Watch for the “Catch 22” and other terms in wind power leases, lawyer says

In this week’s edition of Ontario Farmer is an article by retired QC Garth Manning and Wind Concerns Ontario president Jane Wilson, advising landowners to get legal advice before signing any lease or option to lease for wind power projects and associated equipment.

Although Large Renewable Procurement II is “suspended” the government fully intends to bring it back (after the 2018 election), and the FIT 5.0 process is currently accepting applications for wind power projects with equipment less than 500 kW. (See story today about Brant County being approached for support here.)

Wind power contracts can be very one-sided ... and not in favour of the landowner, says an Ontario lawyer
Wind power contracts can be very one-sided … and not in favour of the landowner, says an Ontario lawyer

Here is the article:

Clients need help with complex wind turbine lease documents

In answer to Ontario citizens’ concerns about rising electricity bills and the fact that Ontario now has a surplus of power, the provincial government suspended its process to accept new bids for wind and solar power in 2017.

While the process is on “hold,” wind power developers are still holding open houses and prospecting for willing landowners to sign Options to Lease land for wind turbines and associated equipment, in hope the contract process will resume after the provincial election in 2018.

Landowners should know that these are very complex documents and they need legal advice before signing. Some option/lease agreements contain a box to be checked that means the landowner has read the agreement and waives legal advice. That may not be the smart move. The Ontario Federation of Agriculture, for example, advises members to seek legal advice before signing.

Why? There are many implications to signing an Option to Lease (which converts to a Lease if the company gets a power contract) including rights to use of the property, first right of refusal at time of sale or if the owner wishes to sever property, even the ability to speak out if there are side effects of having turbines on the land.

The fact is, current forms of options/leases are very one-sided in favour of the wind power developer and should be reviewed literally word for word by an independent lawyer. It’s easy to focus on the dollar amount offered by the developer, and ignore other, important aspects of the agreement. For example, some leases contain cancellation options for the power developer, but most do not provide any option for the landowners to terminate the agreement if they change their minds.

Wind power developers always create a separate corporation to own and operate each project. Its assets include, in Ontario, the Renewable Energy Approval, the contract with the government to supply power, the options/leases for the land for turbines and equipment, and any agreements such as for road use with municipalities.

These corporations are usually mortgaged to the hilt. All assets can be sold to another company without consent of the landowners; the buyer could be a dummy company without assets, which is unwilling or unable to perform any obligation of the original company, including, the decommissioning or dismantling of the huge towers.

There are key financial considerations to consider above the lease amount: having a lease on the property may affect the owner’s ability to use the land as collateral for financing; construction liens may also be filed against the project and will appear on the landowner’s title. …

Read the full article here. windfarmcontractscomplexnovember-2016

More action needed on hydro bills, say Ontario mayors

The Mayor of North Frontenac has written to Energy Minister Glenn Thibeault on behalf of all the 115 municipalities demanding change to the Large Renewable Procurement process. While relieved the next round of bids is “suspended,” he says, the municipalities say more can be done to stop the dramatic rise of Ontario electricity bills.

NorthFrontenac

October 5, 2016

Mayors across Ontario who united together as  a result of a resolution being supported to have municipal support mandatory for industrial wind turbines are relieved that procurement of future wind power has been cancelled for now. The Mayors still feel however that the government needs to take very aggressive actions to address the ongoing crisis caused by high electricity costs in this province. Taking steps to not add $2.45 per month in 2020 does not address the real hardship being felt by our residents now.  It is also not clear that the other measures announced by the government will even offset the ongoing increases in hydro rates that can be expected in the short term unless additional changes are made.

It was important that the Minster of Energy’s statement confirmed that the province has a “robust” supply of electricity and the procurement process could be cancelled without increasing greenhouse gas emissions.  This provides room for more aggressive actions that will address increasing costs. Our tracking of wind turbine contracts shows that there are still many wind turbine projects in the pipeline that will add at least another $7.9 billion to electricity generating costs.  This is equivalent to another $82 per annum for each Ontario electricity user. Seven of these projects are under construction but will not be connected to the grid until sometime this fall or in 2017.  Another five have not been issued ‘Notices to Proceed’ as they are, or have been until recently, involved in Environmental Review Tribunal proceedings or other legal appeals of Renewable Energy Approvals. The final six projects are in the pre-MOECC submission stage.  These include the five contracts issued in early 2016 plus one outstanding project from earlier FIT offers.

