How did we get here? A review of ministerial remarks on electricity prices in Ontario

January 5, 2017

With Ontario’s lead in energy prices in Canada and the fastest rising consumer rates in North America, it is perhaps worth a review of a few of the ministerial comments that got us to this point.

Rates will rise 1% because of the GEA

George Smitherman, Minister of Energy and Infrastructure from June 2008 to November 2009 told the Standing Committee on General Government in April 2009: “We anticipate about 1% per year of additional rate increase associated with the bill’s implementation over the next 15 years.”  In May 2009 the “average” rate was 6.07 cents per kilowatt hour (kWh) (not including delivery or HST). By May 2016, the “average” rate had increased to 11.1 cents/kWh, an increase of 82.9% in 7 years.  The comparable costs of generation from IESO’s Monthly Summaries for the May 2009 to May 2016 comparisons grew by 84.9%.  Looks like the forecast missed the mark by a bit.

Conservation will save you money

Back in July 2013 a press release from Minister Bob Chiarelli credits him with this quote: “By investing in conservation before new generation, where cost-effective, we can save ratepayers money”. At that point, average rates were 8.4 cents/kWh — in just three years they increased 32.1%. IESO’s monthly summaries indicate the cost of generation rose 26.4% in the same time-frame.  Since 2012, consumption has fallen by 4.3 terawatts (TWh) on enough to provide 475,000 average Ontario households with power for a full year.  Conservation hasn’t shown it will “save ratepayers money.”

Moving a gas plant is less than the price of a Tim Horton’s coffee                                                                                                          

Another from former Energy Minister Bob Chiarelli who, when asked about the Oakville gas plant move was quick to suggest, “It’s less than a cup of Tim Horton’s coffee a year.” for the average ratepayer over 20 years. He made this dismissive comment to the Legislature Justice Committee investigating the move. What it meant was the waste of $1.1 billion dollars of taxpayer/ratepayer money; the Minister’s comment is a reflection of the regard the Ontario Liberal government has for the average hardworking Ontarian.

It's nothing, Chiarelli said of a $1.1B scandal
It’s nothing, Chiarelli said of a $1.1B scandal

The Ontario Auditor General not informed?                                                                                                  

Bob Chiarelli again: when the Auditor General’s report in late 2014 on  smart meters was released suggesting the program was over-budget and under-effective  Minister Chiarelli said, “Why are my numbers more credible than hers?” He went on to say: “Electricity is very complex, is very difficult to understand. Some of our senior managers, in discussing these issues with some of the representatives from the auditor general’s office, had the feeling they didn’t understand some of the elements of it.”  As it turned out Auditor General, Bonnie Lysyk worked for Manitoba Hydro for 10 years so probably knew more about the electricity sector than the Minister.

Municipal authority is a non-starter                                                                                                                      Oh dear: Mr. Chiarelli, again. In May 2013 Bob Chiarelli said “Municipalities will be given a much bigger say in where or if renewable energy projects are located”.  His remarks were well received by many municipalities and in the case of Dutton Dunwich council a survey they engaged in allowed them to declare 84% of their residents were against industrial wind developments.  So what? The will of the people was ignored and a contract for a $250-million wind power project was granted anyway.  The minister’s comments appear to have been a pretense that rural Ontario had been given authority to accept or reject contracts.

Industrial Wind Turbines granted special realty tax status                                                              

When Dwight Duncan was Minister of Finance it appears he bowed to lobbying efforts by trade association Canadian Wind Energy Association or CanWEA members who may have been concerned they would be required to pay significant municipal taxes should MPAC assess IWT at actual value!  He accordingly issued a direction to MPAC (Municipal Property Assessment Corporation) to assess industrial wind turbines (IWT) at only $40,000 per megawatt (MW). That means, not only did municipal governments have no say in allowing IWT in their jurisdiction, but were also to receive nominal realty taxes from their presence.

Transparently opaque                                                                                                                        Premier Wynne in early March 2014 introduced the Accountability Act and had this to say to the Legislature:  “I came into this office just over a year ago saying that I was going to do government differently, that we were going to open up and be more transparent.”  Now should you have the urge to seek specific information from the Energy Ministry, which this writer frequently does, what you receive back is a homily that starts out with “you have reached out to us” followed by the promise they will get back to you. If and when the response comes, it generally dodges the question(s) and simply repeats the spin in the press release you are inquiring about.

