WYNNE GOVERNMENT SHOULD CANCEL WIND POWER CONTRACTS FOR HYDRO BILL RELIEF
November 21, 2016
Wind Concerns Ontario welcomes the acknowledgement by Premier Kathleen Wynne of financial hardship imposed by her government’s energy policies, and has sent six recommendations for action that will provide immediate relief.
“We know that energy poverty in Ontario is real and worsening under this government,” says WCO president Jane Wilson. “Hundreds of thousands of people are having difficulty paying their electricity bills, and many are having to choose between ‘heat and eat.’ Meanwhile, corporate power developers are getting paid huge profits in Ontario – this has to change, now.”
Wind Concerns Ontario sent the Premier a list of recommendations:
- Immediately cancel LRP II renewable power program. Currently “suspended,” its target was to acquire 1,000 megawatts (MW) of power, even though the government says we have a “robust” supply of power for the future. The cost of this new capacity would go straight to Ontario’s electricity bills
- Cancel the five wind power contracts awarded under LRP I for 299 MW. This action will save ratepayers about $65 million annually and $1.3 billion over 20 years. Cancellation costs will amount to a small fraction of the annual cost, probably on the order of about $2 million, at most. In addition, cancelling approved but not yet built wind power projects, and the new FIT 5.0 program will also save money. Together, these cancellations can save ratepayers from future rate increases of nearly $4 per month.
- Cancel “conservation” spending of $400 million annually. This action would have an immediate effect on ratepayers’ bills, reducing them by $5.50 per month or about $70 a year. Ontario’s ratepayers have already reduced their consumption from 157 TWh in 2005 to 137 TWh in 2015, for a significant 12.7% decrease.
- Allocate the Ontario Electricity Support Program (OESP) to the Ministry of Community and Social Services. The OESP is essentially a social assistance program and it is questionable as to whether ratepayers should bear the burden of its costs. With an estimated annual cost of $200 million, the effect of this would be an immediate savings of about $4 per month on ratepayers’ bills, and an annual savings of $50. We recognize, however, that the move would impact the budgetary shortfall by a like amount so we recommend the following action.
- Levy a tax on wind and solar power generation on a per-megawatt basis starting at $10 per/MWh. This would result in raising sufficient revenues to offset the OESP costs. The effective rate could be held at that level or increased in the event the OESP costs exceed the forecast $200 million per annum. The Auditor General previously reported the award value per MWh of the 20-year contracts to wind and solar power developers exceeded those in other jurisdictions by a considerable margin. The tax would serve as a recognition of those excessive margins. (Note: the wind power contracts also contain cost of living increases of up to 20% over the term of the contracts.)
- Immediately reduce the Time of Use (TOU) off-peak rate. We recommend an immediate reduction in the TOU off-peak rate from 8.7 cents/kWh to 7.4 cents/kWh to encourage the shift of power consumption from peak to off-peak time in order to flatten daily demand.
“Poverty is a major factor in population health,” says Wilson, a Registered Nurse. “It is time Ontario takes action to help people now, and not cause further hardship for Ontario families.”
Wind Concerns Ontario is a coalition of community groups, individuals and families concerned about the impact of industrial-scale wind power development on the economy, on the natural environment, and on human health in Ontario.
Jane Wilson, President: firstname.lastname@example.org
Parker Gallant, Vice-president: email@example.com