Tag Archives: Ontario Energy Board

Did the Ford government really cancel the Eastern Fields wind power project? Waiting for answers

06 Wednesday Mar 2019

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Citizens thought this power project was gone. Is it? [Photo: Ontario Farmer]

March 6, 2018

Citizens of The Nation are waiting for answers from the Ford government after it was discovered — by accident — that the Ontario Energy Board awarded a 20-year licence to generate electricity to the Eastern Fields wind power project.

Eastern Fields was on the list of 758 power projects cancelled by the Ford government last July, and a check with the Independent Electricity System Operator (IESO) shows that the power developer, U.K.-based RES Canada does not now have a contract.

On the other hand, when both Wind Concerns and community group Save The Nation checked with a Ministry of the Environment, Conservation and Parks officer on the project status, the response was that it is in “technical review.” (This is an onerous process by which civil servants look at boxes on an application and see whether there is a check mark. Important information such as the presence of unstable Leda Clay in the case of the Nation Rise project, need not be assessed, or even known.)

Save The Nation put out the following news release, and is waiting for answers from the Ontario Minister of Energy, Greg Rickford.

In the meantime, says Wind Concerns Ontario president Jane Wilson, the citizens of The Nation lost seven valuable months in which they could have been gathering data on environmental impacts from the wind turbines. Wind Concerns Ontario has government records of thousands of reports about excessive wind turbine noise, which have not been resolved.

Media Release

For immediate release

How Can a Cancelled Wind Turbine Project Receive a Licence to Produce Electricity?

ST-BERNARDIN – Save The Nation is seeking answers from the Ontario Minister of Energy, Greg Rickford, regarding the issuance of an Electricity Generation Licence to the ‘cancelled’ Eastern Fields industrial wind turbine project. The Ontario Energy Board issued the licence on December 6, 2018, even though Minister Rickford had announced the cancellation of Eastern Fields project on July 13, 2018.

“We were shocked to find out about this licence. We do not understand why or how a cancelled project can be issued a licence to produce electricity for a period of 20 years – until 2038. We’re also extremely disappointed that the Ford government does not seem to follow through with its announcement,” says Julie Leroux, spokesperson for Save The Nation.

Eastern Fields was one of 758 projects identified by Minister Rickford for wind-down on July 13, 2018, following a promise to cancel unnecessary and wasteful energy projects in order to cut hydro rates. “We’re asking Minister Rickford to confirm that this promise has been kept and that Eastern Fields Wind Farm LP is a dead project with no chance of ever moving forward. We also ask him to revoke the useless Electricity Generation Licence EG-2018-0213” adds Leroux.

The Electricity Generation Licence was issued on December 6, 2018. Incidentally, on that same day, the Ontario Government adopted the Green Energy Repeal Act, which will affect other acts and regulations, namely the Environmental Protection Act, the Renewable Energy Approvals Regulation 359/09 and the Planning Act when fully enacted.

Save The Nation is a grass-root movement that has been opposing the Eastern Fields industrial wind turbine project near St-Bernardin in The Nation Municipality and Champlain Township since it was publicly announced in June 2015. Save The Nation is not against green initiatives, but is fiercely opposed to the process that was used for the approval of renewable energy projects in Ontario under the Green Energy Act.

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Link to July 13, 2018, Ontario Media Release: https://news.ontario.ca/mndmf/en/2018/07/ontario-to-cancel-energy-contracts-to-bring-hydro-bills-down.html

Attachments: Letter sent to the Minister of Energy Honorable Greg Rickford-March1-2019

Information:

Julie Leroux

Save The Nation Society

sauvonslanation@xplornet.com

www.sauvonslanation.ca

The real cost of closing Ontario’s coal power plants (what the government didn’t tell you)

29 Monday Aug 2016

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Part I

Replacing coal in Ontario: what the government really did

There is so much mythology now around Ontario’s coal plants for power generation, it really is time to set the record straight on what really happened, how much it cost, and what was actually achieved. This is the first in a two-part series by Parker Gallant.

Intermittent, undependable wind power installed to replace coal-fired power generation. Seen here: a new turbine in the Algoma Highlands. Photo: Gord Benner
Intermittent, undependable wind power installed to replace coal-fired power generation. Seen here: road construction for a new turbine in the Algoma Highlands. Photo: Gord Benner

Back in 2011, Ontario had coal plant capacity of 4,484 MW but the plants really operated only occasionally, producing 4.1 terawatts (TWh) of power — just 10.5% of their capacity. The 4.1 TWh they generated in 2011 represented 2.7% of total power generation in Ontario of 149.8 TWh.  The cost  per TWh was $33 million or 3.3 cents/kWh, making the ratepayers’ bill for those 4.1 TWh $135 million.

