The House resumed at 8:04 p.m.

SELECT COMMITTEE ON ONTARIO HYDRO AFFAIRS (CONTINUED)

Mr. Speaker: When we rose at 6 o’clock, I think the honourable member for York South was about to take the floor.

Hon. Mr. Welch: Mr. Speaker, a point of order: It is my understanding that some general agreement has been arrived at with respect to the consideration of this report during the evening. That is, we would divide the time between now and 10:30 p.m. equally among the three parties, which means about 50 minutes for each of our respective groups to be involved in this debate prior to its resolution. If that is the agreement, I thought perhaps we should mention that now for purposes of having the table keep track of the time.

Mr. Speaker: That is my understanding of the arrangement all right. Do you want to deal with the two items separately or do you want to deal with them together?

Mr. MacDonald: They are totally different.

Mr. Speaker: I suggest the 150 minutes the Deputy Premier referred to not only be shared equitably among the three parties, but you would allocate a sufficient amount of time to cover both topics.

Hon. Mr. Welch: Mr. Speaker, it was my understanding that we were just going to do the one report under the order you called. The 150 minutes we would be devoting to the attention of that report would be divided equally among the three groups. In other words, it is my thought that notwithstanding earlier indications to the contrary, we were going to spend this particular October evening simply on that one report.

Mr. Nixon: I do not want to waste time but where did that understanding come from? Was it between you two?

Hon. Mr. Welch: Wait a minute. It came from my House leader, as a result of a meeting he had with you and the other House leader. The understanding was we were going to do that. I am surely not making it up.

Mr. J. Reed: Typical Tory interpretation.

Hon. Mr. Welch: I would be delighted if we get both reports completed tonight. Was that the plan? I have no objection to that.

Resuming the adjourned debate on the motion for adoption of the special report of the select committee on Ontario Hydro affairs, dated December 1979, re: the need for electrical capacity.

Mr. MacDonald: The first item we have to deal with tonight -- and I suspect, Mr. Speaker, if I may gratuitously add, it will take the full 150 minutes; I may be wrong and, if so, we can go on to the second item -- is a special report on the need for electrical capacity.

This report was completed and tabled in this House 10 months ago, in December 1979. Its substance can be very succinctly put. I just want to remind the House at the outset so we will know exactly what we are focusing on that the majority conclusion of this special report was that the growth in demand for electricity, from now through to the end of the century, will be in the range of two to three per cent annually.

That was the conclusion that the committee came to after examining all of the normal inputs that have an impact on electrical energy growth. To have the picture complete, the House should acknowledge or recognize that the Conservative members of the committee dissented, but their dissent was, if I may put it this way, something of a marginal dissent. In their view, the range of growth would be between two and four per cent rather than between two and three per cent.

However, the conclusion that was derived from this, and this is the point that the House will want to focus on, I suspect, is that with the growth in the range of two to three per cent, in the view of the majority of the committee, the Darlington station will not be required until between the years of 1996 and 2004. Therefore, the major recommendation of the committee flowing, I would think, almost with common sense was this, and I quote:

“The government of Ontario inform Ontario Hydro that no additional contracts for construction of the Darlington generating station be awarded until the government has reported to the Legislative Assembly its policy for the construction of additional generating capacity in Ontario.”

I have in my hand the quarterly update of Ontario Hydro for the second quarter of 1980. In it there is a very startling statistic. It notes that at the end of six months in the year 1979, Ontario Hydro had total energy delivery sales of 54,000 million kilowatt hours. In 1980, the comparable figures for the first six months was 53,809 million. In other words, the total amount of electrical energy sold by Ontario Hydro in the first six months of this year was less than it was in the first six months of last year. In short, Ontario Hydro has achieved something which some people said was possible and many people pooh-poohed, that is, zero growth in electrical energy sales in the first six months of this year.

8:10 p.m.

I want to remind the House how that compares with the traditional pattern. Most members are aware that the traditional pattern of annual load growth in Ontario Hydro up until about the mid-1970s was in the range of seven per cent. That figure may not mean very much to the average person until he does a little bit of mental arithmetic. If one compounds the seven per cent growth, one will find every 10 years that one has to double the generating capacity of the system: a really staggering, mind-boggling kind of proposition.

Mr. Nixon: But not new.

Mr. MacDonald: What does the member mean by not new?

Mr. Nixon: Well, it may be mind-boggling. The first time we heard about it was 10 years ago.

Mr. MacDonald: We will hear from the member later.

Mr. Nixon: All right.

Mr. MacDonald: Members may also recall the first significant drop in Ontario’s load was imposed by this government. Darcy McKeough in his inimitable fashion intervened in 1976 and said to Hydro, “Whatever you may think your needs are in terms of new capital, you are not going to have more than a billion and a half a year.” In fixing that ceiling, he made it necessary for Hydro to go back and recalculate how much new growth they could put in and therefore how much load growth they could permit, and to have conservation programs and other methods for reducing that load growth. By so doing, in that arbitrary artificial way, he forced the load growth down into the five to six per cent range.

In 1979 the projected load growth had dropped to 4.8 per cent. By 1980 it had dropped to 3.4 per cent, on the basis of which Hydro moved in its 1980 revision of its expansion program to impose the second delay in the construction of Darlington. It is to be completed now in the years 1989 to 1991 for the four units throughout that period. Let me remind the House that on the basis of the 1980 load forecast, Darlington’s power will not be needed in the system, as acknowledged by Ontario Hydro in its system expansion program revision, until the years 1991 to 1995. In short, it will be completed before it is needed.

Zero electrical energy growth must come as a rather startling revelation to the general public of this problem. I say that because government spokesmen, with the Premier (Mr. Davis) leading the pack, have been contending that electricity is a substitute for high-priced oil. Hydro has been arguing that excess generating capacity is a boon and not an embarrassment because it represents an indigenous energy source that can be used to replace imports. If we have access capacity, we can sell it to the United States at a profit and it will help to reduce the rates that will be charged to the domestic consumers here in the province. But in reality this is not happening. I wonder when we are going to live with the reality.

When we escape from the fantasy world of the Premier’s political rhetoric and Hydro’s promotional advertising, we find, I repeat, that for the first six months of this year we actually dropped in electrical energy sales by 0.4 -- in effect, zero electrical energy growth. For those who think the answer is in export sales, I draw your attention to the quarterly report too. In. 1979 we showed in what is described here as secondary sales and transfers, 6,642 million kilowatt hours. This year in the first six months we sold only 5,911 million kilowatt hours -- in other words, a drop of 700 million kilowatt hours of export sales. It’s all down. The real world is that in all of these levels they haven’t been achieved.

The significant point that honourable members should note is that Hydro’s annual growth rate this year. is likely to fall into the two to three per cent range, which the majority of the select committee stated it would be in this report tabled last December. The evidence piles up more and more conclusively that Hydro’s forecast for future growth rates is still excessively high. When the chief forecaster, for example, was before the committee 18 months ago, he indicated that Hydro’s new econometric model was not significantly out of step with the Ministry of Energy model, a forecast of growth rate in the range of 2.5 to 2.8 per cent. In spite of that, Hydro picked a forecast for 1979 not in that range, but at 4.6 per cent. As I have already reminded the House, a year later, in 1980, they had to drop that dramatically from 4.6 to 3.4 per cent annual growth through to the end of this century.

In the light of the current evidence that has just come out in this quarterly report and is being compiled weekly and monthly in Hydro, obviously Hydro’s figures are still excessively high. With zero energy growth in the first six months of this year, they are going to be forced to bring their forecasts down below three per cent, precisely in the range that the select committee has estimated on the basis of all the evidence that was available to us more than one year ago, in the fall of 1979. In short, evidence is now confirming that the assessment and the conclusions of the select committee were valid.

So much for the forecast. What are their implications, because this is the important thing for us from the policy level? What are their implications in terms of Hydro’s system expansion program? When Hydro’s own forecast dropped dramatically from 4.6 per cent to 3.4 per cent between 1979 and 1980, they were forced to extend the construction program for Darlington for a second time. Honourable members may recall that Darlington, when authorized to start the construction in the fall of 1977, was originally needed to avoid brownouts and blackouts in the mid-1980s -- 1984 and 1985. That proved to be erroneous and so they postponed the startup until 1987. Now they have postponed it a second time and the first unit will come on stream in 1989.

But in Hydro’s usual fashion, they are playing an ultra safe game despite all of the mothballed generating capacity now in the system. They have rescheduled the four units of Darlington to come on stream between 1989 and 1991. In fact, they conceded on the basis of the 1980 forecasts that Darlington will not be needed, a point I made a moment ago and I reiterate it, Darlington’s power will not be needed until the years 1991 to 1995. In short, Darlington is going to be completed before it is needed.

The result will be that it will extend this period of excess generating capacity, which has been a burden on Hydro, that has to be carried in the rate structure. That excess capacity sits there idle, mothballed, stopped and stored, or sitting there available if needed like Lennox, but running at virtually zero capacity. But if Hydro’s growth rate is still too high, if it is going to drop to the range of two to three per cent which the committee has forecasted, then Darlington won’t be needed until the years 1996 to 2004. That means the units of Darlington are going to be brought on stream anywhere from seven to 13 years earlier than they need to be brought on stream. They will force still more generating capacity into mothballs, if that is used rather than some other units of generating capacity within the system.

8:20 p.m.

Surely this is folly. It is bad management. It means we are going to carry not only through the decade of the 1980s, but well into the 1990s, some 4,000 megawatts or more of excess generating capacity which has been paid for and for which the debt burden has to be carried in the current rate structure. The recommendation of the select committee calls for the government to instruct Hydro that no more contracts should be let for Darlington until the government has reported to the Legislature its policy for the construction of additional generating capacity.

I suggest to the House that that recommendation is highly responsible. It represents plain common sense. The prospect that Hydro should continue to ignore the extent of the drop in its annual growth rate and continue to build at its current rate of construction, thereby adding to its generating capacity, is folly. For that reason, I invite members to support the recommendation of this committee.

Before I sit down, I want to deal with a rather intriguing rumour that has got around the halls this past afternoon. We all know that the Minister of Energy is a very cute fellow. The rumour has it that what the Minister of Energy is going to do tonight is to get up and make a statement that will be a statement of the government’s policy with regard to the future construction of Hydro and that will be deemed to be what is requested in the recommendation. It will have been given. Therefore, all the government members will support the report and we will have no division. That magnificent consensus will have been achieved.

