In today’s Ottawa Citizen, a report from Don Butler on the rise in rates for power from Ottawa Hydro. Here’s a comment from someone whose opinion we regard highly, Robert Lyman, former Director-General, Environmental Affairs, with Transport Canada.

The Citizen story is here: http://www.ottawacitizen.com/technology/Modest+Hydro+Ottawa+increase+masks+steep+rise+electricity+rates/7797528/story.html

With his permission, we post Bob Lyman’s comment here:

It tells only a small part of the story, of course. The focus of the article was on the effects of time-of-use rates as compared to delivery charges, with just a passing reference to the taxpayer subsidy that will expire in a few years. The other way of presenting the increases is in terms of the average costs of electrical energy minus the delivery (transmission and distribution) charges. Those increased 85 % from 2005 to 2011 and were projected by Ontario Power Generation to increase another 46% from 2012 to 2015. There are good reasons to believe that the 46% figure is an under-estimate.

More important, the article did not explain why costs are increasing so much, when demand is falling. The answer lies in much higher costs now being paid for new generation sources like wind and solar and the expensive energy “conservation” programs. The effects of these costs are just beginning to be felt. As industrial wind turbines become a much larger share of generation in future, the cost increases will accelerate.

Add to this the costs of implementing the “smart meters” program, which is probably in the range of $2 billion province-wide for the meters and local distribution costs alone, and the huge costs of expanding the transmission system to pick up all the disparate source of electricity generation from wind, and you have an electrical system headed for major rate increases for the foreseeable future.

We as taxpayers are providing a huge subsidy so that we as ratepayers will be lulled into thinking that the electrical energy system is all right. Unfortunately it isn’t.

We would add to this a repetition of the results of a Library of Parliament analysis of the wind power project planned for the south-west rural area of Ottawa, as requested by Nepean-Carleton MP Pierre Poilievre. The research found that the subsidy for this particular project would be on the order of $4.8 MILLION per year.

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