As most Ontarians know, those coal plants were either closed (Lambton and Nanticoke) or converted to biomass (Atikokan and Thunder Bay). We were continually told closing or converting those coal plants would save Ontario’s health care system $4.4 billion, based on a study completed while Dwight Duncan was Ontario’s Energy Minister.  Duncan’s claim was a fictitious interpretation of the actual study, but it was repeated so often by Liberal ministers and MPPs that they all believed it and presumably felt the public believed it, too.  

Good PR but … the truth?

Whether one believes the Duncan claim, the fact is the coal plants were closed or converted and the ruling Ontario Liberal government made a big deal of it even to the point of obtaining an endorsement from Al Gore as the first jurisdiction in North America to end coal fired power generation.

The government never disclosed how much it cost the ratepayers/taxpayers of the province to close or convert those coal plants, and we certainly haven’t seen any improvement in our healthcare system since it happened, as one would expect from saving billions. So, was the claim of savings a falsehood? And what did closing the plants really cost?

Let’s start with looking at our electricity consumption level in 2011 and compare it to 2015. In 2011 Ontario generated 149.8 TWh and consumed 141.5 TWh.  In 2015 we generated 159.6 TWh, including 5.9 TWh of embedded generation, and we reportedly consumed 137 TWh, not including the 5.9 TWh of embedded generation consumed within the confines of your local distribution company (LDC).

The difference of 8.3 TWh in 2011 and 16.7 TWh in 2015 was exported.

Replacing coal-fired generation 

As noted, coal capacity was 4,484 MW in 2011 and in 2015 was zero — so what did we replace it with?   According to the Independent Electricity System Operator (IESO) Ontario Energy Report for Q4 2015, since the end of 2011 we have added:

  1. Nuclear supply increased by 1,532 MW (Bruce Power)
  2. 754 MW of hydro
  3. Natural gas generation increased 602 MW
  4. 2,580 more MW capacity of industrial wind turbines (IWT)
  5. Solar up by 2,078 MW
  6. Bio-mass increased by 481 MW (principally conversions of Atikokan and Thunder Bay from coal)
  7. “Other” increased by 10 MW

As well, residential ratepayers conserved 1.184 GWh1. , equivalent to 450 MW of wind turbines operating at 30% of capacity (generating electricity intermittently and out-of-phase with demand).

So altogether, Ontario added 8,037 MW of capacity to cover the loss of 4,484 MW of coal which, in 2011, operated at only 10.5% of capacity.

Ratepayers also reduced consumption by 6,553 GWh with residential ratepayers representing 1,184 GWh of that reduction.

It would appear the variations of long-term energy planning emanating from the Ontario energy portfolio continually overestimated future demand by a wide margin. Their numerous ministerial directives to the Ontario Power Authority (merged with IESO January 1, 2015) with instructions to contract more and more unreliable intermittent wind and solar generation with “first-to- the-grid” rights at high prices produced surplus energy.

This stream of directives and the acquisition of excess capacity resulted in increasing electricity costs for ratepayers due to surplus generation and payment guarantees for displaced generation.

They also added other expensive policies such as conservation initiatives that simply piled on unneeded costs.

Parker Gallant

August 28, 2016

  1. Interestingly, the OEB in a revision to the “average” residential ratepayers monthly consumption reduced it from 800 kWh to 750 kWh, yet suggests conservation achieved (2011 to 2014) was 1,184 gigawatts (GWh).   The total number of residential ratepayers suggests that consumption has declined by 2,739 GWh (4,564,835 residential ratepayers at December 31, 2015 X 50kWh [montly] X 12 = 2,739 GWh) since 2009.

NEXT: The second in this series will examine the additional costs associated with the various policies applied and how generation additions to Ontario’s energy mix continue to drive up Ontario’s electricity costs

 

[Reposted from Wind Concerns Ontario and Parker Gallant Energy Perspectives]

Ontario quashes citizen participation in electricity issues

04 Monday Jan 2016

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Government halts assistance for citizens, community groups to present views on rate increases and more

Chiarelli's Bill 112: citizens lose the ability to hold utility monopolies to account [Photo Richard Brennan Toronto Star]

Chiarelli’s Bill 112: citizens lose the ability to hold utility monopolies to account [Photo Richard Brennan Toronto Star]

Toronto Star, January 4, 2016

By: Brady Yauch Published on Mon Jan 04 2016

Ontario’s desire for total control over all aspects of the electricity sector is nearly fulfilled.

