This past week, Zoomer Media hosted a panel discussion on Ontario’s growing electricity rates which the media organization (affiliated with the Canadian Association of Retired Persons/CARP) says is adversely affecting seniors and others on fixed incomes.
Energy analyst Tom Adams was one of the panel members, who called on the government to rescind the Green Energy Act, which he says is at the core of the problems today. Wind power produces only 6 percent of the Ontario supply, he said, but at 30 percent of the cost.
Wind: 6% of the power for 30% of the costs
McMaster University professor Marvin Ryder agreed that expensive contracts were a problem but he said the damage has been done, and it will be 10 years before Ontario can climb out of the hole.
NDP leader Andrea Horwath said she still supports the Green Energy Act, but suggested creating subsidies for everyone having problems paying their electricity bills. (The cost of that would be …. added to the bills…)
The Ontario government awarded five contracts for new wind power generation in 2016, including two in the Ottawa area. The cost of these projects is about $1.3 billion. If the projects proceed (they do not yet have Renewable Energy Approvals/REA), the cost will be a further addition to Ontario electricity ratepayers’ bills.
Leeds-Grenville councillors say rural electricity rates are negatively impacting their constituents, farmers and businesses, although Burnbrae Farms – one business cited by council members as a victim of high rates – says electricity costs were not behind its recent decision to expand its operations out of province. The Burnbrae operation near Lyn is shown on Tuesday morning, Feb. 7, 2017. (Ronald Zajac/The Recorder and Times)
Frustration at Ontario’s high hydro rates boiled over at a United Counties meeting Tuesday as mayors railed against an “out-of-touch” provincial government that is indifferent to the plight of rural Ontarians.
“Seniors are losing their homes, seniors are going to food kitchens,” said Mayor David Gordon of North Grenville, who said he knows of 89- and 90-year-old farmers in his township who have to continue to work because they can’t afford their electricity bills.
Gordon said that if Americans were experiencing the same increasing power rates as in Ontario they would be demonstrating and rioting in the streets.
“Up here it’s just ‘deary, deary me’,” he said. “What’s going to happen when somebody dies because they don’t have any heat?”
Augusta Mayor Doug Malanka said the government has failed to consider the unintended consequences of high hydro rates.
As an example, Malanka cited the Prescott Curling Club, which has complained to the Ministry of Sport, Tourism and Culture that its escalating power bills put the future of the club in doubt.
Malanka said the club did extensive energy-saving upgrades to its rink several years ago. Despite this, the club’s power bill increased by $13,000 over an 18-month-period, bringing it to $25,000 annually, he said, noting that the rink operates only six months a year.
Club president Ron Whitehorne said the hydro bill now accounts for half of the club’s budget, and the rates continue to rise despite the $120,000 spent on renovations to make the rink more energy-efficient.
The rising rates, coupled with the depletion of the club’s capital reserves to pay for the improvements, has put a real squeeze on the volunteer-run club, Whitehorne said.
Malanka said counties mayors raised the hydro issues with Liberal MPP Bob Delaney, parliamentary assistant to the energy minister, at a meeting during last week’s Rural Ontario Municipal Association conference. Delaney was initially defensive about the mayors’ complaints, Malanka said, but he later agreed to a followup meeting with counties’ representatives. Warden Robin Jones agreed to contact Delaney to arrange a followup meeting.
Gordon said that the Liberal government has lost touch with the average Ontarian.
“These people living in Toronto don’t care because they are living in their fancy condo on the 27th floor,” he said.
Rideau Lakes Mayor Ron Holman, who chairs ROMA, said the Ontario government needs to set “predictable, prudent, long-term” hydro rates so that businesses and residents can plan for the future. Instead, the government seems to be taking an ad-hoc approach to hydro by fiddling with rates in response to the “flavour of the day,” he said.
Holman said Ontario Premier Kathleen Wynne is continuing to promise “adjustments” to hydro rates in the next budget.
“What does that mean? I have no idea. What assurance does that give to individuals or businesses that want to come to our community? It doesn’t,” he said.
Several mayors pointed to Burnbrae Farm’s decision to build new hen houses in Quebec, instead of Ontario, as a consequence of high energy costs. They were basing their comments on a news report that said the egg producer, which is centred in the United Counties of Leeds and Grenville, was expanding to Quebec to escape Ontario’s hydro rates.
