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Energy: Policy Priority And Business Opportunity – CME Report

Submitted by Ian T. Howcroft, Vice President, Canadian Manufacturers & Exporters (CME) Ontario. Energy, its cost, availability and reliability, is a key issue and priority for Ontario manufacturers. In fact, when Ontario Hydro was established over 100 years ago, it created a hydro-electric system that enabled Ontario to create one of the most powerful manufacturing economies in North America. However, a lot has changed since the system was created by Sir Adam Beck when electricity was generated almost exclusively by hydro.

Today, many people, if not the majority, probably still think that most of our electrical power is generated through hydro. This is not the case, and has not been the case for many years. Today over 50% of our electricity comes from nuclear power, and this will be the case for the foreseeable future. We used to produce approximately 30% of our power from coal, but the government has committed to reducing all reliance on coal by 2014 and we are now down to about 7%.

We have been building new power plants that use gas, and we have been fortunate in that natural gas prices are at very low prices—the lowest in ten years. We have increased supply from green energy, particularly wind and solar, but even with the significant increased in ‘green’ energy production, it still generates a very small amount of the total. However, the costs to produce wind and solar have been relatively high, and while CME has supported looking to new generation methods, we should always be governed by the economic realties. The trend has been and will continue to be for increases in energy prices, so government must take all actions necessary to keep costs down. Manufacturing relies heavily on energy and is more impacted than many other sectors by increased energy prices. Energy will continue to be a major policy issue for CME for a long time.

In addition to our policy focus on energy, we have also been highlighting and promoting the business and supply chain opportunities that manufacturers can take advantage of.

For several years, CME has been working in partnership with the Ontario government (MEDI) to deliver a program called “Energy Connections”. The program has been building awareness, promoting opportunities and facilitating business relationships in the energy supply chains. We have focused five key opportunities: Oil Sands, Wind, Solar, Nuclear, and Smart Grid. The interest has been enormous, and the opportunities continue to grow.

Hundreds of billions will be spent in the oil sands over the coming years, and billions will be spent on refurbishing Ontario’s nuclear fleet. CME did a study of this that demonstrated the economic advantages that accrue to Ontario through the investments that have been made and will be made to maintain our nuclear generators. (Copies of the Study are available on request).

To highlight these opportunities we are holding a major conference in Niagara Falls on May 9th (reception May 8th). This is an excellent opportunity to learn about how one can benefit from the energy supply chains, and to increase one’s network and build relationships. For more information please check our website: http://tinyurl.com/ONTEC2012
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About CME – Canadian Manufacturers & Exporters (CME) is Canada’s leading trade and industry association, and the voice of manufacturing and global business in Canada. For more information, visit www.cme-mec.ca.