The push to eliminate dissent and independent review of the province’s energy monopolies has been a decade in the making. Since 2004, many of the province’s largest and most expensive policies were implemented with little to no oversight — at great cost to ratepayers, as the Auditor General forcefully highlighted in her recent annual report.

But Queen’s Park is set to fully take over all decision-making regarding the province’s energy monopolies by solidifying its control over the province’s energy regulator, the Ontario Energy Board (OEB), with the recent passing of Bill 112. In doing so, Ontario is shutting down the last arena of independent public review of the billions of dollars being spent by the province and its many publicly owned utilities.

The legislation, “Strengthening Consumer Protection and Electricity System Oversight Act,” would deny independent intervenors the funds needed to hire the lawyers and experts needed at these hearings, effectively blocking their participation.

Prior to this legislation, any individual ratepayer or organization representing ratepayers — ranging from big, industrial groups to cottage associations or low-income organizations — could apply for funding and act as an intervenor in any rate application. The government would instead replace the independent intervenors with a new government-appointed consumer representative.

In other jurisdictions where this has occurred, the direct cost of this new bureaucracy has been far more expensive than the cost of reimbursing intervenors for their lawyers and consultants. The indirect costs of losing the ability to hold the utility monopolies to account by forcing them to justify their proposed rate increases before the OEB could be much greater still.

One study found that intervenors have been highly successful at paring back the monopolies’ rate requests, their lawyers and consultants costing ratepayers just 2 cents annually while helping to reduce rate increases by $28 per customer. Other studies found that intervenors account for 1 per cent or less of overall regulatory costs, which themselves are a small amount of total electricity costs borne by ratepayers.

Replacing these groups with a government-appointed consumer representative charged with questioning government-owned monopolies eliminates the last remaining voice of independent review of proposals by public monopolies to spend billions of dollars on capital projects.

The province’s new legislation also ensures that any new transmission line can be deemed a “priority project” by the ministry of energy and automatically approved by the OEB. In the past, the OEB would analyze such projects to determine whether they were necessary or cost-effective. Furthermore, the province is considering more legislation that will exempt all government-directed energy plans or projects to be exempt from the Environmental Assessment Act.

The province’s previous moves to sidestep independent review have been costly for ratepayers. The smart meter rollout — which cost ratepayers $2 billion and counting and still isn’t fully functional — was done without any review from the OEB or other regulators. Billions of dollars in contracts have been — and continue to be — given to renewable energy and natural gas generators without any review by the OEB or intervenors. And the long-term energy plans developed by the province’s own energy planning experts — the Ontario Power Authority (OPA) — were never implemented and, instead, were replaced with plans written by the ministry of energy that were, again, never fully reviewed at the OEB and were later criticized by the Auditor General as overly expensive.

More recently, the province collapsed the OPA into another energy agency, the Independent Electricity System Operator (IESO), which is in charge of operating the province’s wholesale electricity market, ensuring that even more political control is embedded in ever more parts of the electricity sector. There is no longer anything “independent” about the Independent Electricity System Operator.

In the end, the OEB and the intervenors were the last voice of criticism that wasn’t on the payroll of the province. By replacing them with a government-led consumer advocate, the province will control every step of decision-making on electricity policy and spending, those pesky checks and balances eliminated at last.

Brady Yauch is an economist and Executive Director of the Consumer Policy Institute (CPI). He has acted as an intervenor at the OEB.

Electricity bills go up again January 1

30 Wednesday Dec 2015

Posted by in Renewable energy, Wind power

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HydroShame

CBC December 30, 2015

Residential electricity users in Ontario are set to pay more for power in 2016 due to changes that take effect with the flipping of the calendar, according to one energy consultant.

“You can take a look at your electricity bill today,” said Tom Adams as 2015 draws to a close, “and these are the good old days.”

He estimated bills will go up from to six to seven per cent for power consumed starting Jan. 1. That would be on the heels of time-of-use rate hikes that took place Nov. 1, and ahead of more rate hikes planned for May 1, 2016.

The energy minister has said he’s focused on slowing the rate at which the cost of electricity is increasing. A statement from Bob Chiarelli’s office insisted bills are increasing more slowly than in neighbouring jurisdictions.

