Back on March 31, 2004, Energy Minister Dwight Duncan uttered these words in the Ontario Legislature in response to a question on the Liberals energy policy;
“If we address energy policy in a responsible way, our economy will prosper and our families will have a stronger Ontario in which to grow. Our initiatives include aggressive conservation, new supply and accountability at our Crown corporations. Bill 15 will help us meet our goals on accountability and transparency.”
At that point in Ontario’s history the unemployment rate sat at 6.6% (February 2004) and today (September 2012) the unemployment rate is 7.9%.
It is important to take a look at how that “energy policy” has emerged over the last eight years to determine if the initiatives Minister Duncan talked about actually accomplished the goals he mentioned.
With 25% of captive clients purchasing only 18.6% of the product sold in the market how can you increase your profits (after tax) by 135% in only 6 years, and beat your competition in gross profit by 91% in a regulated market?
For an exercise in marketing moxie and an answer to the above question one need only look at Hydro One, the Provincially owned distributor (and transmitter) of electricity in Ontario to 25% of (mainly rural) captive ratepayers. As the Sarah Vaughan song goes; “whatever Lola wants Lola gets”, except in this case it becomes whatever Laura Formosa (CEO of Hydro One) wants they get and their ratepayers pay dearly for the love that the Ontario Energy Board (OEB) has for them.
The Yearbook of Distributors for the year ended December 31, 2011 discloses the above facts and several more about Hydro One versus the other 74 municipally owned local distribution companies (LDCs) in the province. Hydro One actually pay 15.2% less for the cost of power per customer (a pass through at cost) but collect $493.00 (91%) more in gross profits and $107.00 (122%) more in after tax (payments in lieu of tax or PILT) profit per customer. The reason that extra $493.00 in Gross Profits doesn’t find its way to the bottom line is because Hydro One has much higher operations, management and administration costs (OMA) and higher amortization costs on their capital assets which are respectively $216.00 (91%) and $49.00 (73%) higher per customer.
When Hydro One apply for rate increases they inevitably use the excuse for needing higher pricing on the fact that they claim to provide service to almost all of Ontario. In their submissions to the OEB they state they provide electricity distribution to 650,000 sq km versus the 681,511 sq km encompassing the total area all distributors (including Hydro One) serve. So Hydro One claim they service 95.4% of all areas in the province that have a connection to the grid and the area is all rural!
While the above fact might be true if Hydro One were making that claim on behalf of their transmission (where they have a virtual monopoly) and distribution businesses combined, that would make sense, but this submission is only for their distribution business. In fact, putting aside their ownership of Hydro One Brampton (not included in the foregoing or below statistics or calculations) the distribution arm has many urban communities which include a number of what most would consider small cities like Belleville, Trenton, Lindsay, etc or numerous larger towns throughout Ontario. Despite that Hydro One claims all of the area they distribute to is “rural”. Many other distributors such as Oshawa Hydro, PowerStream, etc. break out the area they serve as both rural and urban. Despite the false claim by Ontario Hydro that they serve over 95% of the electrified province the OEB does not seem to challenge them on that issue and generally give them the rate increases they seek.
Yet another interesting piece of information can be gleaned with a little mathematics from the “Yearbook” relating to the percentage of “delivery” costs for the average ratepayer. For the 74 municipally owned LDCs, the delivery cost averages 20% of their ratepayers total bill (including “costs of power”) whereas the delivery cost for Hydro One ratepayers averages 36% of their ratepayers bill and they deliver an average of 580 kWh less per month. Perhaps “rural” Ontarians need to consume more power delivered by Hydro One if they want to see better economies of scale but that would mean that Hydro One would catch the ire of the OEB for not meeting their conservation targets. Is Hydro One’s conservation plan simply raise the price and they will consume less? On the latter; its not working, as the average consumption of a Hydro One customer in 2005 (1740 kWh per month) was the same as it was in 2011 (1739 kWh per month) but at that time Hydro One’s delivery costs were only 31% of their average ratepayers bill. So raising the delivery price is not achieving the desired results except for a one (1) kWh per month reduction. The OEB set the reduction target for 2011-2014 at a cumulative target that works out to 78 kWh per month for Hydro One’s average customer so we should perhaps expect to see their delivery prices rise at a faster rate over the next 2 years in the hopes they will deliver on the goal set for them.
It now appears that the Green Energy and Economy Act (Act) not only imposed giant wind turbines and acres and acres of solar panels on rural Ontario but they also got the double whammy of having all-in electricity bills that are consistently higher then the larger urban centres and likely to remain so.
So rural communities, the breadbasket of the province, not only have had their democratic voices taken away by the Act but they also pay higher prices for electricity that goes into producing the foods that people in the large urban centres consume. The next time they buy their milk, eggs or fresh produce they will hopefully blame it on the Act imposed by the Liberal Government and those Hydro One people on Bay Street in Toronto, where they whip up their rate applications to the OEB so they can impose the highest electricity costs on Ontario’s farmers.
