As outrage over broken promises and new health taxes continues to simmer, Premier Dalton McGuinty is facing a long hot summer of taxpayer discontent. The only political bright spot, ironically, has been Ontario's tepid weather - which means lower demand for hydroelectric power, and less chance of the brownouts and mass blackout which plunged the province into darkness last summer.

Despite cooler temperatures, however, the hydro file is still very much on the government's mind - and this week, it gave taxpayers a nasty shock. Energy Minister Dwight Duncan announced that the government plans to drop $1 billion of public money to restart a second Pickering nuclear plant. This decision forms part of the government's strategy to restructure Ontario Power Generation (OPG) and Hydro One, where mismanagement and cushy consulting contracts made front-page news last fall.

The decision comes in the wake of the report of the OPG Review Committee, headed by former federal finance Minister John Manley, which was released earlier this year. The Committee recommended that OPG consider private-public arrangements, abandon "green" electricity generation, close coal plants, and prioritize investment in nuclear power. Atomic Energy Canada Limited is also forcefully pushing the nuclear agenda - no surprise since they hold the contracts for Ontario's twenty existing reactors.

The government is not adopting all the Review Committee's recommendations: by 2007 it aims to generate 5 per cent of the province's electricity needs through renewable sources such as wind power. But during the last provincial election, Mr. McGuinty pledged to shut down Ontario's coal plants, which currently provide 25% of the province's power. Unfortunately for Ontario taxpayers, that seems to be one promise he's bent on keeping - by falling back on risky, money-losing nuclear power plants.

To date, the results of Ontario's decades-old nuclear experiment are bleak: seven mothballed reactors and a $30 billion stranded hydro debt. The tab for refurbishing the four Pickering reactors is estimated at $4 billion, more than $3 billion higher than originally projected. Just last December, three top OPG executives resigned when it was revealed that repairs at the plant were years behind and billions of dollars over budget. Even in a properly-managed system, the long-term economic viability of nuclear power is questionable, since permanent disposal mechanisms for nuclear waste are still on the drawing board and the cost of storing nuclear by-products is extremely high.

The coal plants McGuinty plans to close actually provide the cheapest source of power. According to official statistics from Ontario's power marketer, since 2002, coal-fired generation produced power at 3.38 cents per kilowatt/hour, compared with 7.64 cents for gas, 8 cents for oil and 7.67 cents for water power. As taxpayers are already paying higher prices since the price cap was lifted April 1, shutting down Ontario's five existing plants will hit them even harder in the pocketbook.

A chorus of voices have decried the government's decision to close the plants, including the provincial Electricity Conservation and Supply task force and Financial Post editor Terrence Corcoran, who noted that "In the United States, where markets are less rigidly controlled by politicians, there's a major oversupply of electricity. Coal is set to account for more than 50% of supply until at least 2025." Upgrading Ontario's coal plants and building new ones with tougher emission controls would be the more intelligent choice.

According to the experts, Ontario will face power shortages as early as 2006. This makes the hydro file nothing short of a political time bomb - which threatens to blow up in taxpayers' faces. One can only hope that the unseasonable weather lets cooler heads prevail, and that the government advances a more viable solution for Ontario's hydro woes.