End of debt charge, clean energy rebate

After Dec. 31, 2015, the debt retirement charge comes off residential electricity bills, although other users such as those in business and industry will continue to pay down the debt incurred by the former Ontario Hydro through at least 2018.

On the same day, the province’s clean energy benefit expires. It was introduced in 2011 and has meant a 10-per-cent rebate on electricity bills.

The two changes do not offset one another, so people will end up paying more for electricity consumed in 2016, said Adams, who estimated the clean energy rebate has typically been double to triple the charge homes paid against the Ontario Hydro debt.

To help those with a low income deal with the loss of that 10-per-cent rebate, the province will begin the Ontario Electricity Support Program starting Jan. 1.

As of late December, people who could be eligible had been slow to apply to that program.

Seven weeks in, the Ontario Energy Board said 19 per cent of the 500,000 users it targeted had applied, which Brian Hewson, its senior manager of strategic policy, called “an excellent response to a program that has been open for such a short period of time.”

All electricity rate payers are being charged $0.0011 per kilowatt-hour to pay for the new credits for those on low incomes.

Province phasing in fixed distribution rates

The hydro bill becomes further complicated, Adams said, as Ontario moves toward a system where every home pays the same, fixed distribution rate.

Starting Jan. 1, the amount of electricity a household consumes will count less and less toward what it’s charged for using the grid.

“The network of poles and wires that are used in your community really don’t vary much in cost depending on how much you use them,” said Hewson of the Ontario Energy Board.

As more Ontarians install solar panels and other technologies, for instance, Hewson said their use of the grid shouldn’t be subsidized by others, who currently pay more for distribution because they use more.

Adams argued that change means a single-bedroom condo that uses very little energy will end up seeing an increase on their bills and a large, single home with many residents will see a decrease.

But large users of electricity will still pay more overall, said Hewson, who said it makes more sense for consumers to focus on the time-of-use line on their electricity bill because that’s where they can consider how they can conserve power.

The energy minister’s office said that a fixed charge will help companies “recover distribution costs” and “remove the disincentive utilities have to encourage customers to conserve.”

For the one in five electricity users that will see their bills go up because of a move to fixed rates, Chiarelli’s office said it will be limited to a hike of 4 per cent per year.

Editor’s note: translation–you pay and pay and pay. Conserve, you pay; use, you pay. Renewables contribute only a fraction of the power Ontario needs but account for a substantial portion of the cost to users. Help for families in “energy poverty”? You’re paying for that, too, though why we are in this situation in energy-rich Ontario (where we are selling surplus power at bargain basement prices) is a mystery of policy and ideology.

Reasons for Nov 1 hydro rate increase not transparent

17 Saturday Oct 2015

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Wind? You pay. No wind? You pay. And pay.

Wind? You pay. No wind? You pay. And pay.

Reposted from Wind Concerns Ontario

The OEB hides the truth on rate increases

The Ontario Energy Board (OEB) reported their semi-annual bad news via the News Release that always contains depressing announcements about upcoming rate increases.   Couched in words meant to assuage the reader, is this statement: “The price is increasing by approximately $4.42 per month on the ‘Electricity’ line, and about 3.4% on the total bill, for a household that consumes 800 kWh per month.”

The OEB doesn’t issue a press release when your local distribution company increases their rates, part of the “total bill,” so that reference is meaningless.

If you look at the actual price rise from November 1, 2014 to November 1, 2015 the increase is considerably more than 3.4%.   In fact the increase on the charge for the “Electricity” line is 12.8% excluding the HST applied on that increase.   The charge for electricity for the “household that consumes 800 kWh per month” increased by a total of $130.31, not the $53.04 that the OEB infers.   Even using the “average” RPP (regulated price plan) posted on their site and comparing November 1, 2014 to November 1, 2015, you get an increase of 12.5%!

Costs from renewables are one-third of the increase

Looking further that what’s in the OEB News Release, we find that they attribute the increase as follows: “Increased costs from Ontario Power Generation’s (OPG) nuclear and hydro-electric power plants make up about 40% of this increase. Costs from renewable generation sources are another driver, representing about one-third of the increase.” I emphasized the last sentence as it doesn’t reflect certain facts about renewable generation (principally wind and solar), including the need to pay OPG for spilled (unused) hydro power, payments to gas plants to idle (ensuring power is available when the wind dies down or the clouds cover the skies), or directions to complete marginal generation (Mattagami’s project cost was $2.6 billion) which produces power when it’s not needed, in the Spring and Fall periods when Ontario’s demand is low.

