Wind Concerns Ontario is a province-wide advocacy organization whose mission is to provide information on the potential impact of industrial-scale wind power generation on the economy, human health, and the natural environment.
Making your head spin or, how Ontario’s energy sector is regulated
Enbridge Gas Distribution recently received the blessing of the Ontario Energy Board (OEB) for a 40% hike in what they charge Ontario’s consumers for distributing natural gas, claiming, because of the high demand during a cold winter they were forced to purchase it at a high market price. The OEB granted the approval despite many objections by various interested parties who pointed out that Union Gas had requested a smaller increase.
This note was in the OEB’s approval: “This means that Enbridge plans for lower storage deliverability requirements and transportation capacity” requiring gas purchases at higher spot prices on the open market. One wonders why Enbridge is not required to maintain a larger storage capacity, which would have allowed them more prudence in purchasing the supply of gas, but that is presumably a question for the OEB to ask!
While the OEB was weighing their decision, another arm of Enbridge was constraining their production of wind-generated electricity. That was to allow the Independent Electricity System Operator (IESO) to protect the grid and prevent blackouts or brownouts by requesting constraint.
Constraining wind power—and paying for it—started September 11, 2013. Since then Enbridge has been paid for not producing about 83,500 megawatt hours (MWh), which should have generated close to $9 million.
Enbridge was not alone: Brookfield didn’t produce over 29,000 MWh and IPC/GDF Suez (where the CEO is Mike Crawley) didn’t produce 12,800 MWh, and TransAlta didn’t produce 17,100 MWh. In total about 161,000 MWh were constrained since IESO started paying wind developers—that means ratepayers picked up the $16 million cost. And that cost doesn’t include what ratepayers pay for remote meteorological stations to ensure wind developers don’t lie about what they may have produced.
Interestingly enough if one checks out Elections Ontario to determine what those wind developers contributed to the three major political parties in 2010, 2011 and 2012, you find that the NDP received nothing, the Ontario PC party received $1,080 from Enbridge and the Ontario Liberal Party or OLP received $8,000 from Enbridge, $14,840 from Brookfield and nothing from the rest. The CEO of IPC did donate a total of $555 to the OLP.
The wind power lobby organization Canadian Wind Energy Association (CanWEA) contributed $16,620 to the OLP over the last three years and zero to the NDP or the Ontario PC party. I wonder why?
This situation is a win-win for some of the parties involved, but a hit to the pocketbook of the average ratepayer.
Formerly a wing of TGH, MaRS is where the money is now
MaRS Discovery District and the Canadian Energy Innovation Summit
Premier Wynne was in a state of shockdays ago when Chrysler announced they would move forward with renovations to their automobile plants in Ontario without government grants or subsidies.“I was very taken aback,” she said. The Ontario Liberal government has been handing out taxpayer dollars since being elected for whatever purpose seems appropriate at the time, be it to satisfy foreign investors who can make millions by erecting wind turbines or solar panels, or to move a couple of gas plants.The phrase “money is no object” seems to be the mantra. So, to have someone declare that they will proceed with an investment without a government handout came as a shock.
It’s not likely to be a trend, however, as another event indicates. Premier Wynne attended what MaRS labeled as “a cross-Canada energy innovation conversation” (writer’s emphasis) called the Canadian Innovation Energy Summit.
This is laughable, in that the Association of Major Power Consumers of Ontario (AMPCO) recently released a report that pleaded for lower power rates and benchmarkedOntario’s power rates against those of other Canadian provinces and U.S. states.They don’t match the promises made five years ago by then Ontario Minister of Energy George Smitherman who said electricity costs would rise by only 1% annually, as he pushed the Green Energy and Green Economy Act through the Legislature.It certainly appears that AMPCO want a conversation that will bring sanity back to the electricity system in Ontario and never mind “innovation.”
Promoting access to tax dollars
On the MaRS website one finds a link to a “search tool” carrying the caption “Three easy steps to access $27,541,872,468 in funding for your business.”It starts with the following:“The Funding Portal Search Tool enables access to more than 4,500 federal, provincial and municipal government funding programs.” It’s clear that the grants or loans represent monies either supplied or backstopped by taxpayers.Identifying $27.5 billion in “government” funding sources suggests every man, woman and child in Canada is able to pony up over $800 each for these “entrepreneurs” to fulfill MaRS’ mission statement “Building Canada’s Next Generation of Growth Companies.” With that kind of cash on the go, no wonder Wynne was shocked by Chrysler.
