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Green energy: ‘The pigs are not going to fly’
Credit: About-face: Five key issues to watch in the London region | Randy Richmond | The London Free Press | June 8, 2018 | lfpress.com ~~
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Translate: FROM English | TO English
Despite Doug Ford’s commitment to tear apart Ontario’s energy system, consumers shouldn’t expect to see much change in their electricity bills, says an energy analyst and researcher.
“Don’t expect your rates to go down. The overall cost of power is likely to rise over the next four years. The power system will look a lot like it does today,” Tom Adams said.
What will likely be gone: The Liberals’ $600-million conservation fund that paid homeowners for installing energy efficiency upgrades.
But even that won’t come without strong opposition, said Adams, author of several academic papers on energy and a consultant for consumer organizations.
Ford has promised to scrap the controversial Green Energy Act, the legislation that led to costly wind turbine projects across Southwestern Ontario – often over the objection of municipalities stripped of control over the location of energy projects.
The legislation became the flashpoint for anger over rising energy bills, which were caused only in part by sweetheart contracts with green energy suppliers.
Ford has promised to cut energy bills by 12 per cent, apparently on top of the Liberals’ 25 per cent cut, which has been criticized because it relies on borrowing money.
“Ford has promised pigs are going to fly. The pigs are not going to fly,” Adams said. “I think he’s going to have to bail on that promise.”
Ontarians must remember 60 per cent of their power comes from nuclear plants, he said.
“They’re very old and we are into the refurbishment phase where a lot of investment is going to be called for those projects. If Ontario’s nuclear history is any guide, some of these major capital $re-investment projects could get themselves into trouble with cost overruns or delays or both,” Adams said.
Some promises will be easier to keep, such as returning to municipalities control over where wind turbines and solar plants go, if anywhere, he said.
“The Green Energy Act is toast,” he added. “But the act is a very large, far-reaching piece legislation. It’s not just about some wind and solar generation. It has huge impacts on the administration of the electricity system. You can’t simply wipe out the Green Energy Act without replacing it with something.”
It’s possible Ford can renegotiate green energy contracts with companies that haven’t started building yet, at a cost less than the hit from the life of the contract, Adams said.
“But that’s a relatively few cases,” he said.
But Ford would have a more difficult task to rip up existing contracts with companies already producing green energy to re-negotiate a better deal, a desire by some in the PC party, he said.
“Those contracts have huge implications for big banks, big insurance companies, utility companies, and those contracts were written by the best energy lawyers in the country.”
There are automatic penalties against ratepayers if terms are adjusted, he said.
Where Ford can find savings is by dropping the Liberals conservation program, which last year paid out $600 million to homeowners to make their homes more energy efficient.
Energy analysts and Ontario’s auditor general all think the program is a waste of money in a province that has so much power it’s giving away some to the U.S. and paying money to some companies not to produce power, Adams said.
“It’s wacky, crazy stuff. This is one area where Ford can achieve a lot of savings for ratepayers, achieve some reduction in costs of the power system.”
But if he does, he will upset energy utilities, contractors, appliance stores and the bureaucracies that benefitted.
“They’re not going to like it when the taps get turned off.”
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