But Margaret Hudson, president of Burnbrae Farms Ltd., flatly denied that hydro rates played a part in the decision.
“The cost of electricity was never a factor in our decision on where to locate our new farm,” Hudson said in a statement Tuesday.
Special guest will be Parker Gallant. Mr Gallant’s commentary on energy issues is regularly published in The Financial Post and other media; he is a former international banker and vice-president at Toronto Dominion Bank. He is vice-president of Wind Concerns Ontario.
The second event will be in early March, location TBA.
Public declaration demands cancellation of wind power procurement, and re-focus of energy policy by the Wynne government
January 9, 2017
The Ontario Multi Municipal Group has issued a public declaration stating it wants the “exploitation” of rural Ontario by the wind power industry, aided by the Ontario government, to end.
“The implementation and expansion of renewable energy (industrial-scale wind turbines and large solar power projects) has developed to the point that it has caused hydro costs to increase, caused a division between rural and urban municipalities, and caused the citizens of Ontario to lose faith in democracy,” says Ron Higgins, Mayor of North Frontenac, in the document.
The municipal group was formed at the last meeting of the Association of Municipalities of Ontario (AMO) after 115 municipalities, or 25 percent of all municipalities in Ontario, passed resolutions demanding that municipalities get final say in the siting of renewable power projects.
“We are now speaking out on behalf of all those communities,” Higgins says.
Rights of communities ‘neutralized’
The Green Energy Act of 2009 removed the right to carry out local land-use planning for power projects –the Multi Municipal Group says that’s wrong. “It neutralizes the rights of residents of rural Ontario to advocate for, rely on and claim the benefit of sound land-use planning principles,” Higgins says. “It amounts to a form of discrimination.”
In the public declaration document, the group lists the impact of Ontario’s wind power program, saying it has not brought the economic benefits promised by the McGuinty government and in fact has resulted in an economic burden and energy poverty. They also say that no environmental benefit has been demonstrated and that “the natural world is suffering” because of large-scale turbines which are disrupting the natural environment and harming wildlife such as migratory birds and endangered species of bats.
Wind power a ‘false hope’ for the environment
Wind power has created “false hope” of steps to be taken to combat climate change and protect the environment, says the Multi Municipal Group. And, the Government of Ontario has ignored knowledge of the negative impacts of invasive wind power technology.
The group demands that all procurement of wind power be stopped, and the Green Energy Act repealed. They also recommend that the government base future policies on generation capacity and conservation, and use current energy supply assets.
“Our rural communities are unprotected against the exploitation [by] renewable energy,” Higgins concludes. The municipalities have no choice but to declare their position to the government and the public formally.
Former banker and now energy analyst Parker Gallant has prepared a summary of submissions to the Ontario Ministry of Energy, which last fall asked for input to a new Long-Term Energy Plan (LTEP).
Aside from the vested interests in wind power, the stakeholder groups like the Canadian Federation of Independent Business, Canadian Manufacturers and Exporters, and the Ontario Society of Professional Engineers all recommended the government act now to get costs down. And that includes, getting rid of wind power.
From the article, an excerpt on two of the submissions made to the government.
Strategic Policy Economics – Marc Brouillette’s excellent submission on behalf of Bruce Nuclear also carries some sane observations such as “Wind generation has not matched demand since its introduction in Ontario” and, “Over 70% of wind generation does not benefit Ontario’s supply capability.” And this one, which is becoming more evident as ratepayers are forced to pay for curtailed generation: “Wind generation will not match demand in the OPO Outlook future projections as 50% of the forecasted production is expected to be surplus.”
The recommendation that will cause the most handwringing will be: “The LTEP should integrate the objectives of Ontario’s environmental, energy, industrial, and economic policies for the long-term future benefit of Ontarians.”
Wind Concerns Ontario – The coalition of community groups and individuals throughout Ontario had this to say by way of advice to the Ministry: “The government policy to promote “renewables” such as wind and solar have been a critical factor in the grave economic situation today. Wind power for example, now represents 22% of electricity cost, while providing only 5.9% of the power. Worse, that power is produced out-of-phase with demand, as has been detailed by two Auditors General; so much of it is wasted. This is unsustainable.