MaRS Discovery District has written the book on where to obtain funding grants as it has survived without any visible means of revenue other than government grants.As a CRA “Registered Charity” it must be (?) a provincially owned institution—in fact, 29 employees made it to the 2012 “Sunshine list” and another five are listed on the Mars Investment Accelerator Fund.The latter is “funded by the Province of Ontario,” and reputedly managed by the Ontario Network of Entrepreneurs.(Finding specific information on the latter is almost impossible but if you visit the site, Liberal MPP Eric Hoskins’ picture appears and then disappears. Kind of like our tax dollars.) The Ontario Network of Entrepreneurs consists of 46 offices throughout the province staffed with individuals that will supply “free” stuff. The “free stuff,” i.e., grants and financing, these centres offer is not really free of course, as taxpayers provide the money supporting them, along with the grants and loans they hand out.
Who picks the “winners” of these grants? Why is there not a publicly available financial accounting?This is something that the Auditor General should examine in detail.
And another thing…
When and if the Auditor General examines the “MaRS Investment Accelerator Fund” perhaps the issue of MaRS’ survival without substantial annual taxpayer funded grants should be reviewed.Between its filing as a “charity” in 2002 and its year-end March 31, 2011, MaRS has received $154 million or 61% of its gross revenue in grants. Most of the balance of funds came from their real estate operation in a renovated building (the original Toronto General Hospital) that was bought and paid for by the Ontario taxpayers!
Examining the latest MaRS financial statement of March 31, 2012 (where is the March 31, 2013 statement?) is disturbing.While the bottom line indicates an “excess of revenues over expenses” of $5.4 million, without the $30.5 million in grants (69% of revenues) MaRS would report a lossof $25.1 million.Even the real estate operation would have lost money without a grant!
The new 20-storey, $344- million MaRS expansion is being financed by “Infrastructure Ontario”(another Liberal creation) is further cause for concern.Infrastructure Ontario was previously headed up by David Livingston, who pocketed $321,000 in salary for 2012.That was the same year that McGuinty appointed him as his “Chief of Staff” following his assignment, by McGuinty, to try and resolve the impasse between the OPA and TransCanada to cancel the Oakville gas plant.Wonder how that worked out!
Where’s the “innovation”?
The “innovation” displayed at the Canadian Energy Innovation Summit was for the Premier to throw another $5 million in grant money to MaRS and establish a new “Advanced Energy Centre” at the MaRS Discovery District.This new “Centre” is a partnership with MaRS, Siemens and Capgemini to “help showcase to the world the expertise and technology the province has to offer in the energy innovation field in order to drive economic growth and create jobs.”
Now it should be pointed out that both Seimens and Capgemini are in it for the money as both of these foreign owned companies have benefited tremendously from the Liberal created electricity mess.Capgemini, via a multimillion dollar contract with Hydro One, “provide an array of technology services, along with human resources, payroll, supply chain, customer service and accounting to Hydro One.”The original Hydro One-Capgemini contract ($1 billion) was signed in 2002 but has been extended without tender by Hydro One.The supply of “customer service” byInergi LP, the Capgemini subsidary, may be something that Andre Marin, Ontario’s Ombudsman, will comment on when he releases his report on the billing messes of Hydro One.
Siemens have been one of the major beneficiaries of Ontario’s rush to wind power by supplyingforeign manufactured turbines and blades.Siemens established a blade manufacturing facility in Tillsonburg (employing 100) due to the Ontario “content rules” ( now determined to be illegal) so perhaps we will see Siemens close this plant as they did with their Hamilton gas turbine (costing 550 jobs) plant, when offered grants and tax incentives from North Carolina.
It seems strange that the province would choose two foreign companies to partner with, let alone create yet another taxpayer-dependent entity, when they already have those 46 taxpayer funded offices spread throughout the province deciding what the next entrepreneurial success story will be—kind of like playing the slots at an OLG casino except it is the taxpayers on the hook for all the money fed to the slots!
The only real “innovation” the Ontario Liberal Party demonstrates is how to spend taxpayer dollars and increase Ontario’s debt.
Wind turbines: Divisive and useless or welcome easy money?
