Looming electricity gap poses a risk to jobs

By Tom Parkin

December 4^th, 2024

BURLINGTON, ON

Ontario’s current private electricity contracts and public generating capacity will be insufficient to meet growing demand starting in 2029, according to a recent report from the Independent Electricity System Operator, the crown agency that manages Ontario’s grid.

The IESO report cites new industrial demand from data centres and steel mills as key drivers of higher electricity demand. The federal and provincial governments have provided billions in public investment to switch steel mill furnaces off coked coal to electricity, an effort now underway.

According to the United Steelworkers Union’s Canadian director, cleaner production should become a competitive advantage for Canadian steel jobs.

Looming electricity gap poses a risk to jobs

But while Ontario jobs are increasingly demanding and dependant on electricity, supply isn’t forecast to keep up.

A long-known impact on Ontario’s generating capacity comes from scheduled refurbishments of major generating stations.

At the Bruce Nuclear Generating Station, which supplies about 30 per cent of Ontario’s power, one generator is currently being refurbished and will remain offline until 2027. Four more generators will be refurbished over the next five years.

The entire Pickering Nuclear Generating Station, which supplies about 14 percent of Ontario’s electricity, will be offline for scheduled refurbishment from the end of 2026 until the mid-2030s.

No supply or demand initiative ready to fill the looming gap

Although rising demand and scheduled refurbishments have been long-known, one of the PCs’ first priorities after election in 2018 was to scrap new power projects, including some already under construction, costing taxpayers $213 million. No major projects have been started since the PCs’ election six years ago.

Premier Ford has been talking about cleaning up the hydro mess for years – but hasn’t managed to get much done.

The Ford PCs have publicly mused about a Bruce station expansion, but that’s not a solution for 2029. Consultations, licensing and construction would take 10 to 15 years.

Strategies to cut demand are also lagging. Evaluations of the province’s Conservation and Demand Management Framework, which provides incentives to consumers to become more energy efficient, have shown its initiatives have been effective, but the current plan expires at the end of this month without a new plan of additional incentives approved and in place.

Keeping the flow of electricity going will become much harder when there isn’t enough electricity available to meet the coming demand.

And while a gap looms, filling it with imported power has become more difficult due to big reductions in hydroelectricity available from Quebec.

Todd Smith, who served as minister since 2021, was shuffled out of the energy portfolio this summer, and replaced by Stephen Lecce. The switch suggests Ontario’s electricity gap has moved past being a policy challenge and is now being considered a crisis communications issue.

Stephen Lecce, Minister of Energy and Electrification announced a media event today at 9:00 am.  He will be joined by Sam Oosterhoff, Associate Minister of Energy-Intensive Industries, to provide remarks.