It is time to tell Lola she won’t get what she wants and the decimation of the Liberal Party in rural Ontario in the last general election certainly conveyed part of that message.
September 26, 2012
In the October 7, 2011 Provincial election, MPP Bill Mauro, Thunder Bay Atikokan, beat out the NDP candidate with 39% of the vote versus 37%. The winning margin—less then 500 votes!
Ahead of that victory by MPP Mauro however, there was a major issue that affected the outcome of the election and it related to a wind development at Big Thunder. The planned development had generated a major push-back by the residents of Thunder Bay who fought their local council on granting the developer, Horizon Wind Inc., rights to access Big Thunder Mountain. The company sued the City for $126 million when the city backed out of their agreement to allow them to erect only 14 turbines (instead of the original 18 the Thunder Bay council had originally approved) on city owned land. Then on September 11, 2011, shortly after the election writ had been dropped; the then Minister of Natural Resources, Linda Jeffrey, refused to issue the developer a permit because it would harm a bird species. Despite the foregoing the developer continues to push ahead on the contract and the eventual outcome, at this point, is still an unknown but Linda Jeffrey has moved on to another portfolio.
By the September 11, 2011 date the Minister of Energy, Brad Duguid, had announced the conversion of the Thunder Bay coal plant to gas in a press release on November 23, 2010 and the Long Term Energy Plan (released on the same day by the Energy Minister) indicated that the 200 MW Atikokan coal plant would be converted to biomass. Since then we have seen other announcements from current Energy Minister Chris Bentley with one on July 19, 2012 and another September 12, 2012. Both announcements promised 200 construction jobs as did the contractor Aecon who won the award for the conversion project at a cost of $170 million. It is worth pointing out that Aecon have contributed in excess of $45,000 to the Liberal Party of Ontario over the past four years and the CEO sat on the Board of Directors of the Ontario Power Authority (OPA) almost since its creation by Dwight Duncan, when he was the Minister of Energy.
It is important to review the contribution of the 200 MW Atitokan coal plant to Ontario`s electricity supply over the past couple of years to determine if it is or was needed. In the last two years it has produced power at 2.6% of it’s capacity which means it hasn’t been needed to support Ontario`s power demands. Had it run at full capacity it could have provided approximately 1.7 million megawatt hours (MWh) annually (enough to power about 175,000 homes) far exceeding the riding’s needs whose population is about 85,000. Additionally the conversion to biomass (which will use wood chips as fuel) will reduce its ability to produce power. In fact according to a filing dated June 30, 2011 by the OPA to the Ontario Energy Board (OEB) the maximum capacity will be 140 GW per year (140,000 MWh) based on fuel availability. That means upon conversion it will operate at a maximum of 8% of capacity.
The foregoing OPA submission also makes the case for expenditures of $600 million to create a new
East West tie line (transmission) at a cost of $600 million in anticipation of activities related to the “ring of fire” and the possibility of some recovery in the pulp and paper sector. Both of these combined with the unknown quantities of hydro electric power; from mainly run of river hydro stations during low water level seasons could cause problems in respect to having sufficient power available to service the region.
Couple the foregoing with the plans for 200 MW of renewable energy (wind and solar) in the region and that will mean excessive volatility. The east/west axis tie line will require the upgrade to ensure reliability and the ability to import (and occasionally export) power from other regions.
What this means is the expenditures caused by adding intermittent wind and solar to the grid and downgrading/converting the Atikokan facility will create spending requirements of close to $1 billion dollars when the subsidies to wind and solar are taken into account.
Ignoring the foregoing expenditures on the East/West tie line and the feed-in tariff (FIT) subsidies for wind and solar the Atitokan facility’s cost of $170 million (capital costs) means that each of those 200 construction jobs promised in the two Provincial press releases and the Aecon announcement will cost Ontario`s ratepayers $850,000 each or $425,000 per employment year (assuming the project is completed by 2014 as the Aecon announcement suggests).
If we examine the amount of energy that Atikokan can produce at 8% of its rated capacity, (outlined in the OPA submission to the OEB) over say a 20 year lifespan it will cost about $61.00 per MWh in capital costs without factoring in fuel costs or the operation, management and administration (OMA) costs. The fuel cost is a big unknown but OPG has put out a “request for indicative prices” for 90,000 tons per year to supply Atikokan. An August 2008 study by Deloitte & Touche LLP indicated the cost per ton of wood pellets at $420., so fuel costs could add almost $38 million per annum to the cost of production of that 140,000 MWh ($270.00 per MWh) if the refurbished plant requires the full 90 thousand tons to produce at 8% of rated capacity. That brings the per MWh cost to $331.00 without inclusion of the operations, management and administration (OMA) costs. Even if OPG is able to purchase the pellets at half the price of the Deloitte forecast amount the cost of production at Atikokan will still be in excess of $275.00 per MWh or more then 12 times the average hourly Ontario energy price (HOEP) to the end of July 2012 (Independent Electricity System Operator). Assuming fuel costs come in at the latter level for the next 20 years; total costs of this conversion will mean Ontarians spent $770 million dollars to ensure MPP Mauro’s seat remains in Liberal hands.