Millions lost in one day

You need only look back to October 13, 2015, a windy day when the industrial wind turbines were cranking out unneeded power. The reported 3,450 MW of wind capacity was spitting out an average of 2,200 MW per hour, at a cost for the whole day of $6.5 million. Ontario was busy exporting 2,228 MW every hour that day, being paid 1.8 cents a kWh and at the same time, paying wind developers an average of 12.3 cents per kWh—we lost more than $5.5 million. That’s just one day!

Now if the OEB were really transparent, they would bring these issues to the forefront.   At a minimum, the people who write news releases for the OEB should also be required to take some remedial math courses!

Ontario electricity customers should demand that the Ontario Energy Board, whose mission is to “regulate prices in the public interest,” demonstrate factual reporting and provide consumers with the truth about rate increases.

© Parker Gallant,

October 16, 2015

The truth about ‘saving’ electricity

12 Sunday Jul 2015

Posted by in Ottawa, Renewable energy

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Ottawa-based energy economist Robert Lyman has taken a critical eye to advertisements on energy conservation

This week, people living in Ottawa are being bombarded with radio and newspaper advertisements proclaiming that the electrical energy they “saved” over the past six years was enough to “power our arenas”.

How about some “truth in advertising”?

There is a big difference between reducing your energy use and “saving” money. When a residential householder in Ontario reduces electricity use, that may temporarily reduce his or her electricity bill, but it does not reduce the costs that are incurred by the various companies that are involved in generating, transmitting and distributing electricity. All of those companies are government-owned and regulated utilities. Unlike private companies that, faced with reduced demand for their services, have to cut back production and costs, the electrical utilities are completely protected by their regulated rate structures. When sales go down, they simply apply to the regulator (the Ontario Energy Board) to raise their rates per unit of sale, denominated in kilowatts per hour (kWh). So, the price for the consumer just goes up after the next rate hearing.

But it gets worse, far worse.

When the Ontario government advertises about “saving energy,” it is not talking about saving consumers money. It is talking about— in theory— reducing the costs associated with generating and transporting electrical energy to consumers. Reducing demand usually refers to two things: reducing the overall average use of electricity and switching the use of electricity from the peak periods of day and season to other times. Reducing the average use over time reduces the amount of generating capacity of all kinds that the electrical utilities need to build. Reducing the peak uses can, in theory, cut the amount of peaking capacity (electrical energy generation capacity that stands idle to be used when needed) that has to be built.

So, in theory, Ontario wants us all to use less electricity so that its utilities won’t have to build more expensive generating plants and transmissions lines. This is where things start to get bizarre. You see, back in 2002, people were justifiably worried that Ontario would not have enough generating capacity. So the province started to add more, and more, and more. In fact, Ontario has added more than 12,400 megawatts (MW) of generating capacity since 2002. As of March 2015, the Independent Electricity Systems Operator (IESO) had 18,458 MW of in-service generating capacity, not counting the significant amount of solar powered capacity that is contracted by the several distribution utilities in the province. The Ontario Auditor General, in his December, 2014 report, found that, while IESO is required to maintain an operating reserve of between 1,300 and 1,600 MW for contingencies, since 2009 the available surplus has been between 4,000 and 5,900 MW.

Meanwhile, IESO is busily contracting for immense amounts of additional capacity, mostly to meet the dictates of the 2009 Green Energy and Green Economy Act. In 2015 alone, newly contracted supply of renewable energy sources (wind, solar and biomass) totaled 1,700 MW, raising the amount of IESO contracted (but not necessarily built) supply to 21,000 MW. This contracted supply is on a path to reach 23,000 MW by the 2018–2022 period. Demand continues to fall every year.

With massive and costly oversupply and a legislated mandate to continue contracting for more, what does IESO do? Does it cut back on its “conserve, conserve, conserve” campaign? Why no, it ramps it up. The present focus is on two strategies — programs and pricing. The programs include plenty of advertising and financial inducements to get people to use less electricity, programs that cost hundreds of millions of dollars and are charged to — you guessed it — Ontario electricity ratepayers.

The pricing strategy is delivered though the use of “smart meters” and time-of-use pricing is to gouge ratepayers until they yell “uncle.” The rate for on-peak service went up on May 1, 2015 to 16.1 cents per kWh.