“Clearly,” WCO continued, “the direction for the Ministry of Energy is to formulate a new Long-Term Energy Plan that will take immediate action on reducing electricity costs. Those actions must include a review of all contractual obligations for power generation from wind, and action to mitigate further costs to the system, and the over-burdened people of Ontario.”
WCO called for cancellation of all the wind power contracts given in 2016, the FIT 5.0 program, and further, cancellation of all contracts for projects not yet built or which are not going to make a critical commercial operation date. In fact, all wind power contracts should be reviewed and paid out, as Ontario can save money by eliminating the need to dispose of the surplus electricity.
WCO vice-president Parker Gallant and president Jane Wilson speak on Ontario’s mismanaged electricity sector, energy poverty, wind turbine noise regulation, and what’s ahead for 2017
(C) Wind Concerns Ontario
Q:You’ve been telling people about the impact of renewables, specifically wind power, on Ontario’s electricity or hydro bills. How much of our electricity bills is due to the wind power/renewables program in Ontario?
Parker Gallant: I recently reviewed the cost of wind and solar generation relative to its contribution to Ontario’s demand for electricity and its impact on our electricity costs is shocking. Wind and solar in the first six months of 2016 delivered 8% of our generated power and represented 35% of the Global Adjustment which appears set to average over $1 billion per month. That represents a cost of over 36 cents a kilowatt hour (kWh), including the hourly Ontario energy price (HOEP).
Q: Parker, you’ve also been telling people about the Global Adjustment or GA, which is where a lot of charges are hidden. Do you think these charges should be detailed on our bills, or is that even possible?Parker Gallant: While I believe in principle the GA should be revealed on our monthly bills, in practice, that would require reams of paper. How will the local distribution company explain how much you are billed for curtailed wind generation or the meteorological stations that measure the amount of curtailed wind that might have been generated? How to explain, say, the cost of spilled hydro or steamed off nuclear or the water fuel fee, or how to tell the ratepayer how much they are subsidizing the rates for large industrial clients, or what it is costing under the rural and remote rate plan (RRRP) that transports diesel fuel to remote First Nations, among dozens of other items included in our monthly bills?
Q: The Premier and Energy Minister are now saying that parts of their policies have been a “mistake” and that they need to get bills down. Wind Concerns is saying that canceling wind power contracts is necessary for that to happen. Can you explain? How much are the 2016 contracts worth?
Parker Gallant: Interesting they are now admitting a “mistake,” but when George Smitherman was Energy Minister he was provided with a long-term energy plan that had been carefully developed by “experts” within the crown agencies. He chose to cancel the plan and instead, impose one developed in conjunction with outsiders who were NOT experts. Previous Energy Ministers (Dwight Duncan comes to mind for his “smart meter” for every ratepayer) made mistakes, as did those who followed such as Brad Duguid and were roundly criticized by both the media and by ratepayers. The canceling of wind power projects not yet built or even contracted is only “step one” and will slow the climb in our bills. The current Minister, Glenn Thibeault has only suspended Large Renewable Procurement or LRP ll, and needs to cancel it, as well as LRP I and any of those contracts now past their agreed-to start date. There are ways to reduce costs almost immediately.
Jane Wilson: Wind Concerns Ontario prepared a detailed document for the IESO on the Long-Term Energy Plan, suggesting ways they could save $1.7 billion annually. That would have an immediate cost reduction impact.
Q: The Energy Minister says that now, Ontario is a “net exporter” of electricity like that’s a good thing. He claims we’re making money: is that true?
Parker Gallant: Being a “net exporter” of 16.8 terawatts (TWh) in 2015 is simply a demonstration of being a bad planner and manager of the system. If one adds the spilled hydro and curtailed wind to the net exports, the 21.2 TWh could have provided over half of all average Ontario households with power for a full year, yet we sold it 2.36 cents/kWh while we paid 10.14 cents/kWh for its generation. Ontario contracted for far too much intermittent and unreliable wind and solar power creating a domino effect the increased our costs of generation. Paradoxically, if Ontario ratepayers consumed more of the annual excess power (15.5% in 2015) it would help reduce our per kWh cost.
