A litany of provincial Liberal ‘benefits’

Lofty ideals and the best of intentions often lead to wretched outcomes

To the Expositor:

As expected, the Ontario Liberals have finally made the connection between wide spread discontent and soaring energy costs. The highlights of the government response are the partial HST rebate and the cancellation of 1,000 megawatts of additional “green” energy.

At every opportunity, Kathleen Wynne and her ministers claim that ‘investments” have been necessary to improve the power system reliability and to move to “green” energy. After thirteen years at it and billions in “investments”, one would think that assets would be in tip-top shape. One would also think that taxpayers of Ontario would be benefiting in some manner from the “investments” touted by Wynne.

Here is a short list of “benefits” that I can put my finger on:

• In the first quarter of 2014, the $/kWh on my power bill was $0.18. The last three bills this year, the rate was $0.25. That is an approximate increase of 40 percent in a little more than two years.

• The rates in Ontario are currently the highest in Canada and the rate of increase in recent years also wins a first place.

• My delivery charges vary from 70 percent to 99 percent depending on consumption. Note that saving electricity drives unit costs up since the base for allocating incurred costs will shrink. Costs like paying power producers to not generate. Selling power to the US at a loss is another example.

Might there be other reasons for the high rates? Here are a few possibilities:

• The gas plant scandal cost Ontario tax payers 1.1 billion dollars.

• “Smart” meter installation cost 2.0 billion with no apparent benefit.

• Between 2006 and 2014, Ontario paid $35 billion above market value for “green” energy.

• It is estimated that by 2032, Ontario will pay $133 billion above market value for ‘green” energy.

All of the numbers above are from the Ontario Auditor General.

Might there be a connection between high energy rates and poor management of the energy file? The staggering numbers cited above would suggest that the frustration and anger surfacing across Ontario are well founded.

The new Energy Minister, Glen Thibeault, in announcing the 1,000 megawatt cancellation, stated that the Independent Electricity System Operator’s planning outlook determined that Ontario has more than enough power for the next decade. Really! Wouldn’t a look at the losses to Ontario exporting power to the USA be a hint? How about paying producers for not spinning the generators? Just now this startling bit of news lands in front of the minister?!

If Dalton McGuinty, Wynne and the rest of them had listened to the technical and planning experts before the Green Energy Act was hatched, they would have been told that Wind and Solar generation is very expensive, is not reliable, and the more of it that is added to the grid, the more inefficient and unstable the grid will become. They would also have been told that there are other options available for additional “clean” power. Here are some examples. Import from Quebec with the added attraction that the rates would or could be among the lowest in Canada. Conversion of existing coal plants was also an option that could have resulted in low power costs and a stable grid.

Closer to home for a moment. What does all this mean for an individual like your grandmother? Typically, she would live in a small apartment which would be electrically heated. She would have a modest and fixed income and would be careful with expenses to ensure that bills are paid and money is available for necessities. Food and electrical power (heat) would take a significant percentage of available funds. With surging power costs, money must be moved from other needs to offset the increases. Adequate heat and less food? That might work for a while but at some point, cold and inadequate food have to be the result unless there is an intervention.

A quote attributed to Kathleen Wynne in Maclean’s magazine reads as follows, “Government exists to be a force for good.” Lofty ideals and the best of intentions often lead to wretched outcomes when sound economic policy and reason take a back seat to ideology. Freezing Grandma was not the intent of the Green Energy Act. None the less, it is happening. Look no further that McLean’s Mountain to understand why.

The recent announcements by the Liberals will do nothing to reduce the overall costs for power. Existing contracts for green energy are typically for twenty years. We will continue to spin off excess power at a loss and the inefficiencies associated with “green” energy remain. The government has shifted the burden around among taxpayers. That is all they have done.

Shane Desjardins