EDITORIAL PAGE (January 27, 1992)

Ontario Hydro’s reversal on plans for nuclear power generation over the next 25 years is a shameful twisting of the provincial Crown corporation’s mandate for political purposes.

The utility’s recent update on its 25-year plan says no new major power generating plants will be needed until 2009. Just two years ago, however, Ontario Hydro said it would need 10 new reactors by 2014, the first by 2002, in order to meet demand.

What has changed in those two years? The recession has reduced growth in demand for electricity, but a sophisticated study like Hydro’s $61-billion plan certainly took such economic cycles into account. Hydro’s laudable conservation efforts have also been very successful, but not enough to prompt a major policy shift in such a huge corporate structure.

What has changed is the provincial government. One of the first major changes instituted by the New Democratic Party after it was elected 16 months ago was to install Premier Bob Rae’s handpicked individual for the job of Ontario Hydro chairman. Marc Eliesen, who was given the post over the objections of Hydro’s own board of directors, is using the utility as a means of implementing the NDP’s policy against building any new nuclear plants. Ontario Hydro should be making its decisions based on facts and the best opinions of the people who run the operation, not on the basis of election promises. A Crown corporation as essential as Ontario Hydro cannot be run effectively if it must shift directions each time a new political party comes into power.

Ontario Hydro’s mandate since its inception in 1906 has been to provide power at cost in order to stimulate industrial investment. What it has become, however, is a huge bureaucracy apparently dedicated to implementing political policy with almost complete disregard for cost. Its annual revenue exceeds $6.5 billion, its staff numbers 26,820 with an average salary of $65,000. The fatal flaw with Ontario Hydro’s original mandate was the concept of providing power at cost. As a result, a huge empire has built up which simply passes costs on to the consumer. Even the Ontario Energy Board says Ontario Hydro is inefficient.

It is time to change Ontario Hydro’s mandate, but not to one that will see it become a tool of political posturing. It needs to reaffirm its role in making Ontario an attractive place to invest by striving to deliver electricity to consumers in the most efficient manner possible.

That, in turn, would require the utility to continue its conservation efforts and perhaps to become at least partly privatized, subject to the demands of the marketplace and accountable to a board of directors that valued results, not the implementation of political policy.