Unreliable and Intermittent: well, why pick Industrial Wind Turbines for Full Electrification

Those IWT in Ontario were in full swing showing off their unreliable and intermittent nature on January 24^th and the 25^th during the first seven (7) hours (from 12 AM to 7 AM) of each day.

On the 24^th over the first seven hours those IWT were humming and IESO forecast they would generate 27,980 MWh which would represent 81.6% of their capacity but IESO scaled back what they actually delivered by curtailing about 2,000 MWh as they were obviously not needed in the middle of the night when nuclear and must-run hydro were pretty well supplying all our needs.  The result was our net exports (exports minus imports) over that 7 hours were 22,934 MWh or 88% of what was accepted from those IWT. The average HOEP (hourly Ontario energy price) during the 7 hours was $8.13/MWh so their sale generated $186,453. If we logically assume the bulk of them were either all IWT generated power or caused by their excess generation; the cost to us Ontarians was $3.096 million ($430K per hour) for what they generated plus another $240K for what IESO curtailed.  Their frequent habit of generating unneeded power with us taxpayers/ratepayers forced to pay them for it at ridiculous prices continues!

Now if we traverse to the first 7 hours on the 25th, IESO forecast they would generate 4,526 MWh (13.2% of capacity) but they actually accepted 3,591 MWh meaning approximately 1,000 MWh were curtailed. The good news: for those 7 hours they kind of acted as they would if they were rammable power (similar to our gas plants and hydro). As a result the average HOEP was $32.16 for the net exports of 9,636 MWh we sold to our neighbours meaning the costs for us Ontario taxpayers was only about $500K for the IWT generated power.

To put the above in perspective the 27,980 MWh those IWT were forecast to supply on the 24^th is about equal to the daily average consumption of 930,000 Ontario households whereas the 4,526 MWh forecast on the 25^th is only enough to power 150,000 households for one day. 

What the foregoing suggests:

1.Without the 11,433 MWh our natural gas generators supplied during those 7 hours on the 25^th we may well have experienced a blackout, and

2.Without natural gas supply EV owners would have been unable to charge their batteries meaning they may have been unable to use them to go to work the following day!

Full electrification is a pipedream but based on a letter from Ontario Energy Minister, Todd Smith, our politicians fail to detect the flaws!

Minister Smith’s letter to the OEB dated October 21, 2022, carried the following message:  “The government has a vision for the energy system in which Ontario leverages its clean energy grid to promote electrification and job creation while continually enhancing reliability, resiliency and customer choice.“ 

We should all expect the “vision” will fail in many ways including; electrification, job creation, reliability and resiliency!

PS: No solar generation to report from 1 AM to 7 AM on either day.

Generating Less Electricity Benefits Ontario Ratepayers

The OEB (Ontario Energy Board) on September 12, 2022 finally posted “Ontario’s System-Wide Electricity Supply Mix: 2021 Data” and it was the latest posting ever from them in the last seven years!  The OEB takes the TX (transmission connected) generation, ie; IESO data* they provide (usually within two weeks of the prior year-end) and add the DX (distribution connected) generation provided by the local distribution companies in the province. We assume it is a slower process to obtain the latter info from the 58 distribution companies but 8 ½ months seems longer than needed!

The foregoing combined data from the OEB report indicates generation from TX and DX generators fell from 154.7 TWh (terawatt hours) in 2020 to 150 TWh in 2021 or 3%.  The 4.7 TW drop equals the annual consumption of about 525,000 Ontario households!

As one would suspect some generation sources fell while some increased but not enough to offset the drop.  The biggest drop was from our nuclear plants which generated 4.8 TW less and our hydro plants also fell generating 2.8 TW less. Combined the 7.6 TW is about what 850,000 average Ontario households (16% of all Ontario households) would consume in a year.  The only generation source to significantly increase generation was Ontario’s grid connected natural gas plants who supplied 12.2 TW an increase of 2.5 TW from 2020 (up 25.7%) and about what 290,000 average households annually consume. The only other categories to show increases were wind; up 100 GW (gigawatts) or about what 10,000 households consume annually and “Non-Contracted” which increased by 500 GW or what 50,000 households would consume annually.  The OEB states the latter “represents a variety of fuel types that the IESO is unable to categorize”! We should suspect those “Non-Contracted” sources are mainly small gas plants operated by manufacturers and sub-contracted to supply generation when the local grid is potentially short of demand!  