Despite all this activity, the surplus continues to grow. So the power is exported. In 2014, Ontario’s exports totaled 19.1 terawatt hours (TWh), sold at a loss of $1.4 billion. If current trends this year continue, export sales will reach an all-time high and an all-time maximum loss of about $2 billion. You already know who will pay for that.

In effect, every kWh saved is another kWh exported and more money lost. Keep that in mind when you hear the ads.

Robert Lyman

Ottawa

Queen’s Park to pass new legislation to ram through new hydro corridors: Ottawa Citizen

21 Thursday May 2015

Posted by in Ottawa, Wind power

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Pathways and green space along the Hydro corridor in the Bridlewood area of Kanata.

Hydro corridor in Bridlewood area of Ottawa: millions of dollars’ worth of new power lines needed

Ottawa Citizen May 21

The provincial government is preparing a new law to make it easier to build and expand hydro corridors, with the Ottawa area a prime target.

Energy Minister Bob Chiarelli told a summit of energy companies in Toronto in early May that he’s working on legislation that’s mostly about adjusting the way Ontario’s main regulator for the industry, the Ontario Energy Board, works once the province sells off a majority share in Hydro One, its main transmission utility.

But part of the new law, according to the text of his speech, will “give cabinet enhanced powers to designate key transmission corridors to expedite their construction.”

Chiarelli’s spokesperson Jennifer Beaudry explained by email that the idea is to let the politicians decide what’s “in the public good” and remove a stage where the energy board makes its own determination about whether a transmission project is really needed. The regulator would still go over costs and decide who should pay what share of them, she said.

A key transmission corridor could be one that brings electricity to a remote First Nations reserve, one needed to power northern mines, or one that’s needed for “enhanced intertie capacity with neighbouring jurisdictions to support clean energy import,” the text of Chiarelli’s speech says.

And that means Ottawa, which is a major transfer point for electricity Ontario buys from Quebec’s hydro dams but where our existing wires are nearly maxed out.

“At present the firm import capability that could be relied on for all hours on the Quebec — Ontario interties is quite restricted due to transmission issues in the Ottawa area,” says a report prepared last fall by the Independent Electricity System Operator, the provincial agency that monitors and forecasts the flow of electricity around Ontario.

Lines that run through Ottawa carry power into Ontario both from northern Quebec and from the big Beauharnois dam near Montreal. Electricity doesn’t travel all that well, so a lot of the energy we use here comes from Quebec, especially in the summer.

A shortage of transmission capacity will be a big deal in the North, where the eventual development of Ring of Fire mines and related industries will take a lot of electricity. It could even affect Toronto, which has a lot of heavy-duty power lines around its outskirts but only a webwork of little ones serving its condo-packed downtown. But it’s here that the clock is really ticking.

Within five years, the agency says, there’ll be no capacity to move electricity from Quebec through Ottawa to the rest of the province unless we build hundreds of millions of dollars’ worth of new power lines; all the juice we can suck in, we’ll be using locally. At a minimum, keeping the system functioning means replacing existing lines that run past backyards in Kanata and Orléans with heavier-duty ones, a $325-million project that would only keep the power supply in Ottawa stable, not give us any to spare.

The most ambitious scenario the IESO considered would cost more like $2 billion. It’s a list of things we’d have to do if Ontario wants to make a major deal to buy Quebec electricity in quantity. We’d have to do major work on just about all of Ottawa’s high-voltage lines, but especially on the ones that run through Orléans because they mainly carry electricity from an “intertie” with Quebec at a hydro dam in Masson-Angers to Ontario’s main power grid. It would also mean building a new eight-kilometre line through Kanata, connecting transfer stations at South March and Terry Fox.

As Ontario knows well by now, new electricity projects are rarely popular. Usually, they benefit other people more than those who live nearby — a wind farm is good for the company that runs it and for whoever leases or sells the land, and (arguably) for the province as a whole, but not for the neighbours who have to look at it.

Same thing with a hydro corridor. We need high-voltage wires but nobody has yet found a way to make them pretty. Plus the science is pretty compelling that they don’t pose a health risk, but there’s no convincing some people. There’s really no way that high-tension wires carrying Quebec power past your house in Ottawa’s suburbs toward Toronto are a selling point. Which is why the cabinet will want the authority to shove them down people’s throats.

dreevely@ottawacitizen.com
twitter.com/davidreevely

 

Where is Ontario getting money for the deficit? Out of your pocket

24 Friday Apr 2015

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New rate increase removes $635 million from electricity customers’ pockets

Ontario now has highest electricity bills in Canada

Ontario’s Minister of Energy Bob Chiarelli in a press release of March 26, 2015 announced the end of the Debt Retirement Charge December 31, 2015. In the “Quick Facts” of the release stated: “Removing the Debt Retirement Charge will save the typical residential electricity ratepayer $5.60 per month.”

