TORONTO - The prospect of a billion-dollar bill isn't dampening the Ontario government's enthusiasm for the federal Liberals' controversial carbon tax plan, Premier Dalton McGuinty said Wednesday.

McGuinty, who initially opposed a carbon tax, said Liberal Leader Stephane Dion's "green shift" plan is still a good idea, even though it could slap a hefty bill on emissions from Ontario's four coal-fired generation plants.

"We'll take a close look at the consequences of that but we expect that we will benefit from putting in place new sources of energy," McGuinty said.

"It's one more reason why we need to eliminate coal-fired generation."

Dion's carbon-tax plan would initially peg the price of greenhouse gas emissions at $10 per tonne, rising to $40 per tonne in four years.

That would add a $1.1-billion tax on Ontario's four coal-fired plants, the province's largest industrial polluters, which produced about 28 million tonnes of emissions last year.

McGuinty failed to live up to a 2003 election promise to close all of the plants, shutting only the Lakeview station in west Toronto in 2005. The remaining four plants are slated to close by 2014.

The Ontario Liberals are currently overseeing an ambitious $26-billion plan to refurbish and replace its aging nuclear fleet, including building two new reactors, which would offset the need for coal-fired generation.

A spokeswoman for newly-minted Energy and Infrastructure Minister George Smitherman said the province is already working to reduce emissions by two-thirds below 2003 levels by 2011.

"In terms of what the price is going to be down the road, it's not something that you can try to pull out of the air right now," said Laurel Ostfield.

"The politics are out of the pricing right now in Ontario and we're going to keep it that way."

Ted Gruetzner, a spokesman for the government-run Ontario Power Generation, also refused to speculate on the potential cost increases consumers may face if Ottawa imposed the tax.

McGuinty seems to be Dion's only provincial ally in the carbon tax plan, which was unveiled last week after pre-emptive attacks by the governing Conservatives. Several provincial leaders have rejected Dion's proposal outright, while others have been reluctant to embrace it.

Prime Minister Stephen Harper warned last week that the plan would "screw everybody across the country" much like the old national energy program, which is still criticized for draining money from the West and sending it to Central Canada.

With emissions priced at $40 per tonne, the tax would raise about $15 billion annually. Dion said it would be offset by an equivalent cut in income and business taxes and a boost in tax breaks for poor, elderly, northern and rural Canadians who stand to be hardest hit by the increased cost of necessities like home heating fuel, electricity, food and travel.

When asked about Dion's carbon tax proposal last month, McGuinty dismissed it, saying his "first choice" for Ontario was a cap-and-trade system with neighbouring Quebec.

He also rejected the idea in February after British Columbia unveiled a carbon tax in its provincial budget, saying it didn't suit Ontario's economy.

McGuinty's flip-flop on the issue isn't surprising, said NDP critic Peter Tabuns.

"I don't know what's going on in the premier's mind on this," he said.

"I mean, he's a premier who doesn't have a climate plan, who doesn't take climate change seriously. So if he goes for a plan that's being put forward by Stephane Dion that has no climate protection targets, maybe that's consistent."

Nearly two weeks ago, McGuinty bristled at suggestions that he might raise taxes to pay for programs if government revenues fall drastically in the tough economic times ahead.

And yet he supports a new tax that will punish consumers by driving up the cost of electricity, said Progressive Conservative critic John Yakabuski.

"An additional billion dollars - that only gets passed on to one place, and that's the electricity consumer," he said.

"I just don't think people can absorb that at this time."

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