The only bright star shining out from the report is related to Ontario’s “net exports” (exports minus imports) which declined by 6.6 TW and had the positive effect of pushing up the market price ie: HOEP (hourly Ontario energy price) from an average of 1.39 cents/kWh in 2020 to 2.85 cents/kWh in 2021. While that doesn’t sound like much it did decrease our costs by $118 million on our Net Exports in 2020 of 8.5 TWh. The increase in the HOEP would also decrease the taxpayer liability amount for those intermittent and unreliable non-hydro “renewable energy contract costs” (wind and solar) as referenced by IESO* and slightly reduce the GA (Global Adjustment) component!

We shouldn’t believe what has finally shown a positive year over year result to continue however, due to the push by the Minister of Energy, Todd Smith’s August 23, 2022 “directive” to IESO containing the following instructions:  “to evaluate a moratorium on the procurement of new natural gas-fired generating stations in Ontario and to develop an achievable pathway to phase out natural gas generation and achieve zero emissions in the electricity system”.

Get prepared for the future which like many European countries will include orders to turn off your air conditioners in the summer and reduce your thermostat in the winter to avoid blackouts. Oh, and don’t charge your EV (electric vehicles) until we tell you, you can!

Energy reliability is no longer a target our politicians promote! The word “reliability” is being replaced by the word “transition” and the OEB is front and center in executing the change with their just released “Energy Transition” post containing a poll we must all take!

*Note on IESO data release: “As of January 1, 2021, Global Adjustment costs for all electricity consumers are being reduced because approximately 85 per cent of non-hydro renewable energy contract costs are being shifted from the rate base to the tax base. Savings will vary, depending on consumers’ electricity consumption, ICI participation, and location.”

Wow, a Municipal Mayor has Determined Natural Gas is a Necessity

Back on November 23, 2020 the City of Windsor at their video Council Meeting passed: “Motion 7.1.6 Request that Council pass a resolution calling for the Province of Ontario to move toward phasing out gas-fired power plants”.  The motion came about as the result of a plea by Jack Gibbons of the OCAA (Ontario Clean Air Alliance).  The motion called to “phase-out all gas-fired electricity generation by 2030 to help Ontario and the City of Windsor meet their climate targets.” As a result, they became one of the 33 municipalities the OCAA had conned into their way of thinking and endorsed the“gas power phaseout”!

Now fast forward to March 23, 2022 and a gathering of municipal, provincial and federal politicians was held but it was not to discuss the gas power phaseout!

The politicians along with representation from LG Electronics North America and Stellantis were at an event to announce a CAD$5 billion joint venture (NextStar) EV battery manufacturing plant.  The Windsor Star on June 2, 2022 posted an article describing the joint venture and also stated: “The federal and provincial governments have also committed to investing hundreds of millions in the project while the City of Windsor will assemble the approximately 220 acres of land necessary for the plant and some additional servicing of the site.”*  The article went on to note: “The plant will be capable of producing 45 gigawatt hours of electricity and will employ 2,500 people” but doesn’t elaborate how it will produce those 45-gigawatt hours.

As a follow up to the announcement a contact informed me that Enbridge Gas had made a submission to the OEB (Ontario Energy Board) requesting approval to construct two pipelines to supply natural gas and on page 49 of the 604 page submission is a letter dated March 31, 2022 from the Mayor of the City of Windsor, Drew Dilkens, endorsing the $200 million cost of the pipelines to supply NextStar which presumably will allow the new battery plant to “produce those 45 gigawatt hours”.

Now, as Alanis Morissette might say; “Isn’t it Ironic”! 

Looking further at the submissions to the OEB one notes a submission by Elson Advocacy on behalf of ED (Environmental Defence) requesting they be allowed as an intervenor in respect to the Enbridge Gas application.  While ED are an eco-warrior group who frequently act as intervenors in respect to applications before the OEB involving fossil fuel applications this one has a twist!  The letter asks that the OEB also deliver electronic copies of “the pre-filed materials and all other documents in the proceeding be delivered to the following consultant” who is none other than Jack Gibbons of the OCAA!

No doubt Gibbons will shed a tear or two over the turnabout of the City of Windsor who may have suddenly realized without natural gas the city would lose jobs and the benefits of the tax dollars they will receive from NextStar and their employees as well the hundreds of millions from federal and provincial taxpayers helping to create those jobs.

