Ontario’s Power Trip: Discounts and windmills

Tom Adams article communicates the growing division between large user pricing, and residential/small business electricity pricing - due to the feed-in tariff, global adjustment, and newly announced industrial rate policies of the McGuinty government.

Ontario’s Power Trip: Discounts and windmills | FP Comment | Financial Post:

While offering industry rates at 5.5¢ per kWh, the government is at the same time committing non-preferred consumers — smaller businesses and retail consumers — to pay rates that start at 11.5¢ per kWh for more wind power and 34.7¢ per kWh for solar. The government’s wind and solar contracts contain escalators and they require guaranteed payments to generators for curtailed production and costly new transmission and backup power.
The new industrial discount announcement continues trends separating the interests of large industrial consumers from the rest of the province’s electricity consumers. While the big industrials were in the same boat with all the other consumers, their lobbying and analytical resources were pushing in the same direction as other consumers would have pushed, had they been so organized.
As industrial rates become politically determined, favoured users guaranteed fixed prices will lose all interest in the underlying costs of the system.

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When the government started shifting Global Adjustment in 2011, the industrials began seeing that wind power cut their bills by suppressing market prices. Now, industrial consumers benefit as wind power costs ramp up for ordinary consumers.

Read Tom Adams' complete article at the Financial Post website: