Winter 2005 - Volume 8 Number 1
Hydro: The Decline and Fall of Ontario's Electric Empire
Toronto: Between the Lines, 2004
"Conservatism" certainly isn't what it used to be. In 1906, bright electric lights spelled out the slogan "Power to the People!" They announced that a new government agency had been formed and had taken as its mission the provision of inexpensive and reliable electrical energy to corporate and individual consumers in Ontario. This was no anticipation of the 1960s "new left" commitment to participatory democracy, but it was an early example of the kind of "progressive" intervention in the economy that occasionally marked the Conservative Party, both federally and provincially for much of the twentieth century. Like the creation of the CBC or TVOntario, it was an illustration of the willingness of governments to provide valuable public services, especially when the private sector was unwilling or unable to do so responsibly or well. It was part of the philosophy of a "mixed economy" in which "market forces" and "private enterprise" were deemed important but not exclusive instruments of job creation, goods and service provision and general prosperity. The fate of Ontario Hydro is a stunning example of what can happen when that basic economic framework is jettisoned.
Jamie Swift is a journalist and a prolific author of books on mining and forestry, as well as a perceptive biography of Eric Kierans. Keith Stewart is a popular environmentalist with impressive teaching, writing and advocacy credentials. Together, they have produced a highly critical and wholly engaging analysis of how the greatest public utility in Canada was destroyed. The tale is well told of the arrogance of the utility, the illusions of manufacturers and consumers who sought to "live better electrically," the pressures from the environment (and sometimes from unwholesome environmentalists) and the machinations of governments as they tried to cope with problemsmany self-created and self-imposed. Also revealed is the history of how ideologically driven politicians seized upon the mythology of the market economy to achieve their ends and, in the end, left Ontario with a broken system and no easy way to repair it.
Although they provide sufficient background to appreciate the place of Ontario Hydro in the development and governance of the province, Swift and Stewart are principally concerned with the last quarter-century of Hydro's existence. The story of its decline and fall makes compelling reading.
For three-quarters of a century Ontario Hydro had been a fixture in Ontario. By the 1970s, however, it was no longer undisputed and unchallenged. Voices from the environmental movement were being heard. Pollution was perceived as a potential problem. The oil crisis gave Canadians such a feeling of vulnerability that the federal government acceded to NDP demands for the creation of Petro Canada, the once national public petroleum company. Attention was paid to the cost and reliability of natural gas and electricity. Innovation was overdue.
By the 1980s, new ecology-friendly ideas began to circulate at Ontario Hydro headquarters, a block away from the provincial legislature. The proximity was appropriate. For decades, the corporate leadership of Ontario Hydro and the political leadership of the Progressive Conservative Party had been almost interchangeable.
The authors tell the familiar story of Robert Macauley, Conservative Minister of Commerce and Development and first vice-chair of the Hydro-Electric Power Commission of Ontario, saying this to his protégé, (future Premier) William Davis, at the time Conservative Minister of Education and second vice-president of Ontario Hydro: "Those guys think they run the government!" Those guys, indeed!
I worked for Ontario Hydro for a while (mainly 1986-1991) as a contract consultant with responsibility for an "energy education program" aimed at pitching conservation in Ontario schools. I was thus able to witness first-hand what was then called a "paradigm shift" in the organization. Ontario Hydro had begun as an exercise in populist political economy. It became massive and dedicated to nothing as much as its own growth. By the late 1980s, however, it sniffed the air, sensed change and responded with characteristic subtlety. It produced the Demand Supply Plan, a 2.8 kg report (which I had to translate into a 28-page magazine for secondary schools). In the massive tome were some messages that seemed remarkably like a commitment to energy conservation and diversity in fuel sources. This "greening" of Ontario Hydro was, of course, balanced with the demand for ten new Candu nuclear reactors and thirty-two new gas turbine generators. But, within the institution, there were dedicated professionals whom I got to observe and esteem; many even carried with them an earnest sense of public service and responsibility.
It was at about this time that the Bob Rae government accidentally came to power. Swift and Stewart explain how the NDP and Maurice Strongan environmentalist/free marketer hybrid who was Bob Rae's choice to lead the utilityultimately set Ontario Hydro down the road to privatization. The complete story introduces elements of neoconservative ideology mongering, the extraordinary actions of Premier Mike Harris, the eventual triumph of the "privatization express," and the chaos that followed when "the wheels came off."
Hydro is a compelling and easily digested book. It is not weighed down with technical jargon. You need not an expert in energy policy to be fascinated by this energetic treatment of politics at the most basic level of supplying modern needs. All that is required of the reader is an awareness of rising electricity rates, impending "brown outs," the implications of fossil fuel pollution and the problem of disposing of "spent" nuclear rods and, of course, massive government debt.
What happened to Ontario Hydro is in some ways unique, for no other instruments of provincial public policy have held the power that Ontario Hydro once did, nor have any been allowed to indulge in their own corporate fantasies to the same extent. Nonetheless, other important areasnot least education and health carehave experienced tremendous problems that bear comparison to the Hydro story. Most important, among these parallels, is the ideological acquiescence in, acceptance of, or commitment to neoconservative economicsa problem for all three major political parties and all citizens in Ontario.
For students of energy policy or the environment, politics or public administration and for citizens simply interested in the decisions that affect their lives, this is an excellent account of an absence of accountability.
Howard A. Doughty teaches in the Faculty of Applied Arts and Health Sciences at Seneca College, King City. He can be reached at email@example.com or 416-491-5050, ext. 5195.
• The views expressed by the authors are those of the authors and do not necessarily reflect those of The College Quarterly or of Seneca College.
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