“This is what Jake Epp says: "There are a lot of issues that need to be taken care of, whether you're talking about supply, you're talking about the market, whether you're talking about OPG's role," in the private market. But what is he saying? No direction. No five-year plan. Not even a one-year plan."
“Now, this government has put a new board and chair in place at OPG. We have made decisions about the future of the company, and we'll make them according to our timetable. Remember, when we came to office we inherited a company that was in complete disarray. We have to be deliberate and careful in the decisions we make. It would be impossible to turn OPG around in 10 months. The last thing we need to do is make knee-jerk decisions that result in flip-flops like we saw under the previous government, because it creates even further instability. I'm the first energy minister in almost a decade to give clear and consistent direction to the sector. Given the strong response we've received to our RFPs, I believe the industry recognizes this. We're moving forward in a deliberate and positive fashion. When Bill 100 passes, we will have a new power authority and conservation bureau. We believe these are the right steps to ensure a reliable, affordable, safe supply of electricity for the people of Ontario.”
The
comment from Duncan that stated; “I'm the first energy minister in
almost a decade to give clear and consistent direction to the
sector,” was no doubt sincere when given but consistency
has not been the watchword of subsequent Energy Ministers. As just
one example we would point to the “turn” around of OPG. OPG's
2003 year end annual report noted that they had rated capacity of
22,777 MW and produced 109.1 terawatts (TWh) of electricity. The
2010 year end annual report saw OPG's rated capacity at 19,931 MW
(down 12.5%) and 88.6 TWh (down 18.8%) of electricity produced. This
quote taken from OPG's 2003 annual report indicated that,
“roughly three-quarters of our production is sold for a price that is considerably lower than the price other market participants receive, after taking into account market rebates.”
The
foregoing aspect of OPG hasn't changed but their drop in production
has been taken up by more “market participants” consisting mainly
of foreign based wind and solar producers who are paid from three (3)
to fifteen (15) times the average price OPG receives. The “clear
and consistent direction” that Minister Duncan spoke to that
November day in 2004 has been effective. It has reduced OPG's role
in the province's production of electricity, however, the costs of
that direction has caused electricity rates to climb much faster then
the inflation index and has driven many living on fixed incomes and
others into energy poverty.
Just
a couple of weeks later on December
9, 2004
the Minister of Energy, Dwight Duncan presented Bill 100 to the
Legislature for it's third and final reading. The following are the
highlights of his presentation:
“The Minister of Energy would kick off the preparation of the
plan by providing to the OPA a series of directives.” and
“But consumption varies from year
to year, and new technologies and upstart competitors can render
expensive facilities obsolete before their usefulness expires.”
and
“Ontario would have a combination of regulated generation
facilities providing continuous power and other facilities competing
in the marketplace to provide electricity to consumers. This element
of competition and risk sharing with private investors in the market
would provide a higher level of discipline on all electricity
suppliers and reduce the risks borne by Ontario's ratepayers.”
and
“While the burning of fossil fuels
is often the most visible sign of the environmental cost of our
electricity system, it should also be noted that the construction of
high-voltage transmission systems, often cutting through otherwise
untouched parts of our province, represents a serious environmental
issue.” and
“Where possible and economically feasible, it is desirable that
Ontario move to a more distributed system of electricity generation,
where clean generation capacity is situated close to the consumers
who require the power.”and
“Consumers would have the benefit of stable and predictable
prices and an electricity sector that emphasizes reliability,
sustainability, diversity and affordability, all while being
environmentally responsible.”
In retrospect all
of the pronouncements uttered by Minister Duncan in seeking
justification for Bill 100 have basically failed with the exception
being the issuing of those “ministerial directives”.
The “plan” was
produced and discarded, “consumption” has fallen as
manufacturers, refiners and forest product companies have either left
for other jurisdictions or gone bankrupt. The technology chosen,
wind and solar is being discarded by the very countries that Ontario
emulated in it's choice of generation options.
The competition
promised has turned out to be simply subsidies for wind and solar
developers that have flocked to Ontario for the above market prices
they are paid. The “risk sharing” envisaged was instead a
provincially guaranteed return on investment (to be paid by
ratepayers) whether you installed 100 megawatts of industrial wind
turbines or 10 kilowatts of solar panels.
In order to hook up
all the renewables to the grid “the construction of high-voltage
transmission systems,” were ordered in those “ministerial
directives” and those “untouched parts of our province” have
become overrun with 400 foot industrial wind turbines, acres of solar
panels both providing unreliable, expensive and intermittent
electricity along with those “high-voltage transmission systems”
that decimate the “untouched parts of our province”!
The concept of “a
more distributed system of electricity generation” is still merely
a concept with grid capacity stretched to avoid blackouts and the
Independent Electricity System Operator (IESO) forced continually to
export electricity at a loss or order hydro generators to spill or
nuclear plants to steam off, all in an effort to balance supply and
demand and all at considerable cost to Ontario's ratepayers!
The promised
“benefit of stable and predictable prices” for consumers was a
pipe dream and the Liberal Party's legacy in the electricity sector
will stain the province for at least two decades.
Some plan, some
legacy!
Previous Chapters:
Parker Gallant,
February 12, 2012
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