Q: What is WCO’s stance on climate change?
Jane Wilson: Our position is that everyone wants to do the right thing for the environment, whether that is preventing air pollution or using the most efficient forms of power generation — but that isn’t industrial-scale wind. For example, the Ontario Society of Professional Engineers or OSPE says that the proliferation of large-scale wind will actually increase greenhouse gas emissions, therefore not achieving the government’s stated goals. In the OSPE’s most recent report, they say “Wind generation offers less GHG reduction value in Ontario because base-load generation is already carbon-free and wind generation often displaces hydroelectric and nuclear base-load generation.”
Q: Why does the Ontario government continue to force wind turbines on communities that don’t want them?
Jane Wilson: The government is acting on an ideology that is not supported by fact and to do that, it erased communities’ right to local land-use planning with the Green Energy Act. We think that’s wrong, and are supporting the now 116 municipal governments that have demanded a return of that control and also that community support be mandatory for wind power contracts. There is a concern too about communities in the North where there may not be elected municipal governments, where contracts can be awarded for wind power projects that have a significant negative impact on the natural environment, for little or no benefit.
WCO worked with Ontario municipalities on the mandatory support resolution.
Q:Can the government really cancel wind power contracts? Can a new government cancel the subsidy programs?
Jane Wilson: Yes. There are clauses in the contracts under LRP I that are “off-ramps” in the case of cancellation, and which set out the financial steps needed to do that. For example, the contract with EDP for the “Nation Rise” project south of Ottawa in North Stormont, worth $430 million over 20 years, would cost $250,000 plus reimbursement for development costs that must be justified, to a maximum of $600,000. And yes, government can cancel subsidy programs. The LRP II, now “suspended”, should be cancelled outright.
The other opportunity is to cancel wind power projects that do not have a “Notice-to-Proceed”: this is straightforward. WCO has also suggested to the IESO that the government look seriously at all contracts and review them for opportunities to cancel. Even costly negotiated buy-outs will reduce hydro costs significantly, due to the high cost of disposing of surplus power.
Q: What is WCO doing to help people already living with wind turbines, and the noise they produce?
Jane Wilson: We support the public health investigation being done by the Huron County Health Unit, and hope that other municipalities will take similar action. We are also looking at how research can be done to help change the Ontario regulations on noise –which are not based on current science and in fact, are completely inadequate to protect health. We prepared a detailed document on how to revise noise enforcement regulations, another on how the approval process must be changed to protect health, and we submitted a document to the World Health Organization which is preparing global noise regulations for wind turbines. In short, we take every opportunity possible to explain the situation for people living in communities where wind turbines and their noise emissions have been forced, without consent, on the people of Ontario, with the goal of having regulations and processes changed.
Q: What’s ahead in 2017?Jane Wilson: It’s a very different world for wind power now, than in 2009 when the Green Energy Act was passed. People are genuinely questioning the benefit of high-impact, large-scale wind power development, especially when there seem to be few, if any, benefits, and we are seeing the shocking results of the government’s complete mismanagement of the electricity sector such as lost jobs and rising energy poverty. We believe the government will have to take dramatic action if it is serious about getting electricity bills down. The fact that Ontario municipalities are speaking out on this issue and taking action will also have results, we believe. We are hoping for a complete halt to the ongoing damage of the government’s policies, and that there will be help for people already living with the noise and other impacts of industrial-scale wind turbines.
As for Wind Concerns Ontario, we are not stopping our work.
Wind turbine noise adversely affects people and the environment
Here is a paper from the Energy Collective, which includes a summary of noise regulations and setbacks. The writer’s conclusion is that worldwide regulation is needed, otherwise local regulation of noise is developed, with heavy influence from the wind power industry.
3-MW turbine south of Ottawa at Brinston: Ontario. Worldwide regulation needed to prevent wind industry influence [Photo by Ray Pilon, Ottawa]
December 19, 2016
Europe and the US have been building onshore wind turbine plants in rural areas for more than 25 years. Anyone living within about 1.0 mile of such plants would hear the noises year-round, year after year. Those nearby people would be experiencing:
Decreasing property values.
Damage to their health, due to lack of sleep and peace of mind.
