Ontario energy policy a shambles: editorial
Norfolk News, January 2, 2016
The provincial Liberals have legalized an end to using coal to produce electricity, but it seems they’re not against leaving a few finals lumps in Ontarians’ stockings this Christmas.
Hydro ratepayers in Norfolk County recently received news that as of Dec. 31, the province will end the Ontario Clean Energy Benefit, which used to take 10 per cent off monthly hydro bills as a way to ease the sting of ever-higher rates.
“This rebate,” Hydro One explained, “was introduced five years ago to help customers through the transition to a cleaner, modern electricity system.”
Cleaner and more modern the system may arguably be, but as we learned this month from Auditor General Bonnie Lysyk, it’s also terribly managed and overly expensive.
After reviewing the utility, Lysyk found that electricity consumers shelled out $37 billion more than necessary from 2006 to 2014 thanks to mismanagement and shoddy service from Hydro One, plus unreasonably high green energy rates.
What’s worse, all that extra money hasn’t produced a flawlessly functioning system, as Lysyk bemoaned more frequent power outages thanks to spotty maintenance of Hydro One’s assets. “Hydro One’s customers have a power system for which reliability appears to be worsening while costs are increasing,” she said.
Paying more for poorer service
Paying more for poorer service is unacceptable, especially since the labour market has still not rebounded from the crash of 2008, and consumers don’t have extra money to burn on their hydro bills. It’s good that there exists a government program to help qualified low-income residents. But what about those residents who work multiple jobs and cut back on everyday frills so they can avoid ending up on the dole? A 10 per cent jump in hydro rates (made even worse by a 4.4 per cent increase to time-of-use prices mandated by the Ontario Energy Board in November) could be enough to push some residents into poverty.
The Clean Energy Benefit was a nice break for consumers reeling from the province’s notion that setting inflated rates for wind and solar projects – Lysyk said some rates set out in the Green Energy Act were double the U.S. market price for wind power and 3.5 times the rate for solar power last year – was a necessary move to get early adopters on board.
“With wind and solar prices around the world beginning to decline around 2008, a competitive process would have meant much lower costs,” Lysyk concluded.
Energy Minister Bob Chiarelli defended the high wind and solar rates, saying the province was “ahead of the way” and “prices are going to be down very dramatically” thanks to a new competitive process for large renewable energy projects to be announced in the new year.
Hard to trust this minister
Forgive our skepticism, but it’s hard to trust the minister’s word on this in light of the AG’s report, and the fact that only on Dec. 31 will consumers finally stop seeing a Debt Retirement Charge on their hydro bills (a move that will lower monthly hydro bills by 3.4 per cent).
Compounding our mistrust is the fact that two former Liberal staffers are up on criminal charges related to the cancellation of two gas-fired power plants in 2011, a purely political move that burdened ratepayers with another billion dollars of debt. These and many other missteps do not inspire confidence in this government’s honour. (And no matter who was in charge at the time, Premier Wynne, the accused wear your party’s colours, so you can’t pretend they don’t exist).
We haven’t even gotten to the ill-advised sell-off of 60 per cent of Hydro One, nor Lysyk’s sobering conclusion that paying to conserve energy during a time of surplus power will actually cost the government more than it saves.
The hydro story in Ontario is the latest example of bald-faced government spin that just doesn’t compute. Cancelling the clean energy rebate while the system remains in shambles is a move worthy of Scrooge himself.