The Ongoing McGuinty GEA Ratepayer Financial Crisis Continues as the OEB releases the 2019 Electricity Supply-Mix

If one is inclined to have a concern about electricity costs and is intent on locating information it is truly disappointing that IESO, who control our grid, issue their annual report with limited information. Even though IESO are responsible for financially settling with all LDC (local distribution companies) for generation from DX (distribution connected) FIT contracted generators they appear unable to  include that generation in their “Year in Review” report.  Their report is released in mid-January.

The IESO report, as noted, doesn’t include DX generation and one must wait another five months or more until the OEB releases what they call; “Ontario’s System-Wide Electricity Supply Mix: 2019 Data”. The OEB released their 2019 review June 18, 2020 and it includes TX (transmission connected) and DX generation by source.  As a matter of interest my friend, Scott Luft does the same thing utilizing IESO Data and estimates, but his reports are issued mere days after the month or year-end.  The OEB report generally confirms his estimates.

So now that the “official” OEB Data is out let’s have a look at some of the information affecting our electricity bills.

Total generation in 2019 was 155.2 TWh (terawatt hours) with nuclear generating 90.4 TWh (58.2%) and hydro 37.2 TWh (24%).  In 2019 we exported 19.8 TWh of our generation to our neighbours in NY, Michigan, Quebec, etc. and they bought it for the average price of 1.83 cents/kWh meaning it generated approximately $360 million in revenue.  If one deducts the exported generation of 19.8 TWh from total generation of 155.2 TWh it indicates Ontario ratepayers consumed 135.4 TWh so nuclear and hydro alone could have supplied 94.2% of all our needs.  Interestingly enough, in 2019 OPG spilled 3.3 TWh of hydro and IESO’s year-end report indicated due to SBG (surplus baseload generation) there were 292 nuclear maneuvers and two (2) nuclear shutdowns. Natural gas plants provided 9.5 TWh so those three sources of generation could have easily supplied all of Ontario’s ratepayer needs.

As noted in the preceding paragraph we exported 19.8 TWh at a very low price but the information from both IESO and the OEB don’t specify the source of the generation exported. If one assumes what we didn’t need was wind and solar (generated and curtailed) the 12.7 TWh of wind plus it’s 2.6 TWh curtailed added to the 3.7 TWh of solar generation coincidentally totals 19 TWh or almost 100% of what we exported for pennies!

Wind and solar costs for 2019 came to about $3.6 billion for which we received only $360 million meaning our exports cost Ontario ratepayers in excess of $3.2 billion and that’s for only one year.  Combined the 16.4 TWh supplied intermittently by wind and solar cost 19.5 cents/kWh or 10.6 times what we sold it for!  Repeating that over the 20-year contract terms granted to renewable energy would remove $64 billion of after-tax dollars from the pockets of ratepayers.

Someone is benefiting from those GEA contracts but it sure isn’t Ontario’s ratepayers!

The Ford government should have utilized the “force majeure” clause in the contracts as soon as the Covid-19 pandemic lock-down was decreed by the Trudeau led Federal government as 2020’s costs will likely be even higher.  The pandemic has resulted in Ontario ratepayers consuming less.

Author: parkergallantenergyperspectivesblog

Retired international banker.

7 thoughts on “The Ongoing McGuinty GEA Ratepayer Financial Crisis Continues as the OEB releases the 2019 Electricity Supply-Mix”

  1. Thank you, Parker, for yet another extremely useful article that gives an overview of the Ontario electricity system- wide performance over the most recent year. Your conclusion that unneeded renewables cost Ontario ratepayers $3.2 billion in one year, and over 20 years will cost them $64 billion, should be front page news across the province. Remember the fuss that was made about the cost of cancelling two gas-fired power plants around the time of the 2012 election? It was on the front pages of newspapers and being debated in the legislature for months! Now a loss twice as high EVERY YEAR gets minimal attention. You point out that the effects of the government-imposed shutdowns of the economy this year will be to further reduce electricity demand and thereby further increase the cost to ratepayers of the McGuinty-Wynne legacy. If those who claim a climate “emergency” exists get their way, they will of course continue to force declines in both economic activity and electricity use, raising the annual and long-term costs even higher.

    Liked by 2 people

  2. “Repeating that over the 20-year contract terms granted to renewable energy would remove $64 billion of after-tax dollars from the pockets of ratepayers.” Thank you for this projection, Parker.
    This needs to be repeated again and again and again until people realize the sheer hypocrisy that you’re referring to, Bob Lyman, regarding the response to the two cancelled gas fire plants.
    How on earth can politicians be allowing this to happen?
    Why are they so worried about protecting such a bad business deal in Ontario, especially now that the province has been in a state of emergency with such serious financial ramifications?
    Invoke force majeure. Cancel long term contracts, especially for industrial scale wind which is not ‘fit for purpose’ according to our engineers.
    End the harm from acoustic emissions trespassing onto neighbours’ properties.
    No one…not even leaseholders… consented to being harmed by acoustic emissions that are non-compliant.

    Liked by 1 person

    1. I wish I knew what moves politicians or the media to make big deal of some stories and to utterly ignore others that have far more important consequence for citizens. Police in Minneapolis kill a black person and tens of thousands of Canadians march in the streets and demand the defunding of police services in Canadian cities where totally different conditions exist. Yet, when the Liberal Party and its fellow travellers in the NDP, Green and Bloc parties shut down the Canadian Parliament for five months during a national crisis, thus removing all legislative overview or restraint over the spending of tens on billions of dollars, the media sits on its hands and no one says, “Boo”. It is difficult to avoid the impression that the media and a whole generation of politicians have lost their way and care not at all for the preservation of either democracy or fiscal responsibility, while ready to jump every time the “woke” mob orders them to do so.

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  3. WRT government influence. Please find attached information about how “shadow bank” Blackrock financial was used by CPP to purchase Ontario’s Industrial Wind Turbines. My question is, why was a regular banker not used? Was due diligence done for these purchases? We need an investigation of the funding and political influence behind these transactions. https://blackrocktransparencyproject.org/2018/08/27/how-canadas-infrastructure-bank-was-created-by-and-set-up-to-benefit-blackrock/

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  4. That is a great tip especially to those fresh to the blogosphere.
    Short but very precise info… Thank you for sharing this one.
    A must read post!

    Like

  5. World’s Biggest Scams: Scotland’s Wind Farms Paid £650,000,000 To NOT Produce Power

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    | | | | World’s Biggest Scams: Scotland’s Wind Farms Paid £650,000,000 To NOT Pr…

    In the history of commerce, there’s never been a financial scam that comes anywhere near rivalling subsidised wi… |

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