Hon. Mr. Welch: You should deal with fact and not rumour.

Mr. MacDonald: Never mind. If that is what is going to happen, if the minister is going to make a statement tonight which he will present as the government policy with regard to the construction of additional generating capacity, I want to say two things. First, why wasn’t that statement made a long time ago? This report has been sitting on the Order Paper for 10 months since last December. I suggest it is evidence of contempt and disdain for the good work of the committee, for the legitimate interests of the members of the Legislature and the public. If he had a policy statement he was going to make, he should have made it a long time ago and not held it until now.

My second point and my final point, and then I will sit down and leave it for others, is if the minister plans to make that statement, I invite him -- indeed I almost demand of him -- that he get in the first circle of speakers in the debate here tonight so that we will know what the substance of government policy is and we won’t be debating in a vacuum. It will be something more of a contempt and disdain for both the Legislature and the committee if the minister sits in his seat and makes that statement as the final speech tonight when we won’t have any opportunity to respond to it. I look forward to the minister rising as the next speaker and telling us what government policy is going to be, if it has a policy.

Mr. Speaker: The member for Durham West.

Mr. Kerrio: He is going to make the minister’s statement.

Mr. Ashe: No. He is not going to make the minister’s statement. The minister is more than capable of making his own statement at his time and at his choosing, which is his prerogative. It is amazing how these hallowed halls are filled with such rumours as suggested by the member for York South.

If all of these manoeuvres and rumours have any founding, then the two opposition parties had better get their two respective House leaders together because they were the ones who have prompted them and circulated them. It just takes some members to come up with their own conclusion.

Going back to the point at issue, which was the report that this Legislature is looking at tonight, the special report on the need for electrical capacity, the member for York South, the chairman of the committee, indicated to this House that there was a majority conclusion and that the minority or dissenting opinion of the government members, which I intend to put on the record very shortly, was just a marginal difference and that there was really no great difference between it at all.

It is too bad that the chairman of the committee wasn’t a little more aware of what was going on in this particular regard. He knows as well as I do that there were more differences than just the difference between two and three per cent and between two and four per cent. But those who were involved very closely in the committee -- I know all the honourable members present were not -- know that even one per cent, when compounded over 20 years, is not an insignificant number.

The honourable member went to great lengths of pointing to -- what was it? -- zero zero something percentage as being a great breakthrough in the numbers game. One per cent over 20 years is a significant difference.

But that really was not the only difference of opinion held by the responsible members on that committee -- namely the government members in this instance -- regarding the whole procedure. The actual tenor of that motion is just unbelievable. It is actually suggesting that a consensus of this Legislature at a previous time should be thrown aside by this government. I will get to the points in due course.

Mr. Foulds: Are you really as obtuse as you sound?

Mr. Ashe: I had a good teacher in the committee, who just spoke -- out of order as usual.

Mr. Speaker, the member for York South very briefly summarized some of the issues that were examined by the committee and tried to use a few examples to suggest how right the committee was on a report that is 10 months out of date. Of course, like everybody else, I have read the report again many times over the last few days. By the way, it was so difficult to come up with a report that had any substance that almost all of the background material had to be added in to make it look like anything. The total report itself was insignificantly short -- namely about six pages -- the dissent was another few pages, and that was really it.

We indicated that the report of the committee was inopportune in terms of the timing. I will be frank. I will even say the dissent has become outdated in the last 10 months. I do not say that in a negative way but in a very positive way.

It is amazing how the gloom and doom members opposite look at the down side of everything and anything. That is the whole basis on which they figure some day they will form the government in this province and the actual reason they will never form the government in this province.

Mr. Nixon: There is nothing gloomy about low load growth.

Mr. Ashe: You have to put a lot of numbers together; that is just one example.

Reviewing the dissent of the government members on the committee, I really saw no better way to summarize some of the concerns we had in the report than try reading it verbatim into the record and then commenting very briefly on a few items thereafter. That I intend to do.

“The members of the select committee from the Progressive Conservative Party” -- and they are named -- “wish to submit the following dissenting opinions on the need for electrical capacity. The Progressive Conservative members did not and do not agree that the report, as written, should be tabled in the Legislature. Instead we believe the report should be tabled at the committee in the winter session of hearings commencing in January 1980.

“The reasons for this position are as follows:

“1. Incomplete information.

“In January and February 1979, the committee members heard extensive testimony from a range of witnesses on the demand for electricity. The view of the Conservative members is that before the select committee can come to conclusions on the need for electrical capacity, as suggested by the title of this report, it must also hear evidence pertaining to energy supply.

“As pointed out in the majority report, decisions affecting the capacity of Ontario Hydro’s system must involve many other factors besides the load forecast. It should also be noted that three members at present sitting on the committee were not part of the original in-depth discussions on the demand for electricity and, therefore, did not hear the evidence. In the last-minute rush by a majority of the committee to table the special report on the need for electrical capacity, it is highly unlikely that the three members indicated had time to review, in any detail, the previously submitted evidence.

8:30 p.m.

“Given that a number of important issues have not been properly addressed, such as, to name a few, the uncertainty of oil supply and relative pricing (nationally and internationally), the significant potential for interfuel substitution, and very important system planning factors such as transmission limitations, the Conservative members question the majority conclusion that the growth in demand for electricity should fall in the range of two to three per cent.”

Keep in mind, Mr. Speaker, we are not talking about six months or three months, which is how the members opposite would plan. That is why, down the line, we would again end up with the lights going off and the industry grinding down in this province. We are talking about 20 years and plus.

Mr. Foulds: Why are you staging such a gloom and doom theme?

Mr. Ashe: No, the members opposite are.

“2. Uncertainty in forecasts. There is a great deal of uncertainty about any load forecast, particularly in these energy uncertain times. We believe that because of the uncertainty involved it would be more prudent to consider a range of two to four per cent.

“Ontario Hydro is now in the process of reassessing its construction schedule in light of the load forecast and other considerations, leading to a decision early in 1980 when the new forecast will be available. This decision, and the planning for an electrical system in light of that forecast, is the responsibility of the Ontario Hydro board.” With the passage of time, that exact thing did happen.

“The final report of the Royal Commission on Electrical Power Planning is also expected in the new year” -- again, an event that came to pass.

“Therefore, it is premature to place this matter before the Legislature at this time. The committee should examine the issue of need for electrical capacity when updated information and analysis is available and when the committee has examined the supply side of the equation.

“3. Maintaining continuity of Hydro contracts. The importance of maintaining the flow of contracts should not be ignored. The implication of a disruption in contracts would amount to a deferral in construction schedule. Such a decision should be made only by the board of Ontario Hydro with full information and its implications.”

Mr. MacDonald: Which they did.

Mr. Ashe: I already acknowledged that.

“Summary. As indicated in the majority report, members are: ‘aware and concerned, however, about the very serious implications on the provincial economy and on Ontario Hydro of a load growth of only two to three per cent per year. Hydro’s construction program is a very significant factor in total provincial employment. The most apparent implication is that the construction at Darlington should be deferred or stretched out even further. But the situation may not be that simple. It is possible that Darlington should be built just to replace one of the older plants on the system that burns one of the fossil fuels. It may be that the construction schedule should be maintained to hold jobs in the current depressed economic circumstances or to keep the nuclear industry from complete collapse or just to provide insurance against other energy problems. The committee has not analysed any of these options in detail nor, in the time it has available, should it’.”

The last two paragraphs, Mr. Speaker, were quoted out of the majority report. Obviously the conclusion that the majority of the committee reached was inaccurate.

“The Conservative members believe the responsibility of the committee is to present findings and recommendations only after it has had an opportunity to assess all these factors. To propose a two to three per cent average annual load growth range without taking these factors fully into account is, in our view, irresponsible.

“It is the opinion of the Conservative members that it is particularly inappropriate for the committee to make a specific recommendation to halt the letting of contracts on Darlington. This is only one of the several generating stations under construction.

“The Legislature has assigned the responsibility for entering into contracts to the Hydro board of directors and Hydro management. It is the board, then, which should decide, with all information before it, on the nature and timing of new contracts relating to Darlington or, for that matter, any other generating station previously given approval by the Lieutenant Governor in Council.”

As we know, under section 24 of the Power Corporation Act, that is not the Lieutenant Governor in Council’s right but the fact is the Hydro board makes the decisions vis-à-vis contracts, makes the decisions and any alterations to a construction schedule, and of course they will fulfil that mandate in 1980 as they have done, based on up-to-date information as needed from time to time.

It is always very easy to be critical of something that may be different yesterday or tomorrow, three months from now or three months ago. Short-term planning is, I suppose one could say, relatively easy. Medium-term to long-term planning is much more difficult. I don’t care what the issue is, but we know from experience and we have seen it whether we like it or not, that on major construction such as that undertaken by Ontario Hydro for new generating facilities, it takes anywhere from 12 to 14 years from the time the decision is made until a particular facility is generating power. One can’t look at a few months at a time.

Mr. Kerrio: That is because of your Texas technology.

Mr. Ashe: That is the honourable member’s opinion.

Mr. Kerrio: Exactly.

Mr. Ashe: That’s good, we will hear from the honourable member in due course, hopefully for not too long a period of time.

One of the other things that the member for York South did not refer to but which in fact was addressed by the committee in its discussions, is this so-called overabundance and excess capacity one talks about. The thing that people do not -- and I repeat “do not” -- talk about and recognize is the fact what while we have excess capacity and hopefully we will always have excess capacity, it is awfully cheap insurance. At the same time, what Ontario Hydro is able to do is to cut down and/or eliminate the generation from other forms. One can use the term “standby” or “mothballed” or whatever, knowing it is there and can be cranked up in one of these four-to-five-year short-term interval situations.

In the meantime we have virtually eliminated the misuse, I think everybody would agree, of gas and oil-fired generation in this province, which is a real curse that many provinces in Canada and many jurisdictions south of us are stuck with today because they don’t have the flexibility and because they made inappropriate generating decisions a number of years ago that don’t compare to those made by Ontario Hydro.

Mr. MacDonald: Does the member remember Wesleyville? They spent $300 million on it, then mothballed it.

Mr. Ashe: Again, it just goes to prove how times do change.

Mr. Foulds: In the short term as well.

Mr. MacDonald: It shows how poor the planning was then.