In all of these cases, the IESO has the option of terminating the agreement for any reason with very limited cost liabilities relative to the 20 year commitment to electricity that is not required.  We respectfully ask that all industrial and solar wind projects be cancelled to avoid ongoing costs to our residents.

Ron Higgins

Mayor, North Frontenac

Councillor, County of Frontenac

Phone 613-884-9736

Email ron.higgins@xplornet.com

Twitter @HigginsRon

Facebook

 

See the letter sent to the Energy Minister, here. lettertoenergyminister-oct52016

 

Mayor Higgins (Photo CBC)
Mayor Higgins (Photo CBC)

Stop digging the hole, utility company tells Wynne

Niagara On The Lake Hydro sent an open letter to Ontario Premier Kathleen Wynne, outlining the steps the government needs to take to get costs down, and halt the unsustainable rise of electricity costs. “When you are in a hole,” President Tim Curtis said, “the best thing is to stop digging.”

The news release and letter can be read here and an excerpt follows.

There are concrete actions that can be taken both immediately and in the medium term to reduce the cost of electricity or slow down the increase.  NOTL Hydro has the lowest delivery charge in the Niagara region not because of anything special we have done but because of a fifteen year focus on managing the business to keep costs low for our customers.  This focus can be replicated at the Provincial level. The chart above shows that the driver of the increase in costs is generally not at the municipal LDC nor transmission level (both in line with inflation) but at the generation level.

Immediate actions include:

  1. Announce that you will stop immediately signing any FIT and MicroFit contracts and move as soon as possible to net metering.  This will prevent encumbering the system with more expensive contracts.  As you are moving to net metering you are not repudiating your climate action plan but accelerating the move to its next phase.  As a sign of our commitment, if you announce this by the end of September 2016 we will cancel our FIT contract.
  2. Eliminate the MDM/R branch of the IESO and their activities.  This branch collects the smart meter data and all their activities are redundant as are duplicated by the local distribution companies who need the information for billing.  If you announce you are eliminating this cost you can also announce you will be removing the $0.79 monthly charge on every customer’s bill.  While not a large amount this would be a symbolic gesture of the new direction.
  3. Recognize that the earlier FIT and MicroFIT contracts were overpriced and transfer the excess cost to the OEFC.  While this will increase the debt of the Province it will also reduce the cost of electricity which is needed to sustain jobs and keep Ontario competitive.
  4. Meet with industrial business representatives such as in the steel industry to develop plans that mitigate the impact time of use pricing is having on the drivers of our economy. This needs to be done in a manner that does not just transfer the cost to residential customers.

 

See the full letter for more actions suggested by Niagara On The Lake Hydro.

Six years of energy assault on Ontario municipalities says Mayor

No justice for Ontario communities under the Green Energy Act: removing democratic rights and ignoring calls to end subsidies
No justice for Ontario communities under the Green Energy Act: removing democratic rights and ignoring calls to end subsidies

September 14, 2016

Now 112 Ontario municipalities have either passed a resolution demanding change to the wind power contracting process, or have endorsed a resolution to that effect, and it’s all because of “six years of energy assault,” says the Mayor of Enniskillen Township.
In a letter published in Ontario Farmer, Kevin Marriott says that “Rural people in the Province of Ontario have been under assault by the provincial government for about six years since the Green Energy Act (GEA) of 2009 was enacted.”

That legislation, says Marriott, was “the first ever to take away a municipality’s democratic right” to perform local land-use planning, “in this case, to say no to industrial wind turbines.”

That’s not all, says Marriott: the other right taken away is affordable electricity. He also points to the difference between how rural and urban residents are treated.
“Why should rural Ontario pay almost double for delivery when most electricity is actually delivered to the GTA from rural Ontario?”