Electricity exports are profitable                                                                                                                We have consistently heard about how profitable our exports of electricity are from the various Energy Ministers in place over the past decade. Former Minister Chiarelli’s claim we made $6 billion was debunked, but the claims continue.  The profits were claimed by former Premier Dalton McGuinty, Brad Duguid when Minister of Energy, and even a senior officer with IESO.  The Auditor General noted the following in the 2015 report:  “Since power is exported at prices below what generators are paid, and curtailed generators are still paid even when they are not producing energy, both of these options are costly. From 2009 to 2014, Ontario had to pay generators $339 million for curtailing 11.9 million MWh of surplus electricity.”  This continues today, at a much higher rate!

High electricity prices a “mistake”                                                                                                            

When Premier Wynne spoke to the 850 members who attended the Ontario Liberal Convention on November 19, 2016 she told the delegates her “government made a mistake” by allowing rates to soar. Apparently Premier Wynne doesn’t pay her electricity bills and didn’t notice since she was elected leader of the Ontario Liberal Party January 26, 2013 to the date of her recent speech, rates charged to residential ratepayers increased 38%.  She also missed the fact that IESO in their monthly summary of December 2012 reported the cost of power generated was 8.89 cents/kWh and the October 31, 2016 summary reported it had climbed to 13.49 cents/kWh — an increase of almost 52%.


The last word is mine 

I challenge anyone to make the claim that “planning” or a “cost/benefit” analysis ever played a role in Ontario reaching our current state of claiming the title of “highest cost” electricity in Canada or “fastest rising” in North America!   The design pursued by the various energy ministers occupying the portfolio since the current government gained the reins of power in Ontario demonstrate clearly, they failed to consider the fate of Ontario households, along with the impact on jobs. Instead, they listened to the cadre of environmental NGOs and corporations that benefit from subsidies provided by the ratepayers.


Author: parkergallantenergyperspectivesblog

Retired international banker.

8 thoughts on “How did we get here? A review of ministerial remarks on electricity prices in Ontario”


    We here in Dutton Dunwich were unaware that the IWT project proposed by the above mentioned coop boasts that Dutton Dunwich will be powered 100% by renewable energy…. that’s right 100%…. also coop boasts the power from 29 IWT is the equivalent power needs of 18000 homes…. wow!!! I must have missed this…. 29 IWT powering 18000 homes….. must be one of the bullfrog turbines they have in Toranta!!!! That turbine alone powers 1/2 of Toranta….. I’m going to cut some firewood to keep warm!!


  2. Parker, I don’t know how you stay so clear headed as you consistently examine and educate people about the truth of this situation. You are amazing! Thank you again!
    The information you have provided infuriates me.
    As if, all that you’ve written about isn’t enough to cause a massive response in Ontario’s citizenry, here is another aspect for your readers to realize.
    People who are being harmed by industrial wind turbines which were sited too close to their homes in Huron County have been sending letters via email to all who are responsible for the harm they are experiencing from noise, low frequency noise modulations and infrasound radiation and despite their enormous efforts to seek protection, the turbines are still running. Right now these people are waiting to hear if the ethics department at the University of Waterloo will approve a year long survey orchestrated by the HC Health Unit. This survey may or may not result in protective measures being taken by this government.
    In the meantime, Dr. Sarah Laurie at the Waubra Foundation has published a full list of symptoms caused by industrial wind turbines. It’s available for all to see on the Waubra Foundation website.
    The information she has provided clearly suggests that the people, who are already experiencing harm could be in much worse condition over time if they stay in their homes. Leaving their homes is not the solution. We do not condone forced relocation in Ontario?
    This government has paid many people to ignore the urgency of this situation.
    The fact that people experiencing harm have provided elected and paid agents who are collectively responsible with this information regarding harm, constitutes knowledge that makes them liable for wilful ‘neglect of duty to protect’.
    If one claims to be a mere order follower, then these recipients have forfeited their birth right and freedom to act out of moral conscience.
    We are at a critical choice point in our moral evolution in Ontario.


  3. Hi Parker

    Happy New Year! Do you have a Facebook link for this? Nancy

    On Thu, Jan 5, 2017 at 8:17 AM, Parker Gallant Energy Perspectives wrote:

    > parkergallantenergyperspectivesblog posted: “January 5, 2017 With > Ontario’s lead in energy prices in Canada and the fastest rising consumer > rates in North America, it is perhaps worth a review of a few of the > ministerial comments that got us to this point. Rates will rise 1% because > of the GEA” >


  4. When one puts all of the above information against the backdrop of the information so clearly provided by Dr. Judith Curry in this very recent interview regarding the ‘baloney’ she has had to deal with as a senior climate scientist at Georgia Tech:

    -the fact that we have been so seriously misled in Ontario by our government is a total embarrassment and perhaps even a crime.
    How many lives will be negatively impacted because these people were not looking at the kind of information that one would have to examine carefully in order to make such crucial decisions?


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