Mr. Ashe: Isn’t it amazing how people are experts in hindsight? I realize the members opposite are all experts in hindsight, but again, decisions relative to these plants are made many years prior to the need.

Who knew back at the time those decisions were taken that OPEC would come into being with all the power it has shown over the last number of years? Who could have predicted it? If any of the members opposite had predicted it, they would be millionaires and wouldn’t even be here right now. Mind you, some may have benefited. I am sure the honourable member opposite probably did, but all the more power to him. I wish I had had some extra money at the time and a little of that insight as well.

The other thing that hasn’t been fully recognized, and there has been a pooh-pooh reference to sales of. this export capacity, is that it has not been insignificant. Over the last few years it has meant a net income, not gross sales; for the consumers of Ontario Hydro’s product in this. province, of something in the order of $275 million. It has meant a seven per cent reduction on the hydro bills for the Ontario consumer.

8:40 p.m.

This is not insignificant at all. If we do have problems with this kind of suggestion, again I think it was summarized and, as I read in the dissent, we said the report that was tabled was inappropriate at that time. I feel it is just as inappropriate at this time.

Having been on the select committee for some three years now, I sincerely feel that in most instances the committee has diligently looked at the tasks it has dealt with, pretty well without exception. Yes, from time to time partisan views come out. That is what it is all about; there is nothing wrong with that at all.

But I would have to say that this was the first major exception, the committee did not fulfil the mandate before it came out with the report. It did not look and examine all up-to-date information and all sides of an issue before it wanted to get in, helter-skelter, with what it felt, and I can only surmise, was going to be an embarrassment to the government and an embarrassment to Ontario Hydro. I really cannot see any other great motivation behind the committee’s haste at that time.

There have been many other instances where that kind of haste was not indicated, other matters that the committee has dealt with over the last three years where it brought back an issue to look at other aspects. The safety one is an excellent example. The interim report did not indicate it was anything other than that, but we did look at other issues as identified by some of the members opposite.

Mr. Haggerty: We pay for all the burying of the wastes.

Mr. Ashe: The member is already into the waste issue. He is on the wrong report but that is par for the course, too.

In any event, we will pass on to other speakers so we can get around to what I know the honourable members opposite are looking forward to, the words of wisdom that will be brought forth at the appropriate time by the honourable minister. I know they all will find them enlightening.

Mr. Foulds: How much drivel do we have to endure until that happens?

Mr. Ashe: But I think it is a safe conclusion, and again I have to emphasize it; to say that the government members on the committee felt 10 months ago this report was incomplete and inappropriate and should not have been considered by the House. My feelings, and I think they are shared by my colleagues, are that nothing has changed as far as this particular report being inappropriate is concerned and that we should not be dealing with it at this time at all. We will not be supporting it, obviously, for that reason.

Mr. J. Reed: Mr. Speaker, I was going to begin this commentary on this report in one particular way. Then I listened to the convolutions of the parliamentary assistant. I heard him run for cover behind the Hydro board of directors so as not to be answerable to the people of Ontario for the largest single financial error in the history of this province.

Mr. Foulds: A fiasco.

Mr. Ashe: Hogwash.

Mr. J. Reed: It really boggles my mind. The Power Corporation Act is constructed in such a way that the utility --

Mr. Ashe: Get up and say you don’t want Darlington. Put it on the record that you are opposed to Darlington.

The Deputy Speaker: Order. Order. The member for Halton-Burlington has the floor.

Mr. J. Reed: Wait until I have finished -- is not answerable to the people of Ontario. Consequently, they have been allowed simply to go on unchecked. Through the years they were warned -- and this is one member who participated in that warning, and there were other members; the ministry itself with its own calculations of growth participated in that warning -- yet, the utility ploughed on.

As the chairman of the select committee pointed out so well, the first real constraint that was placed on the utility was placed on it by the then Treasurer of the province who said, “Fellows, you are not going to get the $6 billion that you think you want.” I remember well the howl that went up from Ontario Hydro. I was at the press conference when we were warned of brownouts, blackouts and all sorts of horrendous consequences because that money wasn’t being spent.

The reality in Ontario today is that we have on hand an excess capacity over and above the reserve margin we think we need to meet the peak that occurs for four hours once every year. Over and above that, we have an excess built-in capacity in the system of 4,000 megawatts, which I expect in today’s dollars, if we were going to build today, would be an expenditure of at least $4 billion.

As the chairman pointed out as well, however, the cost is factored in at the present time and the people of Ontario are carrying that burden and have to pay the interest and depreciation on equipment that is not operating. Still the utility forges a head with the next new project. They justify it by telling us through a $3 million advertising campaign, an immoral advertising campaign that is going on this year.

I have to make a little comment about the advertising campaign. It is double the budget being spent on hydraulic power development in the province this year. If the private sector were to present equations and scenarios, such as are presented in that feeling-of-wellbeing advertising campaign that imparts no information, it would be laughed out of business.

That advertising campaign is simply one of the tactics being used to cover up, to cloud and to justify a mistake. So many times I have tried to say publicly, why doesn’t the utility stop, take stock. recognize and accept that it made a mistake? Why doesn’t the government for once recognize that its own ministry could be right in its assessment of growth, which very nearly parallels the assessment made by the select committee, and stop and say something is wrong when a crown corporation, which is dependent on money being paid by the taxpayers of Ontario, can feed these coffers ad nauseam? We have to have some sort of energy policy that we can show to Ontario Hydro and have it fit into an energy policy for the future.

It is easier to push along and to shuffle along the way the government is doing at the present time, depend on the fear factor of oil shortages and make public statements about substitution in the future. We know that electric power will substitute very well for some things and that it does some jobs particularly well. No one can deny that. One also wonders about the convoluted vision that has been expressed by the Premier so many times that somehow we can move into an electrical future with ease and acceptance and there are no difficulties. Of course, all we have to do is pay the price.

In fact, the select committee found out that even Ontario Hydro, when we get down to the nitty gritty, recognizes that petroleum products and electricity complement each other. That evidence was given to the select committee. They are not necessarily substitutes for one another. The ministry accepted the fact that what was an uncertain oil future does not necessarily lead to the consumption of more electric power. It was so evident in the experience of the United States, especially in the states that surround Ontario. We saw what was happening there first. There was an oil crisis in the United States before there was any impending oil crisis in Canada. What did we see? We saw lowered growth rates.

8:50 p.m.

Maybe the chairman would enlighten me which year it was that the econometric model came forward from Ontario Hydro, a model that had taken six years to perfect. It demonstrated a growth rate of about three per cent. When the forecaster came to the select committee, he showed three scenarios. One was this very expensive, elaborate, econometric model -- a model not dissimilar and maybe more sophisticated than econometric models being used in surrounding utilities. He related that to his old method of forecasting. That was when they phoned up the major power users and said, “How much are you going to use next year, Bill?”

Then he made a decision. He split the difference between those two methods. We asked him, “Why did you come up with that decision? You spent millions of dollars presumably on this econometric model. Why did you come up with that decision?” He said, “Because I just didn’t believe it.”

That is really how Hydro planning has gone on for years. We had demographers from TEIGA who knew in 1960 that the birth rate was beginning to decline and they could predict the population. As a matter of fact, the Ministry of Education didn’t even figure that one out until we had this crisis of declining enrolments. This began in 1960 and it continued in a straight line downwards and the demographer who came to the select committee said that she had picked this up early in the game. We said: “Why didn’t anybody use it? Why was it not factored into the forecast?” She said nobody believed it.

Either this kind of expertise is worth something or it is not worth anything. The money that has been spent then has been spent on seat-of-the-pants decisions that did really not believe the numbers and did not believe the facts and did not accept for one minute the expertise. When we often say in the opposition that Ontario Hydro is out of control, we say it for those reasons.

If this report should have any demonstrations to the government whatsoever, it should be, I would hope, a demonstrated need for the government to say, “We have got to take some responsibility. We have got to provide some leadership. We have to provide an energy policy for Ontario and show Hydro where it fits in that scenario, what role it has to play and what is expected of it in the future.”

I was at the energy electricity conference here a few days ago and the honourable minister and I broke bread together and I enjoyed it very much. I heard an interpretation of our future as being an all-electric future, and here we go and this is the direction we have to go in. Really, that scenario was not denied by the Premier’s speech, which the Minister of Energy read with such passion. I was quite impressed with the way he read the Premier’s speech, but I really believe he would not have written it himself. There were some hand-over-the-heart statements that made me want to set some of it to music. But the fact is that the Premier and the government really and truly don’t know how to cope with the energy future of Ontario.

While I must give the present minister credit for attempting to break through the rigidity and move on into new areas, I want to guarantee him that I will give him every credit where credit is due as these programs come forward. If there is anything to give credit for I will do my best to do that.

The fact is we are still stuck with this concept that oil and coal are diminishing and our only option is nuclear so we have got to get on with the job and we have nothing else to do. The facts do not follow through. The facts do not demonstrate that we are into some sort of electricity crisis because we have got an impending oil crisis. The facts do not show it and yet for some reason we carry on with our construction program. As a matter of fact, we not only carry on with electricity expansion in Ontario, we carry on specializing in nuclear expansion to the detriment of the other options that are available in the province which are competitive to nuclear power.

That is a rather sore point with me because I have tried to keep an objective stance on nuclear power and not become either an anti-nuclear person or a pro-nuclear person but try to be as objective as possible. It bothers me very much that the nuclear lobby within Ontario Hydro would prevail to such an extent that more competitive options would not be allowed to flourish and the word would be spread that we just didn’t have the capacity to develop hydraulically or whatever it was, or it was too expensive.

I have challenged the government, and the minister knows this, to open it up for private development, to call the bluff for one reason. If the private entrepreneur can put power into the system and make a small profit at a lower cost than the utility, then by golly, we have something to think about, don’t we? I will make that contention until that happens.

The select committee made the recommendation about the no additional contracts. We know that Ontario Hydro, since the time this report was completed, have run around like madmen to sign as many contracts as possible because, as you know, there is a point of no return that one reaches when one starts a project of the magnitude of Darlington. A little scenario put together by the Royal Commission on Electric Power Planning shows that somewhere around 22 per cent of capital expenditure really flags that it is better financially to proceed to completion rather than to hold back, rather than to put a check on it or to cancel it or whatever. I would like to point out to the minister that according to my information, just about $1 billion in contracts have been signed. At the time we made that recommendation, $500 million in commitments had been made. Since that time, the select committee has been totally ignored by Hydro.