At this juncture the cost to the taxpayers and ratepayers of the Province for each of those slightly less then 500 extra votes that MPP Mauro received (not including the costs of converting the Thunder Bay coal plant to gas or the $600 plus millions being spent to improve the East West tie line) are about $1.5 million for each one of those 500 votes.
On behalf of all of the rest of Ontario`s taxpayers I certainly hope those 500 voters are happy with the outcome because the rest of Ontario’s ratepayers and taxpayers will be paying for the costs of your votes for years to come.
September 22, 2012
Pop the champagne, Ontario. September is the third anniversary of one of the most expensive and least useful experiments in top-down central planning in the province’s history. Three years ago, the Ontario Power Authority (OPA) released the original pricing model for the Feed-In Tariff (FIT) and MicroFIT programs after the passing of Bill 150, the Green Energy and Economy Act, in the spring of 2009. Under FIT, the Ontario government set sky-high prices for wind and solar power: wind generation at 13.5¢ per kilowatt hour and solar generation as high as 80.2¢ per kWh.
The original pricing model was revised down slightly earlier in the current year, a move that has done little to stem the flow of applications. As of last month, OPA reports applications for 12,000 megawatts for wind and 8,500 MW for solar, numbers that dwarf the government’s long-term target of 10,700 MW by 2030 for wind and solar combined — a clear indication that FIT and MicroFIT pricing has caused developers to salivate at the returns being offered.
As for the revenue, under Ontario’s magic FIT program, the $14-million will be paid by all Ontario electricity ratepayers. In effect, Ontario electricity consumers will help defer Toronto’s municipal tax increases. Essentially, the city of Toronto’s solar-panel revenue becomes an indirect tax on all Ontarians. In addition, the power that will be produced at 48.7¢ a kWh is power that Toronto currently buys at 7.2¢ per kWh (based on its filing with the Ontario Energy Board). Had the city purchased the $15 carbon credits along with the electricity at the foregoing rates, it would have saved ratepayers $1-million per year.
“The name came from sitting under an apple tree in the graveyard. “The apples were plunking down around me as they fell off the tree, and I thought, there’s a lesson here. If you take care of things and leave nature alone, it provides.” The foregoing was from the February 2008 edition of York University’s magazine story about Brent Kopperson, the founder of Windfall Ecology Centre an environmental not-for profit. Perhaps Mr. Kopperson felt that his comment put him on a par with Sir Isac Newton but the short story doesn’t give us that insight!
Kopperson in the story claims responsibility for co-founding the Ontario Sustainable Energy Association (OSEA) and in his biography on the Windfall website it states he was a founding director in the creation of the Canadian Renewable Energy Alliance (CanREA), the Community Power Fund , which led the Green Energy Act Alliance (GEAA) and was the former Chair of Green Communities Canada. His bio also claims he authored “Ontario’s landmark Standard Offer Program or Feed-in Tariff for renewable energy”, that he was a Director of the World Wind Energy Association and “Along the way he earned his private pilot licence and solo aerobatics Endorsement.” Considering his reputed commitment to the environment the latter effort doesn’t sound very carbon neutral, now, does it!
Mr. Kopperson was one of the 14 individuals instrumental in the creation of the Green Energy & Economy Act and his bio and the short story mentioned above confirms that. He purports, in my opinion, to have discovered (with the help of the UN IPCC) the gravity (perhaps a play on words) of “fossil fuels as a finite energy source” as he clearly states in this MaRS video filmed at the “Social Finance Forum”. In his speech he states Ontario is using 19th century technology and further on in that speech he pushes wind turbines (19th century technology) to source our future electricity.
That particular speech (late 2008) confirms that the Community Power Fund, which Kopperson says he co-founded; received $3 million from the Ontario Provincial Government. This was upped to $10 million annually by Brad Duguid in his directive of November 26, 2010 to the Ontario Power Authority (OPA). Part of this fund was subsequently allotted to OSEA, one of the entities Kopperson co-founded. Prior research on OSEA indicated they received almost $2 million ($1.5 million from the Trillium Foundation plus $200,000 from the Toronto Atmospheric Fund or TAF) from various Ontario government (taxpayer funded) ministries and institutions but perhaps that was just part of the “windfall” that came to Kopperson when those apples were falling!