By Parker Gallant
I recently had the pleasure of being invited to do a presentation to the Prescott Federation of Agriculture by dairy farmer Reg Presley. The presentation explained what is behind the four lines on our electricity bills. Judging by the looks on faces, questions and comments afterwards, I think some of those at the OFA meeting were shocked by what we are all paying for.
Traveling through rural Ontario we frequently encounter strange sights now appearing with regularity. Those sights are industrial wind turbines soaring up to 500 feet, sometimes spinning and other times idle. Meant to displace fossil fuels (coal) those turbines were touted as producers of clean electricity which would save us health costs. That was the spin.
My interest in energy didn’t come from viewing the turbines. It came from a nasty electricity bill received from Hydro One for our place in Prince Edward County; a farming community. The research I put into the electricity system reflected on my banking background and why my bill had jumped. As I delved into the way the system functioned I was shocked to see Ontario had implemented a “renewable energy” strategy with no cost/benefit study! It was initially launched by Dwight Duncan when he sat in the Energy Minster’s chair and later expanded by the passing of the Green Energy Act under George Smitherman.
What I found was the move to renewable energy drove up the cost of what all Ontarians tend to regard as a “necessity of life.” Wind generated electricity presents itself in the middle of the night and in the spring and fall; periods when demand is lowest. Also, their intermittent nature means they need rampable back-up power and gas plants (including those moved at a cost of $1.1 billion) fill that gap. Because wind and solar generators get “first to the grid” rights our grid manager is often faced with conditions that may cause blackouts or brownouts.
In those situations Ontario is forced to either export power at a loss, spill hydro, steam off nuclear or pay wind and solar developers for NOT generating.
Those events cause our bill for electricity to rise and recent estimates indicate our loss on just the export side costs Ontario ratepayers in excess of $1 billion annually.
With another 3,700 MW of wind and 1,200 MW of solar to be added to Ontario’s supply those costs will continue to grow! The Energy Minister recently said rates will increase 33 % over the next three years.
Things looked differently a few years ago when Premier McGuinty in a speech stated: “we know the price of fossil fuels will keep going up, while we know the price of renewable technologies will keep coming down. We know where the world is going. And we choose to lead, not follow.”
As a result wind and solar developers swept through Ontario, signing up farmers, promising cash payments for simply allowing them to erect a wind turbine occupying less than an acre of land. Leases were signed and the money started to flow. Early signers found out later they should have held out for more money. Later on lessors discovered those turbines created friction with their neighbours and even family feuds because of the “global warming” debate. The leases locked in farmers, controlling future actions such as severing land, exiting the lease or negotiating early termination; meaning the friction(s) could not be cured.
Those turbines also kill birds and bats; bats that no longer consume insects that infect or destroy crops and result in the need to use pesticides. The estimated cost of pesticide use by Science Magazine as a result of bat kills by wind turbines in Pensylvania was $74 per acre.
Last year I discovered my neighbour had optioned some of his farmland to a wind developer and we chatted about it extensively, discussing the cash payments versus the down side of wind turbines.
Former Premier McGuinty’s musings have not materialized as that “cash crop” to benefit farmers but has wound up in the wind and solar developer pockets while the rest of us hand it over. The lead McGuinty envisaged has been a blow to our pocketbooks. Perhaps we should have simply been a follower.
Parker Gallant is a Toronto-based former Royal Bank vice-president, who has retirement property in Prince Edward County. He is vice president of Ontario Wind Concerns, an anti-wind power umbrella group.
That the Liberals blamed the Harris-Eves government for the 2003 electricity blackout in Ontario is history as is their constant claim that they have fixed what they perceived as a broken and neglected electricity sector. After 8 years in power however, it may be time to review the Liberal track record to determine if they have changed it for the better. To examine their success or failure we should travel back to early 2004 shortly after they came to power and visit Hansard Ontario where the Liberal visions are eloquently spelled out. This is the first chapter of that history and the legacy they will leave our children.