Living with closed windows and doors, due to year-round noises.
Exposure to infrasound.
The wind turbine noise problem is worldwide. Due to a lack of worldwide guidelines, various political entities have been developing their own codes for the past 30 years. The World Health Organization is finally addressing the lack of detailed guidelines regarding such noises.
World Health Organization Noise Guidelines: WHO, publishes detailed guidelines regarding various, everyday noises, such as near highways and airports, within urban communities and in work places. The guidelines serve as input to local noise codes.
In general, wind turbines are located in rural areas. When they had low rated outputs, say about 500 kW in the 1960s and 1970s, they made little audible noise, and the infrasound was weak. However, when rated outputs increased to 1000 kW or greater, the audible and infrasound noises became excessive and complaints were made by nearby people all over the world.
Worldwide guidelines regarding wind turbine noises are needed to protect nearby rural people, such as regarding:
The maximum outdoor dBA value, how that value is arrived at, such as by averaging over one hour, where that value is measured, such as near a residence, or at the resident property line to enable that resident to continue to enjoy his entire property.
How to measure, or calculate the outdoor-to-indoor sound attenuation of a residence.
How much setback is needed, such as one mile to minimize infrasound impacts on nearby residents.
The maximum dB value of infrasound, how that value is arrived at, where that value is measured.
How to determine the need for a 5 dB annoyance penalty.
The lack of such guidelines has resulted in various political jurisdictions creating their own codes. That process has been heavily influenced by well-financed, pro-wind interests, which aim to have the least possible regulation to maximize profits.
Comparison of Wind Turbine Codes: Below are some highlights from the noise codes of various political entities to illustrate their diversity:
1) DENMARK: Because Denmark was an early developer of wind turbine plants, its noise code is more detailed than of most political entities. It has a buffer zone of 4 times total height of a wind turbine, about 4 x 500 = 2,000 ft, about 0.61 km (no exceptions), and it also has the following requirements regarding outdoor and indoor noise:
For dwellings, summer cottages, etc.: 39 dBA (wind speeds of 8 m/s, 18 mph) and 37 dBA (wind speeds of 6 m/s, 13 mph)
For dwellings in open country: 44 dBA (wind speeds of 8 m/s) and 42 dBA (wind speeds of 6 m/s)
The belowregulations describe the methods and time periods over which sounds are to be measured:
Page 4, par 5.1.1 mentions averaging over various periods. Only the worst average readings of a period are to be considered for compliance.
Page 4, par 5.1.2 mentions a 5 dB annoyance penalty must be added to the worst average readings for a period for clearly audible tonal and impulse sounds with frequencies greater than 160 Hz, which would apply to wind turbine sounds.
Page 6, par 5.4 mentions limits for indoor A-weighted low frequency noise 10 – 160 Hz, and G-weighted infrasound 5 – 20 Hz.
“If the perceived noise contains either clearly audible tones, or clearly audible impulses, a 5 dB annoyance penalty shall be added to the measured equivalent sound pressure level” That means, if a measured outdoor reading is 40 dBA (open country, wind speed 6 m/s), and annoyance is present, the reading is increased to 45 dBA, which would not be in compliance with the above-required 42 dBA limit.
In some cases, a proposed wind turbine plant would not be approved, because of the 5 dB annoyance penalties. The noise of wind turbines varies up and down. The annoyance conditions associated with wind turbines occur year-round. The annoyance conditions associated with other noise sources usually occur much less frequently.
NOTE: The 5 dB penalty does not apply to indoor and outdoor low frequency and infrasound noises, i.e., 160 Hz or less.
– For both categories (dwellings, summer cottages, etc.; open country), the mandatory limit for low frequency noise is 20 dBA (Vermont’s limit is 30 dBA), which applies to the calculated indoor noise level in the 1/3-octave bands 10 – 160 Hz, at both 6 and 8 m/s wind speed. The purpose of the regulation is to ensure neither the usual noise, nor the low frequency noise, will annoy nearby people when the wind turbines are in operation.