They have simply gone full steam ahead as quickly as possible to get up to their 22 per cent or 23 per cent or 24, whatever the heck it is that you can get to, and say, “Now we have got to justify completion.” I just want to point out to the minister that those 1988 million, or whatever it is, in contracts that have been signed are not money that has been spent but they are commitments that have been made. I want the minister to be aware that we are not close to the 22 per cent yet.

When more sensible heads prevail in terms of the real growth that is taking place and how we manage the finances of this province and what we charge the consumers of electric power for standby and so on, when all of those factors are weighed in, the minister will look at that resolution and he will say, “By golly, it was made 10 months ago but things that have happened over the last 10 months have proved the committee not only to be right but to have erred on the side of a most conservative,” if the House will pardon the expression, “kind of statement.” I think one must look at the reality and not at the fancy of what one might like to see happen.

9 p.m.

I will just point out one more thing before I sit down. There is great pressure among certain areas to lobby for total substitution into electric power. I want the minister to know that the technology for transferring to the use of an all-electric transportation system, for instance, is really only there to the extent of rail travel -- something I support, incidentally. I hope the government moves to electrify our transit system very soon.

But when it comes to operating our truck transport, our automobile transport and so on, we know the technology is very limited. We also know the energy requirement to produce some of the components is very high, and electric power is increasing in cost at about one or two per cent over inflation per year. It appears it will do that as far as we can see in the future. It would seem to me there are some other options available from other kinds of substitution that are far more valid than a wholesale attempted dive into the use of electric power as a substitute.

There are competitive alternatives, and we have gone over them many times. We have the exciting new one I hope the government is discovering now, and that is peat. We have one we have done our best to bring to the government’s attention, and that is fuel alcohols: ethanol, methanol or ammonia. Of course, we also have the potential for solar development, which I really do not want to get into.

All these things have to be allowed to take their place. Many of them are competitive now and many of them will be competitive within months or within a very few years. The technology of many of them has been with us for generations. To suggest for one minute that we simply have to build more reactors for the sake of providing this kind of electrical security when the facts show the reverse, really requires reconsideration, if I can use a very mild term.

I did not comment other than to show what Hydro had done in signing these contracts as they relate to the recommendation we made. The recommendation also asks for the government to bring an energy policy to this House, and it would be on that basis then Hydro would proceed at whatever pace was appropriate to fitting into that energy policy.

I will appeal to the minister once again to bring in an energy policy, not just an ad hoc series, but an overall strategy; to impose it on Ontario Hydro and to make sure Hydro’s future fits into the ministry’s vision of our energy future in Ontario; to cut out this ad hockery and relieve the electrical consumers of Ontario of this incredible cost burden.

Ms. Gigantes: Mr. Speaker, whenever we get into these reports, it seems to me we sit and talk in an incredibly effete way -- effete for people who have not been involved in this endless process of the select committee on Ontario Hydro affairs -- about growth rates. We drone on and on about growth rates, but we do it for a good reason, because the growth rate is the base on which Hydro designs its expansion program. That expansion program costs us billions and it has been a major matter of concern in this Legislature and before the select committee and with the public of Ontario since 1975, when rate increases started to zoom.

That is why we talk about the growth rate and the disparities that now exist between the growth rate on which Hydro is basing its current building plan and the growth rate we see in the figures for 1978 and 1979 and for the first six months of 1980, which has been devastating. That disparity inspired us on the committee to sit down very carefully in December 1979 and say we think there is a major problem with the forecast on which Hydro is basing its expansion plans, we think the disparity between the figures that are actually being experienced in terms of electrical demand and the Hydro forecast is so great that we have to look at the question of whether Darlington should be built in the time frame in which Hydro proposes to bring it on stream.

I would go further and say we have to question whether Darlington should be built at all. It is of interest to me, listening to the Liberal energy critic and hearing him talk about the seriousness of the question of building Darlington, that it was after the Hydro committee had produced this report and produced the very good reasons why the whole matter of the time frame, and the building of Darlington by implication, should be re-examined by the government immediately in the light of current demand growth rates, that the leader of the Liberal Party announced that as far as he was concerned Darlington should be built. I would just like to know when Darlington should be built in terms of Liberal policy.

The NDP has been quite clear on this issue. We have said categorically, given the experience of the 1977, 1978, and 1979 and 1980 growth rates for electrical demand; in Ontario, that for the province to be backing an investment which will in total, including heavy water, come up around the $7 billion mark for capacity we will not be needing if we have a decent energy policy, Darlington should not be built. That money, that borrowing capacity of the province and the ratepayers of Ontario Hydro, should be used instead for investment in conservation -- what we call energy efficiency -- and for the development of alternative energy sources for Ontario.

I think it is important to note that it was the member for Brant-Oxford-Norfolk who suggested to us in December 1979 that we had better take a new look at the time framework for building Darlington and perhaps consider suggesting to the government that no more contracts be let on Darlington construction until it had taken a very serious look at that building program and the need for it based on the known rates for electrical demand. We did it, not as the member for Durham West suggested earlier, in a quick and hurried fashion. We had, after all, spent several weeks in the preceding spring looking at all the factors that led to Hydro’s forecasts and all the elements that Mr. Higgins, the Hydro forecaster, had taken into consideration in making his forecast for electrical demand and building and forecasting base for Hydro’s expansion program.

We spent a good deal of time on that subject earlier in the year. Then the member for Brant-Oxford-Norfolk suggested we should review Darlington. We did that. We did it in a very serious way. The figures we looked at were up to and including early figures for 1979. They impressed us again with the fact that Darlington was not going to be needed in the time frame Hydro suggested.

9:10 p.m.

They impressed me with the feeling that if, instead of simply accepting Hydro’s projections of what electrical demands would be or in some places should be for the next five to 20 years, we should decide what demand we wanted to see in Ontario and developed policies to make sure that was the kind of demand we experienced -- policies of energy efficiency and development of alternative sources of energy -- then we could do that. In fact, we could very well have an electrical demand growth rate far lower than that growth rate of two to three per cent which the committee felt was likely, given the circumstances as Hydro and the committee were looking at them in December 1979.

Instead of simply predicting what is likely, it seems time that in 1980 in Ontario we began the process which is well under way in the progressive utilities and the progressive states of the United States where the whole pattern of the provision of electrical energy by utilities, most of them private utilities, is changing. There is a very deliberate change in policy going on at the level of state regulatory agencies in the United States and also within the utilities.

It is a change in policy which is going to leave Ontario Hydro looking like the proverbial plant that has rundown equipment. It is going to be a utility that does not have modern up-to-date technology, that does not have modern up-to-date programs, that does not have modern up-to-date efficiency that will stand us in good stead in the years to come as we face new problems of energy planning in Ontario.

Ontario Hydro, instead of being one of the progressive utilities on the North American continent, is going to be outdated. It is going to be a very serious problem not only for whoever forms the government of this province over the next few years in terms of trying to manage with an out-of-date utility, but also for the ratepayers of Ontario. If we continue to follow programs which are retrograde at this stage, we are going to end up paying a very high financial and energy price for them.

The reports that are coming out of the United States late in this year from utilities, energy planning groups and government assessments are indicating that electrical utilities in the United States will be facing a much lower demand for electricity and that they are going to be changing the patterns of their programs. They will be away from high-capital-cost investments such as nuclear investments, and moving increasingly into the areas of energy efficiency and alternative energy sources which I mentioned earlier.

I would like to read a quote from Roger Sant, who is the director of the energy productivity centre at the Carnegie-Mullen Institute of Research in the United States. He was quoted in the New York Times over the last few weeks as follows: “‘I think what we have seen in the last year is probably the precursor to the eighties’ much, much lower growth rate,’ said Roger W. Sant, director of the energy productivity centre at the Carnegie-Mullen Institute of Research. ‘I suppose three per cent growth is now the conventional wisdom’” -- not in Ontario it isn’t -- “‘but my guess is that it will still be quite a bit lower than that’.” That is from one of the top energy analysts in the United States.

There was also a seminar held in August this year at Sanford University which brought together representatives of government agencies, government planners, planners from state regulatory agencies and also utility representatives and planners in the United States. The symposium was held in April 1980, and it was centred on the topic “Energy Efficiency and the Utilities: New Directions.”

I would like to read a couple of brief quotations from two of the participants in those sessions, because I think they relate to what we are discussing here tonight. The first is a comment made by Charles Luce, who is the chairman of the board of Consolidated Edison and who was speaking to the changing role of energy utilities. He said:

“It is said that when Thomas Edison invented the incandescent light his idea of an electric utility was a company that would supply not only electricity but a complete lighting service. Instead of selling only kilowatt-hours of electricity delivered to the customer’s property, the utility would sell an illumination service installed on the customer’s premises. Such a utility company, of course, would have a direct financial interest in the efficiency of that illumination. But as our industry evolved it supplied only electricity and its facilities stopped at the customer’s meter. How efficiently the customer used the electricity delivered to his property by the utility was not regarded as the utility’s concern.

“Today, the utility industry is moving back to Edison’s idea, not thus far as a supplier of illumination but rather as an industry vitally concerned with how efficiently its customers use energy on their premises.

“Today electric utilities encourage the conservation of all forms of energy by offering energy audits that advise customers how most efficiently to insulate and operate their homes and businesses. If the customer needs credit to finance energy-saving improvements, the utility will arrange it. As soon as the law permits, many utilities, including Con Edison, will also contract to install such improvements on the premises of customers who desire such a service.

“In the future I am certain the services offered by a utility on a customer’s premises will extend beyond those that are merely efficiency-oriented or energy-saving. For example, when small solar or fuel-cell generators become economic as supplements to, or possibly even substitutes for, centrally generated electricity, electric utilities will offer to install and maintain such generators.”

That just gives some indication of the role the chairman of the board of Consolidated Edison sees for progressive utilities -- and these are private utilities -- in the United States. If these kinds of policies can be advocated for a private utility by the chairman of the board of such a utility, it seems to me imperative that Ontario Hydro, owned and operated presumably for the benefit of the energy future of the public of Ontario, should be similarly progressive.

