Serious criticisms of Hydro One missing from Ombudsman report

Me, me, me, and, did I mention--me?
Me, me, me, and, did I mention–me?

Fifteen months after it was launched, the report from Andre Marin, Ontario’s Ombudsman, is finally out.

Exactly why it took 15 months to complete is worrisome: there have been literally dozens and dozens of articles on this issue, an Auditor General’s report, numerous letters to the editor, TV and radio exposure, etc., that detailed Hydro One’s billing and smart meter problems since the Ombudsman’s announcement of an investigation.

Hydro One was the fifth most complained about provincial entity for the 2011 and 2012 year, according to the Ombudsman’s own annual reports. Many of the articles and letters go back well before the launch of his investigation.  Most of those earlier complaints were connected to billing issues as a result of “smart meters” installed by Hydro One, but Mr. Marin clearly states in the 119-page report  “we received many complaints about subjects that were not the focus of this investigation – chiefly, electricity pricing and smart meters.”  Were those complaints included in his estimation of the 10,000 plus he claimed they investigated?

Why were “smart meter” related issues simply ignored?  Was it a lack of technical abilities within the Ombudsman’s office, or a case of being overwhelmed by the billing problems? Why wouldn’t the Ombudsman at least note in one of his 66 recommendations that someone with the technical skills should investigate the “smart meter” problems?

Surprisingly the report also says nothing about how the Ontario Energy Board has ignored Hydro One’s problems with the smart meters, nothing about the Energy Ministry’s role or their lack of oversight, and basically nothing critical of Hydro One’s senior management and its apparent failings.  Was Mr. Marin concerned any critique about those subjects might lead to his contract not being renewed?  If that was the case he doesn’t deserve to be our watchdog.

I have reviewed the findings in the report and his 66 recommendations and found many to be repetitive and overlapping.  I also found the report skirted many of the issues that needed examination as the root cause of the billing problems.   In my humble opinion, the Ombudsman’s prejudice against the private sector also shines brightly in the report as does his self-proclamation of his personal skill sets.

©Parker Gallant,

May 30, 2015

Read more Parker Gallant on the Ombudsman report here: Ombudsman’s report-the good, the bad and the ugly

Drennans denied appeal

Lawyer Julian Falconer, appellants and supporters in London, last year
Lawyer Julian Falconer, appellants and supporters in London, last year

For Immediate Release 

HIGHEST COURT IN ONTARIO DECLINES TO HEAR WIND APPEAL

FARM FAMILIES DISAPPOINTED

May 29, 2015 

On May 28, 2015, the Court of Appeal for Ontario denied leave to appeal to the Drennans, Dixons, Ryans, and the Kroeplins, in respect of their Charter Challenge to the current legislation for the approval of wind turbine projects.

These farm families had been seeking the opportunity to argue that the Environmental Protection Act provisions approving renewable energy projects exposes them to a reasonable prospect of serious harm to their health and therefore does not comply with the Canadian Charter of Rights and Freedoms.

The Health Canada Study Summary Results released on November 6, 2014, showed an association between wind turbine noise and annoyance, and an association between wind turbine noise annoyance and sleep disturbances, migraines, tinnitus, dizziness, and measured blood pressure and hair cortisol.

Shawn Drennan commented on the Court of Appeal’s decision: “We are disappointed with the Court’s decision not to hear our case. No one has been able to tell us that the turbines are safe.  We are being told that we have to wait to be harmed before we can do anything to stop them. The Court has given us two choices: leave the land my family has farmed for three generations, or be a guinea pig for the government and the wind companies.”

Lawyer for the farm families, Julian N. Falconer commented: “This decision will leave people like my clients, who face massive wind development projects across this Province, in an impossible position. The Health Canada Study has already shown an association between the turbines and serious health effects. My clients and other families in rural Ontario will now have to suffer these adverse health effects before they can seek any relief from our court system. It won’t surprise anyone that my clients are frustrated with a process that seems to be stacked against them.” 

While this decision may restrict these farm families from pursuing Charter remedies for these harms, they are committed to exploring the other legal options available to them and to holding both the government and the wind turbine companies accountable for the failure to protect their health.

Concerned citizen groups throughout the Province remain committed to seeking justice for those in rural communities affected by industrial wind projects.

For further information, please contact Odi Dashsambuu of Falconers LLP at

416-964-0495, extension 248.

 

Hydro One: explaining the unexplainable

Many puzzling over their Hydro One bills might head for the distribution company’s website where, Parker Gallant says, they will be no farther ahead.

