The Uses and Abuses of Ontario's Nuclear Fleet in the Australian Energy Debate
Debunking Mark Winfield's selective story telling
Ontario’s electricity system is often cited as an example of an affordable, low emissions, generation mix, particularly by Peter Dutton, leader of the official opposition in Australia. Opponents of nuclear energy within Ontario, like Professor Mark Winfield, rely on arguments based on exaggerated cost and delay while ignoring the obvious benefits of nuclear as a cleaner and reliable energy source which has powered a booming economy all while phasing out a substantial coal fleet.
In Winfield’s recent colourful but selective account of Ontario’s nuclear history, he carries on that fine tradition.
Yet, despite challenges, Ontario successfully commissioned 20 large CANDU reactors over just 22 years—an achievement that helped phase out coal and resulted in one of the cleanest electricity grids in the world. In so doing it has achieved retail prices 2/3rd the cost and 1/6th the emissions intensity of Australia. The province’s pace of adding zero-carbon electricity, in the decade from 1984 to 1994, ranks among top efforts globally and dwarfs Australia’s impressive wind and solar additions.
While most CANDU units were built cost-effectively and on schedule, the Darlington nuclear station faced multiple construction pauses during the historically high-interest rate period of the 1980s.
This did contribute significantly to Ontario Hydro’s debt. However through most of its history Ontario Hydro was not allowed to show profits. It had to have debt to grow as assets could not enter the rate base until they achieved commercial operation, and profits could not fund new assets.
The stranded debt charge was devised to allow Ontario Hydro, a crown corporation, to be broken up for privatization in the late 1990s. As energy analyst Harris Berton explains, when that occured the parts couldnt carry the debt of the whole, so the government absorbed the debt and it was paid back with a ratepayer surcharge which wrapped up in 2018. If in an alternative universe Ontario Hydro had never built nuclear but continued on instead with its coal expansion such a deregulation would have resulted in a still substantial albeit smaller debt since coal is cheaper than nuclear.
Regional context is also useful. The neighboring province of Quebec carries a long-term debt of $55.2 billion comfortably, due to the extraordinary value of its hydroelectric infrastructure—built at a similar time as Ontario’s nuclear installations. However, had Hydro Quebec partially deregulated as Ontario did, they too would have ended up with a large stranded debt.
Although early refurbishments of Ontario’s reactors were costly, expertise was rebuilt and more recent CANDU refurbishments have been uniformly on budget and significantly ahead of schedule, even during the disruptions of the COVID-19 pandemic. This track record of excellence in multi-billion-dollar nuclear project management is now providing policymakers the confidence to expand Ontario’s nuclear fleet.
Nuclear critic Mark Winfield refers to a planned $100-billion "binge" over the next 25 years to refurbish the CANDU fleet and add another 6GW of capacity. However, this figure represents a manageable annual expenditure of $4 billion, which will secure 18GW of ultra-reliable, 24/7 zero-carbon electricity for the province.
To put high-end estimates of nuclear costs in perspective, consider that Ontario currently spends $3.5 billion annually on above-market feed-in tariffs (FiTs) introduced under the Green Energy Act. These FiTs paid private developers up to 15-84 cents per kWh for wind and solar, when the wholesale price of electricity was just 4 cents/kWh and the grid was already experiencing frequent periods of surplus baseload generation.
Ontario electricity prices rose by 70% between 2008 and 2016 and became so burdensome and unpopular that 85% of the cost of the FiTs was shifted to the tax base in the form of a 3.1 billion per year subsidy named the Renewable Cost Shift.
Much is made of Ontario’s electricity subsidies which in total amount to just over 6 billion per year, however the majority of those subsidies are to cover the high cost of Ontario’s renewable energy experiment. For sake of comparison Australia introduced a 3.5 billion Energy Bill Relief subsidy for 2024-2025 to cover rising costs due in part to the addition of “the cheapest form of energy.”
When all is said and done Ontario’s Green Energy Act is set to cost $62 billion over 20 years to generate 200TWh of electricity—meager when compared to the 3,200TWh delivered by the existing CANDU fleet for an inflation-adjusted investment of $58 billion. Moreover, these reactors are only at mid-life and are expected to provide a further 3,000TWh over the next 30-40 years.
Spending on nuclear power also supports Ontario’s workforce and local economy. The industry provides 89,000 high-paying jobs in technology and skilled trades, with an 85 per cent unionization rate. CANDU reactors create a powerful economic multiplier effect, generating $1.40 in economic activity for every dollar spent, due to a 95 per cent Canadian-based supply chain—stimulating the local economy rather than funneling money to foreign suppliers that dominate the wind and solar sectors.
Nuclear played a crucial role in phasing out coal. The province was almost entirely powered by hydroelectricity until the late 1950’s when its energy needs outgrew this resource. The 1960’s saw a rapid addition of coal capacity to fuel a booming post war economy and thriving auto sector. The problem was that Ontario had no significant coal deposits. It was therefore dependent on imports from Western Canada and the USA via barges using the Great Lakes. There were significant headaches with labour unrest in US coal mines, freezing of the waterways and volatile prices that made this an unattractive situation.
Nuclear made its roaring entry in the 1970’s halting the expansion of coal. Between 2003 and 2014 the final death blow was dealt to coal burning in Ontario. 74 per cent of the required replacement generation came from the restart of 6 idled nuclear reactors. Recent rises in natural gas emissions are largely due to several reactors temporarily coming offline for refurbishment as well as exports to drought stricken Quebec. This temporary dynamic of nuclear down, gas up, and vice versa illustrates how effective nuclear is at minimizing gas use.
By contrast, wind and solar have proven to be of limited value in Ontario’s grid. Wind produces out of sync with demand, disappearing during summer heatwaves, and overproducing in low-demand shoulder seasons. This excess production, 2300GWh in 2020, which Ontario must purchase at above-market rates, often gets sold at low or negative prices to the U.S., costing the province an estimated $1 billion annually by displacing cheaper sources like zero-emissions hydroelectricity.
Solar, while more aligned with summer demand patterns, contributes little to decarbonizing winter heating loads.
Mark Winfield offers advice to Australians on energy policy based on a selective interpretation of the facts. Ultimately Australia must make its own decisions regarding its energy transition based on a fulsome picture provided above. Its policymakers would be wise to consider the successful example of their commonwealth cousin. Ontario not only eliminated coal but did so while dramatically growing its economy and achieving one of the lowest emissions grids on planet earth.
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Special thanks to Scott Luft for his input on Ontario Hydro debt.
The GEA / CANDU price comparison chart is crazy. They only deliver 200TW hours/20 years? The grift is clear
Readers may wish to review chapters 2-7 of Blue-Green Province: The Environment and the Political Economic of Ontario (UBC Press 2012 - open access) to gain a clearer and more reality-based grasp history of electricity and energy policy in Ontario. The relevant chapters in the 2016 and 2024 editions of the Politics of Ontario would be useful as well. If the author of this article has any refereed publications of their own to share on these matters I am sure readers would be interested to know what they are.