Wind turbines are sucking money out of Ontarians’ wallets, a new report says.
What Goes Up, a Fraser Institute report by Ross McKitrick and Tom Adams to be released Thursday, makes a number of controversial recommendations to ease the upward pressure on electricity bills.
The Ontario government should announce an immediate moratorium on new wind and solar power facilities, and revisit existing contracts that commit Ontarians to paying well above market rates for renewable electricity, the authors conclude.
“Wind and solar power systems provide less than 4% of Ontario’s power but account for 20% of the cost paid by Ontarians, yet the government wants to triple the number of wind and solar generators,” energy analyst Adams said in a statement. “That’s a good deal for wind and solar producers but a raw deal for consumers.”
The report suggests the government explore large-scale imports of electricity from Hydro Quebec to cover any shortfall during planned nuclear power plant refurbishments, rather than ramping up renewable energy.
What Goes Up also calls on the government to reopen four coal-burning units at Lambton and Nanticoke which the authors argue are as clean burning as gas plants.
The provincial Liberals say they ordered the closure of the plants, which produce power at relatively cheap cost, to protect air quality and human health.
“The Ontario government conducted a misleading public relations campaign to demonize coal and scare the public into thinking that the Lambton and Nanticoke plants greatly harm Ontario’s air quality which is false,” University of Guelph Economics Professor McKitrick said.
In yet another recommendation likely to raise eyebrows, the authors called on the government to curtail its electricity conservation message during its frequent periods of excess supply, rather than export the province’s pricey power at a deep loss to other jurisdictions.
The report zeroes in on the Global Adjustment (GA), the difference between the market price for electricity and what it actually costs to get the electricity, as one of the main culprits for Ontario’s rapidly rising hydro bills.
For instance, the GA covers the guaranteed price paid to wind and solar powers producers, usually well above the market price for electricity.
Each additional megawatt of new wind capacity adds about $0.02/MWh to the GA, the report says.
The GA, which is added to hydro bills, also pays some generators for “capacity” which means they get compensated even if they’re told not to produce electricity because it isn’t needed, the report notes.
“Over the past decade, electricity prices in Ontario have skyrocketed, and they’ll continue to rise unless the province starts to put the interests of ordinary Ontarians ahead of industry insiders,” McKitrick said.
The Liberal government says renewable energy is good for the environment, and that it has taken numerous steps to keep the lid on rising electricity costs like renegotiating some power contracts.
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