Perhaps the other 32 municipalities who have endorsed the “gas power phaseout” will also come to their senses and the OCAA and Gibbons can rest in peace knowing they haven’t destroyed the livelihood of millions of Canadian workers as they have been trying to do as a (prepare to laugh) charity!

*The amounts committed by the Federal and Provincial governments have not been released.

Eco-Warriors Bubble Up Again

The Narwhal is pushing pumped storage on behalf of Northland Power and dear old Jack Gibbons of the OCAA (Ontario Clean Air Alliance) is excited.  They are also excited about battery storage.

Big pit energy: an old mine could bring renewables and new life to an eastern Ontario town

I took a run at the Northland plans back on November 18, 2013 and didn’t like what it was suggesting at that time.  I wouldn’t think things have changed much except for the increasing capital costs which suggest it would be even worse now than it looked like almost nine years ago.

https://ep.probeinternational.org/2013/11/18/parker-gallant-pumped-storage-equals-pumped-energy-prices-2/

Eco-Warriors are Strangling Energy Advances at a Cost to Consumers

Back in 1989 Greenpeace Canada lost it’s charitable status with the CRA and they kept trying to get it back without success but suddenly in late 2020 for some reason the CRA suddenly allowed the newly formed Greenpeace Canada Education Fund to have charitable status. The latter claim they are “focused on research, investigations and education” and reputedly have engaged “more than 17,000 students from K-12 and 328 presentations across Canada”.  One should presume those engagements have been to scare our children and grandchildren that the world will end unless we deal with “climate change”. 

As a coincidence an unrelated “Google” search led to finding an entity called the Green Energy Coalition which has been an “intervenor” with the Ontario Energy Board and on occasions; jointly with Environmental Defence.  Members of the GEC are none other than; Greenpeace Canada, David Suzuki Foundation, Sierra Club of Canada and the World Wildlife Fund.  The latter three plus Environmental Defence are all registered Charities and push the concept of eliminating fossil fuels and supporting expensive and unreliable renewable energy in the form of wind and solar.  One should note they are not the only eco-warrior intervenors pushing for the end of fossil fuel use.  Others include Pollution Probe, OSEA (Ontario Sustainable Energy Association), the Atmospheric Fund (created by the City of Toronto in 1991), Clean Air Council/Clean Air Partnership (funded by many municipal governments) and several others. One of the others is the School Energy Coalition Intervention Services (SEC) handled principally by the law firm Shepherd Rubenstein” who are also big supporters of “climate change”. The SEC (primary funding from school boards) intervenor awards alone for the April 1, 2019 – March 31, 2020 OEB year report totaled $840K which was 18% of all the awards for that year.

What becomes obvious is, our tax dollars; municipal, provincial and federal, not only pay for the Ontario Energy Board, school boards, etc. etc. via all the tax burdens we experience but also are used to create not-for-profits and charities that continually fight as intervenors and whose costs are also billed to us via our bills for both the electricity and natural gas, we use, which are also both taxed on our bills. 

A recent example was the intervenor costs associated with Enbridge’s effort to replace a deteriorating 19.8 kilometer pipeline (denied by the OEB) in Ottawa where intervenor costs for SEC were $63,319.55, for Pollution Probe $36,637.43 and $12,856.01 for Environmental Defence.

Not sure how the OEB can view intervention by those eco-warriors as a benefit to all of the households and businesses using electricity and natural gas in Ontario as we are also obliged to pick up those intervenor costs which has a multiplier effect on our tax costs. Just another tax on tax on tax!

This is but one example of why we should not wonder why Canada ranks so low in the OCED for getting things done due to our numerous regulations and the bureaucrats managing them! 

Perhaps the time has arrived to reduce our regulations and the numerous bureaucrats managing them!

Ontario Minister of Energy’s Plan Will Save TESLA Owners 25 Cents Per Day

Many of us here in Ontario will remember back in late 2013 Bob Chiarelli Minister of Energy, shortly after a legislative justice committee investigating the cancellation of the TC Oakville gas plant; told reporters the cost’s claiming; “It’s less than a cup of Tim Hortons coffee a year.” The final cost of the cancellation turned out to be in excess of $1 billion but if you do the math over 20 years he probably wasn’t lying!