I have one more quotation from the same seminar. This is a contribution by Bernard Cherry, who is the vice-president of the General Public Utilities Corporation of Pennsylvania, or GPU. He was talking about the need to curb demand for energy in times when marginal cost of producing that energy is rising. He said:

“The utility industry has for the last 10 years been in a sharply rising marginal cost situation with regard to capacity. The industry’s ability to survive the regulatory process, regulatory lag and, in some cases, regulatory response which has not been completely adequate, has been a function of the industry’s ability to take advantage of short-term credit and borrowing capability.

“In the case of GPU, the reason we are having difficulties and that the company is in a perilous financial situation is that our short-term credit cushion has all but evaporated. We have had to use short-term credit to take care of purchased power costs which were not initially recognized as part of the regulatory process. We have also had to devote a substantial portion of our short-term credit to clean up efforts with Three Mile Island. There is a lesson there.”

I want members to note that this is not simply a lesson he applied to a utility that had the kind of problems that arose at Three Mile Island. He said:

“There is a lesson there. In a regulated industry when marginal costs are rising, if there is an appetite not to pass on that full freight in the form of rates, at some point that balloon is going to break, and it is only a question of time until various companies around use up their cushion.” Mr. Speaker, I suggest to you that is the path Ontario Hydro is on.

9:20 p.m.

He continued: “Finally, I think it is unfortunate that the utility industry has found itself in the position of being perceived as champions for base generation. I think this has been true. It was the right thing to do in an era of declining costs. It is precisely the wrong thing to do in an era of increasing marginal costs. There is a very strong financial incentive for the utility industry to get into programs which decrease demand and which look to more dispersed investments -- investments which have a very short turnaround.”

We are hearing these voices from the United States from people who have spent years, since 1973, looking at the need for change in policy on the part of utilities, both private and public. The Tennessee Valley Authority, for example, in the southern United States, is entering into greatly changed policies of the kind I am suggesting Ontario Hydro should be following.

It seems totally reasonable -- in fact, imperative -- that Ontario Hydro should be called upon by this Minister of Energy or by this government as quickly as possible to stop investing in heavily capitalized nuclear generation of electricity and to begin making serious investments in the kinds of programs and the kinds of initiatives we are going to have to have for the energy future of Ontario. If we do not do that soon, we are going to be into revenue problems in Ontario which will threaten to sink the financial viability and strength of that public corporation known as Ontario Hydro. That will be a shame and a pity, and the blame for that will fall on this government unless it can begin quickly to provide the kind of policy direction that Ontario Hydro desperately needs at this point.

I recommend to the minister the very minimal kind of recommendation we have made in the select committee. We should immediately prevent Hydro from letting further contracts for the construction of Darlington; take the 1980 demand figures for electricity as clear warning that events have gone even further in the direction we looked at earlier, in December 1979; and call upon this government to take action that will begin a new energy future for the province using Ontario Hydro as a reasonable and progressive tool for the creation of that energy future.

Hon. Mr. Welch: Mr. Speaker, I know there are several others who want to take part in the debate on this report, but may I be permitted to make a few comments concerning the report in terms of Ontario’s energy situation and policies in general and electricity in particular?

As we have been reminded, the select committee made only one recommendation in its report tabled in the House in December 1979, and I think it might be wise at this stage, to help me develop very briefly my contribution to this debate, if I might read into the record the recommendation once again.

The committee recommended that the government of Ontario inform Ontario Hydro that no additional contracts for the construction of the Darlington generating station be awarded until the government has reported to the legislative assembly its policy for the construction of additional generating capacity in Ontario.

During the course of this discussion so far members have heard, from my parliamentary assistant in particular, the dissent of some members of the select committee. I assume we could agree that dissent sets out fairly clearly the responsibility of Ontario Hydro on the one hand and the government on the other. The Power Corporation Act passed by the Legislative Assembly of Ontario is quite clear with respect to this matter.

With regard to the government’s advising the Legislature of its policy for the construction of additional generating capacity in Ontario, I suggest to members this evening that policy is well known. As members of the Legislature will recall, Ontario Hydro in February of this year issued its 1980 load forecast of 3.4 per cent annually to the year 2000. As well, in March 1980, in the light of the new load forecast, the Ontario Hydro board decided to stretch out the construction of the Darlington generating station over a slightly longer period. Again, that decision was made quite public.

I would like to recall for the honourable members the process by which the government gave its approval to Ontario Hydro’s committed construction program, including, as it did, Darlington, published in the long-range policy paper of the Ministry of Energy released about a year ago. As members will recall, initial approval in principle for this program was given in 1973, and the final project-by-project approvals were granted during the period 1974-77. As honourable members will also know, under section 4 of the Power Corporation Act, the Ontario Hydro board of directors is responsible for the business and affairs of that particular corporation. Within the general approvals, and I underline “general,” because I think it is important to see exactly how the process works, within the general approvals granted by the Lieutenant Governor in Council under section 24 of that act for the construction of facilities, it then becomes the legal responsibility of the Ontario Hydro board to decide on the exact scheduling of construction and the letting of contracts.

Beyond the committed construction program, including Darlington, Ontario Hydro has not requested any approvals from the government for additional generating stations. This government expects that Ontario Hydro will request such approvals when they feel it is timely to do so.

As I have already indicated in the policy document entitled Energy Security for the Eighties: A Policy for Ontario, which I released a year ago, as the members of the House will remember, targets for indigenous energy supply were established for the period 1980-95. These targets included, and I remind the members of this, in addition to the committed nuclear program, which was all set out there, additional hydraulic capacity and potential lignite fired generation. It is all in that document. Overall, and I underline this as well, an expanded role for electricity was foreseen. However, no authorization for additional generating capacity has been requested by Ontario Hydro and consequently none has been given.

Last week -- last Friday, to be precise -- I announced to the House new and tightened targets for energy consumption and energy self-sufficiency for the province. As well, I announced a number of programs in such areas as solar energy, alternative fuels and energy conservation, which I hope members will agree will contribute substantially to our meeting these targets. In energy terms, internationally, we are living in extremely uncertain times as recent events in the Middle East have made quite clear.

9:30 p.m.

It is the belief of the government of the province, that Canada, our country, must strive for crude oil self-sufficiency by the end of this decade. I am encouraged to hear the federal minister agree with this particular goal and indicate that he felt it was a practicable and attainable goal. Part of that obviously has to be substitution of other energy forms for petroleum products. That is going to play a major role in both the federal and the provincial off-oil programs. In the field of space heating, for instance, I expect many home owners and industries will choose to convert to electricity rather than to natural gas. I would emphasize here that both have a major role to play in our province.

Would you not agree, Mr. Speaker, that in this province, we are very fortunate, in addition to the natural gas option, to have a strong and vital electrical generation system, fuelled substantially from our own resources? Some years from now, as people read the report of this debate, we will come to appreciate even more the tremendous contribution of Ontario Hydro to the wellbeing of the people of this province.

In the light of the events that have taken place in the 10 months since this report was tabled in the House in December 1979, and in the light of these few comments to the Legislature tonight, I would like to suggest, with respect, that the concerns of the majority of the select committee members as expressed in the committee’s recommendation have been satisfied. I would also suggest that the dissent of some members of the committee clearly sets out the respective responsibilities of Ontario Hydro and the government.

Finally, I would also like to suggest that the facts of the energy situation, which has changed so rapidly in just 10 months, underline the urgency of Ontario’s producing more of its own energy. It is this urgent need which Ontario Hydro can and will do so much to fulfil.

Mr. Nixon: Mr. Speaker, I have a feeling almost of unreality when I listen to this debate and see the way it is being received by the Legislature and predict how it will be received by the public. Essentially, nobody in the House or out of the House gives a damn about this matter, but it may be the most important one we deal with all this session. We are talking about building a $7-billion electrical plant, undoubtedly the biggest and probably the best in the world when it is eventually completed. I am one of those who believes it will be eventually completed.

As far as our party is concerned, we are simply talking about building that plant when its output is going to be required. From the information put before the select committee of this Legislature from the best sources, including the Ministry of Energy which, I say, is among the best but not the best, and Ontario Hydro, which also is among the best but not the best, we have come to the conclusion that the growth rate will not justify the continuation of the building of Darlington probably until another six or seven years have elapsed.

We are already indebted as far as Hydro is concerned in that the liability the province is responsible for is to the extent of $4 billion. They are advertising another bond issue, which is going to pay 13.3 per cent, to borrow some of the money that will probably go to the landscaping of the Darlington site. We are talking about an expenditure estimated to be about $7 billion but which undoubtedly will be closer to $10 billion in the dollars of the day if it is built on the timetable the minister is talking about.

We had the very best advice available. This is not the time for any usual complaint about it being also the most expensive but it was the best advice available. We had before the committee impartial witnesses from all over the world. Among some of the things that were put to us and accepted by the committee as facts were those things which the minister still persists in fuzzing. I quote from page E-29 of the report we are debating: “Both the Hydro forecast and the ministry projection show that electric substitution will not be a major factor. Hydro explicitly recognizes that oil and electricity are complements, not substitutes” -- although the minister has just said the opposite with all of the definiteness of which he is capable. “[The] ministry shows that ‘uncertain’ oil future does not lead to more electricity.” It’s a very simple quotation. It is very flat and plain. It is not hedged or fuzzed by any clauses or possibilities. It just says it.

While the minister is suggesting that some plants may not convert to gas but may convert to electricity, and undoubtedly that is so, even the Premier -- when he is trying to make some sort of a position out of the huge surplus of electrical capacity that we have bought and paid for and on which we are paying interest to New York at an average of 10 per cent -- tries to make it into a virtue. He says, “Let’s electrify the GO Transit system.” Five hundred megawatts is all the electricity that could possibly be used by that rail system if it were electrified tomorrow.

It is just not practical for the minister to justify something that somehow he and his advisers feel is rooted somewhere in Tory philosophy. Everybody in this province is proud, not only of the accomplishments of Ontario Hydro but certainly also of the Candu reactor and the capability to produce electricity from that source.

I am not an anti-nuclear individual nor an anti-nuclear politician. People are aware of that. In some respects, I suppose I am like the farmer who would very much like to buy a $100,000 tractor. It is great to drive around in and look at, and say, “God, I’ve got the biggest in the community.” But I don’t need it. And the government does not need Darlington. That is the gist of this report. Some time we will and we can plan for it. But I would submit that the research that went into the development of the conclusions that are before us -- and even the parliamentary assistant to the minister would have to go along with this -- would indicate that growth of energy utilization does not warrant the building of Darlington on the schedule that the minister is talking about.

