What a Liberal Majority Means for Ontario’s Nuclear Industry

June 13, 2014

By John Stewart
Director, Policy and Research
Canadian Nuclear Association

What will four years of Liberal majority government mean for Ontario’s electric power industry?

We could analyze this in several ways. Some would be more critical than my colleagues would probably want posted; so the following is as kind as I can be.

Electric power is a business of decades. The infrastructure is large and expensive. For good reasons of reliability and safety, it is designed, verified, tested and evaluated to very high standards. It stays in service for 30 to 70 years. It affects every single household and business. The system is fantastically complex to manage; it requires balance and synchronization that few of us can understand.

North America’s electric power grid has been called the world’s largest single machine. If there is a business for technocrats – engineers, accountants, and independent regulators – surely this is it.

Politics is a business of months or, at most, a few years. Power and leadership are tenuous (as two leaders found out last night). Attention is dispersed between campaigning, forming teams, fending off attacks from inside and outside one’s party, legislating, and trying to govern.

Yet few businesses in our society are run so directly from the Premier’s desk as electric power. Electric power is a technocrat’s 50-year game that absolutely must come out right. Yet we subject it to constant political meddling.

When I first studied this business as an economist 24 years ago, it was obvious to me that this was a serious problem. Sadly for Ontario, it still is. I thought rational governments would seek to put some distance between themselves and the governance of the electric power system, if not for the good of the province, then at least to give themselves some peace. We have not seen that happen.

So let’s accept that our electric power system is and will continue to be run by politicians whose time frame does not match the one required for successful results, and who will continue to do the kinds of things in the future that they have done in the past.

Paradoxically, then, last night’s election result may be the best we could have hoped for. Here’s why: It is probably the least disruptive.

Whatever else one thinks of the opposition parties, a win by the PCs or the NDP would have held high risks for further erratic policy changes in a sector that is already challenged by the unforeseen consequences of recent interference.

A minority Liberal government would have held smaller versions of those risks, which might have been imposed by one of the opposition parties in return for support in the legislature.

The Wynne government has a mandate to change things, but with little apparent focus on the electricity sector; it pertains mainly to areas like education, social services and pensions.  The government’s commitment to infrastructure investment will be constrained by finances, it seems to be focused on transportation, and anyway, it has a chance of being beneficial if done rationally.

The Wynne government also has an electric power policy, the Long-Term Energy Plan, released last fall. Whatever else one thinks of it, at least we know what it is. In fact, it’s not bad.

And last night’s result means there is little risk of an election or a transition in the Premier’s Office for four years.

Much can still go wrong, and history says there’s a good chance it will. But much can still go right. A colleague recently remarked to me that “Ontario used to be where people came to learn how to run an electric power system. Now it’s where they come to learn how not to do it.” That can still change. Our odds are a little better today than they were yesterday.

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