Less than a month later the Ontario Energy Board (OEB) issued their semi-annual rate setting letter for the upcoming six months of May 1st to November 30th; it was full of continuing bad news for households and small businesses.   The OEB told us effective May 1st, our electricity bill would increase $5.71 a month.  So much for that savings of $5.60 a month!

Written to assuage the reader, the OEB’s letter pretends to be what it isn’t.  Rates are going up substantially and while the letter states monthly increases for the “average” consumer will be 4.6% or $5.71 per month, on the Electricity, line the truth is more daunting.  The rate increases should be annualized, but they aren’t.  If they were, the additional $70 annual increase suggested would be $143.

Off-peak rates are up 6.7% or about four times the inflation rate and the On-peak rate jumps up over 19% per annum.

By increasing on-peak rates by 19%, the OEB suggests the “ratio” shift to 2:1 between on-and off-peak prices “will benefit customers who shift their use to the cheapest time period.”  In another document the OEB released they say that about two-thirds of consumption is already in the off-peak period leaving the consumption split between mid and on-peak at 17% each.

So small businesses operating during on-peak periods, seniors living on fixed incomes, people with disabilities, the unemployed, and stay-at-home parents are locked into paying 16.1 cents per kilowatt hour.   Those who can least afford high rates are the ones expected to shoulder the burden.  This increase will simply add to the 570,000 households Energy Minister Bob Chiarelli admits are currently living in “energy poverty” in Ontario.

If one annualized the rate increases as it applies to “average” households and small businesses, the electricity sector will take approximately $635 million more from ratepayers’ pockets in pre-tax (small businesses) and after-tax dollars (households) in the next 12 months.  They will extract $281 million from on-peak, $134 million from mid-peak and $220 million from off-peak consumption from “average” ratepayers based on 4.5 million residential and small business ratepayers.

Ontario can now claim to be the highest cost electricity market in Canada, and rivals all but three or four of the U.S. states such as California, Alaska and Hawaii.

The Liberals can claim we are “green” but that green is supporting foreign investors enjoying the benefits of ratepayer dollars flowing into their pockets for wind and solar contracts obtained from the OPA under the direction of past and present Liberal Ministers of Energy.

Ontario: now “a place to groan.” No shifting of consumption will ease the burden or stop inflation of our electricity bills.

©Parker Gallant, April 21, 2015

The views expressed are those of the author and do not represent Wind Concerns Ontario policy.

Parker’s Calculations

May 2015  electricity consumer prices vs May 2014

Consumption is based on 66% off-peak, 17% mid-peak, 17% on-peak

TOU Consumption kWh Rates/kWh/cents 2015 costs $ 2014 costs $ Increase $
Off-peak 6,336 8.0 506.88 456.19 50
Mid-peak 1,632 12.2 199.10 169.73 30
On-peak 1,632 16.1 262.75 199.10 63
TOTAL 9,600 968.73 825.02 143

Hydro bills to rise again November 1

17 Friday Oct 2014

Posted by in Renewable energy

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The price per kilowatt hour is going up at all times of the day starting November 1.

Off-peak rates have climbed 51% since 2010

From the CBC:

Ontario hydro bills are scheduled to increase as temperatures decrease, the Ontario Energy Board announced Thursday.

The price per kilowatt hour will go up for on-, off- and mid-peak hours of the day starting November 1.

The Board says the changes will translate into a 1.7 per cent increase on a typical bill. That’s about $2 a month for the average household.

The lowest priced periods remain weekdays from 7 p.m. to 7 a.m., as well as all day during weekends and holidays. The off-peak price will be 7.7 cents per kilowatt hour — a 0.2 cent increase from current prices.

Electricity prices in Ontario have now gone up 51 per cent in off-peak usage, 41 per cent in mid-peak usage and 41 per cent in peak usage in the last four years.

Bob Chiarelli thinks you are stupid

03 Monday Feb 2014

Posted by in Ottawa, Renewable energy, Wind power

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Here from energy economist Robert Lyman, a comment on recent remarks made by Energy Minister Bob Chiarelli, on actions taken by his government, and whether electricity bills will rise (again).