Just to put the latter point in perspective it is worth pondering the fact that Trillium Foundation have approved grants to Windfall Ecology of $1,047,600, to Green Communities Canada, $1,181,000 and $465,000 to another entity that Kopperson is involved with—Chippewas of Georgina. In fact Kopperson has been involved with the Chippewas of Georgina for many years almost since the advent of Windfall itself.
Kopperson has ingratiated himself with the Chippewas to the point where he is a director of the Pukwis Energy Co-operative which has a contract with the OPA for a 20 MW wind turbine development (Phase 1) on Georgina Island. The development is to consist of ten (10) 2 MW turbines on the island which Kopperson purports to be capable of producing enough energy to supply 7500 homes meaning it would produce energy at a level of over 41% of capacity. [Strangely the link that should take you to the “Pukwis” website posted on Windfall Ecology’s page actually leads to a “coupon” website.] The Kopperson suggested level of production would trump any wind development project in the province and pretty well anywhere in the world. Wind turbines, in Ontario during 2011 operated at a level of about 27% of capacity which is consistent with global experience. The claim was not disputed by the Ministry of Energy but a June 20, 2011 posting on the Ministry blog said the Pukwis development would generate enough power to power 4500 homes. Lake Simcoe’s Georgina Island is approximately 14.5 Sq Kilometres with a population of 220 and 1.5 kilometres from the mainland. The foregoing means the costs of hooking this development to the grid will be borne by Ontario’s ratepayers as the projected amount of energy produced is well in excess of what should be required for a population of that size.
Georgina Island is approximately 50 miles north of Toronto and outside the area of financial interest to the City of Toronto, yet TAF (Chaired by councillor Shelly Carroll) at a Board meeting on December 15, 2010 approved financing of $500,000 for the Pukwis Energy Co-Operative to erect the 20 MW Pukwis Community Wind Park. Later that month the Deputy Mayor of Toronto, Doug Holyday, got wind of this approval and raised the issue in the press and was quoted as follows: “I just don’t see the benefits to the citizens of Toronto to be sending $500,000 up to Georgina Island.” As time passed TAF reported that Pukwis was able to raise cheaper financing and the TAF financing was no longer required. Despite that claim, one wonders if that is really the truth. Perhaps Kopperson was able to arrange alternate financing from conventional sources, however, it certainly appears that Pukwis may have instead tapped into other government financing sources including the Aboriginal Renewable Energy Network which may have provided funding of up to $770,000.
Needless to say the Pukwis Energy Co-operative has received a lot of attention from Mr. Kopperson in his efforts to push this project forward to conclusion. Those efforts included one of the Trillium grants ($150,000) for Windfall to “develop a community owned wind farm”. His efforts to utilize the Sheppard House in Aurora as Windfall’s offices resulted in Trillium grants of $100,000 to make it “energy efficient” and another $100,000 for “office equipment” and hire an “education co-coordinator”. Sheppard House and the Sheppard’s Bush conservation area it occupies is managed by the Lake Simcoe Region Conservation Authority (LSRCA) which in 2011 received almost $9 million of taxpayer (municipal, provincial & federal) funds which represented 65% of their gross revenue. [As a taxpayer I find it insulting that conservation authorities and many other quasi-government entities believe an annual report is; nature pictures, verbiage and two pie charts showing revenues and expenditures-actual disclosure is devoid of facts]. Windfall reputedly pay $12,000 (in kind) in annual rental payments to use the Sheppard House which seems to be very cheap rent.
Windfall obtained another $568,000 grant from Trillium to develop and launch Repower Ontario. Repower operates out of the Sheppard House and according to its website it:
“is a learning program that orients, trains, and connects eager participants with employment and self-employment opportunities and provides insight into what is possible and what is driving rapid growth in the new green economy.”
Mr. Kopperson has done an admirable job of multiplying those falling apples into what can only be properly described (in my opinion) as a windfall for him and the various entities he claims he founded or co-founded.
Amongst his other claims Kopperson reputes he introduced George Smitherman, former Minister of Energy, to Herman Scheer of German renewable energy fame at the 2008 World Wind Energy Conference and that introduction led Smitherman (after a tour of Germany) to bring the Green Energy & Economy Act forward.
The ratepayers and taxpayers of Ontario are paying dearly for those falling apples; since Brent Kopperson had his “aha” moment. Based on his numerous claims, in this writer’s opinion, it certainly appears he deserves to be included in the small club of people that greatly influenced the Liberal government pushing the creation of Bill 150, the Green Energy & Economy Act that has cost Ontarians billions of dollars, created health problems, driven down property values in rural Ontario, killed tens of thousands of birds and bats and set in place the causes of the rural/urban divide that exists today.
Some windfall for Ontario!
