April 2, 2018
Ontario’s premier fights New York’s “Buy American Act” while selling them subsidized electricity, costing the province’s citizens millions
On June 21, 2017 the New York State Senate passed the “Buy American Act” which restricts the use for all road and bridge capital projects of using imported iron and steel and requires New York government agencies to use only American-produced products.
Ontario’s Premier responded April 2, 2018 announcing Ontario is “restricting its government entities from entering into certain procurement contracts with suppliers from New York State, including provisions that restrict suppliers use of structural iron* from New York State.”
The Premier’s statement noted, “At this time of economic uncertainty, Ontario workers and businesses need to know that I am their number-one advocate.”
Ontario’s ratepayers should wonder why the Ontario government didn’t simply announce we would no longer subsidize the sale of cheap electricity to New York State — that would have had more severe implications, and been a more forceful economic response to sanctions.
In 2017, Ontario’s net exports (exports minus imports) were 8,242 GWh (gigawatts) to the State of New York and produced approximately $250 million in revenue from their sale. The cost to ratepayers, however, was about $950 million, meaning the subsidies cost Ontario ratepayers about $700 million.
If the Premier had stopped the electricity subsidies instead of restricting the import of “structural iron” it would have hit New York and the U.S. right in the pocketbook, at the same time saving Ontario’s ratepayers $700 million!
Parker Gallant, April 2, 2018
*Structural iron has much higher carbon levels than structural steel.