Ontario energy grid emissions set to skyrocket 400% as Ford government cranks up the gas

Ontario has some of the world's cleanest electricity.

When the wind is blowing strong enough, the entire province can be powered without producing any carbon emissions - the product of an unprecedented push to end our dependence on coal.

But that's about to change.

Over the next two decades, greenhouse gas (GHG) emissions from Ontario's energy grid are set to skyrocket more than 400 per cent as the province cranks up the dial on its underused fleet of natural gas plants.

That rapid rise in emissions is revealed in the official forecast put out by the Independent Electricity System Operator (IESO), a crown corporation that manages Ontario's energy grid.

Since all renewable energy projects were cancelled when Premier Doug Ford was elected, the province currently has no other way to compensate for the looming shutdown of a major nuclear reactor in Pickering, responsible for roughly 16 per cent of province-wide power. Only natural gas is available to meet rapidly growing demand for electricity, according to the IESO projections.

The projections show that the province's natural gas plants - which only operate about 60 per cent of the time now - will run non-stop by 2033. The additional annual emissions this will produce over the next 20 years are equivalent to a large Alberta oilsands project.

We're going totally in the wrong direction," said Jack Gibbons, chair of the Ontario Clean Air Alliance and a former Toronto Hydro commissioner.

Burning more methane - the primary component of natural gas - flies in the face of Canada's international GHG reduction commitments, he added.

Industry analysts, meanwhile, point out that Ontario's competitive advantage in the clean-tech sector is at risk.

Ontario's largest industries, from steelmakers to auto manufacturers, are facing intense buyer pressure to decarbonize their operations. Some businesses are setting up shop in places like Quebec, where cheap, low-emission hydroelectricity is abundant.

While Ontario's energy grid currently produces less than three per cent of the province's total GHG emissions, experts are quick to note that a 100 per cent clean grid is a prerequisite for decarbonizing the rest of the economy, which will need massive amounts of green electricity in the future.

You can't get to zero unless electricity is at zero," said John Stephenson, a retired engineer who oversaw the development of new generation projects at both Toronto Hydro and Ontario Hydro. Any carbon in the electricity grid is a big drag on trying to reduce emissions elsewhere."

Nuclear power has been a key element to developing Ontario's decarbonized energy system. It provides reliable round-the-clock power with zero emissions (if you don't count the construction of the reactor or the transportation of fuel and waste). This nuclear baseload" complements renewables like solar and wind, which are intermittent producers, only generating power when the sun is shining or the wind is blowing.

But Ontario's three aging nuclear reactors are coming to the end of their service lives. Bruce and Darlington are in a decade-long process of refurbishment that should allow them to keep operating for another 40 years. Pickering, on the other hand, is slated to shut permanently in 2025.

This will leave a yawning gap between supply and demand for electricity in the province. And it's a baseload gap that cannot be filled with wind and solar. A lack of planning - we could have built up storage capacity to collect surplus wind and solar and feed it back into the grid when needed - means the province has no choice but to replace non-polluting nuclear with fossil fuel generation, according to the IESO projections.

The province has ignored energy planning for the last four years because there was no need. We had an energy surplus," said Gord Miller, Ontario's former environment commissioner - an independent watchdog position eliminated by the Ford government. But now we're in an energy squeeze. When Pickering turns off, we have no plans ... and the default option is to up the gas."

The story of how Ontario went from being a polluter to a beacon of green energy and back again is a political one that spans almost two decades and three premiers.

It starts in 2003, when then-premier Dalton McGuinty went out on a political limb to announce the complete phaseout of coal-fired generation. Over the next 12 years, carbon emissions from the electricity sector dropped precipitously - from more than 35 megatonnes of carbon in 2005 down to six in 2014, when Ontario became the first jurisdiction in the world to completely wean itself off coal.

But the cost of this achievement - a tripling of electricity rates - demanded a political price.

McGuinty resigned, chased from office by outrage at the soaring rates caused by generous subsidies to the renewable energy sector and a rush to build natural gas plants to replace coal generation.

Regardless, McGuinty's successor, Kathleen Wynne, didn't back off the Liberals' green energy ambitions. She continued to invest in the construction of new renewable electricity generation while tapering off subsidies, and signed a deal to import cheap and clean hydro from Quebec. Under Wynne, the grid's carbon emissions declined to 2.5 megatonnes - a 93 per cent drop from 2005 levels.

But lower emissions weren't enough to quell voters' anger at higher rates.

Ford was elected in a landslide victory in 2018 promising to cancel renewable energy and bring electricity bills down. Four years later, the results are in: electricity prices are up and so are emissions. During Ford's first three years in office, they've more than doubled to 5.4 megatonnes.

And because no new renewable generation contracts have been signed, emissions are projected to continue rising all the way up to 18.6 megatonnes, erasing more than half the reductions made since 2005.

These numbers, buried deep in the data tables appended to the IESO's annual reports, haven't escaped notice.

In the last year and a half, 32 municipalities across Ontario passed resolutions calling on the province to completely phase out natural gas plants, calling it an imperative to fighting climate change. The cities comprise almost 60 per cent of the province's population, including Toronto, Mississauga, Hamilton and Ottawa.

In response, Energy Minister Todd Smith asked the IESO to study whether natural gas could be completely eliminated by 2030. The report, issued last fall, warned that ending natural gas generation by that date would lead to a $100 increase in average monthly electricity bills and rolling blackouts across the province.