For the first visit we will go to March 22, 2004 and this salvo fired by: Mrs Donna H. Cansfield (Etobicoke Centre):
“The previous NDP and Conservative governments have left our energy sector a disaster. So imagine my surprise when I heard a conversation that took place last Friday on Metro Morning. These are the folk, the NDP, who used Hydro to buy a rain forest in Costa Rica and they cut our lifeline by cutting a lucrative contract to Manitoba. The Tories as well squandered a North-American-wide economic boom and failed at the same time to renew our generating capacity, and yet I wonder why. I wonder if it’s because Mr Tom Long received over $2 million in a contract; Mr Paul Rhodes got more than $800,000; Michael Gourley received more than $4 million; Leslie Noble received more than $300,000; and Jaime Watt received $800,000. Maybe they were too busy signing contracts to keep our lights on. But better still, the member from Rainy River has taken up hydro hypocrisy. Throughout the election, and for years, the NDP has been demanding that coal-fired plants in Ontario be closed or converted. They even put it in the 2007 pledge for their platform. They wrote the Ontario Clean Air Alliance as well to close all the plants. It was their promise. At least it was until Mr Hampton, the member for Rainy River, cried to keep the coal plants open. He even said he ran on keeping the coal plants open – unbelievable.”
If one examines the hypocrisy behind this statement after having gone through the recent Ontario election it is worth noting that the Atitokan coal-fired generating station has been closed by the Liberals however in order to preserve the seat (held by Liberals in the last 4 Provincial elections) the Long Term Energy Plan launched by Energy Minister Duguid in November 2010 declared that Atitokan would be converted to biomass by 2013 (page 21 of the LTEP). That a conversion of this size has (to the best of this writer’s knowledge) never before happened did not deter the directive from Minister Duguid being issued. There are many that would equate this to trying to save a Liberal seat that was seen as very vulnerable because of a planned wind turbine development in that riding along with lost jobs in the forest industry sector caused by expensive electricity.
The other ironic part of MPP Cansfield’s remarks relate to the Liberals abandonment of the Mississauga gas plant only two weeks before the recent voting day in order to save two other Liberal seats. The costs of the Atitokan conversion is an unknown as is the cost of cancellation of the Mississauga gas plant. It would appear that it is OK for the Liberals to throw hundreds of millions of dollars of taxpayer money away, if only to ensure they save Liberal seats however, if the NDP or the Conservatives want to save jobs it is not OK!
Later on March 22, 2004 Hansard records this recital by: Mr Kevin Daniel Flynn (Oakville):
“My question is for the Minister of Energy. People in Oakville have been shocked recently by allegations of impropriety at Hydro One. They were troubled to hear that during the term of the previous PC government, people who were well known to be friends of the government were awarded lucrative, untendered contracts. Minister, can you outline to the people and businesses in my riding what process you plan to use to ensure that contracts are awarded in an open and transparent manner, unlike the previous government’s method of dealing with contracts?”
The response coming from the then Minister of Energy, the Hon Mr Duncan was:
“The first step we took was to make sure that, unlike the Conservative government, we won’t treat Hydro One and OPG like our own private country club; that’s ended. Their record on hydroelectricity: no new generation in eight years; a price cap that cost the taxpayers of Ontario $850 million; no renewable electricity in Ontario; no development under your administration. But all the while they had money for their friends and contacts, people who didn’t have to go through a tender, people who would work for a year or two and go off and get all kinds of goodies. Well, those days are over, thank goodness. This government’s bringing change to electricity. We’re bringing safe, secure, reliable new supply at an affordable, predictable price for the people they ignored for eight long, painful years.”
Once again, in hindsight, the question posed by MPP Flynn and the response from MPP Duncan drip with hypocrisy. Cancellation of the Oakville power plant by Trans Canada in October 2010 was generally seen as a means to save MPP Flynn’s Liberal seat in the Legislature. This will again cost the taxpayers and ratepayers of this province untold hundreds of millions of dollars without any benefits other then having to endure a Liberal “majority minority”. One has to wonder if Mr. Hampton was still the leader of the NDP would he be less inclined to side with the Liberals on energy matters then the current leader who has Peter Tabuns, former Executive Director of Greenpeace, as the NDP’s Energy Critic?
That MPP Peter Tabuns beat the Liberal Candidate, Ben Chin in a by-election in the Toronto Danforth riding is yet another hypocrisy as Mr. Chin, having lost the election suddenly became an executive with the Ontario Power Authority and the Sunshine List for 2010 indicated he earned $246,000-not bad for a Liberal who lost the election! The Liberals were also busy ensuring that those who drank the global warming kool-aid were also rewarded with Board appointments on the Ontario Power Authority and presumably benefited in other ways for their perceived stewardship on cleaning up Ontario’s electricity sector. People like Bruce Lourie, (appointed to the OPA Board and also to the Trillium Foundation’s Board) have been able to influence decisions emanating from those taxpayer owned institutions.
