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  • How Much Is Each Energy Source Costing Ontario?

Nothing in Ontario public discourse is as inflammatory, as divisive, and as unclear as our energy bills. There’s no doubt they’re high, too high in fact, in a province saddled with story after story of mishandled, misaddressed, and simply a miss of an energy policy. This week, we want to break down the cost of our energy and see what’s working, what isn’t, and why Ontario resident are paying through the nose for their energy needs.

Just a forward: The costs measure we’ve examined is in proportion to electricity paid for. While your hydro bill will also contain delivery charges, HST, and that every hated “Debt Retirement Charge”, they will be covered in a future article.

Nuclear Energy: Provides 57%, Costs 47%

 

Image Courtesy of FreeDigitalPhotos.net

Image Courtesy of FreeDigitalPhotos.net

Nuclear energy is Ontario’s single largest energy source, a hallmark of Ontario’s once-past dreams of being a leader in nuclear energy. These days, those dreams are dashed, but Ontario’s reliance on nuclear energy definitely has given the province an edge over the long term sustainability of their energy needs. Nuclear energy is among the lowest cost energy generation models in Ontario, and internationally has been explored as one of the cheapest energy bases available.

However, has it worked for Ontario? From a logistic standpoint, nuclear seems to be the key. But Ontario nuclear power has a very nasty and embarrassing habit of running precariously over-budget. In 2010, the Bruce Generation Plant ran over $2 billion over budget, luckily being covered by Bruce Power and not homeowners.

While nuclear will always remain a cheap source of energy, in Ontario it’s become a political and economic football that’s eating away at provincial finances. Without a clear direction, better management, and strict budgets, retrofitting old nuclear power plants could be a costly and painful endeavor.

Fossil Fuels: Provides 17%, Costs 16% (With a hidden cost)

Image Courtesy of FreeDigitalPhotos.net

Image Courtesy of FreeDigitalPhotos.net

Critics of renewables and nuclear, many as they are, point to Germany and the United States who have expanded their coal and fossil fuel dependency to provide a cheaper energy source. And it’s true, coal and oil are very affordable energy generation methods, comparable to the operating costs of nuclear with a much lower initial up-front cost.

However, while coal, gas, and oil operate roughly in line with the prices we pay at home, we’re also paying a hidden cost that isn’t readily apparent. In 2005, coal power accounted for $4.4 billion per year in health care and environmental costs. Back then, 25% of Ontario’s power was generated and, as of April of this year, that number is 0%. When we look at the cost of our energy needs, the bill isn’t the only place we look, we also have to look at the cost it bears on our health and well-being.

As we transition away from fossil fuels, time can only tell to see what hidden costs will have been saved through termination. For now, fossil fuels remain an efficient, if problematic energy source.

 

Hydro Energy: Provides 22%, Costs 16%

Hydro, alongside nuclear, has defined Ontario’s energy policy as one of sustainability, and it’s no wonder that hydro saturation is expected to peak at 30%. With a combination of high efficiency and long-term sustainability, hydro definitely retains a positive position to take a good portion of Ontario’s energy burden.

And perhaps this is part of the reason that critics of nuclear have pointed to hydro as a means of securing lower energy costs. More specifically, hydro from Quebec. While toted as a low-cost solution for a province burdened by high costs and huge energy exports, it would necessarily come at the cost of future development in Ontario’s energy infrastructure.

Wind/Solar Power: Provides 6%, Costs 12%

And this is the big elephant in the room regarding high hydro bills: is solar and wind energy the cause of our bills hiking?

Yes and No.

Yes in that wind and solar development currently incur a hefty upfront cost (much more so for solar than wind, mind you), and yes in that Ontario homeowners are bearing cost for a low-output energy source. And the numbers don’t lie: development for wind and solar farms is expensive.

However the answer is also No, for a number of reasons. For one, the scope of these projects are still too small in relation to their role, and comparatively their costs still remain low. This is in contrast to nuclear, which has the capacity to be much cheaper, yet isn’t in the face of mismanagement and retrofitting projects.

Solar and Wind are currently the most inefficient model of energy generation Ontario has at the moment. However in ten or fifteen years that could change. For an energy source that’s supposed to be cheap such as nuclear, can the mismanagement, the greed, and overspending change in that time?

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