Marriott concludes by saying the electricity policy has made electricity bills three times higher than they were eight years ago. The government “has ignored our pleas to stop subsidizing wind turbines by billions of dollars”.

More Ontario municipalities demand final say in wind power sites: more than 100 stand up to Wynne government

Ontario municipalities want local land-use planning control back
Ontario municipalities want local land-use planning control back

September 11, 2016

Now 111 municipalities in Ontario have either passed or formally endorsed a resolution at Council, demanding that municipal support be a mandatory requirement for contracts in the Wynne government’s next round of Large Renewable Procurement.

The municipalities include several urban municipalities with rural components including Ottawa, Hamilton, and Stratford.

“That number, 111, represents more than a quarter of all Ontario municipalities,” says Wind Concerns Ontario president Jane Wilson.

“They believe that they are the best judge of where important infrastructure should be sited, and that they are the voice of their community concerns about where power generation projects are located. Development is only sustainable and appropriate where there is community support — and as we are seeing, many rural communities don’t support the government’s policy of forcing these power facilities on people, and the environment.”

Local land-use planning for developments such as wind and solar power generation facilities was removed by the Green Energy Act in 2009.

Despite a surplus of power in Ontario, the cost of long-term contracts for renewable sources of power,  and province-wide protests about Ontario’s rising electricity bills, which have forced several hundred thousand residents into “energy poverty,” the Wynne government still plans to launch a new procurement process in 2017. The deadline for corporate wind power developers to file a request for qualification with the IESO was Thursday, September 8th.

Energy analyst Tom Adams told Global TV news last week that the government needs to cancel contracts where it can, and cancel the planned Large Renewable Procurement (LRP II).

Save Ontario $500 million: cancel wind power contract, says community group

August 29, 2016

The Windlectric wind power project on tiny Amherst Island has no hope of meeting its “drop-dead” Commercial Operation date, so Ontario’s Independent Electricity System Operator (IESO) can cancel the Feed In Tariff (FIT) contract right now, with no penalty, says the Association to Protect Amherst Island.

See the letter to IESO Chair Tim O’Neill here and below.

header-12.jpg

Dear Dr. O’Neill,

In August 2015 The Association to Protect Amherst Island requested that the IESO exercise its ability to cancel the Fit Contract dated February 25, 2011 with Windlectric Inc. (Algonquin Power) without penalty because of the inability of the company to achieve its commercial operation date.

In its 2016 Q2 Quarterly Report, extract attached, Algonquin now advises that construction is expected to take 12 to 18 months and that the Commercial Operation Date will be in 2018. This timeline is contrary to what was submitted to the Environmental Review Tribunal and to the Ontario Energy Board. A COD of 2018 is seven years from the date of award of the contract.

Cancellation of the contract at this time would enable the IESO to achieve cost avoidance exceeding $500 million over the next 20 years based on the high cost of power generation at 13.5 cents per kilowatt-hour set out in the contract with Windlectric and based on the IESO’s commitment to pay Windlectric to not produce power when capacity exceeds demand. Cancellation of the Windlectric contract could be achieved without penalty due to noncompliance and would address in part the IESO’s budget challenges and energy poverty in Ontario.

Accordingly, the Association reiterates its request that IESO cancel the FIT Contract with Windlectric Inc.

Rick Conroy, in the attached article from the Wellington Times, explains the Kafkaesque and cruel nature of allowing the Amherst island project to continue especially in light of the unused power capacity of the nearby Lennox Generating Station and the Napanee Gas Plant under construction.

In summary:

Windlectric cannot comply with the Commercial Operation Date in its FIT Contract.

At a time of skyrocketing hydro rates and financial challenges the IESO could save $500 million over the next 20 years by cancelling the Windlectric Contract without penalty.

Existing nearby generating capacity is almost never used and will increase when the Napanee Gas Plant comes online. Intermittent and expensive power from wind turbines on Amherst Island is not necessary

Finally, please provide the IESO’s understanding of the Commercial Operation Date for Windlectric, any extensions awarded by the IESO, and the number of days granted due to Force Majeure and judicial matters.