Fast forward just a bit over eight years later and the current Ontario Minister of Energy, Todd Smith seems intent on adding another TOU (time-of-use) pricing mechanism to reduce your rates; if you happen to drive an EV (electric vehicle) or are a shift worker. The OEB (Ontario Energy Board) provided him with the report he was presumably looking for with some input from IESO! The report did note risks and this one should be of some concern: “A Low Overnight price design may result in more EV owners charging at home and may overload the electricity distribution grid in residential areas, resulting in blackouts and costly upgrades“

If the proposed price plan announced in the April 12, 2022 press release becomes a reality, you can charge your EV for only 2.5cents/kWh between 11 PM and 7 AM seven days a week while the current peak rate of 17 cents/kWh will climb to 25 cents/kWh or 47%.  Reputedly this additional TOU option will save those who charge their vehicles $90 annually or 25 cents per day which will be sufficient to purchase a medium sized “Timmies” each week!  One would have thought those purchasing an EV could afford the extra cost of charging their EV at the existing off-peak rate of 8.2 cents/kWh particularly as they receive a $5K grant (our tax dollars) from the Feds.

The purpose behind the rate reduction for EV drivers appears as an attempt to both reduce our night time surplus and entice people to purchase an EV as the Ford government has been handing out our tax dollars to Ford, General Motors and others to ensure they manufacture some of those EV in Ontario.  Our night time surplus electricity is sold off at the HOEP (hourly Ontario energy price) to our neighbours in NY, Michigan and Quebec and due to ongoing nuclear refurbishment has not been as high as it used to be.  The result of the latter is the HOEP has climbed from its low of 1.39 cents/kWh in 2020.  As examples, the off-peak HOEP averaged 3.9 cents/kWh in January, 3.5 cents/kWh in February and 3.4 cents/kWh in March of this year or slightly more than the 2.5 cents/kWh now (perhaps) to be offered to people owning EV.  

Based on 2021 sales of automobiles in Ontario it appears the prime objective is aimed at trying to justify the hundreds of millions of Ontario tax dollar grants to the manufacturers of EV and some of their related parts.  2021 new motor vehicles sold in Ontario were 496,529 of which only 9,949 were EV representing 2% of total sales. 

What the foregoing suggests is, to achieve the targets set by the federal government; ie; “half of all new passenger cars sold in Canada to be zero-emission vehicles by 2030, and reach 100% by 2035” appears to be a pie in the sky dream!

Despite the above however, we should hope the IESO, OEB and Ministry bureaucrats pay attention to the EV penetration in Ontario before we are faced with the potential “blackouts and costly upgrades” or Minister Smith’s legacy will be similar to that of Chiarelli’s but only for 25 cents per week!

The Ford Government Brings us More Promises and More Tax Dollars Down the Drain

It’s become hard to understand exactly why the Ford led OCP (Ontario Conservative Party) seems set on imitating the Trudeau government who are hell-bent on destroying Canada’s fossil fuel sector but, many recent and past announcements and actions by the OCP suggest they are two peas in a pod!

As one example Minister of Energy Todd Smith issued a press release about the taxpayer subsidized ONroute Electric Vehicle Charging Stations recently and the release noted there were 72,655 EV currently registered in the province and “by 2030 one out of 3 vehicles sold will be electric”.  That would represent sales of around 170,000 EV! Presently the currently registered EV represent 0.85% of all vehicles weighing less than 4,500 kilograms in Ontario (2019 stats) and most if not all, received provincial and/or federal tax grants.  One should wonder will this Ford government’s sudden love affair with EV trigger a return of the provincial grant that the Ford government killed when first elected?

Another announcement by Minister Smith in the Belleville Intelligencer had the following quote in an article about his plan to lower electricity rates during the night: “Our government has reversed the trend of skyrocketing electricity prices and given families and businesses more control when it comes to their energy bills,”.  The article failed to note the recent Financial Accountability Office of Ontario (FAO) report indicated taxpayers would be picking up $6.9 billion of costs in the current fiscal year associated with his claim. What the foregoing infers is, “the trend”, seems to be; lets increase the provincial debt to burden future taxpayers.

Cheaper Nighttime Rates May Produce Blackouts

The article in the Intelligencer was headlined: “Energy Minister Todd Smith eyes ‘ultra-low overnight electricity plan“, and suggested it was to “benefit shift workers and support EV adoption”. Minister Smith has directed the OEB (Ontario Energy Board) to review the concept of implementing the reduction, “for residents who charge their electric vehicles overnight”! This looks to be simply another burden on future taxpayers with little benefit to those “shift workers” who, if they drive EV, will have to charge them during the day when rates are at peak levels. It will also result in higher rates during “peak demand” times of each day and a further burden on future taxpayers.