Further it remains a mystery if Mr. Lourie, via certain of his “for profit” companies, like Enerquality Corporation, the certification arm of ENERGY STAR (R) or Clean Air Foundation, now Summerhill Group, (market transformation consultancy) specializing in energy conservation and renewable energy. have benefited financially. Summerhill is a for profit, not-for-profit and a charity through its three arms. The for profit end claims the OPA, Ontario Realty Corp and Toronto Hydro as clients. That a good Liberal, John Manley was appointed by the Provincial Liberals in 2003 to conduct the review of OPG, that John Beck of Aecon was appointed the Chairman of the OPA’s Board of Directors and the entities that make up Aecon have contributed in excess of $150,000 to the Liberal Party in the last 7 years should be considered co-incidental. The fact that Aeconjointly with Peter Kiewit Sons Co were awarded a $1.7 billion contract for the Lower Mattagami hydropower project should also be considered a co-incidence? That “country club” that Minister Duncan referred to appears to have reappeared but perhaps in a slightly different guise!
The last visit to Hansard on March 22, 2004 has the Hon Dalton McGuinty (Premier, Minister of Intergovernmental Affairs)saying the following:
“Speaking of growth, we embrace our responsibility to bring forward a plan that will ensure Ontarians have a lasting, reliable supply of clean and affordable electricity.”
Fast forward seven plus years and the electricity sector has more bureaucracy, a bloated infrastructure, hundreds of unreliable wind turbines producing energy when we don’t need it, a shrinking publicly owned generator in OPG, a bloated distribution company in the form of Hydro One and commitments to foreign owned companies like Samsung that will extract as much as $100 billion dollars from the ratepayers and taxpayers of Ontario over the next 20 years. To top it off, whoever occupies the Energy Minister’s chair has become the reputed “expert” and via dozens of “directives” has politicized what was once a reasonably well run electricity sector that provided low cost electricity and attracted jobs to the province. Now we have high priced electricity that drives jobs out of the province and energy poverty for many who are living on fixed incomes. Where is that “reliable supply of clean and affordable electricity” that Premier McGuinty promised?
That is the legacy that the Provincial Liberal Party have created. There will be more to come on what the McGuinty Liberals have done to the electricity sector in Ontario as we examine their vision and the resulting legacy in more detail!
The failure of the Harris-Eves government to include certain crown corporations in the commonly referred to; “Sunshine Act” caught the attention of the Liberal’s shortly after they attained power in Ontario and particularly because of the Clitheroe scandal that had occured in 2002 while she was the CEO of Hydro One. That led them to seek to amend the act to capture those institutions and grant the public the right to see what the salaries and perks were at those crown corporations. The following deals to some extent with the efforts to amend that Act along with the rhetoric that accompanies any amendments to an act or the introduction of a new act and is but one day when the Legislature sat in March of 2004.
Hansard from March 31, 2004 was a day filled with lots of chatter about OPG and Hydro One and the extension of Bill 15, the Public Sector Salary Disclosure Act. The Bill would require the same salary disclosure for OPG and Hydro One as was required for all other public servants as well as making them subject to the Freedom of Information and Protection of Privacy Act.
That the Liberals would only one year later, create the Ontario Power Authority which would sign “undisclosed” generation contracts with dozens of wind turbine developers including Samsung flies in the face of their need to have OPG and Hydro One made subject to the Freedom of Information and Protection of Privacy Act. The other issue mentioned frequently by the Liberal speakers on this day referred to the prior sitting government of Ernie Eves and his freezing of the electricity rates which reputedly cost the Ontario taxpayers $850 million. To put that in perspective the Samsung contract alone will cost the ratepayers in the Province in excess of $1 billion for each of the next 20 years.