Thank you for your consideration.

Sincerely,

Michèle Le Lay

President

Association to Protect Amherst Island

CC Premier Kathleen Wynne

Honourable Glenn Thibeault, Minister

 

Replacing coal in Ontario: what the government really did

There is so much mythology now around Ontario’s coal plants for power generation, it really is time to set the record straight on what really happened, how much it cost, and what was actually achieved. This is the first in a two-part series by Parker Gallant.

Intermittent, undependable wind power installed to replace coal-fired power generation. Seen here: a new turbine in the Algoma Highlands. Photo: Gord Benner
Intermittent, undependable wind power installed to replace coal-fired power generation. Seen here: road construction for a new turbine in the Algoma Highlands. Photo: Gord Benner

Back in 2011, Ontario had coal plant capacity of 4,484 MW but the plants really operated only occasionally, producing 4.1 terawatts (TWh) of power — just 10.5% of their capacity. The 4.1 TWh they generated in 2011 represented 2.7% of total power generation in Ontario of 149.8 TWh.  The cost  per TWh was $33 million or 3.3 cents/kWh, making the ratepayers’ bill for those 4.1 TWh $135 million.

As most Ontarians know, those coal plants were either closed (Lambton and Nanticoke) or converted to biomass (Atikokan and Thunder Bay). We were continually told closing or converting those coal plants would save Ontario’s health care system $4.4 billion, based on a study completed while Dwight Duncan was Ontario’s Energy Minister.  Duncan’s claim was a fictitious interpretation of the actual study, but it was repeated so often by Liberal ministers and MPPs that they all believed it and presumably felt the public believed it, too.  

Good PR but … the truth?

Whether one believes the Duncan claim, the fact is the coal plants were closed or converted and the ruling Ontario Liberal government made a big deal of it even to the point of obtaining an endorsement from Al Gore as the first jurisdiction in North America to end coal fired power generation.

The government never disclosed how much it cost the ratepayers/taxpayers of the province to close or convert those coal plants, and we certainly haven’t seen any improvement in our healthcare system since it happened, as one would expect from saving billions. So, was the claim of savings a falsehood? And what did closing the plants really cost?

Let’s start with looking at our electricity consumption level in 2011 and compare it to 2015. In 2011 Ontario generated 149.8 TWh and consumed 141.5 TWh.  In 2015 we generated 159.6 TWh, including 5.9 TWh of embedded generation, and we reportedly consumed 137 TWh, not including the 5.9 TWh of embedded generation consumed within the confines of your local distribution company (LDC).

The difference of 8.3 TWh in 2011 and 16.7 TWh in 2015 was exported.

Replacing coal-fired generation 

As noted, coal capacity was 4,484 MW in 2011 and in 2015 was zero — so what did we replace it with?   According to the Independent Electricity System Operator (IESO) Ontario Energy Report for Q4 2015, since the end of 2011 we have added:

  1. Nuclear supply increased by 1,532 MW (Bruce Power)
  2. 754 MW of hydro
  3. Natural gas generation increased 602 MW
  4. 2,580 more MW capacity of industrial wind turbines (IWT)
  5. Solar up by 2,078 MW
  6. Bio-mass increased by 481 MW (principally conversions of Atikokan and Thunder Bay from coal)
  7. “Other” increased by 10 MW

As well, residential ratepayers conserved 1.184 GWh1. , equivalent to 450 MW of wind turbines operating at 30% of capacity (generating electricity intermittently and out-of-phase with demand).

So altogether, Ontario added 8,037 MW of capacity to cover the loss of 4,484 MW of coal which, in 2011, operated at only 10.5% of capacity.

Ratepayers also reduced consumption by 6,553 GWh with residential ratepayers representing 1,184 GWh of that reduction.