September 10, 2012
The Green Energy Act (Act) didn’t just happen—it was created by the Green Energy Act Alliance or GEAA. The 3rd Anniversay of the Act just passed so this article will take a look at; how the Act came about and the effect it has had on the Province.
A visit to the MaRS Discovery District to view some of the videos resident on that site by the list of people on the attached chart will quickly show many of the individuals involved in the GEEA claim responsibility for bringing the Act to fruition. As one example, Marion Fraser is almost beside herself with delight about her role in its creation. The GEAA inundated the Ontario Liberal Majority government with material and lobbying efforts from the time the McGuinty government were first elected until they successfully got Energy and Infrastructure Minister, George Smitherman, to buy into their concepts.
Before the Act received its third reading and Royal Assent, it was reviewed by the Standing Committee on General Government. On April 8, 2009 Deborah Doncaster, Chair of the GEAA, supported by David Poch, the GEAA’s legal adviser; presented her views to the Committee. She said;
“Finally, we believe that one of the most significant features of the act is that it will create jobs—tens of thousands, hundreds of thousands of jobs. The proposed act and the relevant regulations have the potential to enable the greatest number of meaningful jobs, more than the OPA’s previous plan, and those jobs can start today. Renewables and conservation are shovels in the ground today—and we need the jobs today. We, too, have commissioned a study, with the Political Economy Research Institute of the University of Massachusetts. Preliminary results shows that aggressive implementation of the Green Energy and Green Economy Act, the feed-in tariff program and related regulations will produce three times the number of jobs than what the IPSP had originally proposed. The government estimates of job creation of 50,000 are likely to significantly understate the potential. Just as importantly, jobs from conservation and green power occur across the province and a greater proportion of those jobs are ongoing. Distributed generation and conservation means distributed local jobs—and yes, I’m going to use the Germany analogy, much to the ministers chagrin, if he were here to stay for this.
The point of referencing Germany is not to compare supply mix possibilities or probabilities; the point of comparison with Germany is that it is a jurisdiction with a landmass one third the size of Ontario, and in Germany today they have 280,000 jobs in the renewable energy sector. They’re producing 32,000 megawatts of renewable energy today; that’s 100 terawatt hours per year, which compares to Ontario’s total electricity demand of 150 terawatt hours a year. By 2030, Germany’s renewable energy supply will grow from 15% to 50% of total requirements. The German government anticipates the jobs to be in the 800,000 to 900,000 range. In some ways, Ontario’s energy plan is superior to Germany’s because we are legally required to eliminate coal-fired generation by 2014 and the proposed act does not place caps or limits on the amount of renewables and conservation that can come into the system.”
As the reader will discern, Ms. Doncaster, a little over three years ago, was forecasting “hundreds of thousands of jobs.” would be created by the Act while citing the German example and boldly stated that Ontario’s “energy plan was superior to Germany’s”.
|View as .pdf|
This presentation and numerous studies, including the one mentioned in her presentation were regular occurrences, leading up to the presentation of the Act in the Ontario Legislature. It is worth reflecting on whether those studies were partially financed by the taxpayers of the Province bearing in mind the list of sponsors of the GEAA. Those sponsors include six (6) of the GEAA Founders (refer attached chart), many of whom were adept at obtaining grants from publicly owned institutions like the Trillium Foundation, Friends of the Greenbelt, Toronto Atmospheric Fund, etc., etc.
Interestingly enough one of the few corporate sponsors; Trillium Power, is now suing the Province for $2.25 billion claiming “Ontario assassinated the company and the offshore industry by stealth through a press release.”
The Founders of the GEAA were originally listed on a 7 page paper titled; “Creating a Green Energy Act before Copenhagen 2009”, that seems to have been created by Kris Stevens of the Ontario Sustainable Energy Association (OSEA) on November 3, 2008. This paper forecast 215,000 jobs , 200,000 trained workers and cites the German and Spanish experience. The paper omitted listing the World Wildlife Fund as a founder but they were subsequently added.
Yet another study released in February 2009 by Toronto Region Conservation Authority (TRAC where David Love is Executive Director) in conjunction with York University’s Faculty of Environmental Studies (FES) noted the jobs Ontario had lost (230,000 manufacturing jobs) and suggested the way forward was renewable energy as the highest job creator! Spain and Germany were again noted as examples of how they created jobs from their adoption of renewable energy generation. This report went on to outline the biographies of the interviewees (16) of whom many were connected to the GEAA including Jose Etcheverry, Assistant Professor in the York FES as well as the Chair of the GEAA, Deborah Doncaster, Brent Kopperson of Windfall Ecology Centre and Kris Stevens of OSEA.
It should be noted that York’s FES are also adept at tapping into public funds as an October 2011 newsletter tells all about $3 million in grants received and mentions several familiar names involved in the environmental movement.
