Electricity planning in Ontario: bad and getting worse

Ontario Energy Minister Thibeault: he really believes this stuff?

From all appearances, Ontario Energy Minister Glenn Thibeault sincerely believes Premier Wynne’s plan to reduce our hydro bills is the right one and the opposition parties have got it all wrong.

Shortly after Premier Wynne and her loyal servant Glenn Thibeault announced the Liberals’ “Fair Hydro Plan” Andrea Horwath, leader of the NDP, announced their plan. Thibeault had this to say about the NDP’s plans to repurchase Hydro One shares: “Buying back $4 billion in Hydro One shares is costly, he added, and ‘will not take one cent off electricity bills. What it will do is send billions to the stock market instead of making much needed infrastructure investments in communities across Ontario.’ ”

When PC MPP Vic Fedeli suggested diverting our surplus power to local businesses so they can create jobs, instead of exporting it to U.S. states at staggeringly low prices* Thibeault lashed out, saying that was  “back-of-the-napkin” thinking.  Thibeault did admit Ontario “doesn’t have sufficient electricity demand at home to use up the electricity we export to other markets.”

This begs the question: why does the Energy Minister not cancel contracts recently awarded (LRP 1) and permanently cancel plans (LRP 2) to add more renewables that will be surplus due to insufficient demand and plant closures.  In respect to the latter, demand will continue to be insufficient as the recent announcements about the closing of the Proctor and Gamble plant (500 employees) in Brockville and the Siemens plant in Tillsonburg (340 employees), just to name two, will further reduce demand.

The Siemens announcement undermines the Green Energy Act which the Liberals originally touted as destined to create 50,000 jobs, but fell miserably short of that goal. In fact it cost Ontario jobs as suggested by former Ontario Auditor General McCarter in his 2011 report.

Thibeault might also stop directing IESO to spend $400 million annually on conservation programs which further reduces demand, but at a cost that is added to ratepayer bills and negatively affects export sale prices.*

Now, when Minister Thibeault or Premier Wynne speak about the Liberal Plan, they revert to the main “Fair Hydro Plan” talking point which is “This is the largest rate cut in Ontario history”.  What Minister Thibeault always fails to note is Ontario’s ratepayers have experienced the largest rate increases in history thanks to the GEA’s passage in 2009!  He also fails to acknowledge the future costs due to the Fair Hydro Plan which will push rates up well past those before the “largest rate cut in Ontario history”.   That cost (subject to balanced budgets) according to the Financial Accountability Office will be $45 billion versus a benefit of $24 billion.  That $45 billion will easily drive up electricity rates and represents in excess of two years of current total electricity costs.

Amortized over 10 years we should expect annual rate increases well in excess of 10%.   At that time, all ratepayers will be exposed to the Ontario Liberal government’s incredibility bad planning!

Parker Gallant

* For the first six months of 2017 IESO report the sales price for surplus exports was $14.93 a megawatt hour (MWh) or 1.49 cents a kWh which is close to 10% of what it costs to produce. Ontario’s ratepayers pay for the losses via their monthly bills


Author: parkergallantenergyperspectivesblog

Retired international banker.

14 thoughts on “Electricity planning in Ontario: bad and getting worse”

  1. Parker Gallant – a voice in the energy wilderness and speaker of the real truth. Totally discredited by the Ontario Government leaders because they don’t want the truth to be known


  2. I saw Glenny Glen Glen Thibeault last night on the news bragging about the $50 billion that HIS government spent on NEW INFRASTRUCTRE that now prevents brown outs….. and the closure of the 97 % efficient coal generation plants….. wow I guess if you say a lie enough times you actually do believe it….. still doesn’t explain the 25 cents per kWh hydro I’m paying!!!
    Everyone needs to make this an election issue….. like the lieberals selling off our airports now for infrastructure money….. didn’t the federal government just approve a banking system that specifically deal with provincial infrastructure loans….. something smells fishy Again!!!!!


  3. The FHP does nothing to lower the cost of producing hydro. The FHP only lowers (temporarily) your hydro bill. In ten years it is not FAIR to burden rate payers with costs higher than the status quo. In 29 years the cost of HYDRO will remain unchanged from the status quo, and that is not a PLAN.
    The FHP is simply a stalling tactic. The Wynne version of government wants re-election. The FHP would allow for two re-elections until the bad news kicks in.


  4. I know eh Pete….. what does Parker Gallant….. the auditor generals (2 of them) …. the Ontario Society of Proffessional Engeneers…… know about running a hydro system…… the lieberals are much more knowledgeable….. look at Glenny Glen Glen Thibeaults experience for example…. steeped in grid management knowledge!!!!! Steeped dude!!!!!


  5. These incompetent people rely on talking points which they repeat ad nauseum. They need to be forced to deliver the precise information they’re using to justify their intransigence. A real leader watches carefully to see how his/her decisions are impacting the people who he/she is mandated to protect. Constant, careful analysis and receptivity to reports of harm or problems at all levels, should prompt immediate modifications to their ongoing decision making process.
    The energy portfolio is too important to be left in the hands of someone who does not have a thorough over view of the various areas of expertise involved with safe and affordable energy.
    This needs to be an election issue.
    I feel sorry for Glenn Thibeault.


  6. Mandated to protect?? Who??? You mean the government’s clients or the people of Ontario??? Im confused….. growing up here rural Ontario we were taught to look after each other… your family…your your neighbours… your community…. we’ve got some serious trouble coming… as I have just learned….. the turdbine manufacturing operations x 2 that just made short term green energy jobs a reality by closing down….. is not because the turdbine manufacturing industry is shutting down but…..
    getting bigger…..
    they closed cause the turdbines they are producing are obsolete and too small…..
    ALL project like the strong stinky breeze project here in DD will be fitted with 3.5 MW or bigger turdbines….


  7. Hey Ron…. OEB applied to raise the delivery rates already…. coincidentally it is not included in the FHP….. so it doesn’t count in the government’s inflation increase…. its the OEB fault your hydro went up… call anyone at the premiers office…. OEB …. IESO.. MOE….. MOECC….. they will tell you the same b.s. story….. it’s not us… it’s them….
    P.s. Ron…… our rates will return to 2016 prices plus 50% more in 2021….. that’s only 4 years away!!!!
    It’s just fairererererer………


  8. http://live.gridwatch.ca/home-page.html

    There it is again… even though our demand is only 500 MW short of our production we are exporting over 2000MW per hour to the guaranteed renewable energy market our great government has created….. if you think this sucks wait till that 15cm line goes across lake Erie to 13 states and 60 MILLION US hydro customers…. their hydro will be guaranteed and cheap while we here in Ontario we are left tow the line!!!!


  9. Parker:

    Electricity prices are being detached from the cost. In other words Wynne can order $100 billion more useless wind and solar from the Liberal cronies that run wind power in Ontario, and run the bill straight into taxpayers. There is literally nothing stopping Wynne from spending more and more on silly excess.


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