It would appear the variations of long-term energy planning emanating from the Ontario energy portfolio continually overestimated future demand by a wide margin. Their numerous ministerial directives to the Ontario Power Authority (merged with IESO January 1, 2015) with instructions to contract more and more unreliable intermittent wind and solar generation with “first-to- the-grid” rights at high prices produced surplus energy.

This stream of directives and the acquisition of excess capacity resulted in increasing electricity costs for ratepayers due to surplus generation and payment guarantees for displaced generation.

They also added other expensive policies such as conservation initiatives that simply piled on unneeded costs.

Parker Gallant

August 28, 2016

  1. Interestingly, the OEB in a revision to the “average” residential ratepayers monthly consumption reduced it from 800 kWh to 750 kWh, yet suggests conservation achieved (2011 to 2014) was 1,184 gigawatts (GWh).   The total number of residential ratepayers suggests that consumption has declined by 2,739 GWh (4,564,835 residential ratepayers at December 31, 2015 X 50kWh [montly] X 12 = 2,739 GWh) since 2009.

NEXT: The second in this series will examine the additional costs associated with the various policies applied and how generation additions to Ontario’s energy mix continue to drive up Ontario’s electricity costs

 

[Reposted from Parker Gallant Energy Perspectives]

More Ontario municipalities demand municipal support be mandatory in wind power contract bids

NoMeansNo_FB (2)

As of August 19, 2016, 86 Ontario municipalities have passed a motion or resolution at Council, demanding the Wynne government and the Independent Electricity System Operator (IESO) make municipal support a mandatory requirement for new wind power contract bids going forward.

Despite a surplus of electricity and the fact that Ontario ratepayers take losses weekly on sell-offs of extra power, while paying generators to “constrain” or, in the case of hydro and nuclear, to spill or steam off, the Ontario government still plans to proceed with a request for proposals for 600 megawatts of new contracts in 2017. The new contracts will cost Ontario electricity customer billions, at a time when bills have risen dramatically, and more than 8 percent of electricity customers have allowed their accounts to fall into arrears, according to a report recently released by the Ontario Energy Board.

Wind power aiming at the wrong thing

Ontario’s “green” energy program, now widely regarded as a failure, was brought in to benefit the environment, specifically air quality. Ontario’s new Environmental Commissioner Dianne Saxe has commented that the government has made a mistake—the true source of emissions is in the transportation sector.

Municipalities say that wind power projects have been a very invasive and high impact form of infrastructure on their communities: aside from the increasing electricity bills (which have social costs in terms of energy poverty, resulting in more visits to food banks and greater strain on social services), reports of noise, inaudible sound and health effects, and environmental impacts such as the deaths of birds and bats.

As a result, several passed resolutions to the effect that they want municipal support to be a necessity in successful wind power bids. As a City of Ottawa councilor put it, before Ontario’s second largest city passed its own resolution, the siting of power plants should be in line with municipalities’ own development plans. Moreover, truly successful sustainable development must have “buy-in” from the community — there are many serious concerns about wind power projects that warrant municipal control over siting … or whether a project goes ahead at all.

“This has been growing over the last several years,” says Wind Concerns Ontario president Jane Wilson. “Three years ago, the Association of Municipalities [AMO] met in Ottawa and we attended a special meeting on wind power. Sixty-three municipalities were represented that day, and I recall one mayor saying, ‘We’ve been beaten up pretty badly’ by government and the wind power corporations. Now, the municipalities want the land use planning powers removed by the Green Energy Act returned—it’s the fair and transparent thing for this government to do.”

A symposium was held prior to the recent AMO 2016 conference in Windsor, attended by municipal representatives, the IESO, and the Energy ministry. The IESO told the municipal officials that they were open to change but that they were “bound” by ministerial directive.

Asking Wynne to restore democracy to rural Ontario

“Democracy should be restored,” comments North Frontenac Mayor Ron Higgins, whose municipality faced proposals by two huge wind power developers in the last contract round and where a plebiscite revealed more than 80 percent of voters did not support the power projects. Environmental impact and property values were key concerns for the community. “I am hopeful the new Minister of Energy will meet with municipalities to discuss this,” he says.