I drive past the area, down through Pickering and on into Darlington, and see that enormous site with the nine-mile fence around it. The high-tension lines that come into the site now go off into the distance over the horizon. Why they were built, I do not know, because there is nothing in them, I do not even know where they go. One can drive for miles and they are built throughout all the farm land --

Mr. Cureatz: That’s not true. They are carrying electricity.

Mr. Nixon: My honourable colleague and good friend tells me that if you touch them, you will get a shock; so there probably is something in it. It probably comes in to run their Skilsaws or whatever they use to build atomic plants.

Mr. Ashe: Go try it.

Mr. Nixon: All right. But they are designed to carry the energy out of the place and to feed the grid, and it will be a long time before the energy is ever produced.

Somehow the debate is on the findings of a committee that did its work almost two years ago. That is part of the unreality, that we have been accused by the parliamentary assistant of hurrying the report. I thought it was outrageous that we took so long and delayed the report on the safety of the reactors and the electrical capacity as we did. I do not even know whether any other members of the Legislature have read the report. I reread it because one forgets it over that period of time.

But we spent eight intensive weeks of the kind of concentrated work that I do not recall ever doing, let’s say, in a bachelor of science course at one of the major provincially assisted universities. It was a very concentrated period and extremely interesting. We fought and argued about the thing. Sure, part of the argument by some of the members was on the basis that no nukes should be built at all, and the ones we have should probably be closed down. I reject that and most of the committee did as well. We believe we have a nuclear future in the provision of energy here. But the idea that it is going to replace oil and gas is so astonishingly naive that I find it frightening. The facts are completely opposite to that.

The government could even ignore the fact that we do not need it. They could say we do need the $7 billion of investment to make jobs. They could say it was for some other reason, that we do need the $1-billion investment to keep the nuclear industry in Canada functioning -- and that argument has been put. If they were prepared to say they were going to cut our imports of oil from Alberta and embark on a program to heat with electricity across the province, then let them say so.

9:40 p.m.

There are many things associated with it that must be a part of the program. If Alberta suddenly turns the tap off on us and everybody rushes down to Canadian Tire to get a neat little electric heater for the bedroom and the TV room, we will draw into our shell. We will not be able to get electricity from these fantastic plants, many of them closed down and mothballed. We will not be able to get the electricity into our homes. The distribution system will not carry it and, if the government thinks it can just run a few extra lines around to compensate for that, it is once again naive. If it is talking about the utilization of electricity for this purpose, using up this fantastic surplus, that just cannot be done.

If they are prepared to embark on a five- or 10-year program to double and triple the capacity of the lines serving the urban and rural areas of the province to justify the building of Darlington, that is what we mean when we say the government should stop contracts until they are prepared to say to the House why we will need it. If, on the other hand, they are going to embark on a program of producing electricity here that we cannot use and sell it to the United States or somebody else, that is very interesting, if they want to do that. But that is obviously something that should be debated and decided right here. Every time it is mentioned there is quite a furore in the community on both sides of an extremely important position.

If that is the justification then, once again, according to the requirements of the resolution, the government should come to the House and say, “This is what we are prepared to do, and we are going to go ahead with Darlington.” But to go ahead with Darlington because it is Conservative or something like that is nonsense. It is just appalling. We are talking about a $7-billion investment, and obviously it will be much more than that. It will be a world-class atomic reactor, probably the best in the world and, as far as I am concerned, the safest. We are not arguing about that. But the justification simply is not there.

I feel very strongly that the government is not considering the report as seriously as it should. When I was a part of the committee, I felt the recommendations brought forward by a majority would be debated here and voted on here. I understand the parliamentary system well enough to know that, even if the House votes a certain position, the government can thumb its nose at the House and go forward. But it would do so only at its peril; it has quite an armoury of things to soften the peril, and the advertising campaign from Hydro is one of them. That is why we are so frustrated when we see the position taken by Hydro in this circumstance.

As far as the load is concerned, my colleague the energy critic has already put it very clearly and, I would say, almost advantageously for the government, when he indicated that we only have a surplus of 4,000 megawatts. We have an additional 4,000 there as a cushion for safety above and beyond the single day’s break in the year. That is one enormous cushion, probably worth $8 billion. We are paying interest on that, and it all goes into our hydro rates.

If the minister were going to speak immediately, or if the Premier (Mr. Davis) were here, he would say we have the cheapest hydro anywhere, which is not quite true. Perhaps they would amend that, because we are sliding off that scale rather rapidly. But think of the advantage we could have had if the growth of our capability had been somewhere near the growth of our requirements. I cannot put it any more clearly than that.

We in this House on all sides are not prepared to abdicate completely our responsibility to the wizards at Ontario Hydro or even to the minister and his staff, capable and well-intentioned though they may be. Somehow there is a great block in the thinking and the decision-making capability in this instance which leads me to feel that somehow we are not communicating.

There is not a sense that this decision is an important one. I suggest to you, Mr. Speaker, it is going to be the most important decision that is taken. Somehow it is being taken out from under us. The minister is saying, “We have fulfilled all those requirements,” when essentially the government does not accept the load forecast we have made as a committee and which is verified by the statistics before us. About the best the minister can say is, “This is a situation where it is difficult to predict.” We know that, but our predictions are as good as or better than the ones that have been dictating the policy in the past.

I would hope that the minister would be prepared to say, if he is sticking with the timetable they have, at present, what he is going to do with the power. Is he going to close Nanticoke because we will not need it? Nanticoke is one of the most serious sulphur-dioxide polluting plants anywhere, but it is still the most modern one we have. It is a huge plant. We paid $800 million for it, and they are having a devil of a time starting it up, but it is going to be all right eventually if we spend enough money on it.

Are we going to say we are going to use the power to export to the United States? If the minister continues to say, “Isn’t it great to have so much energy at a time when oil is expensive?” I would suggest to him that answer is simply misleading. It is not based on facts that have been presented from impartial sources but rather from those who simply want to substantiate decisions made in the past.

I call upon the minister and his colleagues to accept the report in the terms in which it was intended. It was intended to modify the government policy. If the minister has any respect for not only the opposition members but also his own colleagues, who even in their minority report have indicated that the growth of the load is not going to justify these decisions, he will use his undoubted power as minister to modify, at least in part, the decisions of Ontario Hydro which I believe are needlessly expensive and wasteful.

Mr. Foulds: Mr. Speaker, I am told I have 13 minutes left, and I would like to use those moments to try to summarize some of the thoughts that have gone into the debate thus far.

Very rarely do I find myself in agreement with the member for Brant-Oxford-Norfolk (Mr. Nixon), but on this occasion I certainly agree with many of the points he has made. As a layman on the committee, after I wade through all the technical data, I find myself sitting back and saying, “What does all that mean?” After I hear the arguments put forward by the parliamentary assistant to the minister and I find the argument put forward by the minister himself, which frankly I found very disappointing, I say to myself, “Somebody is missing something here.”

The truth of the matter is that the cabinet of this particular government made a decision in 1973, because the Premier was bedazzled by technology in the nuclear industry, to go whole hog into nuclear expansion. That legacy will come back to haunt us in this province, because it was the one time that the Premier of this province made a rash and irrational decision based on little evidence and little background about what our electrical capacity needed and about what the options were.

The fact is that this government has saddled the electrical ratepayers of this province with a white elephant and that white elephant, which is currently symbolized by the nuclear station of Darlington, is going to be the skinniest white elephant in the history of this province, because we are going to have to continue to stretch it out into infinity.

The second point I would like to make is that we talked about a provincial grid as if that really existed in this province. As a person who comes from northwestern Ontario, I resent that, because we have this enormous overcapacity that is centred on the eastern grid in these large nuclear installations in southern Ontario, and the government is going to build more of them, while we were warned a couple of weeks ago in northwestern Ontario that we are going to have blackouts. What the hell kind of provincial grid is that?

What we need is a little bit more capacity in northwestern Ontario and a heck of a lot less capacity in the eastern grid, or in southern Ontario. We need to give the businessmen and the industry in northwestern Ontario the same kind of break on commercial and industrial rates that they get in the eastern grid. The government fails to address that problem and, frankly, I resent that.

9:50 p.m.

The third point I would like to make is that the Minister of Energy got up and gave one of the weakest speeches he has given in a long time -- and I admire this minister; he is a fighting and feisty kind of battler.

Mr. Martel: Even though he is small

Mr. Hennessy: Like a rooster.

Mr. Foulds: Right. Exactly. But what does he do? This fighting bantam rooster got up before the House and said weakly: “The policy was made and the decision was made in 1973. The actual project approvals were made in 1976. We cannot go back on that.” He said: “The government has given the approval. We are going to take our hands off now.”

Darcy McKeough, when he was Minister of Energy, did not have that attitude. Darcy McKeough said to Ontario Hydro, “You beggars are not going to have any more than this borrowing capacity.” Where is the guts over there to take on Ontario Hydro?

Hon. Mr. Snow: Don’t worry about it.

Mr. Foulds: As a matter of fact, the thing that I find intriguing, I say to the Minister of Transportation and Communications (Mr. Snow) is that Hydro has more common sense on this matter than its parliamentary representative in the Legislature. Hydro has some business sense; it will postpone the construction of Darlington when it becomes self-evident that it is not needed any more, and it will keep postponing it.

The fourth point I want to make to the parliamentary assistant to the minister is that if he calls this overcapacity insurance, it is one of the most expensive kinds of insurance that we have. Does he know what it costs us? It costs something like $2.1 billion for the excess capacity. That is one of the most expensive insurances We have.

There is something else. This government and the Premier like to rail against Alberta and Alberta heritage savings trust fund bonds, but they are willing to spend more on one nuclear installation, Darlington, than Alberta has in all of its heritage savings trust fund.

Mr. Ashe: You don’t even know what they have,

Mr. Foulds: Explain that. As much could be put into an Ontario heritage fund by saving the money on the expense of hardware the Premier is bedazzled with, and we could build all of the alternatives we need, increase the hydraulic capacity and it would not be necessary to plug into his expensive grid. A number of small communities throughout northern Ontario could be electrified by building a small hydraulic generator that would supply a particular town and there would be no need to get into the expensive transmission lines.

Finally, I have only three or four more points that I want to make. The message of the select committee on Ontario Hydro affairs was a very simple one. It was that when we need additional building capacity, and when our forecasts show that we need to build additional electrical capacity, then let us build it. But our forecasts show that in southern Ontario we do not need additional electrical capacity.

