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System will boost pollution, group says - Globe and Mail

May 01 2002
Martin Mittelstaedt, Environment Reporter, Toronto
Globe and Mail

Air pollution will get far worse in Ontario because the opening of the electricity market will encourage power production from dirty, coal-burning generating stations, the Toronto Environmental Alliance predicts.

The province's $10-billion electricity market opens for competition for the first time today, and the group says the development favours cheap but high-polluting power from coal stations rather than clean energy from wind turbines, solar cells and small-scale hydro electric stations.

"The way the Tories are doing this is going to result in more air pollution in this province and it's actually going to inhibit bringing in better environmental policies in the future," said Keith Stewart, a spokesman for the group.

Many environmentalists are concerned about the deregulated electricity market as price will now be the sole factor determining the type of generating capacity used to slake Ontario's thirst for electricity.

Coal stations typically produce lower-cost electricity than cleaner-running natural-gas-powered stations, or green power from wind turbines, because market prices don't reflect health and environmental damage from air pollution.

Currently, Ontario's five coal-fired power plants and one dual natural-gas-oil-fuelled plant, all owned by the government through Ontario Power Generation, operate at about 50 per cent of capacity, yet produce about 14 per cent of Ontario's smog-causing nitrogen oxides, and about 23 per cent of its acid rain causing sulphur dioxide, the alliance said.

The group is worried that the province's coal stations, several of which are on the auction block, will soon be run at higher operating rates due to competitive market pressures.

It believes the private investors who buy the stations will try to earn a better return by cranking up their output. The stations could sell their extra juice to the United States, where prices have generally been higher than in Ontario.

John Earl, spokesman for Ontario Power Generation, said the company will generally offer for sale power from its low-cost hydro-electric and nuclear-power stations before the output of its coal-fired stations. The company's natural-gas capacity is the most expensive and will be offered for sale last.

He said it is "impossible to say" what the operating rates of the coal stations will be in an open market because new suppliers could undercut the economics of operating these plants.

The alliance issued a report yesterday in which it called on the government to encourage power production from clean sources. Among its recommendations is a proposal that Ontario require a certain percentage of its electricity to come from renewable sources, such as wind, solar, and small-scale hydro-electric plants. Twelve U.S. states have these so-called renewable portfolio standards.

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