On May 1, 2020 an article penned by yours truly, outlined the OEB’s (Ontario Energy Board) concerns about how the Covid-19 pandemic will reduce revenue for OPG and Hydro One. The OEB instructed both to keep track of revenue losses for future rate application increases and to establish “deferral accounts” to keep track of those losses.
The OEB has done it again but this time their letter is aimed at all of the LDC’s (local distribution companies) telling them to keep track of losses related to the pandemic and to set up: “Account 1509 – Impacts Arising from the COVID-19 Emergency (Account). Collecting information on the balances in the Account will inform the OEB about the impacts of the emergency on distributors”. Needless to say, the projected losses could be significant should the LDC’s bad debts include significant businesses who fail as a fall-out of the pandemic. While the dollar amounts in respect to either of the two OEB letters is presently unknown one should suspect they will be significant as the lock-down continues and many businesses may not survive and consumption falls.
The question arising is; will it be ratepayers impacted in the future or will the burden fall on taxpayers? We should suspect the latter as a review of Ministerial Directives* from the Ford led government, up to this point, have transferred a lot of costs to taxpayers. The latter includes the renamed “Fair Hydro Plan” launched by former Premier Wynne, now called the “Ontario Electricity Rebate” which negatively impacted last year’s budget to the tune of $5.6 billion. Other costs continue to accumulate due to the Green Energy Act (GEA) initiative instituted by the former governing Ontario Liberal Party and with reduced consumption will grow as recently pointed out, costing ratepayers $2 billion annually related to just the cost of industrial wind turbines (IWT).
Another recent initiative by the Ford government will eventually come back to bite ratepayers as they have decreed due to the pandemic the April GA (Global Adjustment) will be set for all Class B ratepayers at $115/MWh (megawatt hour) or $40/MWh less than what my friend Scott Luft estimates it would have been. Class A ratepayers will see a similar deferment. The initiative will carry through to the end of June 2020 meaning it potentially could amount to over $800 million to be recouped from ratepayers commencing January 2021 according to IESO.
As if the foregoing wasn’t enough, the only significant IWT cancelled by the Ford government, potentially saving ratepayers $450 million over the 20 year contract, was just reinstated by a ruling of the Ontario Superior Court of Justice!
The Nation Rise wind power project is a 100-megawatt (MW) IWT project, which I have written extensively on. It is unneeded, as it will simply add to our surplus generation. Additionally, the original contracted party, EDPR of Portugal (partially owned by state owned Chinese companies) sold off controlling interest to a Quebec based company (Axium) run by former senior executives of SNC Lavalin.
In examining the Justices hearing the appeal and overturning its cancellation it is striking to note one of them was Supernumerary Justice Harriet Sachs married to Clayton Ruby. Clayton Ruby is a well-respected lawyer who has been quite active in promoting renewable energy and appears to be a firm believer in “climate change”. Mr. Ruby has even signed the Leap Manifesto which makes major improbable and unproven claims such as: “The latest research shows it is feasible for Canada to get 100% of its electricity from renewable resources within two decades; by 2050 we could have a 100% clean economy.” A picture of Mr. Ruby and others who signed the Manifesto can be found on page 39 in the November/December 2015 issue of the Monitor. The Monitor was issued by the Canadian Centre for Policy Alternatives. Should Mr. Ruby desire, he could easily find many recent research papers that would dispel many of the Leap Manifesto claims. Based on Mr. Ruby’s beliefs, it should be expected they would be chatted about with his spouse, Justice Sachs, over the kitchen table or a family event, so the question arises; does she share his beliefs?
Looking back to October 2013 Justice Sachs was to sit as the judge on a “mock trial” of environmentalist David Suzuki related to a live theatre performance referenced as “The Trial of David Suzuki” but she withdrew as Sun News host Ezra Levant raised “queries on Judge Sachs and her possible bias.”
The foregoing raises the question on whether she continues to retain the suggested bias and if so, why did she not relinquish her role in this matter or why didn’t the other two justices suggest she do so?
It is obvious the mess created by the former governments of the province continue to weigh heavily on the ratepayers/taxpayers and the Covid-19 pandemic is exacerbating the burden.
Once the pandemic recedes the Ford government needs to take serious action to correct this mess in the Energy Ministry and not simply transfer the costs to taxpayers.
*The Ford government has to this point issued less than 10 directives which moved costs to taxpayers whereas the McGuinty/Wynne led Ontario Liberal governments issued over 150 directives to the OEB, IESO, Hydro One and the OPG and the bulk of them have and continue to cause electricity rates to increase.