bring down lower cost hydro power – but then again there is no need to re-flog that beast – we flogged it to death already.

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2 Responses to Green Daulton

  1. mikel says:

    NEVER make a statement about what ‘ontarians accept’ because politics here is VERY different than NB. The fact is that Daulton only ranks high in the polls because the alternatives rank lower. Nobody really ‘accepts’ what McGuinty does because everybody knows they really can’t do anything about it. The HST was the litmus test, where a hugely unpopular tax was brought in, which everybody but business hates, and opposition parties tried like hell to make it a big ‘let’s hate liberals’ kind of issue. It never worked. Apart from the parties, there were no big protests, I don’t think there was even much online at facebook, etc., although I’ll admit to not really looking. Certainly the media never made it an issue, and in a province like ontario thats the only place it really CAN be made into an issue. After the horrendous failure of the Proportional Representation referendum (and even more horrendous voter turnout), most groups seem to have been pretty demoralized into making ANY kind of political difference in ontario. It really is so big that its like a whole country.

    But again, when it comes to energy its a very different condition than NB. As you say, most families pay very little for electricity, and new appliances are coming out all the time that cost even less. The only real juice user in our house is our refrigerator, and our dryer, which is low energy, but still high enough that when it gets replaced we’ll be getting a gas one. Plus, energy is ‘sort of’ deregulated, so our hydro is mainly municipal. I recall one energy ‘expert’ saying that even the heads of Ontario Hydro find the whole energy industry just too confusing to make heads or tails out of.

    I know they TALK like its an economic generator, but is more likely just the ‘Samsung connection’. One corporation buys in heavily, and economic policy stems around making them happy. It’s already the case that all the wind farms in southern ontario already have big protests going on, and signs all along highway 9. There really is no way anybody can seriously think green energy will be the next auto industry, but protecting the samsung investment is a different story. There is no way that an average user will care where the power comes from – IF its ‘green’ and IF its cheaper.

    This is just sort of the ‘irving effect’ but for ontario. And if you actually READ the ontario governments ‘plan’, its VERY clear, as most environmental groups have pointed out, that they DON”T really have a ‘plan’ at all. They do have policies though-but that’s like saying that Alward’s government has a ‘plan’ for natural gas-when all they have is mediocre legislation that even the minister says isn’t good enough for when there is actually an industry operating.

  2. Keerthana Kamalavasan says:

    The global recession was hard on economies around the world. Ontario worked with people when others would have cut them loose. The economy is back on track. Ontario jobs are coming back and growth is returning. See the progress report here: http://bit.ly/k2ADga

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