Decades of bungled energy policy in Ontario have left consumers deeply suspicious of the government’s ability to get it right this time.Fred Lum/The Globe and Mail
It's hard to get your head around Ontario's long-term energy strategy – mainly because it's forever changing.
First, there was a push for new natural-gas-fired power plants to replace coal and backstop newly added wind and solar capacity. The projects were later cancelled at a cost of more than $1-billion. And now, the government is apparently moving to phase out natural gas for heating and cooling buildings as it scrambles to meet tough new greenhouse gas-emission targets.
Natural gas currently provides 76 per cent of heating in Ontario and accounts for roughly 28 per cent of installed electrical-generating capacity.
Natural gas is the designated bad boy, according to a leaked version of the Liberal government's Climate Change Action Plan. The plan would end the use of natural-gas heat in all new houses by 2030 and all other buildings by 2050. The province would also offer generous incentives to get homes and businesses to switch from gas to non-fossil-fuel alternatives, including electricity, geothermal and solar.
We all know Canadians will have to make some significant sacrifices to meet the ambitious emission targets committed to at last December's Paris climate conference. Ontario, for example, is aiming to cut emissions to 15 per cent below 1990 levels by 2020 and 80 per cent below by 2050.
Unfortunately, decades of bungled energy policy in Ontario have left consumers deeply suspicious of the government's ability to get it right this time.
Like other provinces, Ontario faces daunting challenges. It needs to find a way to curb emissions without driving business and people out of the province with uncompetitive electricity rates.
It must vastly improve energy-storage capacity to deal with the intermittent nature of renewable wind and solar power and to make the most efficient use of its power supply. Ontario currently produces more power than it needs. At times, it sells power at a loss outside the province or opens the floodgates on hydroelectric dams because it can't sell the power.
In the current environment, natural gas remains a vital and highly attractive transition fuel. It's cheap, abundantly available and much cleaner than coal or oil. That's why it's become the heating source of choice in Ontario, where electricity rates are already relatively expensive and headed higher, owing to factors such as the costly refurbishment of nuclear plants and high-cost long-term solar and wind contracts.
The overarching principle should be to use the cleanest energy source available at the lowest possible cost. And natural gas offers the best bang for the buck when it comes to reducing emissions, particularly in industries and communities that use even dirtier fuels.
Across Canada, natural gas makes up one-third of the energy supply. Nearly seven million customers use natural gas to heat and power houses, apartments, buildings, businesses, hospitals and schools, according to the Canadian Gas Association.
But it's a fossil fuel. And as such, it is the largest single target for emission reduction in the Ontario government's climate-change plan, accounting for three million tonnes of projected carbon-dioxide-emissions cuts.
There are some sensible ideas in the plan, including policies aimed at getting key sectors to use the most appropriate fuel. That includes a $280-million program over four years to get truckers and school-bus operators to switch to lower-carbon alternatives, including liquid natural gas and electricity.
But Ontario's plan also features flip-flops of previous policies and potential conflicts with what other governments are doing. The move away from natural gas, as both a fuel for electricity generation and a heating source, comes as two gas-fired power plants are under construction and will soon be added to the power grid – in Napanee and Sarnia, Ont.
It's also not clear that Ontario is completely in sync with the federal government and other provincial governments. The recent federal budget, for example, includes several measures to promote and expand the use of cleaner fuels, including natural gas, in vehicles as well as buildings. The industry is also pushing governments elsewhere to subsidize the expansion of natural gas use into more remote areas, which are often dependent on dirtier diesel or gasoline to generate electricity.
Ontario's climate blueprint remains a work in progress. And the province says it will offset the impact of higher electricity rates on consumers.
If the past is in any guide, that could be the toughest part of the plan to deliver on.