Blinking in the face of a growing political backlash against rising electricity prices, Ontario is suspending plans for more green energy.
The surprise announcement by Ontario’s Liberal government Tuesday – affecting wind, solar, hydro and energy-from-waste projects – is forecast to save the province billions of dollars.
It comes after nearly a decade of the Liberals steadfastly sticking to a controversial green energy agenda that has cost Ontarians billions of dollars above market prices for power and alienated many people – especially in Southwestern Ontario, where most of the province’s wind farms are located.
At Queen’s Park, the abrupt move dominated questions in the legislature, with the Progressive Conservatives saying Ontario’s high electricity rates are driving businesses out of the province.
“This government has plowed ahead for years signing contracts for energy we simply do not need,” said Opposition Leader Patrick Brown. “The premier has become the best minister of economic development that Pennsylvania and New York has ever seen.”
The Liberals began their plunge into green power shortly after taking office, vowing to close Ontario’s dirty coal-fired power plants and replace them with thousands of wind turbines – many, operated under sweetheart contracts that pay companies far more than consumers pay – and solar energy panels.
Admitting the suspension was a difficult decision, Energy Minister Glenn Thibeault said he made the call after receiving an outlook report Sept. 1 from the Independent Electricity System Operator (IESO) that indicated Ontario will have enough generation capacity to meet its needs for at least a decade.
Under instructions from Kathleen Wynne’s government, the IESO had already launched another round of green energy procurement with 59 companies lining up to take part in plans to add another 1,000 megawatts of electricity.
Thibeault said the report made it clear the extra green energy isn’t needed.
“By putting our finger on the pause button it allows me to save $3.8 billion for ratepayers, and that’s pretty significant in terms of helping ratepayers right across the province,” Thibeault said in an interview.
Savings from the suspension work out to about $2.45 a month for Ontario households, according to the Ontario Energy Ministry.
The decision does not affect green energy projects already approved, including the Strong Breeze Wind Project planned for Dutton-Dunwich in Elgin County, where residents voted overwhelmingly against the wind farm.
The government’s handling of the electricity file has come under harsh review by the province’s own auditor general, Bonnie Lysyk, who last year found Ontarians paid $37 billion extra for power over the last eight years because of the government’s decisions to ignore its own planning process for new power generation projects.
Lysyk found the electricity portion of power bills rose by 70 per cent 2006 to 2014, with the province going against the advice of its own power planning authority, and warned power rates will keep climbing, costing consumers another $133 billion extra over the next 17 years.
Earlier this month, after a stinging byelection loss in Toronto, the Liberals moved to soften the blow of rising power rates, announcing rebates on the provincial portion of the HST on power bills and more relief in rural areas where transmission costs are higher. That came less than a year after the government scrapped a 10-per-cent subsidy, worth more than $1 billion a year, it had been paying on electricity bills to offset clean energy costs.
Despite Tuesday’s move, Thibeault said the Liberals aren’t walking away from green energy and will look for affordable, clean, reliable energy in future.
“We are not shutting the door on the importance of renewable energy in our province at all,” he said.
But opponents of Ontario’s green energy program said Thibeault isn’t going far enough, while supporters suggested Ontario is blowing a major opportunity.
“This is exactly the wrong time to put the brakes on renewable energy,” said Keith Brooks, programs director at Environmental Defence.
Deployment of wind and solar power is soaring around the world while costs plummet, he said.
“If we want to be part of that we have to continue to support the industry at home. Now is not the time to back away. It’s time to double down.”
Robert Hornung, president of the Canadian Wind Energy Association, said the industry was shocked and disappointed by Ontario’s move.
While the government believes the power isn’t needed, Hornung said Ontario will face higher power demands as it moves to meet its climate change targets.
“It represents a bit of a lost opportunity,” he said.
When Ontario does recognize it needs more electricity, wind energy will be an obvious choice, competing with any other source of new power, Hornung said.
Jane Wilson, president of Wind Concerns Ontario, a coalition of groups opposed to wind energy, predicted last week the government would have to halt the green energy procurement program in the face of rising electricity bills.
Tuesday, she said the government should go a step further and cancel contracts where companies have failed to meet their obligations.
“With rising electricity bills and energy poverty at a ‘crisis’ point in Ontario, it would have been indefensible for the Wynne government to continue the Large Renewable Procurement process,” Wilson said.
Lisa Thompson, Conservative MPP for Huron-Bruce, home to some of Ontario’s largest wind farm projects, said the halt to procurement won’t save anybody money on their electricity bills.
“What we saw today was just a desperate ploy from an energy minister trying to help stop the premier’s popularity that is in an absolute free-fall. This is just a desperate ploy to give a cushion to land on,” Thompson said.
Thompson said the moves were inspired by the Liberals losing the Scarborough-Rouge River byelection.
“Now they are pulling out Band-aids but the good people of Ontario can’t be fooled,” she said.
John Laforet, principal at Broadview Strategy Group, a communications company that has been hired by groups opposing wind farm development, said the government had to make the move.
“It was the easiest of a lot of uncomfortable decisions they are going to have to make. This will not lower anyone’s electricity bill, but it will prevent it from getting any higher related to these projects,” said Laforet, a former Liberal riding president who turned against the party over wind farm development.
— With file by Canadian Press