It was shortly after Ontario’s Auditor General Bonnie Lysyk, released her damning report on “smart meters” when Energy Minister Bob Chiarelli suggested she got it wrong because “The electricity system is very complex, it’s very difficult to understand.”

Maybe Mr. Chiarelli will say the same thing about the recent “Understand my Bill” posting on Hydro One’s websit, as it misses the mark in several ways.  It is seven pages long (should you print it out) which is an indication of just how “complex” the Liberals have made things for electricity consumers.

Here are a few questions:

Why does Hydro One describe their “typical residential customer” as a user of 800 kWh per month but when applying for rate increases they use 1,000 kWh per month?

Why are two (2) charts missing from the website?

Why does the pie chart, “how the money is spent” have “replacing worn out equipment” in one slice and “new or higher rated equipment” in another slice?

Why does the pie chart claim 3% is for administration expenses when their filing with the OEB for the Yearbook of Distributors for 2013 indicates it is 23% of all expenses for their distribution business?

Why is the “Three column chart showing how delivery charges are calculated” missing?

Why does the chart, “A breakdown of your bill” indicate there are only “Over 400 generators” while the OPA/IESO indicates there are over 23,000 contracts?

Why does this chart indicate HST is 12% when it is actually 13%?

Why does the text following the heading “How we deliver electricity” suggest “electricity is created by harnessing other power sources like windmills,” and go on to say “or burning coal across the province”? Is Hydro One unaware that the coal plants have been shuttered?

Why do they claim they have $22 billion in equipment and later on indicate they have spent $7.3 billion in the last three years indicating they would fully replace all their equipment over a nine-year time span but still claim their focus is “on maintaining the performance of our aging infrastructure?”  Aren’t most transformers built to last 30 years?

Under “Frequently asked questions” why do they use the smallest recent rate increase in the chart subtitled “How much will my bill increase” which varies from a low of .01% to a high of 7.8%?

Why under this same section the question posed is:  “Why are my residential delivery rates increasing? I was told they were going to be reduced”  and the answer provided is: “We’re sorry for the confusion. When we applied to the OEB we thought delivery rates would be reduced for a typical residential medium density customer who uses 800 kWh a month.”  Why would they suggest that, knowing they applied for a rate increase, and exactly who did Hydro One tell rates were going to be reduced?

Following this and another question the site launches into a confusing array of combining TOU increases and delivery rate increases suggesting increases were effective January 1, 2015 but they are not going to be implemented until May 1, 2015 but an eight-month adjustment period will occur to catch up for the missing increases.

Is it perhaps too much to ask that those 70% of Hydro One employees on the Sunshine List to understand what they are billing their 1.2 million customers?

Minister Chiarelli should provide all Ontario ratepayers with an explanation but I suspect he will repeat that it is too complex to understand.

©Parker Gallant,

May 28, 2015

April 2015: surplus wind power costs Ontario millions

Energy Minister hiding his head over consumer losses due to surplus power, lots of it wind
Energy Minister hiding his head over consumer losses due to surplus power, lots of it wind

Electricity exports cost heading for $2 billion in 2015

The continued costs to Ontario’s ratepayers for the oversupply of electricity generation in Ontario continued in April 2015; we exported another 2 terawatts (TWh) of power to our neighbours.  April’s exported TWh brings exports for the first four months of 2015 to 8.65 TWh — that’s enough to supply 900,000 average Ontario ratepayers with power for a full year.

Surplus exports represented over 19% of Ontario’s total demand for the month; that figure doesn’t include curtailed wind, steamed-off nuclear or spilled hydro.

The cost (Hourly Ontario Electricity Price + Global Adjustment) to ratepayers for exported power in April was $223 million. We sold it for 1.57 cents per kilowatt hour, thereby generating only $32 million. Ontario’s electricity ratepayers had to eat $191 million in losses that will find their way to the Global Adjustment pot and the “electricity” line on our bills.

As noted in a prior article, the first quarter of the current year generated losses (costs to ratepayers) of $437 million. So now, with the April figures, those costs to date are $608 million or $135 per ratepayer.

We still have eight months left in the year: at the current pace, our bill to support surplus exports will amount to over $400 for the average ratepayer.

Wind power generation for April represented 39% of the exported volume as it produced about 850,000 MWh (megawatt hours) at an average of $123.50 per/MWh, meaning its cost of $104 million represented almost 50% of total export costs.

Energy Minister Bob Chiarelli doesn’t seem to notice our growing surplus*; however, he has directed the IESO to acquire another 500 MW of renewable energy from wind and solar in 2015, and mandated conservation of another 7 TWh by 2020.

Time to stop digging the hole.

© Parker Gallant

May 27, 2015

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

 Editor’s note: speaking at a wind power information evening in Finch, Ontario, on May 6th, Ontario Federation of Agriculture president Don McCabe said there is no surplus of power in Ontario. This is a lot of lost power and a lot of losses to electricity consumers—including farmers—to deny.

Power policies in Ontario: sacrificing the most vulnerable

Tell it to Bob: electricity bills now higher than rent for some Ontario residents
Tell it to Bob: electricity bills now higher than rent for some Ontario residents

Ontario’s current Minister of Energy Bob Chiarelli is not afraid of issuing directives to his underlings.  On October 23, 2014 he directed the OPA to initiate a CDM (conservation and demand management) program to reduce demand by 7 TWh (terawatt hours) between Jan. 1, 2015 and Dec. 31, 2020.  The budget to produce those results is $2.4 billion or $400 million annually.

Conservation directives date to Donna Cansfield’s time in the Energy Minister’s chair and her February 10, 2006 NB: one; when she told the newly formed OPA  “I hereby direct the OPA to assume, effective as of the date of this letter of direction, responsibility for seeking up to 300 MW demand side management and/or demand response initiatives in the Toronto area by 2010.  In recognition of Toronto Hydro’s existing and planned conservation initiative funded through to September 2007, it is expected that the OPA will work cooperatively with Toronto Hydro and the community in the Toronto area”.

The “Conservation First” theme was recently echoed by IESO’s VP, Market and Resource Development in a speech at the Ontario Power Summit.  A quote from the speech:  “Conservation and demand response are providing clean, cost-effective alternatives to generation, and technological advances are leading to new possibilities through energy management tools, low-cost solar panels and energy storage.”

The billions spent and the billions to be spent on conservation programs get dumped into the Global Adjustment pot, added to the cost of electricity, and has been a factor in its continuing rise.  The revenue lost through conservation is simply replaced by a rise in the commodity and delivery charges—that is felt by the most vulnerable.  A recent story in the Toronto Star related to a Toronto Community Housing complex highlighted the effects of all that spending: “Tenants in a downtown Toronto Community Housing development are struggling to cope after being slapped with unexpectedly high hydro bills this winter. In some cases the bills were hundreds of dollars more than their rent, and several residents say having to make the payments left them without money for other essentials such as food.”  Foregone medication was mentioned by others.

There was more:  “Toronto Hydro spokesperson Tori Gass wouldn’t comment on whether the bills were excessive, but said the agency was expecting an increase in power consumption this winter because of the unusually cold weather.”  That comment was the opposite of what Hydro One reported in their first quarter release as they noted transmission revenue was down due to “milder weather in the first quarter of 2015, compared to the same period in 2014”.

The two biggest local distribution companies in the province can’t even agree on recent weather events!

So, let’s get this straight: conservation spending, coupled with adding thousands of megawatts of subsidized renewable energy from wind and solar, has put many of Ontario’s most vulnerable in a position where they must choose between “heat or eat.”

This is a legacy the Ontario Liberal government should be ashamed of.

©Parker Gallant

May 25, 2015

 

NB:  The directive is dated “2005” at the top but “2006” at the bottom.

Australian Senator urges caution on wind turbine noise

Sydney Morning Herald, May 24, 2015

It seems the only thing colourful crossbench senator David Leyonhjelm hates more than red tape is wind farming.

Despite typically being a fierce opponent of new government regulation, the Liberal Democrat is calling on the government to set up a new regulator to monitor noise levels near wind turbines.

He claims a Senate inquiry he set up has uncovered “credible evidence” that some people are suffering health concerns caused by low frequency noise and vibrations known as infrasound.

Australia’s peak medical agency this year concluded there is no direct or consistent evidence that wind farms damage human health, after conducting a year-long study into so-called “wind turbine syndrome”.

Indeed, many health experts and environmentalists have long dismissed turbine-related health concerns as a myth.

But Senator Leyonhjelm has seized on reports that the German Medical Assembly wants a halt on further wind farm developments near housing pending more research into the possible health impacts.

“I am usually the last person to support the creation of additional government bureaucracy but when we are directing around $22 billion towards the Renewable Energy Target (RET), the creation of a regulator would be a drop in the bucket,” Senator Leyonhjelm says.

“Those who justify action on climate change because of the precautionary principle will understand the need to apply the same principle to infrasound.”

The crossbencher says the need for a new regulator is particularly pressing given the Clean Energy Regulator says another 1000 wind turbines will need to be erected in the next five years to meet the RET.

Senator Leyonhjelm’s inquiry attracted 418 submissions and is set to report back to parliament in August. It is the latest in a long line of investigations into renewable energy and wind turbines.

© 2015 Fairfax Media

WCO president misquoted in Ontario Farmer

To subscribers of Ontario Farmer, please take note: in the opinion column by Tom Van Dusen on a wind power information meeting held recently in Finch, Ontario, Wind Concerns Ontario president Jane Wilson is quoted as saying Ontario ought to put wind “farms” in isolated areas where they won’t bother anyone. Mr Van Dusen then quoted the CanWEA representative Tom Levy as rebutting the statement, citing transmission costs when power is transported over great distances.

Mr Van Dusen’s recollection of the remarks is false: what Wilson said, in response to a question from the floor about why wind “farms” aren’t simply located in the North, was that people live there too, and the significant environmental damage done by wind “farms” was a factor, everywhere, including the North. Mr Levy did add the issue of transmission costs.

Wind Concerns Ontario will be sending a letter to the Editor of Ontario Farmer to correct this misstatement by Mr Van Dusen.

 

Doctors in Germany call for halt to wind farms; concerned about health impacts from infrasound

German doctors push to halt building of wind turbines

Credit:  German doctors want more research into the health effects of wind turbines |   Graham Lloyd, Environment Editor |   The Australian |   May 21, 2015 |   www.theaustralian.com.au ~~

The “parliament” of Germany’s medical profession has called on its leaders to support a halt to further wind farm developments near housing until more research has been undertaken into the possible health impacts of low-frequency noise from wind turbines.

The issue was debated at the German Medical Assembly in Frankfurt on Friday and transferred to the executive board of the German Medical Association.

Association policy adviser Adrian Alexander Jakel confirmed a motion calling for ­research had been forwarded to the board “for further action”.

Germany is considered a world leader in adopting renewable ener­gy and the minutes of the Medical Assembly meeting said that, with the phase-out of nuclear power, more wind energy would be used in future. But it said the entir­e life cycle of renewable technologies, from the initial raw mater­ial supply to disposal and the planning and risk considerations, should be considered in advance.

The Medical Assembly motion said this required “scientifically sound findings of potential health effects, and a deliberate balance between benefit and validity to be able to make conscious weightings between the benefits and of the disadvantages and risks”.

“In particular regarding emissions in the low frequency and infra­sound range there are no reliab­le independent studies that investigate field measurement methodology suitable for this sound field below the threshold of hearing,” they said.

The assembly called for the federal government to close the gaps in knowledge about the health effec­ts of infrasound and low-frequenc­y sound from wind turbines through scientific research.

It said research should clarify open questions concerning meas­urement methods and, where approp­riate, adjust regulations to “allow the expansion and the operation of wind turbines wisely, carefully, with integrated expertise, sustainability and overall societal responsibility”.

It said the health effects of infra­sound (below 20 Hz) and low-frequency sound (below 100 Hz) in relation to emissions from wind turbines were “still open questions’’, as were “the effects of noise below the hearing threshold or lower frequencies with increasing exposure duration”. The assembly said the erection of more turbines close to settlements should be stopped until there was reliable data to exclude a safety hazard.

[Click here to read the motion.]

Source:  German doctors want more research into the health effects of wind turbines |   Graham Lloyd, Environment Editor |   The Australian |   May 21, 2015 |   www.theaustralian.com.au

No windfall in tax revenue for Ontario communities hosting wind farms

With a cap on assessments for wind turbines, Ontario municipalities are limited in tax revenues on the multi-million-dollar power projects. Revenues work out to less than 1% of what the developers have in their money bags
With a cap on assessments for wind turbines, Ontario municipalities are limited in tax revenues on the multi-million-dollar power projects. Revenues work out to less than 1% of what the developers have in their money bags

Revenues no more than “Chump Change” for municipalities

Wind power developers bringing projects to Ontario’s municipalities offer various inducements to persuade politicians they will benefit from millions of dollars.  Like the landowners signing leases for turbines, money is frequently the reason municipal politicians support wind power development and locating projects locally.

In Ontario, local politicians have no real power to support or deny those projects, and also, little ability to generate a real community benefit due to the Green Energy and Green Economy Act (GEA).  It doesn’t matter what the capital value of an industrial wind turbine (IWT) is, or what they levy in local realty taxes as the provincial government has set the taxable value!   Former Minister of Finance, Dwight Duncan decreed (one year before resigning) IWTs would be assessed by the Municipal Property Assessment Corporation (MPAC) at a maximum of $40,000 per megawatt (MW). That translates to tax revenue averaging $1,000/2,000 per MW, based on local industrial mill rates.

My research indicates Ontario has the lowest assessed value per/MW capacity of all provinces.

Ontario:

The 2014 3rd Quarter update from the OPA claimed they had contracted for 5,697 MW of wind capacity.  Payment per MW hour for wind generated power averages $123.50/MWh.

Using an average of $1,500 per MW for the OPA-contracted 5,697 MW of wind means Ontario host municipalities will generate about $8.5 million annual realty taxes. (5,697 X $1,500 = $8.5 million)

Those 5,697 MW will produce energy at 30% of their capacity producing cash for the developers of $1.8 billion (5,697 X 30% X 8760 [hours per annum] X $123.50 = $1.8 billion)  Eighty percent (80%) of the time the power will be surplus to Ontario’s demand.1.   Tax revenues represent less than 1% of developers’ revenue.

Nova Scotia:

Nova Scotia’s legislature set the annual price for their realty taxes at $5,500 per MW “plus a percentage of $5,500.00 equal to the percentage increase in the Consumer Price Index for Canada at the end of the calendar year ending in the immediately preceding municipal taxation year relative to the Consumer Price Index for Canada at the end of the 2005 calendar year”.

If Nova Scotia had contracted for the 5,697 MW the OPA has in Ontario, realty tax revenues would be in excess of $31 million. (5,697 X $5,500 = $31.3 million)

In Nova Scotia those 5,697 MW of wind turbines operating at 30% of capacity would be paid an an average of $100 MWh and generate $1.5 billion.  Tax revenues would represent slightly more than 2% of revenue for the developers.

British Columbia:

For British Columbia realty taxes applicable to farms are applied to wind developments which presumably means assessment of the capital cost (depreciating) of about $1.5 million per MW.  Specific information was difficult to locate; however, what I found indicates realty taxes appear to be approximately $14K/MW and the price paid for generation is $105 per/MWh.

Using the limited amount of information available and applying it to the Ontario contracted 5,697 MW of capacity; in BC the tax revenue would be $80 million annually (5,697 X $14K = $80 million) and at $105 per MWh would generate $1.6 billion annually for the developers.  Taxes would represent 5% of the revenue generated for the developers.

Alberta:

It was almost impossible to locate assessment values for wind turbines in Alberta except for one reference in a report from the Greengate Power Corporation posted on the University of Calgary site.  That report claimed a 300 MW wind development would pay municipal taxes of $5 million annually which indicates a realty tax of about $16K per MW.

Using that information and applying it to Ontario’s 5,697MW of contracted capacity, suggests annual tax revenue for municipalities would be $91 million.  In Alberta the wind developers must sell their production via the spot market and in 2013 a BNN article suggested they earned an average of $54.97 per MWh which translates to annual revenue of $820 million for the developers.  In Alberta realty taxes would therefore represent 11% of the revenue generated by the developers.

Summary:

With Ontario municipalities receiving so little for hosting industrial wind turbines it is surprising the Canadian Wind Energy Association (CanWEA) when faced with any kind of opposition would issue a press release that claims:  “Right now there are literally thousands of Ontarians participating in the province’s ground-breaking clean energy economy. Communities across this province — from Chatham-Kent to Frontenac Island, Tillsonburg to Niagara — stand to receive hundreds of millions of dollars in direct benefits from wind energy projects.”

MPAC’s 2014 annual report claims they assess and classify “more than five million properties with an estimated total value of $2.2 trillion.  The assessed value of the contracted 5,697 industrial wind turbines at $40K per MW gives them a total value of $228 million or .0001% of total assessed values versus a likely capital cost approaching $8.5 billion, or 4% of MPAC’s total value!

So, Ontario’s wind developers walk away with an estimated $1.8 billion annually and $36 billion over the 20-year term of the contracts, while Ontario’s hosting municipalities have to make do with chump change of $8.5 million annually, and only $170 million over the full terms of those contracts.

Far from enjoying millions in cash windfall, Ontario’s municipalities got stuck with the worst possible deal.

©Parker Gallant,

May 19, 2015

 

1.  Professor Ross McKitrick: http://www.rossmckitrick.com/uploads/4/8/0/8/4808045/oebletter_feb2013.pdf