BOB CHIARELLI THINKS YOU ARE STUPID

Ontario’s Energy Minister, Bob Chiarelli, was recently quoted in the Toronto Sun as saying, “When the OCEB (Ontario Clean Energy Benefit) comes off the (hydro) bill, residential customers don’t face additional costs.”

The accompanying news article explained that the OCEB was a subsidy funded by taxpayers that was imposed years ago when Ontario realized that the cost of its “green” energy policies would drive electricity rates much higher. Under this subsidy, ratepayers get a 10 per cent reduction off their electricity bills. This subsidy is scheduled to be ended in July 2014. To offset the increase in electricity rates, the Ontario government apparently plans to end the debt retirement charge (DRC).

What does this mean?

When former Ontario Energy Minister Brad Duguid announced Ontario’s Long Term Energy Plan in 2005, he predicted that this would increase rates by 7.9 per cent per year annually for the ensuing five years. The Provincial sales tax of 8 per cent was also added to electricity rates, and the actual increase in transmission, distribution and energy costs far exceeded 7.9 per cent per year. To “offset” this, Ontario introduced the Clean Energy Benefit, a subsidy from taxpayers to electricity ratepayers amounting to 10 per cent of residential bills.

The average ratepayer in Ontario consumes 800 kilowatts (kWh) of electricity per month. The ratepayer’s bill is now about $130.00 per month, which means that the OCEB reduces it by $13.00.

The debt retirement charge is a component of nearly every Ontario ratepayer’s electricity bill. Collection of the DRC began on May 1, 2002, at a rate of 0.7 cents per kilowatt hour (kWh) of electricity and it remains at that rate today. The charge remits to the Ontario Electricity Financial Corporation (OEFC), and thus to the Ministry of Finance, about $925 million per year. The DRC was authorized by the Energy Competition Act of 1998, which included the restructuring of the former Ontario Hydro into four main successor companies. The OEFC was given the responsibility to manage the legacy debt of the old Ontario Hydro, which resulted from the fact that, at its dissolution, the former Crown Corporation had debts of $38.1 billion and assets of only $17.2 billion. The $20.9 billion difference was to be repaid partially out of the future profits of OPG and Hydro One. The rest, called the “residual stranded debt’ was to be repaid by consumers directly via the DRC.

Here’s the problem. As of March 31, 2013, the Ontario government had collected $12.9 billion from the DRC, more than enough to eliminate the original “residual stranded debt”. The government claimed, however, that the debt had not been retired because in the meantime the OEFC had incurred other costs. The Auditor General of Ontario, in his 2011 Annual Report, took the position that the Ontario government should determine what the balance of the residual stranded debt was and provide periodic reports to the public on its progress in reducing the debt.

The Ontario Minister of Finance included a report in the 2012 Ontario Economic Outlook and the 2013 Budget on the residual stranded debt. The report revealed that the debt was $4.5 billion at March 31, 2012. The report gave no explanation or commitment as to when the debt would be fully paid and the DRC charge removed.

If one considers only the average rate of reduction from 2003/2004 to 2011/2012 of $925 million per year and projects this forward, it means that the residual stranded debt will not be paid off until the end of 2016/2017. By that time, the Ontario government would have collected about $15.3 billion to repay the original $7.8 billion. This assumes that no other unexplained charges get added to consumers’ bills.

Suddenly, the Energy Minister has discovered that the government does not need to go on collecting the DRC and so will delete it from consumers’ bills. What effect would that have?

That average ratepayer consuming 800 kWh per month would pay $5.60 per month in DRC. The loss of the OCEB would increase his bill by $13.00.  The net effect would be an increase of $7.40 per month. Add the HST and the additional cost increase becomes $8.11 per month, or $97.00 per year for the average ratepayer. If Mr. Chiarelli believes that consumers will be kept whole, he either does not understand mathematics or he assumes the average resident of Ontario will not understand it either.

So who gains and who loses? Ontario electricity ratepayers are today paying rates far higher than the government predicted when it instituted it green energy policy, even with the “Clean Energy Benefit”. Now, those rates will be higher still. Ontario taxpayers will no longer have to pay the subsidy, so they will save about $1.2 billion annually. However, who will end up paying the balance of the “residual stranded debt” that, up to now, the government has claimed is owed? Could there be some creative accounting done by the Ontario government to transfer the costs to ratepayers or taxpayers in some other way? We will just have to watch and see. You can be sure that the Liberal Party of Ontario will not be paying it.

Robert Lyman, Ottawa, February 3rd, 2014

The views expressed here are those of the author.