While the 86 communities represents about 20 percent of all municipalities in Ontario, in fact it is the majority of municipalities that are vulnerable to wind power projects. The 86 span the province from east to west and include several in Ontario’s North. Several of the municipalities already have wind power projects operating—they have seen the complications first-hand, and have had enough.

See the list of communities here:

  1. Adelaide-Metcalfe, Middlesex County
  2. Alfred & Plantagenet, Prescott-Russell County
  3. Amaranth, Dufferin County
  4. Asphodel-Norwood. Peterborough County
  5. Algonquin Highlands, Haliburton County
  6. Armour, District of Parry Sound
  7. Arran-Elderslie, Bruce County
  8. Ashfield-Colborne-Wawanosh, Huron County
  9. Bayham, Elgin County
  10. Bluewater, Huron
  11. Brockton, Bruce
  12. Brooke-Alvinston, Lambton
  13. Bruce Mines, Algoma District
  14. Cavan-Monaghan, Peterborough
  15. Central Elgin, Elgin
  16. Central Huron, Huron
  17. Chamberlain, Timiskaming District
  18. Chatsworth, Grey County
  19. Clarington, Region of Durham
  20. Dutton-Dunwich, Elgin
  21. East Ferris, Nippissing District
  22. Elgin, County of
  23. Elizabeth-Kitley, Leeds and Grenville County
  24. Essex, Essex County
  25. Enniskillen, Lambton County
  26. Gananoque, Leeds and Grenville
  27. Georgian Bluffs, Grey
  28. Greater Madawaska, Renfrew County
  29. Greater Napanee, Lennox and Addington County
  30. Grey Highlands, Grey
  31. Hastings, County of
  32. Hastings Highlands, Hastings County
  33. Havelock-Belmont-Methuen, Peterborough
  34. Hawkesbury, Prescott-Russell
  35. Hornepayne, Algoma
  36. Howick, Huron
  37. Huron, County of
  38. Huron-Kinloss, Bruce
  39. Kawartha Lakes, City of
  40. Killarney, Sudbury District
  41. Kincardine, Bruce
  42. Lakeshore, Essex
  43. Lambton, County of
  44. LaSalle, Essex
  45. Laurentian Hills, Renfrew County
  46. Leeds and the Thousand Islands, Leeds and Grenville
  47. Lennox & Addington, County of
  48. Madawaska Valley, Renfrew
  49. Mapleton, Wellington
  50. Magnetawan, Parry Sound
  51. Marathon, Thunder Bay District
  52. McDougall, Parry Sound
  53. McNabb Braeside, Renfrew
  54. Meaford
  55. Merrickville-Wolford, Leeds and Grenville
  56. Newbury, Middlesex
  57. Mono, Dufferin County
  58. Morris-Turnberry, Huron
  59. Nairn and Hyman, Sudbury District
  60. North Frontenac, Frontenac County
  61. North Glengarry; Stormont, Dundas and Glengarry
  62. North Grenville, Leeds and Grenville
  63. North Perth, Perth
  64. North Stormont; Stormont, Dundas & Glengarry
  65. Northern Bruce Peninsula, Bruce
  66. Ottawa, City of
  67. Perth, County of
  68. Peterborough, County of
  69. Plympton-Wyoming, Lambton
  70. Prescott-Russell, United Counties of
  71. Prince Edward, County of
  72. Rainy River, Rainy River District
  73. Ramara, Simcoe County
  74. South Bruce Peninsula, Bruce
  75. Southgate, Grey
  76. Southwald, Elgin
  77. Tillsonburg, Oxford County
  78. Trent Lakes, Peterborough
  79. Tudor and Cashel, Hastings
  80. Tweed, Hastings
  81. Val Rita-Harty, Cochrane District
  82. Warwick, Lambton
  83. Wainfleet, Niagara Region
  84. West Grey, Grey
  85. West Lincoln, Niagara
  86. Zorra, Oxford

Ontario’s electricity policy disaster: power cost down, consumer rates up says economist