Assistant Professor Etcheverry honed his skills at the David Suzuki Foundation before joining York University and it appears he has launched the “Sustainable Energy Initiative” (SEI) under the banner of the FES enlisting Mark Windfield (formerly with Pembina [a GEAA founder] and the Canadian Institute for Environmental Law & Policy) as a Co-Chair along with Peter Love (formerly Ontario’s Chief Conservation Officer with the Ontario Power Authority) and Tyler Hamilton, “editor-in-chief of Corporate Knights and the Toronto Star’s clean energy and technology columnist. The focus of the SEI appears to be to get students to drink the renewable energy kool-aid. SEI’s partners include TRAC (see above), Windfall Ecology Centre where Brent Kopperson is listed as founder and Executive Director. Kopperson was one of the drivers of the GEAA (refer chart). Windfall is very effective at tapping into publicly owned entities as this link will show.
The list of the main individuals involved and listed on the chart fails to include a few luminaries involved in the GEAA. An expanded list would include Paul Gipe, a US based IWT supporter for decades, Bruce Lourie of Ivey Foundation, Tim Weis of Pembina, Gideon Forman of the Canadian Association of Physicians for the Environment, Jack Gibbons of the Ontario Clean Air Alliance. Those on the list are the ones most connected and recognized in the halls of Queens Park working to create the Act. They were included in the November 3, 2008 paper and included in the GEAA’s list of the Management Committee and the Phase 1 and Phase II Campaign Teams. We have also cross listed them with Tom Rand’s list of the “Top 20 Movers and Shakers of the Green Energy Act as picked by Tom Rand after consultation with seven (7) people and with the signatories on a March 29, 2009 paper that sought to amend the original Bill 150.
Needless to say the Act received third reading and Royal Assent on May 14, 2009 and the Deputy Premier and Minister of Energy & Infrastructure, George Smitherman had this to say;
“The Green Energy Act will truly set us on the path to a 21st century green economy for Ontario, one that is sustainable, easy on the environment, and focused on the jobs of the future. We’ll be working hard to ensure Ontario gets every benefit possible from renewable energy and from the efficiency and savings that come from developing a culture of conservation.”
The message above from George Smitherman, the then Deputy Premier, signaled his full belief in the messages that the GEAA pumped out in the form of their studies and papers. Three years later it is obvious that the messages delivered to the ruling Liberal party weren’t worth the paper they were printed on.
The Act has done absolutely nothing to curb the decreasing manufacturing employment in the Province and nothing to clean the air. The poster children of those who were active in the GEAA in the form of Spain, Denmark and Germany have also fallen on hard times and it now appears Germany may be on the verge of ridding itself of subsidies that support solar and wind generation. According to Spiegel Online “Bankruptcies Have German Solar on the Ropes” creating massive job losses as government subsidies are reduced. A recent study by the German Energy Agency (dena) estimates that Germany will require backup fossil fuel plants for renewable energy equivalent to 60% to ensure security of supply. They also forecast that electricity rates will continue their climb (presently German electricity rates are the 2nd highest in Europe after Denmark) much like Ontario where electricity rates are forecast to be the highest in North America.
But didn’t the GEAA members tell us that the Act would create “hundreds of thousands of jobs” and produce electricity at lower rates then new gas or nuclear generation units and didn’t they promise us clean air (so far Ontario has had the 3rd highest number of smog days in 2012 since record keeping began in 1995)? Did the McGuinty Liberal government simply take the words of these 14 plus individuals and not consult with anyone who might deign to disagree or even to examine the facts presented in the papers and presentations?
Most of these environmental not-for profits and charities that formed the GEAA are now using the same information to tell us that noise from industrial wind turbines (IWTs) is not harmful to humans and that more birds are killed flying into buildings then by IWTs and the Liberals seem to accept their musings, staying the Acts course.
When will sanity return to those we elect to manage the affairs of this province? The taxpayers and ratepayers of this province don’t want or deserve another Liberal majority government that panders to the beliefs of a few and fail to do proper cost/benefit analysis that reflects the lack of economic and health aspects of the Act!
In this writer’s humble opinion the cure for the ills caused by the McGuinty Liberals will take far more time then the 9 years they have been in power and the legacy left by the Liberals will be decades of austerity and high electricity prices.
August 27, 2012
A few weeks ago an article I penned noted a former employee of the Ontario Power Authority (OPA) was quoted in a Toronto Star article that, in my opinion, appeared to indicate that the former employee, Jason Chee-Aloy, was lobbying on behalf of his company’s clients who included; Samsung, NextEra, Pattern and IPR-GDF North America. It also appeared on the surface, at least, to put him in a conflict of interest position. Following up on that worrisome thought took me to the Conflict of Interest Commissioner website and that was followed by an enquiry suggesting they investigate the matter under the Public Service of Ontario Act 2006, Regulation 381/07. What I got back in response was the following: “The Commissioner’s jurisdiction is limited to public servants in Ontario government ministries and agencies, known as public bodies. The list of public bodies that are governed by the PSOA and its regulations are set out in Ontario Regulation 146/10”.