The support for Bill 15 from some of the sitting Liberal members was absolutely bubbly as noted below. The following from Liberal MPP, Donna Cansfield (now Parliamentary Assistant to the Minister of Economic Development, Brad Duguid) is particularly “holier then thou”;
“ On paper, Hydro One and OPG have only one shareholder, the province of Ontario. In fact, there are about 12,112,000 shareholders, the total population of our province. These 12 million shareholders will find it much more difficult than other shareholders to understand what is happening at Hydro One and Ontario Power Generation because they don’t receive annual reports and, of course, they don’t attend stockholder meetings. They must rely on us, members of Parliament, the government, as their only proxy to keep close watch on these companies and to protect their interests, the interests of Ontarians, these 12,112,000 people. Doesn’t this give us a much more onerous task than the directors of any other public company? Of course it does. Are we not more responsible for surveillance, not less? Is it not more important then that all of us in government have an absolute duty to be more resolute, more demanding and more ethical than any other shareholder or director?” and this; “We will make certain that some of the money we will force Hydro One and Ontario Power Generation to spend more wisely will go to initiatives that include aggressive conservation, new and greener sources of supply and an accountability to help us meet our objectives of cleaner air, consumer protection and a sustainable supply of electricity for generations to come.” and this; “This bill is an important and integral part of the stand of the Liberal government. It means we’ll be able to take the dollars and apply them to health, education, our seniors and long-term care. It will make a difference in terms of the compensation that will come. It will make a difference in terms of what will happen in the future for the children in this province.”
MPP Donna Cansfield in the recent run to retain her seat was quite delighted to support the cancellation of the Mississauga gas plant and was quoted as follows; “I’m delighted that the Ontario Liberals will put more rigour into site selection to protect homes, schools and hospitals,” said Cansfield. “I’m also delighted that the views of our community have been listened to.” One has to wonder how this cancellation, the product of Dwight Duncan’s original directive(which is blanked out [see Chapter 3 about the McGuinty “open electricity policy] but presumably included the Mississauga contract and others) and it’s costs will affect the dollars for “health, education, our seniors and long-term” care. It would appear that MPP Cansfield was willing to claw back those dollars for health, education, seniors and long-term care in order to save a couple of Liberal seats in the most recent election.
The Minister of Energy in 2004 was Dwight Duncan and he had this to say that day in the Legislature: “The member is quite right: We introduced Bill 4, which will erase the $850-million charge to the provincial government that your failed energy policy put on the people of Ontario. My colleague the Minister of Municipal Affairs had the rent bank announcement, and my colleague the Minister of Community and Social Services has $2 million to help those low-income families. We expect that bills for the average consumer will go up by about 4% to 5%.”
That forecast of a a 4% to 5% increase in the average electricity bill 7 years later has resulted in the “average consumer” paying over 100% more and the recent Minister of Energy, Brad Duguid has told us to expect another 46% increase by 2015. And Duncan is now the Minister of Finance! One of MPP Duguid’s predecessors in the Energy chair was George Smitherman who when presenting the Green Energy Act (Act)to Parliament in early 2009 was quoted as saying that the average electricity bill would rise by 1% per year. Forecasts don’t seem to be a strong suit of our Liberal Energy Ministers.
Another Liberal David Ramsay (Minister of Natural Resources) had this to say on that day in March 2004: “In January of this year my colleague Dwight Duncan, the Minister of Energy, announced our intention to seek up to 300 megawatts of new renewable energy capacity as soon as possible. One of the components of meeting that goal is wind power. The wind turbine, for example, at Exhibition Place can produce enough electricity each year to light 250 homes. Since it produces no pollution, it displaces up to 380 tonnes of carbon dioxide annually. This is a proven technology that works, and they will increase our supply of renewable energy.”
That wind turbine that Minister Ramsay touted produces less then half of the energy required to power those 250 homes and has cost the ratepayers of Toronto an as yet undisclosed amount of money through the partial acquisition of it by Toronto Hydro. It may have also cost the co-op members but questions asked of Toronto Hydro, the City of Toronto and the Co-op on several occasions have gone unanswered-in fact all three parties have ignored requests for information. Will MPP Cansfield speak up about how her Liberal party has met the test of her remarks in the Legislature: “government have an absolute duty to be more resolute, more demanding and more ethical than any other shareholder or director?” Somehow I doubt that!
Forecasts and the ethics of disclosure would not seem to be a strong suit of the governing Liberals so we should be concerned that the most recent 46% forecast will be greatly exceeded in order to reward Samsung and others connected with the renewable energy sector.