Ontario is reeling.
The “Ontario Green Energy Program,” introduced four years ago by then-Ontario Premier Dalton McGuinty’s Liberal government, has proved to be an utter disaster.
A public inquiry has brought to light the sheer size of this white elephant.
The consequence of going all-out green will cost the average Ontario family an extra $636 a year by 2018 , a 42% jump in electricity bills over the next five years.
Independent analysts are pegging the additional costs at $16 billion today, $23 billion by 2016. This in a province that is already $273 billion in debt!
“Trying to save the future has created an economic disaster in the here and now, for our children and our grandchildren,” summed up one commentator.
Ontario industry is paying more for power than almost any other jurisdiction in North America. Any wonder manufacturing and food processing companies are leaving Ontario? Any wonder it’s so tough to find a job in Ontario?
I don’t pretend to know the ins-and-outs of the electricity business. It’s a complicated beast.
But I do know that Ontario’s uproar is happening just as Alberta’s deregulated, industry-run electricity system would appear to be settling down and providing electricity at reasonable cost, without hidden government subsidy and without the fool’s game of crown-owned utilities controlled by politicians seeking re-election.
What happened in Ontario was quite simple.
In 2010, its provincial Liberal government bought the “green” argument hook, line and sinker.
It promised huge subsidies to wind and solar electrical producers, promised to buy their power output at three times the rate paid to “conventional” (hydro, coal, nuclear, natural gas) power producers.
Blinded by green-tinted glasses, all excited by pie-in-the-sky projections of 50,000 new green-power industry jobs which didn’t happen, the Liberals made a $7 billion deal with industry to create enormous wind farms.
Once a portion of those wind farms were built – creating political fallout in rural areas where they were not wanted – another crushing reality came into play. Demand and wind patterns didn’t match. Wind farms were pumping out power at night, when demand was lowest. Government, paying a pre-promised 13.5 cents a kilowatt hour, was dumping most of that electricity into American grids at 2.4 cents a kilowatt hour.
On top of the green fiasco was a decision by the McGuinty government to move two planned natural-gas power stations out of Oakville and Mississauga due to political pressure, at more additional costs, i.e. $1.5 billion.
Here’s the true environmental picture. Natural gas is one of the cleanest-burning and least expensive fuels in the world.
An internal government report from 2005, just recently made public, recommended Ontario simply replace aging coal and nuclear plants with gas-fired ones, plus retro-fitted existing gas plants. Had that advice been followed, the Green Energy environmental goals would easily have been met, at one-tenth the cost!
It all comes down to what this column has argued over and over. Global warming is mostly due to CO2 from coal- burning electricity plants, especially in developing countries with no environmental safeguards. Convert those plants to gas, and we’d no longer have a CO2 problem.
In the developed world, natural gas is fast replacing coal. Natural gas is cheap. The world is awash in it. Three years ago, coal supplied 53% of USA electricity. Today it’s 38%.
Ontario, to its credit, has just closed the last of its coal plants.
Alberta is not far behind. Coal plants are being phased out over time, as per federal environmental directives. Capital Power and Enmax are building a natural-gas plant near Calgary and new gas-fired units west of Edmonton.
Our electricity controversies are chicken feed compared to those of Ontario. Mainly because Alberta does not use electricity as a laboratory for social policy.
And if alternate energy producers could ever bring down their costs to compete in price with clean fossil fuels, I’d be all over that bandwagon. But it’s not going to happen in my lifetime.
|Wind Watch relies entirely
on User Funding