$13 million wasted on windy last day of March: Ontario pays to get rid of excess power

These spring windy days are costing you: Ontario’s Wynne government  pays millions for power it can’t use including wind, produced exactly when we don’t need it.

More than $13 million wasted on windy last day of March

By Parker Gallant

March 2016 left like a lion with the wind roaring mightily. Wind on March 31st could have generated over 90% of its IESO posted capacity of almost 3,900 MW— but it didn’t.  Demand  was relatively low in Ontario that day, with users requiring only 359,000 MWh. That meant the IESO folks were busy getting nuclear to steam off (about 26,000 MWh), spilling hydro, and actively curtailing wind.

Curtailed wind generation on that day exceeded both Ontario’s net exports of 31,400 MWh, and wind-generated electricity actually delivered to the grid.   Our exported surplus was sold at a negative average price of the HOEP (hourly Ontario energy price) as we paid New York, Michigan, Quebec, and others $1.71/MWh to take our excess power.

We also paid wind power generators in the neighbourhood of $120 per MWh to curtail an estimated 40,500 MWh.

Our production costs for the month of March are collectively estimated at $117/MWh, suggesting the Global Adjustment (GA) will average about $112/MWh and the HOEP will average around $5/MWh. That means the cost of the day’s full generation of 400,224 MWh (Ontario Demand + exports) at an estimated $46.8 million. Included in that figure are costs for net exports,  steamed off nuclear, spilled hydro, curtailed wind, and idling gas plants, needed to back up wind and solar.

The one-day costs included in the $46.8 million are: an estimated $1.5 million for Bruce Power to steam off nuclear; $3 million to pay idling gas plants; $3.7 million to pay for our exported surplus; and about $4.8 million for curtailed wind.

Without including costs for spilled hydro, the total costs for energy not needed for just one day came to about $13 million.  We should be grateful the sun wasn’t shining too or we would have been paying for solar generation at even higher prices.  We also saved about $15/MWh or $600,000 March 31st by curtailing wind generation or the $13 million daily cost would have been higher.

Now, try to imagine how that $13 million might have helped out our health care system, perhaps by retaining nurses at many hospitals such as Windsor, North Bay, etc., where recent staff reductions have occurred. No wonder an Ontario Health Coalition study a year ago stated:  “we have been deeply disturbed at the devastating cuts we are seeing to needed public hospital care all across Ontario.”

The money that should be earmarked for health care is finding its way into the pockets of the mainly foreign wind turbine and solar panel developers instead of actually helping out Ontarians.

Time to scrap the acquisition of more intermittent wind and solar generation and earmark the money where it belongs. Ontarians don’t want to see $13 million wasted daily, just to pretend wind and solar are better than emission-free nuclear and hydro.

©Parker Gallant,

April 3, 2016

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Green energy done badly: stories from around the world

WEEKEND READING

April 2, 2016

We present a collection of stories that review the manner in which strategies that are supposedly positive for the environment have been enacted (usually without any sort of cost-benefit or full impact analysis), and what the results are to date.

From Terence Corcoran’s review in The Financial Post, to a review of German energy policy (this is a sad, sad story worthy of Dickens), an article in Prince Edward County’s Wellington Times (one of the last independent newspapers in Canada) on a wind power developer’s arrogance, and last, an opinion on what the real effect on the local environment green energy policies are in reality, the collection deserves a read … and consideration by the Ontario government.

Will they? In the words of the team of academics lead by the University of Ottawa’s Stewart Fast, writing recently about the disastrous implementation of the Green Energy Act on Ontario communities, “Our recommendations will unfortunately remain unaddressed, without further consideration or assessment of the lessons that could be learned.” [Fast et al. Lessons learned from Ontario wind energy disputes, January, 2016]

Terence Corcoran, The Financial Post, “Clean, green, and catastrophic.” (Note: our Parker Gallant provided some figures for this article.)

Handelsblatt (Global edition) “How to kill an industry”. (Thanks to energy economist Robert Lyman in Ottawa for sending this in.)

Rick Conroy, The Wellington Times, “There’s always a catch.” (“The wolf has been sent to find out what’s killing all the lambs …” Conroy writes.)

Last, this letter to the editor of Ontario Farmer, excerpted here.

“Off-grid will make a bad situation worse for reluctant grid payees”

A farming friend recently took me on a “crop tour” of rural businesses that are partially or fully off-grid. We saw a sawmill, a pressed-steel manufacturer, a maker of wood-burning stoves, a cabinet-maker and an ethanol plant. Finding it progressively more difficult to remain profitable in the agricultural business with skyrocketing electrical costs, my friend is seriously looking at more cost-effective alternatives. If going off-grid works for others, perhaps it will work for him.

“Off-grid” means that these business owners are no longer victims of usurious hydro rates the Ontario Green Energy Act (GEA) has imposed on the vast majority who obtain electricity from Hydro One and other such utility companies. Are these enterprises trailblazers illuminating a path to greater energy independence for other beleaguered hydro ratepayers?

Or are they creating an even greater financial burden for those who remain on the grid?

And what may be the environmental impact if a great many businesses follow suit?

Operating the Ontario power grid has become exorbitantly expensive under the GEA. It is becoming ever more expensive as greater numbers of windmills spring up to further sully our rural landscapes. … Operating costs of a centralized generation and distribution system are borne by all users. The more users there are, the less share of fixed costs each user pays. Businesses fleeing to off-grid energy alternatives leave fewer users on-grid bearing fixed costs; thus, each user pays more. While going off-grid may financially benefit those who do it, greater economic burden falls on those remaining on-grid, and most have no choice.

Fossil fuels are the primary energy source for off-grid users. Electricity to run their businesses must be generated by some sort of power plant, typically an internal combustion engine driving and electrical generator. It’s far removed from the most cost-effective or environmentally friendly way to generate and distribute electricity —the way we used to do it — but the GEA has made grid power so prohibitively expensive off-grid generation has become economically viable for major energy users.

Dave Plumb

Belmont, Ontario