A search of that list (194 names) confirmed that the OPA was not on it, and neither was Hydro One, Ontario Power Generation, IESO, MaRS Discovery District or Friends of the Greenbelt. I did note that the Premier’s Climate Change Advisory Panel was on the list along with the Ontario Energy Board (OEB) and Ontario Electricity Financial Corporation (OEFC). Others that I didn’t know existed like the “Ontario Geographic Names Board”, the “Owen Sound Transportation Committee” and even a “Rabies Advisory Board” were on the list. As it turns out the “Crown Corporations” under the “Electricity Act 1998” are charged with developing their own Governance and Structure By-Laws via their Board of Directors. Searching the records was an exercise in futility as the search only turned up the “conflict of interest” guidelines for directors and in the search of the OPA site the Board Resolution only focused on the “directors” as being caught up in the By-Law whereas the IESO Board Resolution also referred to “employees”. The next port of call was the Office of the Integrity Commissioner and a check in at the Lobbyist Registry. Needless to say Mr. Chee-Aloy was not registered nor was his employer, Power Advisory LLC so I duly sent my opinion to the Lobbyist Registry by e-mail. The response back was atypical in that it stated “the Act does not contain a complaint and investigation procedure.” The best they could do was to advise me they would contact Mr. Chee-Aloy so they could “raise awareness and encourage compliance,” Despite the tepid response from the Integrity Commissioner they claim “ULTIMATELY the Commissioner can lead a new investigation if not satisfied with the response to a referral .” In the past I had occasion to refer the Ontario Sustainable Energy Association (OSEA) and their Executive Director, Kristopher Stevens to the Commissioner which simply resulted in both Stevens and OSEA suddenly appearing on the Lobbyist Registry.
So one must ask what exactly do these two entities really do to protect the public from abuses that reflect themselves in either potential conflicts of interest or ignorance of the “Acts” meant to protect the taxpayers from abuse by favoured parties? The answer is apparently not much!
Interestingly enough travels though the internet disclosed a “Conflict of Interest and Post-Service Directive” dated September 9, 2000 which on Page 9 under “H 21.” had the following to say;
“The government of Ontario maintains a legal interest in the post-service activities of former public servants. As such, public servants shall not, after leaving employment with the Crown, take improper advantage of their past office. For example, a public servant shall not do the following, including:
(a) allow prospects of outside employment to create a real or potential conflict of interest while in public service with the Crown
(b) seek preferential treatment or privileged access to government after leaving public service with the Crown
(c) take personal advantage of information obtained through official duties and responsibilities that is not available to the public”.
Its not clear if this directive remains in force but in the opinion of the writer it appears that Mr. Chee-Aloy is in a clear conflict with the text outlined therein. If this directive has been abandoned by the McGuinty Liberals to ensure their push for industrial wind turbines permeate the Ontario landscape it is the ruling party that should be found in conflict—but who exactly will exert their authority and punish the guilty party? This is something that escapes the writer as it is obviously neither of the two Commissioners mentioned above.
If someone does undertake the task they should also look at some other related past actions that smack of conflict such as the appearance of Ben Chin as the VP, Communications at the OPA. His sudden appearance at the OPA came following his defeat by Peter Tabuns in the Toronto-Danforth riding by-election in 2006 after a stint as a “senior adviser” to Premier McGuinty. The Sunshine List reported that Chin earned $186,000 in 2009 and $246,000 in 2010 while acting in the capacity as head of the communications team at the OPA which was much better pay then he would have received as an MPP. Chin has since left the OPA and moved to BC.
Another individual that seems (in the writer’s opinion) to be up to his UWO neck in either blatant nepotism or outright conflict is Mike Crawley, the newly elected President of the Liberal Party of Canada. Crawley’s daytime job is as the CEO and President of International Power Canada Inc. (IPC), a wholly owned subsidiary of International Power plc UK; a company with annual revenue in excess of 3 billion Euros. Crawley was one of the founders of the predecessor company, AIM PowerGen. International Power plc acquired that company from Renewable Energy Generation Limited who originally purchased AIM for $29.1 million, Mr. Crawley would appear to have benefited from the acquisition if he was a significant shareholder. As a former banker I would assume the company would have been valued not so much on it’s income statement, but on the above market contracts they obtained from the OPA for their many industrial wind developments around rural Ontario.
The recent creation of the “Clean Energy Task Force” by the Minister of Energy included two (2) IPC employees, a foreign company; perhaps because of the position of Mr Crawley as CEO of IPC and his prior position as Chair of the Management Committee of the Liberal Party of Canada (Ontario) for seven (7) years. Was Crawley owed a favour by Minister Chris Bentley or was Bentley seeking one when Dalton McGuinty resigns? Bentley has signalled his interest in the past in leading the party and presumably Crawley could deliver some delegate votes but that is pure speculation on the writer’s part..