Denmark’s Controversial Noise Attenuation Calculations: The controversy in Denmark is regarding the Danish EPA assuming high attenuation factors for calculating attenuation from 44 dBA (outdoor) to 20 dBA (indoor, windows closed) for frequencies above 63 Hz, which yield calculated indoor noise levels less than 20 dBA. The Danish EPA prefers assuming high factors, because they result in compliance, which is favorable for wind turbines.
However, acousticsengineers have made indoor field measurements (supposedly “too difficult to measure”, according to the Danish EPA), which indicate many houses near wind turbine plants have lower than assumed attenuation factors, which results in indoor noise levels greater than 20 dBA, i.e., non-compliance, which is not favorable for wind turbines.
However, the final arbiters should not be government personnel using assumptions, but the nearby people. Increasingly, those people are venting their frustrations at public hearings and in public demonstrations.
2) POLAND is considering a proposed a law with a 2.0 km (1.24 mile) buffer zone between a wind turbine and any building. That means at least 65% of Poland would be off limits to wind turbines. Future wind turbine plants likely would be offshore. …
Internet giant Amazon Web Services has opened a cluster of data centres near Montreal due to the ready availability and cost of hydro-electric power in Quebec.
The company, which is notoriously secretive about its data centres, said there are now at least two data centres just outside Montreal to offer web-based services to the “Canada Region.” Canada joins 15 other regions around the globe from which Amazon is running data services on behalf of clients.
Teresa Carlson, vice-president of public sector with Amazon Web Services, said the cost and availability of hydro-electric power is ultimately what made Amazon choose Quebec as its Canadian home.
“We picked the area that we did because of the hydro power,” said Carlson. “We did find them (Quebec) to be very business friendly.”
Carlson said Amazon conducted a thorough review of various options within Canada, including Ontario, that involved looking at a number of factors, including the price of electricity. …
Wind power developer EDP Renewables, based in Portugal, will be holding an Open House information session on the 100-megawatt, 30+-turbine, $430-million wind power development they have called “Nation Rise” on December 13 in the arena in Finch.
Last week, MPPs Jim McDonell and Grant Crack took letters and petitions containing more than 1200 signatures from citizens of North Stormont and Nation Twp to the Legislature at Queen’s Park, demanding that the contracts for the two Ottawa-area power projects be cancelled.
The Open House information sessions are typically just poster sessions with developer staff available to answer any questions.
The site plan for the project has not yet been made available although proposed turbine locations are usually part of the application to the IESO for a power contract. The lack of a site plan means there are community members who may yet be unaware that they will have an industrial-scale wind turbine generating power near them.
Wind turbines emit a wide range of noise including low-frequency or inaudible noise which has been linked to adverse health effects. Wind turbines have also been implicated in disturbances to the water table and drinking water (Dover Twp, Ontario) via seismic vibration, and wind turbines are responsible for the deaths of migratory birds and endangered species of bats.
A few weeks ago, Ontario Premier Kathleen Wynne admitted that her government’s electricity policies have been “a mistake” and that they need to work to get consumer bills down. Last week, Energy Minister Glenn Thibeault admitted that an “arbitrary” choice of wind power as a source of power generation had led to “sub-optimal siting” and community concerns.
The Nation Rise power project will cost Ontario as much as $430 million over the 20-year life of the contract.
The Open House will be held from 3:30-7:30 PM.
EDP wind turbine and home at South Branch project, Brinston, Ontario. Photo by Ray Pilon.
Former bank vice-president and vice-president of Wind Concerns Ontario was in Ottawa this past weekend, speaking at a Town Hall in Kanata on the details of Ontario’s electricity bills.
Today, he published an analysis of how much wind power is really costing us, on his Energy Perspectivesblog. When the well-financed wind power lobby claims wind power prices are low, they don’t factor in other costs such as wasted hydro, gas, and nuclear, he says.
This is really shocking, given the rise in energy poverty in Ontario.
For the cost to provide a small portion of Ontario’s power, wind is no bargain
Most electricity ratepayers in Ontario are aware that contracts awarded to wind power developers following the Green Energy Act gave them 13.5 cents per kilowatt (kWh) for power generation, no matter when that power was delivered. Last year, the Ontario Auditor General’s report noted that renewable contracts (wind and solar) were handed out at above market prices; as a result, Ontario ratepayers overpaid by billions.
