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Ontario’s energy plan falls short

Tuesday, April 10th 2018 9:57:34am

Plan doesn’t provide the path from fossil fuels to low-carbon energy sources 

TORONTO April 10, 2018 - The Ontario government’s Long-Term Energy Plan ignores its own climate law, says Making Connections: Straight Talk about Electricity in Ontario, a new report from Dianne Saxe, Ontario’s Environmental Commissioner. The climate law requires Ontarians to reduce greenhouse gas emissions from fossil fuels, such as gasoline, natural gas and oil by 2030, but the province isn’t planning how to make that happen. 

“The climate law means that Ontarians must be prepared to reduce emissions from fossil fuel use by 40 to 50 per cent in the next 13 years,” said Saxe. “This means more conservation, and converting some fossil fuel uses - including some gas-fuelled cars and trucks, and some heating of our homes and businesses - to electricity instead.” Ontario’s electricity system produces very few emissions since coal-fired power plants were closed. 

The Long-Term Energy Plan is produced by the Ministry of Energy to detail Ontario’s energy needs for the future. It guides the government’s energy investments to meet these needs. The current Long-Term Energy Plan however, predicts that demand for electricity will remain fairly stable, and doesn’t recognize or plan for the low-carbon transition that is needed. In addition to switching from fossil fuels to electricity, the energy system as a whole must become more efficient, and Ontarians must do more to conserve. 

Saxe acknowledged the government’s role in cleaning up Ontario’s electricity system and air by ending coal-fired power. By replacing coal with low-carbon electricity sources such as hydro, solar, wind and nuclear power, the system was 96 per cent emission-free in 2017. She noted that the cost to clean up the system led to higher electricity bills, but overall, it was worth it. 

“Electricity was cheap, but it came at a very high cost to our environment and health,” said Saxe. In 2005, the system not only strained to meet the peak demand, it was also a major cause of greenhouse gas emissions, air pollution and smog. “Those with asthma and other respiratory ailments struggled with bad air quality. There is no doubt that our electricity system was a major contributor to poor air quality and higher health costs.” 

Making Connections: Straight Talk about Electricity in Ontario can be downloaded at: eco.on.ca/reports/2018-making-connections


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Ann Lehman-Allison 
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The Environmental Commissioner of Ontario is an independent officer of the Legislature who reports on government progress on environmental protection, climate change and energy conservation. The ECO is the province's environmental watchdog and guardian of Ontarians' environmental rights. 

Backgrounder -
Making Connections: Straight Talk about Electricity in Ontario 

The Long-Term Energy Plan
The 2017 Long-Term Energy Plan is the government’s roadmap for Ontario’s energy sector. It outlines energy needs for the future, and how the government will invest to meet those needs. The 2017 plan is Ontario’s 20-year energy plan. The plan assumes that demand for electricity will remain stable over the next 20 years. This assumption is inconsistent with the climate law. 

Ontario’s Electricity System 
The electricity system meets about one-fifth of Ontario’s energy needs. Almost all of the remaining 80 per cent is provided by fossil fuels. While fossil fuel energy in Ontario produces greenhouse gas emissions and air pollution, Ontario’s electricity system was 96 per cent emission-free in 2017. Sources include nuclear power, hydro (water) power, wind, solar and natural gas-fired generation. 

Most of the power needs formerly met by coal are now met through new renewable power generation and conservation. Nuclear refurbishments and new natural gas-fired plants have also increased system capacity and reliability. 

Ontario has a surplus of electricity only at times when demand for electricity is low - mostly nights and weekend in the spring and fall. Conservation has reduced the amount of electricity Ontario uses. We sell surplus power at low rates to keep clean electricity from going to waste, and earn money for ratepayers. The surplus is expected to lessen in the next few years. 

The system as a whole now costs about $21 billion each year, up from about $15 billion in 2005. The extra costs are mostly for added capacity to generate power, so the system is more reliable; it can handle high demand at peak periods on the hottest summer days. A clean, low-polluting system also benefits human health and lowers health care costs through improved air quality. 

