Sunday, January 13, 2013

Ontario Spin Week

Did we all miss some parliamentary declaration that created an Ontario focused Spin Week?

With the bulk of the MSM (main stream media) focused on Spence, of hunger strike fame (not the Spence of Toronto District School Board plagiarism fame) and Bill 115, Ontario's charter busting affrontry dealing with the various teacher's unions/federations/associations “right to strike”, it was hard to keep up with the rest of the news coming from the Liberals and the energy sector.  Much of that latter news was simply skimmed or ignored by most of the press.

One item that gained a fair amount of traction with the media was related to the erection of several wind turbines in rural Ontario and the damage they will or could cause. The story wasn't connected to either human health, the negative effect on property values or the economic effect of industrial wind turbines on our electricity bills, it was about nature. One of those large foreign companies (NexTera) that rushed to Ontario to get those lucrative contracts handed out under the Liberal's Green Energy Act received permission to cut down a tree containing one of only 57 bald eagle nests in Southern Ontario.  They got permission from the Ministry of Natural Resources where the reigning, career Liberal politician and Minister Michael Gravelle is in charge.  A few years ago Gravelle was really excited about his riding attracting a 99 MW industrial wind farm which is owned by Enbridge.  The uproar on the granting of approval to remove the eagle's nest was considerable throughout rural Ontario and received wide coverage in their media. Another event that also garnered some media attention for the past couple of weeks was the granting of the approval to erect nine wind turbines at Ostrander Point, a sensitive environmental and important migratory bird path in Prince Edward County.  Those industrial wind turbines with a capacity factor of 22.5 MW are not needed but despite that, the Ministry of the Environment and the Ministry of Natural Resources blessed their erection.

The eagle's nest removal, to allow an access road for the erection of industrial wind turbines, wasn't picked up by the MSM however other events were, including the announcement by Premier McGuinty on the closure of the last two remaining coal plants in the Province. The Premier spoke to that issue to the media when expounding on the expansion of the Green Belt, despite the media getting him off topic by raising the upcoming planned illegal “action” by two of those teachers unions.  Those unions had supported the Liberal party in the last three provincial election campaigns via “Working Families” and supported the Green Energy Act.  In 2011 those two unions (ETFO & OSSTF) donated almost $100,000 to the Liberal Party, just over $100,000 to the NDP and zero to the PC Party. The Working Families coalition reputedly spent millions on media advertising during the 2011 and prior election campaigns.

McGuinty's announcement and a January 11, 2013 press release from the Independent Electricity System Operator (IESO) were enough to intrigue two of the Toronto Star's “reporters” in the form of John Spears and Tyler Hamilton who within hours of the release of IESO's annual mid-January media missive (pinpointing how much electricity Ontario consumed and how it was produced) had written about the events. Hamilton wrote on the issue of how anti-wind people fail to understand how, as a generation source, wind fits into the grid and reduces fossil fuel use from coal plants but he does admit that “wind isn't perfect”.  For Hamilton that latter admission is a big step forward.

The McGuinty announcement about the coal plant closures failed the “union” test as the only quasi-union I could find that spoke out on this issue was the Society of Energy Professionals who lashed out “over planned coal plant closures.” Ironically the newly appointed President of the Society, Scott Travers is a “Senior Analyst” with IESO.  The Society didn't appear to contribute to any political party from a search conducted by the author.

The IESO missive disclosed that for the first time ever (in Ontario) electricity produced by industrial wind turbines (4.6 terrawatts-TWh) surpassed production from coal plants (4.3 TWh) and the Star reporters jumped on the news.  Spears obtained quotes from a CanWEA (Canadian Wind Energy Association) officer and headlined his article as; “Wind out-produces coal”! What Spears failed to note in his article is that wind gets “first to the grid” rights and coal generation gets “last rights” (actual and metaphysically speaking) for the past several years. He funnily quotes how the numbers “delighted” the CanWEA spokesperson. The “delight” expressed by the CanWEA spokesperson is akin to a runner of a 100 yard dash starting 50 yards behind ”the starting line” and told they must hop on one foot for the first 50 yards.  Obviously your opponent will win the race hence the “delight” from the winner who in this case is represented by the CanWEA spokesperson.  Somewhat amusingly Spears suggests the price of electricity “crept up by 2.9%”. In the process he ignores the elephant; the actual “wholesale price”; referred to as the “hourly Ontario energy price” (HOEP) fell by 23.5% ($7.10 per MWh) from 2011. He also failed to note that the price of the Global Adjustment Mechanism (GAM) had risen 23.7% ($9.50 per MWh) over 2011. The GAM pot is where the difference between the HOEP and the “contracted” rates are dumped before allocation. Combining the two brought the increase to the 2.9% Spears says “crept up”!