The issue of cheaper rates during the night may also benefit municipalities who have jumped on the “net-zero” concept and have told the province to shut down our gas plants that serve to back up the unreliable and intermittent wind and solar generation.  One wonders if Minister Smith is familiar with the fact that several municipalities such as Ottawa are aiming to convert their transit buses and other municipal vehicles to battery fueled vehicles. Ottawa alone intends to purchase 450 E-buses by 2030 and have a full E-bus fleet by 2036.  One should assume those buses will be charged principally at night and if so, what impact will it have on demand if all 32 municipalities who have told the province to shut down the gas plants convert their fleets?  Obviously, they will also demand they can charge those buses, etc. with those lower nighttime rates too! The City of Ottawa will borrow $400 million from the taxpayer owned “Infrastructure Bank” (a Trudeau led government creation) to assist in the purchase of those buses which further burdens all of Canada’s taxpayers!

Those buses charging at night also may have other issues as some cities who have moved to E-bus fleets have had bad experiences due to sudden fires. Germany has had several flareups in different cities. Recent events where fires broke out are of concern; meaning E-buses will require more stringent regulations such as separate garage stalls further raising conversion costs. Insurance companies have not yet dealt with those issues but will undoubtedly raise their premiums as a result of those events.   

In his push to support EV to reduce emissions Minister Smith ignores the fact the Pickering Nuclear generating station that supplies Ontario with 2,500 MWh every hour of the day will be shut down in 2025!  So far, the ministry has not identified what will replace that emission free power.

The absence of generation to meet demand in the future can be visualized by the following chart Scott Luft recently posted on his twitter page showing demand increasing substantially in the future! 

The plans and targets the current Ontario government has to reputedly reverse “the trend of skyrocketing electricity prices” seem destined to continue throwing our tax dollars down the drain.  A recent report by the Fraser Institute forecasts Ontario’s net debt will reach $503.3 billion or about $130K per household by 2023-24!

The time has come for this government to take action and stop spending money that serves to increase the possibility of a future debt crisis!

PS: Stay tuned for the next plan by the Ministry of Energy to drive up our Cost of Living.

Strange Things that Caught My Eye Over the Recent Week

Should you, as I do, consider recent events to be off the scale of normal, it is worth pondering the cause!  Is it related to the Covid-19 pandemic, climate change, the “woke” generation, government bureaucrats or those in political power or perhaps a combination of some or all of them?  Some recent examples:

Planting Trees in Brampton as Part of Two Billion Trees                                                                             

I’m sure most will recall just before the last Federal election in 2019 our PM Trudeau met with Greta Thunberg and promised her we would plant 2 billion trees.  Well, it appears the process, under the Minister of Natural Resources, Seamus O’Regan has finally started according to a press release on August 4, 2021 which contained the following:

“Today, Maninder Sidhu, Parliamentary Secretary to the Minister of International Development and Member of Parliament for Brampton East, on behalf of the Honourable Seamus O’Regan Jr., Minister of Natural Resources, announced $1,280,000 to the City of Brampton in support of the Government of Canada’s plan to plant two billion trees over 10 years. This project will see 8,000 trees planted across the region this year and contribute to the rehabilitation of the city’s urban tree canopy.”

Quick math on the cost per tree being planted comes to $160.00 each meaning if Minister O’Regan Jr. continues at this level the total cost to Canada’s taxpayers will be $320 billion for the 2 billion trees. Those 8,000 trees will, eventually, absorb about 174 tons of CO2 meaning the cost per ton of emissions removal is about $7,400. Pretty sure O’Regan could have purchased “carbon offsets” for a few dollars each from former Governor of the Bank of Canada, Mark Carney and saved the taxpayers money!

CONFIDENCE IN CHARITY LEADERS HAS FALLEN SHARPLY OVER THE LAST TWO DECADES – WHAT DOES THAT MEAN FOR THE SECTOR?