Crawley also sits on the IESO’s Market Development Committee and was the Chair of the RPS Implementation Working Group within the Renewable Energy Task Team (RETT). RETT was the catalyst in the push for renewable energy in the Province when “global warming” was still the buzz word before the IPCC was discredited. The link to their report of November 14, 2003 reflect many of the recommendations implemented by Dwight Duncan in 2004 via (Bill 100) changes to the Electricity Act 1998 and those were further exacerbated by the Green Energy and Economy Act in 2009. One section of the November 14, 2003 report had the following to say:
“The RETT believes that the private sector is willing to assume the financial risk and burden of new power supply development, in addition to permitting, construction and operation risk. The only risk that the private sector is currently unable to accept is the electricity market risk. The financial community’s profound unease about the Ontario electricity market due to the inconsistency of the previous Government’s electricity policy means that power purchase agreements from a credit-worthy entity (i.e. A body of the Government) is the only way to facilitate private sector financing of new power plants.”
We now know that the “Working Group” proposal resulted in the creation of the OPA through Bill 100 and in 2009 the Green Energy and Economy Act bumped up the rates paid to wind and solar developers via the FIT and MicroFIT programs on the backs of Ontario’s ratepayers.
That IPC (or its predecessor) and presumably Mike Crawley, personally, benefited from the actions of the Liberal Government is a conclusion that one must assume and it is no small coincidence that the underwriting of their concepts through legislative changes created wealth for the original AIM PowerGen founders.
The eventual outcome of the path that the Liberals have taken Ontario’s electricity sector down, will prove to be a cost to Ontario’s ratepayers, taxpayers, employers and workers that will make the e-Health scandal look like chump change with costs in the tens of billions and will stretch out for two decades or more.
Its time to amend the PSOA Legislation to protect Ontarians from this type of abuse and time for a task force to investigate and assign blame to this complicit wealth transfer from the pockets of the 4.5 million ordinary ratepayers.
July 3, 2012
The University of Western Ontario’s (UWO) publication, Western News, recently published a news item about their annual electricity bill. The bill for UWO was reported as $25 million in 2011 and the writer incorrectly blamed 25% of that bill on what they called a Global Adjustment (GA) “tax”. The author tried to explain what the GA represented but many of the facts were wrong. One thing the writer was correct on was that UWO was a “Class A” customer, because they consume in excess of 5,000 kWh per month-the cutoff point for large users.
Class A and B customers were created after lobbying by the Association of Major Power Consumers in Ontario (42 members) but the benefits of this classification didn’t come into play until January 1, 2011. Class A customers are able to reduce their costs of electricity by picking 5 peak demand hours that occur over a 12 month period, This task can be predicted with relative accuracy by looking at Ontario’s electricity peak demand patterns which occur on hot days in the summer in the hours close to dinner. Once the hours are picked the Class A customer can fire up the diesel backup generator to reduce their demand on the grid and the shift is complete. As Aegent Energy reported the shift in 2011 reduced the GA Class A customers paid by $10.97 a MW or 28.7% less then they would have paid under the previous system. This shift reduced the Class A customer’s share of the GA while increasing the share paid by Class B ratepayers. For 2011 that shift cost Class B ratepayers $225 million. The amount of that shift will increase in the current year as the GA pot grows to over $7 billion from $5.1 billion in 2011. For 2012 the shift will be over $300 million and close to 40% less for the Class A consumers under the old system.
When created the Class A group was portrayed as a means for Ontario’s manufacturing sector to secure competitive electricity pricing but it didn’t distinguish between private and public sector entities. Those Class A public sector customers ironically include those who produce most of the electricity generation, transmission and distribution that Class B ratepayers are subsidizing through this shift. While there is no list of public sector Class A companies it is assumed they include Hydro One, Ontario Power Generation, Toronto Hydro, OLG, LCBO, York University, Toronto General Hospital, University of Toronto, etc., etc. many of whom are in the MUSH (municipalities, universities, schools and hospitals) category.
It certainly appears the Western News article was correct by referring to the GA as a tax. That “tax” was exacerbated by the changes announced in Finance Minister, Dwight Duncan’s budget (endorsed by the NDP) wherein he reduced the Ontario Clean Energy Benefit for Class B customers utilizing more then 3,000 kWh per month immediately impacting small and medium sized businesses (job creators) and a large number of Ontario farmers.
In summary, the Ministry of Energy’s plan to reduce Ontario’s peak electricity demand is: use “dirty” diesel generators while simultaneously creating a hidden stealth tax on Ontario’s Class B ratepayers.
June 22, 2012