Net Zero plan isn’t just impossible, it’s absurd

Guilbeault’s attack on fossil-fuel-generated electricity will cost Canadians more for a lower standard of living and drag our federal finances further towards the abyss

By Adam Pankratz, Na­tional Post, August 22, 2023

Canada’s Minister of Environmental Magic, Steven Guilbeault, is at it again. His next trick, more daring than scaling even the tallest skyscraper, is to eliminate fossil fuels from Canada’s electrical grid by 2035. If rammed through, this latest government act of wand waving will cost Canadians more for a lower standard of living and drag our federal finances further towards the abyss. His plan is already encountering push back as it comes up against that which Minister Guilbeault hates most: reality.

Let us first consider the facts of the matter. Canada’s electricity grid is already very clean by international standards. Approximately 82 per cent of our electricity currently comes from renewable and non-carbon emitting sources, with the majority accounted for by our vast hydroelectric capabilities.

The distribution is not even, however. In B.C. electricity is 87 per cent hydro and almost 95 per cent renewable already, and in Ontario over 90 per cent of electricity is from non-emitting sources, the majority being nuclear. In Alberta the story is different: non-renewable sources account for 90 per cent of electrical generation there. It is hardly surprising then that B.C. and Ontario have remained silent while Alberta has blown a (natural gas fuelled) gasket over the Liberal plan.

All provinces should, however, be careful. Eighty-two per cent clean electricity is not 100 per cent and that 18 per cent is meaningful both in terms of quality of life and expense. The key question is: what does that 18 per cent actually represent? In 2019 Canada generated 632.3 terawatt-hours of electricity. If 82 per cent produced little or no carbon emissions, that still leaves 113.8 terawatt-hours from natural gas, coal and oil.

To meet demand, B.C. would need 22 Site-C-sized dams

British Columbia is currently building a massive hydroelectric dam called Site-C. This project, for which planning began in the 1990s and construction only started in 2015, will cost approximately $16-billion and generate 5,100 gigawatt-hours of electricity for British Columbia. That’s 5.1 terawatt-hours.

So, were we to use hydro to make up for the electrical shortfall eliminating fossil fuels creates, at minimum we would need to build 22 Site-C equivalents. At B.C. prices that’s $352-billion dollars. Even if we could pretend to ignore that mind-boggling sum, does anyone believe we could build 22 such infrastructure projects in 12 years given our recent track record? If you do, I have land to sell you upon which to build them.

Perhaps we could use nuclear? Well, yes we could. However, anyone in Ontario familiar with the Darlington nuclear plant fiasco can tell you what magnitude of costs we are talking about. The current refurbishment which, on time and on budget though it is, will still cost nearly $13 billion. Its generation capacity is large at 31 TWH annually.

But current costs are only a refurbishment. To build a new plant is far more expensive. In Georgia, the phase 3 and 4 of the Vogtle plant will cost over US$30 billion, while generating 17.5 TWH of power. This means Canada could be looking at five or more reactors and a bill anywhere between $52 billion on the unrealistic low end and $262 billion on the Georgia-experience end.

So there we have two of the biggest realistic options to replace fossil fuels in our electrical grid. This raises some obvious questions for our Minister of Environmental and Financial Magic. First, if we go the hydro route, which 22 rivers would he suggest we dam up to provide this electricity? Second, if we went nuclear, how will he convince the communities this is a good idea given many countries are phasing out nuclear? Third, where is the money for all this coming from?

No matter the option chosen Canada would theoretically be on the hook for $300 billion or more by 2035 in order to hit the current goals and timelines laid out.

Fuel for near-future should be natural gas

Moving to a grid that is free of carbon emissions is a laudable goal, but the timelines and plan are highly unrealistic. Right now, for example, Canada has enormous reserves of natural gas which could replace coal generation. This is a cleaner burning alternative and would be far less expensive in terms of transition than what Guilbeault is currently proposing. It is also a fuel the world is screaming for.

Natural gas allows Canada to reduce emissions at home and abroad, all while generating economic revenues for Canadians. Bizarrely our government still doesn’t see the business case for gas, while the U.S. and Qatar watch the dollars roll in from their exports.

The net-zero electrical grid proposal by the government also ignores the increase in electricity needed as we move away from fossil fuels generally towards a greener economy. The numbers we have discussed are all current electrical demands. Future demands could be significantly higher.

In B.C., estimates are that electrical production would need to double by 2055 to fully electrify all vehicles in the province. If we can expand that thinking to the country has a whole, then suddenly we are damming up 44 rivers or building more than 10 nuclear reactors while shelling out over $600 billion.

The conversation around electrification and fossil fuel elimination is frequently driven by ideology and ignorance of financial implications. Moving toward a greener world is desirable but the costs associated with this shift are stupefyingly huge and the timelines long. We need an honest discussion about what is truly needed to achieve the lofty rhetoric governments so love. Let us remind Minister Guilbeault that energy policy is not created with a magic wand despite what he would like to believe.

Adam Pankratz is a lec­turer at the Univer­sity of Bri­tish Columbia’s Sauder School of Busi­ness.

Leave a Reply

Your email address will not be published. Required fields are marked *