In late June Charity Village released a report that tracked “four research streams that asked about perceptions of charity leaders over time, representing 27 distinct surveys.” The surveys cited go back as far as 2000.  One of the comments in their report stated: “In 2000, 27% of Canadians reported a lot of trust or confidence in charity leaders, but in the Environics Institute’s research, only 8% reported having a lot of confidence in 2020,”. Another finding was, “between 2009 and 2020, confidence in charity leaders dropped by 22 percentage points, compared to only eight percentage points for business leaders, six for union leaders, and three for government leaders.” The preceding findings may (in my mind) be a reflection of the growth in eco-charities who provide no real charitable benefits to those in need and are well funded by domestic and foreign charitable foundations. The former includes many of Canada’s colleges and universities with departments focused on “climate change”! Needless to say, the drop in confidence has resulted in fewer Canadian tax filers donating: “In 2000, 25.5% of Canadian tax filers reported charitable donations, but by 2018 it was only 19.4%.” 

Toyota CEO Agrees With Elon Musk: We Don’t Have Enough Electricity to Electrify All the Cars

Toyota’s CEO at the company’s year-end press conference in mid-December 2020 said; “The current business model of the car industry is going to collapse. The more EVs we build, the worse carbon dioxide gets…When politicians are out there saying, ‘Let’s get rid of all cars using gasoline; do they understand this?” 

Interestingly enough, Elon Musk, the founder of Tesla just a couple of weeks earlier noted “Increasing the availability of sustainable energy is a major challenge as cars move from combustion engines to battery-driven electric motors, a shift which will take two decades, Musk said in a talk hosted by Berlin-based publisher Axel Springer.”  Musk also said; “electricity consumption will double if the world’s car fleets are electrified, increasing the need to expand nuclear, solar, geothermal and wind energy generating sources.” In respect to “wind energy” it is interesting to note the Global Wind Energy Council in an article claimed, at the end of 2020 there were “743 GW of wind power capacity worldwide”.  To put that in perspective the Federal Government’s “Canadian Centre for Energy Information” tells us at the end of 2017 Canada’s total electricity capacity was 145,214 MW which is only 145.2 GW! 

As industrial wind turbine’s (IWT) life span is around 20 years we should expect about 50% of those in operation globally will reach their end-of-life in the next 10 years and the rest by the time Musk forecasts capacity must double.   Approximately the same life-span applies to solar panel and batteries for storage. Those politicians and Musk should also understand the USA in 2020 generated 60.3% of it’s electricity consumption from fossil fuels!  I would therefore suggest the “politicians” cited by Toyota’s CEO along with Musk himself have no understanding of what EV will do to the electricity system globally and why both are way off base and have no bearing on getting us to “net-zero” emissions by 2050!

Hydro One submits five-year Investment Plan to the Ontario Energy Board to energize life for communities

Just a few days ago Hydro One issued a press release announcing they had submitted a 5 year plan to the OEB (Ontario Energy Board) seeking approval to spend $17 billion over that time to reputedly: “reduce the impacts of power outages for its distribution customers by approximately 25 per cent” and “enable economic growth and prepare for the impacts of climate change.” The proposed capital expenditures are about double what they have been over the past several years (eg: 2019 was $1.667 billion and 2020 was $1.878 billion).  The press release claims “If approved, the five-year Investment Plan will have bill impacts below the expected rate of inflation, with the monthly bill for a typical year-round residential customer increasing by an average of $1.68 each year from 2023 to 2027.” Reviewing the OEB’s Yearbook of Distributors to get a sense of how those “power outages” compare due to “defective equipment” the 2015 report states the hours interrupted due to “defective equipment” were over 4.6 million hours and in 2019 (2020 report is not yet published) they had dropped to just under 4.4 million hours.  Since 2015 Hydro One’s residential customer base also increased by 60,000 so hours per customer have dropped.

As a former banker I don’t believe the approximately $2 million the 1,2 million residential customers will cough up at the suggested $1.68 annual increase will be sufficient to pay the interest on the $1.9 billion of new debt (the foregoing additional debt assumes Hydro One will maintain is debt to equity ratio at 2020 year-end levels) they will incur annually.  By 2027 it will be a pipe dream!

Let us all hope the OEB does its job for the benefit of Hydro One’s customer base of which I am one.

