Ka-ching! Windy days blow away ratepayer dollars

Consumers pay: wind power is surplus, and expensive — emissions-free power is wasted

Wind power on two recent windy days cost Ontario electricity customers three times the current rate … and the surplus meant emissions-free hydro and nuclear was wasted


A simple Google search “wind power is cheapest energy” will generate 1.2 million hits.

If you search “wind power is most expensive energy” you get 2.1 million hits.

Two days last week in Ontario are real-world proof of the cost of wind power, no matter what the government or wind power industry spin tells you. Tuesday, December 5th and Wednesday December 6th were two very windy days, an excellent opportunity to examine both the power generation from industrial wind turbines in Ontario and their delivered cost of power to the grid.

The numbers for those two days:

$$$   IESO forecasts indicated that wind could have delivered 23.8% (177,100 MWh) of total Ontario demand (755,200 MWh) via the 4,200 MW of grid-connected wind capacity.

But wind turbines have a bad habit of generating power when it’s not needed (middle of the night, spring and fall) so the intermittent power must often be curtailed (constrained/wasted but paid for).  It was!

$$$   The IESO curtailed 41.8% of their forecast generation meaning 74,000 MWh were not used!

Via the contracts in place with wind power companies, IESO is obliged to pay for both delivered and curtailed power at prices for grid-accepted power at $135/MWh and $120/MWh for curtailed power.

$$$   Quick math: the cost for grid-accepted wind on those two days meant Ontario ratepayers got charged approximately $22.8 million or $221.14/MWh for grid-accepted wind. That means it cost ratepayers 22.11cents/kWh (kilowatt hour), well above what the average time-of-use rates would be for the average Ontario ratepayer!  The cost of the delivered wind power for those two days was almost three times the current levied* “average” cost of 8.22 cents/kWh, and 3.7 times the off-peak cost of 5.9 cents/kWh.

There’s more (sorry): be assured IESO instructed OPG to spill water over the hydro dams and Bruce Nuclear to steam off nuclear power — so power from our two reliable, emissions-free sources of power generation was also wasted.   OPG and Bruce will be paid for that waste and the cost will be added to our bills.  At the same time gas plants (backing up wind and solar) were being paid for idling.

Those two December days also saw sales of surplus power of 93,700 MWh to our neighbours in New York, Michigan, and others for pennies of the actual cost. In all probability, we recovered around 15% of their generation costs meaning, we bit the bullet for another $10/11 million.

Total: too much

Just the cost of the curtailed and grid-accepted wind and the losses on our surplus exports for those two days was $32/33 million for absolutely no benefit to any of us ratepayers. If every day of the year was like those two days last week, Ontario’s ratepayers would be shelling out over $6 billion annually, due to the abysmal planning and management of the electricity sector by the current Ontario government.

Imagine how far $6 billion would go to improve our health care system.

Parker Gallant,

December 10, 2017


* This price reflects the 17% deferral under the Fair Hydro Act.

Author: parkergallantenergyperspectivesblog

Retired international banker.

6 thoughts on “Ka-ching! Windy days blow away ratepayer dollars”

  1. Hi Parker, love your stuff, but don’t see the big costs on my hydro bill. I’m paying Oakville Hydro way less each month than last year. How/when/why will I ever pay the exorbitant costs you describe? Thx, Mike


    1. You’re paying less for your electricity costs only. Your delivery costs per kWh will not have changed much, if at all. The Fair Hydro Act removed 17% of the cost of electricity from your bill per kWh and the 8% portion of the HST was removed. If you consume the same exact amount as you did last year that should be the result. If you are consuming less than you bill will be less. The deferred amount will start to show up in 2018 on your bill as it will be accumulated in a big debt that will be on the books of the OPG’s special trust. Up until 2022 the increase in our bills will be held at the rate of inflation.


  2. Good morning Parker,
    I am with you on the dismal record of the Ontario government and their supposed clean and green energy that has jacked up costs for ratepayers; however, as I’ve mentioned to you on several occasions, hydroelectric is neither clean nor green, and certainly isn’t GHG emission-free. You can check out a Washington State University study that reports on hydroelectric reservoirs being a large source of methane – a greenhouse gas 34 times more potent than carbon dioxide: https://news.wsu.edu/2016/09/28/reservoirs-play-substantial-role-global-warming/ You can also check out another important study indicating that sedimentation-driven methane emissions from dammed river hot spot sites can potentially increase global freshwater emissions by up to 7%: http://www.dx.doi.org/10.1021/es4003907 You can also check out ORA’s Hydro Impacts 101 – The Tradeoffs which is a compilation of studies that document numerous studies showing the multitude of negative impacts from hydroelectric, including methylmercury contamination of fish, GHG emissions, erosion, sedimentation, and degraded water quality to name only a few: http://www.ontarioriversalliance.ca/hydro-impacts-101-the-trade-offs-2/


  3. The cost you quote is the advertised price – which is a complete lie.

    Real cost of wind power:

    $130/MWh ‘public’ cost.
    $100/MWh tax savings – big Energy companies claim lots of green tax credits for helping McGuinty pay for all the Muskoka, Whistler and Carribean properties!
    $100/MWh – extra costs on delivery – Hydro One
    $100/MWh – cost of curtailment at Bruce, etc
    $100/MWh IESO/Government/HydroOne/Exec overheads. The cost of upper-level administration is huge!

    There are other costs, as the total comes to about $1000/MWh, as is evidenced by the Ontario electric bill.

    80% regular power @ $0.12 /kWh + 20% magical vote buying green power @ $1.00 / kWh = $0.30 which is the Ontario retail price for electricity. Quebec, Manitoba and Michigan all pay about $0.12.


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