Cost of cancelling gas plants is at least $828 million: expert

TORONTO -- The cost of cancelling two gas plants in Oakville and Mississauga is closer to $828 million, more than three times what the governing Liberals insist taxpayers will bear, an energy expert said Wednesday.

The cost of the Oakville plant -- which was cancelled in 2010 -- is about $638 million, not $40 million as the Liberals have said, Bruce Sharp told a legislative committee that's looking into the gas plant cancellations.

The mechanical engineer, who says he's spent 25 years in the energy sector, said relocating the plant will cost $40 million, but there are extra costs, said Sharp, who works for Aegent Energy Advisors.

He's pegged gas delivery and management costs at $313 million and transmission costs at $359 million.

"My view is that there are so many people making money in so many different ways in the sector, that when something goes wrong, no one wants to talk about it," he told the committee.

"When the Oakville settlement details were made public in September, it was clear to me that the additional costs quoted of $40 million was low, so I felt the whole subject deserved some attention."

Sharp said he agreed that the cost of relocating another plant in Mississauga will cost about $190 million, but that could have been at least $28 million lower because it will cost less money to deliver natural gas to its new site in Sarnia.

It's unfortunate that Ontario is seeing the "negative outcomes" of abandoning power system planning, he said.

"On the subject of politics, I would just say that we're sitting here today because of the siren call of political intervention and we really need to get away from that political intervention and swear a blood oath to not meddle in electricity policy in Ontario," Sharp added.

The Liberals questioned Sharp's figures, saying their numbers have been independently verified and will be examined by the auditor general.

They also said that money would have to be spent on upgrading transmission regardless of where the plants were located.

But Sharp's testimony bolstered opposition claims that the cancellation of the two plants cost much more than the $230 million the governing Liberals have maintained.

Premier Kathleen Wynne said she was unaware of any additional costs to the Oakville plant cancellation.

"I've been very clear about the information that I have been given, so the numbers that I've talked about are the numbers that I knew," she said.

Whether or not she pays a political cost for decisions made under her predecessor Dalton McGuinty isn't the issue, she said.

"I'm going to make the right decisions as I see them for the people of Ontario going forward, and whether that has a positive or negative impact -- or whether something that went before has a positive or negative impact on my personal political career -- that's not what the people of Ontario need to worry about," Wynne said.

"What they need to worry about is that they're getting the information to answer the questions that they have, and I'm going to do everything in my power to make sure that that happens, and have done since I've been in this office."

The NDP and Conservatives have accused the Liberals of relocating the Oakville gas plant and then the Mississauga plant in the dying days of the 2011 election campaign to save Liberal seats in the face of local opposition to the projects.

The Liberals knew that it would cost much more than they let on, both parties said.

"There's no way that you can make a private deal on a gas plant with a private person and expect that at the end of it, if you break the deal, it's going to be $40 million," said New Democrat Rosario Marchese.

"It's impossible. I think they all knew that."

Progressive Conservative energy critic Vic Fedeli said he doesn't believe Wynne either.

"A proven energy expert irrefutably proved now that this is in almost a billion dollars, and the government has gone to great pains to cover it up," he said.

"And they'll pay the price for the coverup."