Let’s thank our lucky stars Hydro One was not allowed to buy Avista

While on the subject of Hydro One it should remind all that back a few years ago they were intent on purchasing Avista Corporation via an all-cash purchase at $53 (US) per share.  The total cost for the all-cash offer was estimated at Cdn$6.7 billion.  The closing price on Avista’s stock on Friday July 7, 2021 and over three years after the purchase offer was $42.67 (US).  At the time the purchase offer was made Glen Thibeault was the Ontario Minister of Energy and was keen on the takeover saying: “One of the benefits of broadening the ownership of Hydro One was to unlock the potential for precisely this sort of transaction,”.  Thibeault went on to say; “As the single largest shareholder in Hydro One, the Ontario government would benefit from the company’s receipt of additional regulated returns expected to begin in 2019. Those benefits will be above and beyond the proceeds already attributed to the Ontario Trillium Trust as a result of the IPO and subsequent secondary offerings.”

Needless to say, those of us who felt Hydro One should focus on Ontario’s ratepayers were delighted US regulators in the states where Avista operated refused the takeover. Hydro One had planned to borrow $3.4 billion and issue another $1.4 billion of debentures convertible into Hydro One shares which would have, in all probability, detrimentally impacted all of their existing Ontario ratepayers.

Conclusion

Unfortunately, it appears those we elect as our representative politicians often are more influenced by those lobbying them continually such as the “climate change” advocates or they bow to the bureaucrats who are the beneficiaries of our tax dollars for their pay. Combine the foregoing with the “woke” generation screaming and their mainstream media support along with the push for globalization and we should unfortunately recognize what is continuing to happen appears to be the “new normal”!  

Political Promises, High Electricity Costs, Climate Change, EV and Line 5

I was invited on the Marc Patrone Show on Sauga 960 AM today and the above title suggests some of the topics we covered. You can listen to our discussion on Sauga 960’s Marc Patrone Show starting at 1:03:25 of the podcast of his July 6, 2021 show by going here:

Podcasts

Another Broken Political Promise

Back in April 2018 Doug Ford, the then recently chosen leader of the Ontario PC Party promised “to cut hydro bills by 12 per cent if he wins Ontario’s spring election, saying it would be on top of a rate reduction from the governing Liberals, whose plan he has repeatedly criticized. The Progressive Conservative leader said Thursday that he would cut rates through a variety of measures that would save the average ratepayer $173 a year.”

So how has that promise turned out?                                                                             

A recent report from the C. D. Howe Institute titled; “Power Surge: The Causes of (and Solutions to) Ontario’s Electricity Price Rise Since 2006” reminded me of Premier Ford’s above promise. I decided to measure his promise against actual results from our personal Hydro One bills.

A quick calculation of our June 2018 bill indicated all-in costs on the Hydro One bill we received were 15.06 cents/per kWh (kilowatt hour) after being granted a rebate of the provincial portion (8%) of the HST and a further discount under the “Fair Hydro Plan”.  Collectively the two reductions represented 34.5% of what our bill would have been.  Without discount(s) costs would have been 22.6 cents/kWh!

Fast forward three years later to June 2021 and all-in costs were 14.99 cents/kWh or a drop of 0.07 cents not the 1.8 cents/kWh of the promised 12% reduction.  The strange thing about the latter bill however is on the actual calculations the amount deducted is referenced as the “Ontario Electricity Rebate” (OER) and if added to what we paid would have raised the price to 18 cents/kWh.  On page 1 of the bill however, there was a dollar amount cited (Total Ontario support) that was 3.5 times the amount of the OER and if added to what we were required to pay would have increased the costs to 25.5 cents/kWh or 12.8% more than the 22.6 cents/kWh of June 2018. 

What the foregoing suggests is the Ford government has done nothing to reduce the cost of electricity since elected and instead is simply burdening taxpayers at the rate of 10.6 cents/kWh (25.5 cents/kWh minus 14.9 cents/kWh) for electricity consumed by residential and (perhaps) other ratepayers.

In respect to the foregoing the C. D. Howe report contains the following about the taxpayer burden: “As system costs – particularly in energy generation – have continued to rise, the Ontario government has increasingly turned towards taxpayers to keep total bills down. The most recent estimates from the Ministry of Finance show the cost of subsides rising to a staggering $6.5 billion for the 2021/22 fiscal year – or nearly 3.5 percent of total government expenditures. To put this number in context, that same budget proposed to spend $5.8 billion in taxpayer dollars on long-term care.“

Premier Ford left Greg Richford in the portfolio for three years and this suggests he accomplished nothing other than burdening taxpayers with debt! With the advent of Todd Smith as the new Minister of Energy, taxpayers and ratepayers should hope he will somehow start the process of fixing the mess.

The time has come for the Ford led Government to recognize that taxpayers and ratepayers are normally one and the same individual!