Massive revenue guarantees for a handful of lucky wind power generators, but no appreciable environmental benefit from Ontario’s energy policies says economics professor Ross McKitrick

More turbines means more losses and higher bills, with no environmental benefits [Photo: Gord Benner]
More turbines means more losses and higher bills, with no environmental benefits [Photo Algoma construction site by Gord Benner]
Financial Post, August 10, 2016

You may be surprised to learn that electricity is now cheaper to generate in Ontario than it has been for decades. The wholesale price, called the Hourly Ontario Electricity Price or HOEP, used to bounce around between five and eight cents per kilowatt hour (kWh), but over the last decade, thanks in large part to the shale gas revolution, it has trended down to below three cents, and on a typical day is now as low as two cents per kWh. Good news, right?

It would be, except that this is Ontario. A hidden tax on Ontario’s electricity has pushed the actual purchase price in the opposite direction, to the highest it’s ever been. The tax, called the Global Adjustment (GA), is levied on electricity purchases to cover a massive provincial slush fund for green energy, conservation programs, nuclear plant repairs and other central planning boondoggles. As these spending commitments soar, so does the GA.

In the latter part of the last decade when the HOEP was around five cents per kWh and the government had not yet begun tinkering, the GA was negligible, so it hardly affected the price. In 2009, when the Green Energy Act kicked in with massive revenue guarantees for wind and solar generators, the GA jumped to about 3.5 cents per kWh, and has been trending up since — now it is regularly above 9.5 cents. In April it even topped 11 cents, triple the average HOEP.

So while the marginal production cost for generation is the lowest in decades, electricity bills have never been higher. And the way the system is structured, costs will keep rising.

More wind turbines, bigger losses, higher bills

The province signed long-term contracts with a handful of lucky firms, guaranteeing them 13.5 cents per kWh for electricity produced from wind, and even more from solar. Obviously, if the wholesale price is around 2.5 cents, and the wind turbines are guaranteed 13.5 cents, someone has to kick in 11 cents to make up the difference. That’s where the GA comes in. The more the wind blows, and the more turbines get built, the bigger the losses and the higher the GA.

Just to make the story more exquisitely painful, if the HOEP goes down further, for instance through technological innovation, power rates won’t go down. A drop in the HOEP widens the gap between the market price and the wind farm’s guaranteed price, which means the GA has to go up to cover the losses.

Ontario’s policy disaster goes many layers further. If people conserve power and demand drops, the GA per kWh goes up, so if everyone tries to save money by cutting usage, the price will just increase, defeating the effort. Nor do Ontarians benefit through exports. Because the renewables sector is guaranteed the sale, Ontario often ends up exporting surplus power at a loss.

The story only gets worse if you try to find any benefits from all this spending. Ontario doesn’t get more electricity than before, it gets less.

Despite the hype, all this tinkering produced no special environmental benefits. The province said it needed to close its coal-fired power plants to reduce air pollution. But prior to 2005, these plants were responsible for less than two per cent of annual fine particulate emissions in Ontario, about the same as meat packing plants, and far less than construction or agriculture. Moreover, engineering studies showed that improvements in air quality equivalent to shutting the plants down could be obtained by simply completing the pollution control retrofit then underway, and at a fraction of the cost. Greenhouse gas emissions could have been netted to zero by purchasing carbon credits on the open market, again at a fraction of the cost. The environmental benefits exist only in provincial propaganda.

An ordeal for people forced to live with wind power projects

And on the subject of environmental protection, mention must be made of the ruin of so many scenic vistas in the province, especially long stretches of the Great Lakes shores, the once-pristine recreational areas of the central highlands, and the formerly pastoral landscapes of the southwestern farmlands; and we have not even mentioned yet the well-documented ordeal for people living with the noise and disturbance of wind turbines in their backyards. We will look in vain for benefits in Ontario even remotely commensurate to the damage that has been done. …

Read the full story here.