That conclusion has been widely criticized for setting an all-or-nothing goal of 2030 and distorting the challenges of reaching net zero.

When you look at the fine print, they actually did develop a plan to get a 99.7 per cent carbon-free electricity system for Ontario by 2030," said the Ontario Clean Air Alliance's Gibbons. But then they made this absurd claim that it would be impossible by 2030 to replace that remaining 3/10ths of one per cent of our electricity supply with zero-carbon resources."

Smith also appeared dissatisfied. In response to the report, he went back to the agency, asking it to develop a phaseout plan on a more flexible timeline.

The significant impacts to affordability and reliability are unacceptable to our government," said Smith in a statement. We are moving away from the haphazard approach of the previous Liberal government which overpaid for contracts and saw household electricity bills skyrocket."

In an interview with the Star, Chuck Farmer, vice-president of planning, conservation and resource adequacy at the IESO, welcomed the opportunity to plot out a feasible path to a zero-carbon grid.

It's not that it can't be done. It's the timeline that's challenging," he said.

When the Conservatives entered office in 2018, they spent $231 million to cancel 758 green energy projects. They sued the federal government, spending $30 million to fight the federal carbon tax on constitutional grounds, and lost in court. Ford also eliminated buyer incentive programs for electric vehicles, deriding Tesla owners as millionaires" who didn't need government handouts to fund their commuting choices.

Then, facing a loss of manufacturing jobs in the auto sector, industry leaders pushed Ford to embrace electric vehicle manufacturing - and he seems to have had a change of heart.

Now, energy-efficient technology has emerged as a cornerstone of the party's re-election campaign. Ford has unveiled billions of dollars for electric car and battery plants.

The trouble, experts note, is that electric vehicles are only as clean as the grid they are built and run on; if the local network is powered by fossil fuels from natural gas, so, too, will the car. And in the race for clean energy to power clean products, regions with dirtier electric grids have greater difficulty attracting manufacturers and development.

It's becoming more and more apparent that having clean, cheap and affordable electricity is a huge competitive advantage," said Mark Zacarias, executive director of Clean Energy Canada.

Two international manufacturers, General Motors Co. and BASF SE, announced plans in March to open brand-new plants near Montreal for developing electric vehicle parts, citing Quebec's hydro electricity as a big factor in the decision.

Ontario's major steel mills will soon face requirements from the European Union to decarbonize their materials or face stringent tariffs.

ArcelorMittal Dofasco and Algoma Steel are undergoing major refurbishments that will convert their coal furnaces to be powered with hydrogen produced from electricity.

Some of our steel is already among the cleanest in the world right now. (We) need to keep it that way to maintain our export competitiveness," said Zacarias.

Meanwhile in Ottawa, the political ground is shifting. Electricity, which is normally the purview of the provinces, is now under the federal microscope because of the fundamental role it will play in reducing greenhouse gas emissions - and meeting Canada's international commitments.

Prime Minister Justin Trudeau was reelected last fall on a commitment to implement net-zero electricity from coast to coast by 2035. A discussion paper published in March suggests that the federal government will soon announce a phaseout of all conventional fossil fuel electricity generation," which would include all remaining coal and natural gas plants.

Thanks to the recent Supreme Court decision upholding the carbon tax, the federal government is confident that it can regulate emissions so natural gas would no longer be viable.

These signals from Ottawa have prompted belated action on the clean electricity file in Ontario.

Last month, Energy Minister Smith announced an electrification and energy transition panel to study a pathway to net-zero electricity. He has also entered into negotiations for the province's first large-scale battery storage facility.

But the bulk of Ontario's preferred solution will come from nuclear. In addition to the refurbishments of Darlington and Bruce, Smith has announced the province will partner with GE Hitachi to build one of the world's first small nuclear reactors.

Called Small Modular Reactors (SMRs), these next-generation nuclear reactors are promoted as a way to avoid the lengthy construction times and large cost overruns of conventional reactors. The only problem: no one has ever built one.

Gibbons, of the Ontario Clean Air Alliance, doubts claims that an unproven technology will be inexpensive. Rather than doubling down on nuclear, he advocates Ontario renew its commitment to building wind and solar and forge a long-term relationship with Quebec, which has cheap, carbon-free hydro to spare.

By integrating our wind and solar with Quebec's hydro reservoirs, we can convert wind and solar into a firm, 24/7 source of baseload electricity for Ontario," he said.

Much like Europe's Nordlink or the Maritimes' proposed Atlantic Loop, Ontario and Quebec could lay enough cable between them so excess wind electricity in Ontario could be exported to Quebec, allowing them to close their hydro dams and keep more water in reserve. Later, when the wind dies down, Quebec would open the dams and reverse the flow of electricity back to Ontario.

It's like a giant battery. We can smooth over fluctuations in wind power production and turn it into a steady, 24/7 source of baseload supply for Ontario," Gibbons said.

Working with our neighbours would avoid not only the long-term radioactive waste produced by nuclear but also its uncertain costs, Gibbons said. But only if Ford's U-turn on emissions is stopped in its tracks.

We've got a potential win-win solution: a zero-carbon electricity grid, low greenhouse gas pollution and lower electricity bills," he said.

Why wouldn't we want to choose a solution that is better for consumers and better for our planet?"