The Climate Mitigation and Low-carbon Economy Act 
Ontario’s climate law has put a cap on the amount of greenhouse gas emissions allowed in Ontario from burning fossil fuels each year. The cap will decline each year. 

Emitters, including companies that sell fossil fuels to Ontarians, are required to buy allowances to cover their emissions. These companies will pass on costs of allowances to those who purchase fossil fuels for use. As allowances become increasingly scarce as the cap is reduced, these costs will increase. 

For more information about Ontario’s cap and trade system, see our Introduction to Cap and Trade in Ontario

Ontario’s Emissions 
In 1990, Ontario industry was responsible for more than one third of our emissions, producing 67 of 181 megatonnes (Mt) of carbon pollution. Transportation produced 48 Mt, buildings produced 28 Mt, mainly from heating, and our electricity system produced 26 Mt. 

Things have changed since then. In 2015, Ontario industry emitted 48 Mt, down 28 per cent. The electricity system reduced its contribution from 26 to 5 Mt*, a drop of 80 per cent, due mainly to the elimination of coal-fired power. 

It’s not all good news however. Transportation emissions increased over the same period from 41 to 55 Mt in 2015, an increase of 34 per cent. Freight traffic alone more than doubled its emissions. Emissions from buildings increased by 32 per cent as well, from 28 to 37 Mt. 

For more information about Ontario’s 2015 emissions, see The Climate Act: from Plan to Progress.
Our Future Energy System 
While Ontario’s electricity system is now low-carbon, our energy sector as whole is not. In 2016, Ontario emitted 126 Mt of carbon pollution from burning fossil fuels for energy, which is more than three-quarters of Ontario’s total greenhouse gas emissions. The 2030 cap on emissions means that fossil fuel emissions will need to be cut almost in half in the next 13 years. 

Ontarians need to look at where fossil fuel use has increased - in transportation and building heating - to find ways to reduce emissions. As Ontario’s electricity system produces almost no emissions, conservation, and electrifying transportation and building heating could produce large reductions in greenhouse gas emissions, and more improvements to air quality. 

Ontarians will be encouraged to conserve electricity, but we could need about a third more low carbon electricity to have enough to power much of our transportation and heating. The Long-Term Energy Plan needs to think through the potential for higher electricity demand, and what supply sources can meet that demand, to make sure Ontario stays within its emissions cap and meets its climate obligations. 

*Note: Some slight differences in emissions data occur due to inconsistencies in data collection from different sources. 

Making Connections: Straight Talk about Electricity in Ontario 
Table of Contents 

Ontario’s transition to a low-carbon electricity system 
1. What’s this report about? 
2. How does Ontario make decisions about its sources of electricity? 
3. How and why has Ontario’s electricity demand changed? 
4. Where does our electricity come from and how has the supply mix changed? 

Impact on the electricity system 
5. Has Ontario’s electricity system become more reliable and able to meet peak demand? 
6. How does Ontario deal with the variability of wind and solar electricity output 
7. Why does Ontario export and curtail so much electricity? 

Impact on electricity prices 
8. How high are Ontario electricity prices? 
9. What do higher electricity costs pay for? 

Impact on the environment
10. What are the environmental impacts of Ontario’s electricity sources? 
11. How much have the coal phase-out, renewable electricity, and conservation reduced greenhouse gas emissions? 
12. How much did the coal shutdown reduce pollution in Ontario? 

Ontario’s electricity future
13. What does the 2017 Long-Term Energy Plan propose for Ontario’s electricity future? 
14.What are the consequences of the Long-Term Energy Plan’s commitment to nuclear power? 
15.How much of Ontario’s energy system must be electrified to meet Ontario’s legal greenhouse gas limits? 
16.How can Ontario make full use of clean off-peak electricity and prevent it from going to waste? 
17.What impact will Ontario’s electricity market redesign have on the cost and greenhouse gas emissions of our electricity system? 
18.What impact will net metering have on the future of renewable electricity in Ontario? 
19.What is the value of conservation?