The creep, ascribed by Spears, only affects Ontario's consumers. The IESO report disclosed that Ontario demand was 141.3 terrawatts (one TWh is equivalent to 1 billion kilowatts), a slight reduction from 2011. It also disclosed Ontario exported 14.6 TWh.  The foreign buyers of those 14.6 TWh are not required to pay for anything in the GAM pot nor do they pay for the stranded debt, or regulatory charges. They pay only market prices.

The 14.6 TWh exported generated about $352 million @ $24.1 million per TWh in 2012. That power cost Ontario's ratepayers ~$1,076 million (14.6 TWh @ $73.7 million per TWh) for a direct hit to ratepayers of $724 million as that money went into the GAM pot. The foregoing hit to ratepayers is without factoring in the weighing of production from wind and solar.  It also doesn't reflect costs of nuclear steam off, the shift (about 5%) from Class A to Class B of the GAM, the revenue loss to OPG to spill hydro, NRR (net revenue requirement) for the gas generators, or even the HST on the GAM allocation.

The actual subsidized cost of those 2012 electricity exports using the average 2.41 cents per kWh measured against the average of 8.2 cents that Ontario's residential ratepayers paid under time of use (TOU) rates indicates the subsidy was 5.8 cents per kWh or about $850 million for the 14,6 TWh exported; up considerably from the 4 cents per kWh ($420 million) estimated subsidized costs of 2011. That subsidy caused more than the Spears creep and had those exports not occurred, ie demand and production were matched, ratepayers may have actually experienced a small decline in the cost per kWh.

More spin came from the Environment Commissioner, Gordon Miller on January 8, 2013 when he released Volume Two of his 2011 Annual Energy Conservation Progress Report to the Ontario Legislature (which is prorogued) and castigated all Ontarians for not conserving enough and in the process claimed that it only costs us 3 cents per kWh to reduce our consumption.  An article I had penned a week before his release indicated that the cost of conservation was in fact closer to 14 cents a kWh based on the $4 billion that had already been dedicated to get us to conserve.  His media event received scant attention due to all the other issues deemed more important and as the Legislature wasn't sitting the opportunity for say, Peter Tabuns, the NDP Energy Critic to castigate the Energy Minister, Chris Bentley, for not spending more to conserve didn't present itself.  With our outgoing Premier, Dalton McGuinty, heading off on his China junket there also wasn't any opportunity for the media to seek him out for his views on the report.

I think most Ontarians were insulted by one of the Commissioner's comments when he said; “In the past, Ontarians were very conscious of the cost of heating their homes but that’s no longer the case."  Only moments before he claimed we were all “fascinated by the price of electricity”.  Did Commissioner Miller appreciate the dichotomy of his statements to the media, or is he simply pushing his own agenda which in this writer's opinion is very confusing.

Commissioner Miller's media event presented a perfect opportunity for him to speak out about that eagle's nest being moved or the Ostrander Point industrial wind project but he chose to remain silent. So just what is important to the Environment Commissioner is clearly not the harm that wind turbines are causing to nature or the environment but it is tough to figure out just what is!

What this province now gets is too much spin and not enough transparency or honesty from our politicians and bureaucrats.



Parker Gallant,
January 13, 2013



















3 comments:

  1. The Americans had their toxic asset meltdown, which we were largely spared from thanks to a more prudent banking system and regulatory framework. The McGuinty Government has turned us into a have not province and now this--hundreds of millions more flushed down the toilet. Last year's Hydro Quebec Price Comparison Report showed that for the largest power user category we have the highest priced power in the country. At this rate, every category will be the highest. We need a regulator for the government.

    ReplyDelete
  2. There is no Parliament in which to have made the Spin Week declaration! It's all spin, all the time in Ontario!

    ReplyDelete
  3. I'm not in a position to view this web site correctly on chrome I think there's a drawback

    My site having trouble getting pregnant the third time

    ReplyDelete