The committee’s recommendation was a very modest one. All it said was, do not let Ontario Hydro award more contracts that commit us more and more to a plant until it has been stated what the program is going to be. It was a very modest conclusion. The evidence before us then, and it is not out of date, that we would have a modest increase of two to three per cent, has been borne out by what has passed since the committee come to that conclusion.

As the chairman of the committee rightly pointed out, we are now almost in a zero growth period which was, interestingly enough, the pattern predicted by the model devised by Hydro’s forecast. But then he flew by the seat of his pants with regional estimates, and there are some delightful quotations. I draw the members’ attention to the afternoon sitting of the committee on Wednesday, February 28, when Larry Higgins, the chief forecaster for Ontario Hydro, called the final process after he went through all the model, which was very sound and very accurate, “a primordial soup.” I said: “Is this the primordial soup that you deal with after your model? Is that what we are looking at, the entrails of a chicken?” Mr. Higgins said, “At this stage, I think largely.” I ask you, Mr. Speaker, is that any way to develop a policy for electrical demand and therefore construction in this province?

One of the things the minister forgets when he talks about trying to get off oil and gas and on to electricity is that, even with our minimal and modest conservation advertising in Ontario, people find electricity easier to conserve than oil and gas. Very simply put, it is easier to turn off an electric switch than it is to get yourself into a car pool.

Electricity is a convenient and very interesting form of energy and, because of its convenience, it is one that is widely used. It is also convenient not to use it, and you can use it much more wisely than you can other forms of energy. I suspect we could conserve at least a third of the electricity we use very simply by turning off light switches, fans, humidifiers and air conditioners when we do not need them. We would still not suffer any loss of comfort or standard of living, but it is going to be a heck of a long time before we see electrified cars in northern Ontario or electrified highways.

I think the committee’s recommendation simply makes a lot of ordinary, good common sense. I fail to understand why the minister does not endorse it wholeheartedly and why the parliamentary assistant does not endorse it without the cavilling that he has done. It is in fact a sensible, reasonable report. The very fact that it concentrates on one recommendation I think highlights and symbolizes the importance of the report. I just do not understand why the parliamentary assistant, the cabinet, the Premier and the minister are so gung-ho to become nuclear and electrical imperialists when they themselves know that it is economic and political as well as social folly.

Mr. Cureatz: Mr. Speaker, may I say how pleased I am to participate in tonight’s debate. It seems like Thursday night is Hydro night. I want to say at the outset that, unfortunately, I did not have the wonderful opportunity of sitting on the select committee on Ontario Hydro affairs when it was looking at the capacity of Ontario Hydro.

Notwithstanding that problem, I do have a couple of thoughts and concerns that I want to relate to the assembly tonight, not only as a member representing the province but, more importantly, as the representative of the wonderful riding of Durham East, because that is where the Darlington generating station happens to be located. I emphasize that to the member for Niagara Falls (Mr. Kerrio); that is why I am very pleased to participate in the debate for a few moments

The adoption of this report’s recommendation would have a serious economic effect on the people of my riding, one which the members opposite may not really appreciate. I would like to mention that this report is now. almost a year old, and since then the timing of Darlington’s construction has been lengthened. That decision was made by Ontario Hydro and not by this House. They reassessed their load forecast and subsequently adapted their construction program. This House is not in the business of producing electricity; that is the job of Ontario Hydro.

10 p.m.

I also have strong reservations about this report because I do not believe the members who signed the report took into consideration Darlington’s biggest asset, that it is a nuclear plant and, as such, it is another step in removing us from expensive oil and environmentally difficult coal generation. If we do not finish Darlington now, the costs of building it later will be much higher and this will be reflected in the future of electricity costs across the province.

Mr. Kerrio: Let’s build four more then.

Mr. Cureatz: I am always interested to hear the comments from the member for Niagara Falls. It was only a week ago that he stood up and indicated how proud he was to participate in a tender to establish a nuclear generating station. Now here he is, tonight, criticizing the aspect of building a nuclear station. Is he representing the Liberal Party and trying to stand on both sides of the fence, for one day and against the next?

Mr. Hennessy: No.

Mr. Cureatz: No, he is not doing that at all. Thanks to the member for Fort William.

If Ontario runs low on energy in the winter of 1981 or 1982, the millions of dollars saved by not building Darlington now will not provide the heat, light and transportation that people need. Those savings might buy enough imported oil to see us through such a crisis, if imported oil is available. But I would like to ask the members opposite, what about the next winter and the one after that? Can anyone in this House accurately predict the effect the current Iranian-Iraq conflict will have on oil supplies? If we are caught in a crisis, the foes of Hydro expansion may graciously admit they were wrong. But that will not deliver the power, and that argument will not wash with the public. If Hydro errs, let it be on the side of the surplus, not shortage.

If this province spends money creating too much energy-producing capacity, that will certainly not be a calamity in this energy-short world. But if Ontario has too little energy capacity in the future, I suggest that will be a calamity. This House must realize if we are to meet these energy demands we are going to have to depend on plants like Darlington. The bottom line of this argument is that it is better to have too much power than not enough.

We are constantly reminded about the tragedies of an overbuilt system, but one thing I have learned as a member is there are always two sides to every story, and I would like to get this other side on the record. Unfortunately, it is a story that I feel has not often been emphasized. This energy surplus does have some benefits. How many other countries, provinces or states are in the process of conducting a similar debate? The answer is not many, because most are experiencing alarming energy shortages.

Ontario has a great advantage in competing with American states when we can assure potential investors of a guaranteed supply of electricity at reasonable rates. Many of those states cannot make that claim. I am very pleased with my government’s initiative to reduce its dependency on foreign oil. Electrical heating should become cheaper than oil heating within two or three years and could undercut the price of natural gas by the late 1980s. When that happens, a Hydro system that can meet the rising demand will save us millions of dollars. It will have been built at a rate cheaper than any possible in the future, and it should become the province’s strongest hedge against inflation.

Finally, I want to make three other brief points as the representative for Durham East. First, I want to emphasize to this House that, in terms of local representation, both the regional municipality of Durham and the city of Oshawa, through their various councillors, have indicated support for the continued construction of the Darlington generating station.

In addition and more important, I want to emphasize that the local municipality, the town of Newcastle, which I know the Minister of Energy has been very fortunate in having occasion to pass through from time to time, has indicated strenuously that it is in favour of the continued construction of Darlington. I do not have to remind the members that approximately a year and a half ago Councillor Jasper Holliday, the local councillor for ward one, where the station is being built, made representations to the select committee, along with Councillor Keith Barr, who was then acting as mayor on behalf of Mayor Garnet Richard. They specifically indicated to the select committee on Ontario Affairs that Darlington and its positive impact on the community should be continued.

The final point I would like to emphasize to members opposite --

Mr. J. Reed: There are some things I need in my riding.

Mr. Cureatz: Listen to the member for Halton-Burlington. I want to suggest to him that as soon as we have an electrical shortage the first thing that is going to be cut is that wonderful Vicks coughdrop commercial where he is talking on the CB. Let him think about that while he is trying to make some other income on the side by making TV commercials.

Let me say to the members opposite that in the next election, be it this fall or next spring or whenever, I want them to suggest to their appropriate candidates to come out with a press release or at an all-candidates’ debate and say: “Please elect me, because the first thing I am going to do is shut down Darlington.” I want those candidates to go out to the Darlington site and to gather up what is now 200 employees -- maybe by next spring it will be 1,000 and say, “Please vote for me because if you do I will guarantee your jobs will be terminated.”

I want to emphasize that fact and to remind that to the member opposite who are always so concerned about industrial strategy and work in the wonderful province of Ontario.

Mr. Kerrio: Mr. Speaker, I would like to suggest to the member for Durham East (Mr. Cureatz) that, as usual, he goes off on a tangent and does not discuss the topic at hand. If we are to debate the merits of building Darlington to provide jobs, that should appear on the Order Paper. That is entirely a subject far removed from the subject matter at hand. When the member challenges any of us to stand up in that area and suggest we stop the construction, he makes a very valid point if he is talking about jobs. We are not talking about jobs. we are talking about the overbuilding of Ontario Hydro, and we should keep that in perspective.

If we want to talk about things just to print copies of Hansard to send them back to our constituents to show them what great people we are, keeping in mind the problems at home, we could do that from any side of the House.

The purpose of the debate tonight is to discuss a report that made a very valid recommendation to this Legislature. I will not pursue the areas that the very able members from my caucus have already made determinations of. One is our critic for energy and the other is the member for Brant-Oxford-Norfolk (Mr. Nixon). I will touch on a couple of areas that have some uniqueness in this debate.

The first one is that the government always hides behind the cloak of the integrity of Hydro, the mandate it has and the fact that it is its judgement that makes the decision. I do not know how many times various members are going to stand in their places here and suggest we curtail Ontario Hydro’s involvement. One of the most powerful members of the assembly did it in a very simple way. It was exactly the way one would get one’s wife to stop shopping. We would cut off the money supply. That is what Darcy McKeough did with Ontario Hydro, and it is such a simple and expedient way: If one does not have the funds, one cannot spend them. Let us not take away from the general public of Ontario the fact that this Legislature, the cabinet and the Premier through the Ministry of the Treasury and Economics, can conveniently do whatever it will with Ontario Hydro.

The only time they begin to tell us that is not the fact is when all members on all sides participate in some very valid criticism of the direction that Ontario Hydro has taken. Then they throw to us the contention that the mandate was given to Ontario Hydro and we should not make it a political football. They say it should not be on the floor of this Legislature. That is not true. It is already here. The government has the ability to direct Ontario Hydro. We think we should insist on participating in that kind of debate. Here we are this evening doing just that.

10:10 p.m.

There are many factors about the involvement of Ontario Hydro that have not been discussed here tonight. One of the quarrels I have with Ontario Hydro -- the point was made by one of the members from northern Ontario -- is that they are suffering from what I call “Texas technology.” They insist that it has to be big to be better. I think Canada could have led the world in a different kind of technology. We could have been building smaller, more efficient units. I do not think wires would have been strung all over Ontario from these huge plants. I do not think there would be the outage if there were numerous small plants throughout northern Ontario and not so many lines. If one small plant went out, there would be a grid that could supply the others.

That has been a grave mistake, and it is not just my opinion. Many experts appeared before our committee who suggested that other jurisdictions with their smaller plants make use of the waste heat and every other conceivable byproduct of a plant that is smaller and more efficient in a given area.

The things that have not been touched on that are very dangerous in our society today have to do with what large corporations can do. That is, if they have a captive market -- Bell Canada typically; Hydro is another -- they can through huge expenditures of money create a market. Unfair as it may be, Ontario Hydro has that capacity here. Beyond their capacity and their mandate to generate electricity, they can go out and spend huge sums of money to attempt to bend people’s minds towards their direction.

That is what some of the members try to do over there; they use the scare about cutting off the oil from Iran and Iraq, the scare tactics that talk about brownouts and blackouts. Certainly it is easy to defend their position, which is to say it is better to have more capacity. I would like to have four more bridges down at Niagara Falls instead of one, but we cannot afford them. It does not make any kind of sense. As the member for Brant-Oxford-Norfolk pointed out, he would like to have four big diesel tractors. Many people would like to have another car in their garage. In the event they do not get their car started, wouldn’t that be nice? Many people would like an extra television set.

This government has not had to face the responsibility that have to be faced by many individuals, many corporations and many businesses across the province. It is very easy to sell one’s way, to stand up and say, “Would you cut off Darlington?” If it had to do strictly with generating electricity in the power grid as it stands, we would have no other option. We are tremendously overbuilt.

We have never addressed ourselves to any kind of efficient management of load in Ontario Hydro -- none whatsoever. Every evening at exactly the same time, all the water heaters go on across the province to heat the water that is used during the dinner hour. That need not be. We could take the peaks and cut them up and put them into the valleys; we could do a considerable job if we were threatened, if it were borderline. We have never approached anywhere near that kind of problem. We could do all sorts of things to manage the load, to cut those peaks off and put them in the valleys.

These figures that are before us showing the extra capacity have been fudged in favour of the government and Ontario Hydro for years. They are really figures that are not fact, simply because there are so many other factors. What about the charges to Ontario Hydro? What about the fact that people are encouraged to use more hydro because the more you use the cheaper it gets? The dearest power in the province is for a little couple, retired on a fixed income, making their first cup of tea. That is the highest priced power in Ontario. That is disgraceful, and it should not happen. We should not encourage people to heat their swimming pools with electricity. We should not encourage these people until the structure of charges were such that people would be encouraged to save electricity.

We have not made any steps in the direction of meaningful involvement with insulation. In Ontario today we still build homes with what used to be two-by-fours, which now have shrunk to two-by-three-and-a-half and may get smaller. If they take a wall of that thickness and put all the outlets around the outside walls, where do they put the insulation?

We have done nothing about the collection of passive solar heat. It costs nothing to collect. We have done nothing along these lines that would reflect on the numbers that are before us that would cut this need without anyone in the province suffering. The government keeps suggesting that the people on this side would cut back on the quality of life. That is not true. We would not cut back one iota on the quality of life if we had done what was fair. There have been many things said by members of the government party that have nothing to do with the question before us.

The other point I want to make is about the involvement of planning. The parliamentary assistant talked about the difficulty of long-term planning and the ease of short-term planning. The fact that long-term planning is difficult goes back to the argument I made just a few moments ago as it relates to plants being of the magnitude that they cannot adjust in any kind of reasonable time.

If they need 10 or 12 years to design a plant in the system, maybe the plant size is wrong; maybe it is time they looked at more efficient, smaller units so that their planning did not have to be in the long term and they could address an increase or decrease in the very short term.

In that case, the excess capacity is not cheap insurance. I say that to the parliamentary assistant, because he made that suggestion in exactly that fashion, that extra capacity is cheap. I think the numbers that were put before us tonight would discount that particular involvement.

Mr. Ashe: Three cents a day per family.

Mr. Kerrio: That is not true, and the member knows it. Overdesign is as bad as underdesign because, if it were critical and it was near the mark, there are all sorts of things we could do to address ourselves to the problem.

The minister’s comment as it relates to the subject matter before us certainly does not address itself to the fact -- and I would like to read part of it into the record -- that the committee has made only one recommendation. I think that recommendation speaks highly of the whole determination of the load forecast, and it would suggest that Ontario Hydro should be brought into line with the future development of the whole energy policy of the province. It should be one facet of the whole that the Minister of Energy should bring into focus, and it should have one particular function within that group of alternative supplies. The Minister of Energy should be able to bring it into focus.

10:20 p.m.

Mr. Williams: Mr. Speaker, I must warn you that I do not intend to take off my jacket or roll up my sleeves or to gesticulate or engage in any other type of theatrics this evening. Rather, I am going to present a clear, calm, rational presentation of the facts as they pertain to this report.

I was interested to find in the opening comments made by the member for York South (Mr. MacDonald) that he took a great deal of credit in proving the accuracy of this report as far as it dealt with the low growth factors of two to three per cent. He quoted the comparative factors of electrical supply growth during the first six months of last year as compared to this year and said there has been zero growth. He took great pride in the fact that this proved his report was accurate.

I can only say that is nonsense. What he did not do was acknowledge and give credit here it was really due. Credit should have been given to our tiny, perfect Deputy Premier and Minister of Energy who brought forward an initiative in this province with a new energy source that the people of this province finally have learned to accept and make use of: the energy conservation concept. It is because of that new initiative of our Deputy Premier and minister that we have had a no-growth factor in that six-month period. To suggest that justifies the accuracy of that report is complete nonsense.

My difficulty is that I had hoped to address this matter this evening in two sections. First, I wanted to indicate quite clearly to the assembled members that the dissenting point of view of the Conservative members is the accurate assessment that was made, albeit 18 months ago. Second, I wanted to address myself to the only recommendation made in the report as indicated in the minister’s remarks this evening. What I will endeavour to do is condense what I was going to say in an hour into 10 minutes, if I can. It will be difficult to do but perhaps, if I took off my jacket and rolled up my sleeves and really concentrated on this, I could do it.

Let me first address the points made by the parliamentary assistant in his opening remarks in speaking to the dissenting decision in the report. I think it is made quite clear that our concerns as expressed in that report have been borne out.

As you will recall, Mr. Speaker, there were two points of concern expressed with regard to the uncertainty in forecasting. First, it was pointed out that it was premature to bring in the report at that particular time, because Ontario Hydro was coming in with its new lower forecasts two or three months after the reporting date. Second, it was pointed out that the report of the Royal Commission on Electric Power Planning was forthcoming early in 1980.

Both those things did come to pass, and they both showed the error in the so-called wisdom of the majority report, which suggested that the low forecast increases would be retained at two or three per cent. In fact, the lower forecast by Ontario Hydro in February 1980 showed the forecast would be up to 3.4 per cent growth. The report also came forward from the royal commission in February of this year and, with respect, I would suggest we have a much more learned and in-depth report here. It has taken five years of preparation by the learned Arthur Porter, who pointed out in his recommendations that Ontario Hydro should phase its system expansion plan for the future on a growth range for a peak capacity to the year 2000 of 2.5 to four per cent per annum. Both those learned bodies discounted the accuracy of the majority report contained in the December report of the select committee; so I think the wisdom of the dissenting opinion has been borne out by authorities other than ourselves.

I would like to come to the only recommendation in the report, which deals with the suggestion that no additional contracts be awarded for the construction of the Darlington generating station.

It has been interesting this evening to listen to the member for Brant-Oxford-Norfolk whom I have always considered to be one of the leading lights in the committee discussions. I always felt he brought common sense and clear thinking to the discussions. As an opposition member, he certainly has been an exception in this situation.

But I must take issue with him this evening for suggesting that we should not be building a $7-billion nuclear power plant until we need it. That is the term he used: “until we need it.” What he has overlooked, and what the members of the third party have overlooked, is the obvious. That is the fact that we cannot start building a facility of this magnitude, or planning for it, when it is needed. We have to plan much in advance of when it is needed, to be realistic.

The member for York South talked this evening about living in a dream world. I suggest that if anybody is living in a dream world it is our friends who are interjecting across the way at this time.

Mr. Foulds: Our forecasts showed we do not need it.

Mr. Williams: To be realistic, we know that in earlier times it took a minimum of five years to plan for, design and construct a nuclear power plant -- they are massive undertakings -- but at this time, because of increased public involvement in these considerations and because of greater environmental concerns, it has now stretched out to about a 10-year period. It is mistaken to suggest that when the need is shown for more electricity, perhaps in 1990, then we should start thinking about building this facility. It would cost twice as much if we delayed everything until then. Based on the 1980 dollar, it would probably cost three times as much. Instead of talking about $7 billion, we would probably be talking about $21 billion. Is that good planning? I doubt it.

The important thing is that from 1973 until 1977 only the design concepts got off the drawing board and were approved. We still have to get to the brick-and-mortar aspect, which will take at least another five years on a project of this magnitude. Even if the facility were completed a year or two in advance of when its total output was really needed after it was commissioned, we could well use those surpluses that might exist. I am not suggesting they will exist but, if they did exist, if we brought the plant on stream a year or two in advance. It would be far better than bringing it on a year or two too late.

That is precisely what would happen if we followed the irrational suggestions of the members opposite.

What we must do, and what this government has always been noted for doing, is long-term responsible planning, both financially and in every other way. That is what we intend to continue to do in this province. That is what our Minister of Energy is going to give us the leadership in doing. We will be assured that the Darlington project will proceed, notwithstanding the fact that the project has been stretched out to some reasonable degree. Nevertheless, the project will proceed. It will be completed in time to meet the future needs of the people of this province so we will be ensured that there will not be the blackouts and the brownouts that our Clarence Darrow across the way talked about so eloquently earlier this evening.

The minority decision of this report has proven only too true, based on the evidence that I have presented this evening and on what is happening in jurisdictions beyond our own borders where the demand for indigenous power sources is becoming even more critical at this time. It will be interesting to hear our friend from Carleton East (Ms. Gigantes) get up a year or two from now when there are no sources of energy available to us to explain away why she was opposed to proceeding with our nuclear power plants and making available the indigenous sources of power in this province.

We, as a responsible government party, are not going to put ourselves in that position; it would be an untenable one. It is easy to argue when one is not with the party in power and responsible to the people of Ontario, but we are and we intend to continue to act responsibly in this matter and to ensure that there will be a continuing supply of energy at reasonable cost to the people of Ontario from local sources.

Report adopted.

The House adjourned at 10:30 p.m.