When it comes to the costs of addressing our climate change commitments, give it to the people straight
I have concluded that politicians these days would rather gin up the benefits of a policy decision and ignore the costs, rather than tell it to people straight.
When it comes to addressing our climate change commitments, people need to know it will come with a cost. Either the taxpayer or the ratepayer in places like New Brunswick and Nova Scotia will have to pay billions of dollars over the next 30+ years. Any expert I have talked to or read, say that electricity costs will be higher - at least for some period of time until certain technologies (e.g. grid scale batteries) mature. The cost of converting oil-heated homes will be significant. The cost to migrate the transportation system off fossil fuel energy will be huge. The cost for many of our important industries to move from natural gas to hydrogen or other energy sources, well, you get the picture.
So when NS Premier Rankin talked about the move away from coal fired electricity last week, it was all sweetness and apple pie. An RFP for 10% of Nova Scotia electricity from renewables such as wind and solar will create 4,000 jobs mostly in rural Nova Scotia and generate more than $550 million in construction activity “in wind-rich areas, such as Guysborough, Pictou, Antigonish, Hants, Cumberland, and Colchester counties.”
The press release goes on: “This is about doing what's right for ratepayers and keeping electricity affordable,” said Premier Rankin. “It also ensures we mitigate risks for ratepayers and establish an energy sector that attracts business.” Wind is now the cheapest source of electrical energy in Canada.
First of all, I agree with getting off coal-fired electricity. We have to do this. I just think the residents of Nova Scotia need to know what it will really cost and what the benefits will be.
The 4,000 jobs in rural Nova Scotia will be short term construction jobs. The annual jobs associated with operating and maintaining wind and solar farms are marginal and not likely to replace the 300+ inevitable jobs lost in Cape Breton alone with the two coal-fired plants and their supply chains. Not being clear about this with residents is a mistake. Now, if I am wrong and this will create 4,000 good paying annual jobs ongoing for decades, then I would like to see how they can pull that off.
Second, while wind is becoming a lower cost source of electricity with improved technology, in my understanding that does not include the cost of ensuring you have a robust electricity system. When the wind isn’t blowing or the sun isn’t shining or - more importantly - in February when it is 30 below. With the old technologies you just shovel more coal into the furnace or open the natural gas valve. With wind and solar either you a) have huge excess capacity on standby or b) you buy the power from NB or Quebec at very high rates to meet demand.
So, what the Premier should have said here is “we expect these changes to impact electricity rates by xx but we must do this for the good of the planet”. If indeed the all-in lifetime costs of wind and solar are going to push down electricity rates, they should be open and transparent about the math.
When NB Power was asked about early closure of the Belledune coal-fired plant, there were articles in the newspaper suggesting rates could rise by 30% or more. This kind of analysis should be done in Nova Scotia.
Nova Scotians pay nearly 40% more of their household income for “water, fuel and electricity” compared to the average Canadian household. It is important to be transparent with people about how these policies will impact their costs. A thousand dollar increase in annual household energy costs will hurt much more in Nova Scotia than in Ontario.
Where is the regulator on this? They comb through Emera’s executive expense accounts to find a few thousands dollars of ineligible expenses but they don’t weigh in on the cost to ratepayers from a large scale shift to renewables?
The other big Nova Scotia issue is oil heated homes. The Premier wants rural residents to focus on the 4,000 construction jobs for a couple of years and the wind and solar farms that will dot the horizon, but he needs to explain how the 192,500 homes that use heating oil will be addressed. According to Statistics Canada home heating oil accounts for 51% of all household energy consumption in Nova Scotia. Someone is going to have to pay for a massive conversion - either the resident, the general taxpayer or the ratepayer. If this heating oil conversion is to electricity - the ratepayers will need to know how all this increased capacity will be paid for. Remember, heating oil you just turn the valve in February when you need more (metaphorically). If you are relying on the electricity grid, and renewables, it gets far more complicated. Maybe the best solution for replacing heating oil will be localized - roof-top solar, micro-wind - but someone will need to pay.
In conclusion, I think politicians would be better advised to play it straight with this one. Tell people what needs to be done to completely de-carbonize the economy by 2050 (or better define what you mean by ‘net’) and explain how we are going to collectively pay for it.
The carbon tax, clean fuel standard and other costs are comin’. I’m not sure the average resident in Atlantic Canada realizes how it will impact them.