High hydro rates now a ‘crisis’ for Ontario says social aid agency

If 30 children were sick with measles, it would be a public health crisis, says United Way executive director Francesca Dobbyn. So why isn’t it a crisis when more than 60,000 Ontario families have been cut off from electricity service? And in rural Ontario, no power means, no water. Meanwhile, the Wynne government announces it is spending millions on a network of electric car charging stations between southern Ontario cities.

 

Rural Ontario ‘in crisis’ due to high hydro rates, local United Way head says

By Denis Langlois, Sun Times, Owen Sound

Soaring hydro costs have created a crisis situation in Ontario that is especially concerning in rural areas like Grey-Bruce, says the head of one of the local agencies that is helping people to keep their lights on.

Francesca Dobbyn, executive director of the United Way of Bruce Grey, which has released a report on utility assistance provided to households in the region over the past year, pointed to national news reports that quote the Ontario Energy Board as saying nearly 60,000 residential customers were disconnected in 2015 from hydro services due to non-payment. That number was confirmed by The Sun Times Friday.

“If we had 30 kids in Ontario with the measles, we’d have a health crisis. With 60,000 households in Ontario who were disconnected from hydro, that’s a crisis. And in rural Ontario, when that disconnection means you can’t use your well, that’s a public health crisis,” she said in an interview.

The local United Way’s report found that from July 1, 2015, to June 30, 2016, the United Way, along with Bruce and Grey counties, Y Housing and the Salvation Army in Wiarton distributed nearly $750,000 to help people with hydro or natural gas arrears or to purchase wood, oil or propane to heat their homes.

That figure rises to more than $1 million, the report says, when factoring in the staff time and resources provided by the agencies.

Dobbyn said while that number alone is startling and points to a “crisis brewing in our region,” it doesn’t include the financial assistance provided to people by other sources, such as churches or other organizations or by family members or friends.

The report says electricity costs have climbed by 100 per cent in the past decade.

Rural residents have been hardest hit, Dobbyn said, because they are charged higher delivery costs by utility companies.

Rural residents, on average, pay almost double the delivery rates compared to households in “urban high density” areas, according to the United Way report.

An average household in a low-density area is charged about $84.46 for delivery, distribution, connection, network and other fees, the report says, while homes in high-density areas pay about $44.50. And that’s without using any energy at all, it says.

Homes that use baseboards for heat pay about $80 a month in hydro rates on top of the delivery fees.

“And that’s before turning on a light or using a microwave or any other source of electricity,” Dobbyn said.

The numbers, she said, show that even while conserving energy in the home, people in rural areas are still facing high monthly hydro bills.

“Our clients, our families are not wasteful. They do everything they can to reduce consumption, they unplug everything and we often advise them to turn breakers off in an effort to reduce their bill,” she said.

Dobbyn said for some families in Grey-Bruce who live in geared-to-income housing with baseboard heaters, the cost of hydro is more than the price of rent.

The new Ontario Energy Savings Program, which gives qualifying consumers $30 to $50 per month relief, is not enough to prevent disconnections, she said. And those disconnections can have far-reaching consequences, she added.

Facing or experiencing a disconnection can affect a person’s mental health, she said, and cause incredible stress, which can make them sick. That puts a further strain on Ontario’s health care system and can lead to lost time at work.

Dobbyn said she has heard from many people who have become obsessed with keeping their energy use low. They frequently check their hydro usage online and unplug devices like coffeemakers, microwaves, televisions and computers right after using them. Dobbyn said she would like to see more measures put in place to help reduce hydro costs for rural residents. She would like to see, for example, delivery fees spread evenly among all hydro users in Ontario, as is done in Quebec, so rural residents aren’t shouldering such high costs.

“What we have now is a user-pay system and that’s not fair,” she said.

Conservation programs “that actually have an impact,” can also help, she said, such as those that cover the cost of window replacements and insulation to make homes more energy efficient. However, Dobbyn cautioned that hydro conservation has been known to lead to increases in the costs of electricity.

For example, the Ontario Energy Board said one of the main reasons for the increase to hydro rates last May was because Ontarians consumed less electricity over the recent milder winter, so Regulated Price Plan prices did not recover the full cost of serving RPP customers. …

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