The Auditor General’s findings were vigorously disputed by the wind power lobbyist the Canadian Wind Energy Association or CanWEA, and the Energy Minister of the day, Bob Chiarelli.
Here are some cogent facts about wind power. The U.K. president for German energy giant E.ON stated wind power requires 90% backup from gas or coal plants due to its unreliable and intermittent nature. The average efficiency of onshore wind power generation, accepted by Ontario’s Independent Electricity System Operator (IESO) and other grid operators, is 30% of their rated capacity; the Ontario Society of Professional Engineers (OSPE) supports that claim. OSPE also note the actual value of a kWh of wind is 3 cents a kWh (fuel costs) as all it does is displace gas generators when it is generating during high demand periods. On occasion, wind turbines will generate power at levels over 90% and other times at 0% of capacity. When wind power is generated during low demand hours, the IESO is forced to spill hydro, steam off nuclear or curtail power from the wind turbines, in order to manage the grid. When wind turbines operate at lower capacity levels during peak demand times, other suppliers such as gas plants are called on for what is needed to meet demand.
Bearing all that in mind, it is worth looking at wind generation’s effect on costs in the first six months of 2016 and ask, are the costs are reflective of the $135/MWh (+ up to 20% COL [cost of living] increases) 20 year contracts IESO, and the Ontario Power Authority awarded?
As of June 30, 2016, Ontario had 3,823 MW grid-connected wind turbines and 515 MW distributor-connected. The Ontario Energy Reports for the 1st two quarters of 2016 indicate that wind turbines contributed 4.6 terawatts (TWh) of power, which represented 5.9% of Ontario’s consumption of 69.3 TWh.
Missing something important
Not mentioned in those reports is the “curtailed” wind. The cost of curtailed wind (estimated at $120 per/MWh) is part of the electricity line on our bills via the Global Adjustment, or GA. Estimates by energy analyst Scott Luft have curtailed wind in the first six months of 2016 at 1.228 TWh.
So, based on the foregoing, the GA cost of grid-accepted and curtailed IWT generation in the first six months of 2016 was $759.2 million, made up of a cost of $611.8 million for grid-delivered generation (estimated at $133 million per TWh) and $147.4 million for curtailed generation. Those two costs on their own mean the per kWh cost of wind was 16.5 cents/kWh (3.2 cents about the average of 13.3 cents/kWh). The $759.2 million was 12% of the GA costs ($6.3 billion) for the six months for 5.9% of the power contributed.
But hold on, that’s not all. We know that wind turbines need gas plant backup, so those costs should be included, too. Those costs (due to the peaking abilities of gas plants) currently are approximately $160/MWh (at 20% of capacity utilization) meaning payments to idling plants for the 4.6 TWh backup was about $662 million. That brings the overall cost of the wind power contribution to the GA to about $1.421 billion, for a per kWh rate of 30.9 cents. If you add in costs of spilled or wasted hydro power to make way for wind (3.4 TWh in the first six months) and steamed off nuclear generation at Bruce Power (unknown and unreported) the cost per/kWh would be higher still.
So when the moneyed corporate wind power lobbyist CanWEA claims that the latest procurement of IWT is priced at 8.59 cents per kWh, they are purposely ignoring the costs of curtailed wind and the costs of gas plant backup.
22% of the costs for 5.9% of the power
Effectively, for the first six months of 2016 the $1.421 billion in costs to deliver 4.6 TWh of wind-generated power represented 22.5% of the total GA of $6.3 billion but delivered only 5.9% of the power. Each of the kWh delivered by IWT, at a cost of 30.9 cents/kWh was 2.8 times the average cost set by the OEB and billed to the ratepayer. As more wind turbines are added to the grid (Ontario signed contracts for more in April 2016), the costs described here will grow and be billed to Ontario’s consumers.
CanWEA recently claimed “Ontario’s decision to nurture a clean energy economy was a smart investment and additional investments in wind energy will provide an increasingly good news story for the province’s electricity customers.”
There is plenty of evidence to counter the claim that wind power is “a smart investment.” But it is true that this is a “good news story” — for the wind power developers, that is. They rushed to Ontario to obtain the generous above-market rates handed out at the expense of Ontario’s residents and businesses. And we’re all paying for it.