EBR Registry #012-8840 I…

EBR Registry #012-8840

I have looked over the “Ontario Planning Outlook” by IESO, “Fuels Technical Report” by the Ministry of Energy and have read “Planning Ontario’s Energy Future - A Discussion Guide to Start the Conversation” towards forming the 2017 LTEP by the Ministry of Energy. I read the 2010 and 2013 LTEPs when they came out. I have also read the Auditor General’s 2011, 2014 and 2015 Annual Reports on the Ministry of Energy sector.

1. The IESO and Ministry of Energy need to thoroughly read and implement the recommendations of the Auditor’s Annual Reports of 2011, 2014 and 2015 concerning the energy sector.

2. Show Global Adjustment in a separate line on the electricity bill.

One such recommendation from the Auditors has gone unheeded: “disclose the components of the TOU rates (electricity market price and Global Adjustment) separately on electricity bills so that the impact of the Global Adjustment is transparent to ratepayers.” (P.386, 2014 Annual Report of the Office of the Auditor General of Ontario, “Smart Metering Initiative”, Chapter 3, Ministry of Energy, Section 3.11)

“The total Global Adjustment (GA) charged to ratepayers has grown from $654 million in 2006 to 7.7 billion in 2013. With more new contracted generators, especially of renewable energy expected to begin producing energy at higher contract prices, the total GA is expected to grow further to $8.5 billion in 2014 and $9.4 billion in 2015. From 2006 to 2014, electricity consumers have already paid a total of $37 billion and they are expected to pay another $133 billion in Global Adjustment fees from 2015 to 2032.” (P.222, 2015 Auditor’s Report.) “Global Adjustment accounts for about 70% of each TOU rate. Even though the GA has increased significantly and accounts for a substantial proportion of the TOU rates, its impact is not transparent to most ratepayers because it does not appear on electricity bills as a separate line; instead it is imbedded in the TOU rates used to calculate the electricity charge.” (P. 377- 380, 2014 Auditor’s Report) Meanwhile, the market price of electricity continues to fall due to increasing supply to about 2 cents/kWh. “The GA increased by 1,200% while the market price dropped by 46% between 2006 and 2013.” (P.377) The more supply of electricity, the more the market price drops causing more difference between the GA and market price causing more increasing costs to ratepayers.

“Almost one-third of the GA in 2014 is attributable to renewable energy contracts.”  (P. 94 Auditor’s 2011 Report)

2. We have too much surplus power. Stop procuring more power.

“The Ministry’s attractive guaranteed prices program has been one of the main contributors to the surplus power situation Ontario has faced since 2009, in that it has procured too many renewable projects, too quickly, and at too high a cost.” (P.226, 2015 Auditor’s Report)

Surplus power exported at lower prices and at a loss is costing us over a $ billion each year. Our neighbours who buy the power do not have to pay the Global Adjustment on that power but Ontario ratepayers do.

3. Cancel all LRPI contracts. (300 MW of wind and 145 of solar) They were issued in March 2016 but construction has not begun. These extra MW of power will cause higher ratepayer costs in the GA.

4. Cancel any further LRP contracts. The LRP II was recently cancelled as well it should have been as it should never have been offered. We already have about 9,000 MW of natural gas power plants sitting mostly idle with two more plants on the way at Napanee and Lambton that are not needed. We are still paying for these plants to be maintained and back up wind power.  “Renewable energy sources such as wind and solar provide intermittent energy and require backup from coal or gas-fired generators to maintain a steady, reliable output. 10,000 MW electricity from wind would require an additional 47% of non-wind power, typically produced by natural-gas-fired generation plants to ensure continuous supply.” (P.91, Electricity Sector-Renewable Energy Initiatives, Auditor’s 2011 Annual Report) We also paid about $950 million, according to the Auditor for those two new gas plants previously when they were cancelled from Oakville and Mississauga.

5. Conduct cost/benefit analyses well before implementing any new energy policies. That was not done before the Green Energy Act or the Smart Meter program. So costly.

6. The Ministry of Energy must stop issuing directives to the IESO. Consult with the IESO, LDC experts, energy technical experts as in the former OPA and engineering experts and let the IESO make the decisions. “But over the last decade, this power system planning process has essentially broken down and Ontario’s energy system has not had a technical plan in place for the last ten years. Operating outside the checks and balances of the legislated planning process, the Ministry of Energy has made a number of decisions about power generation that have resulted in significant costs to electricity consumers.” (P. 213, 2015 Annual Report of the Office of the Auditor General of Ontario, Electricity Power System Planning, Ministry of Energy, Chapter 3, Section 3.05) “We calculate that electricity consumers have had to pay $9.2 billion more for renewables than they would have paid under the previous program.” (P.214, 2015 Auditor’s Report) “In 2009, the Ministry directed the OPA to create a new guaranteed price program that offered significantly more attractive contract prices. At the same time the OPA had suggested to the Ministry to use a competitive procurement process but the Ministry decided against it.” (P.214, 2015 Auditor’s Report)  Now, there is finally competitive procurement for wind power contracts but the prices are not made known to the public.

7. The OEB’s mandate to oversee electricity prices must remain and not be taken away by the Ministry of Energy. As the Auditor stated in 2011, the renewable programs prior to 2009 were very successful but the gov’t offered outrageously high FIT prices, “two to ten times higher than those of conventional energy sources.” (P. 102, 2011 Auditor’s Report) “Although the OEB has historically been mandated to oversee and approve electricity prices, it has no role or legislative responsibility to review or approve FIT prices.” P,104, 2011 Auditor’s Report) In 2014, the auditor found that prices for wind were still twice the market price and three and a half times the market price for solar. (P. 214, 2015 Auditor’s Report)

8. Consult with all local distribution companies in Ontario prior to any changes. If that had been done prior to the Green Energy Act, we wouldn’t have these high electricity costs. They saw the pitfalls of it and knew the costs involved. (LTEP round table discussions 2013 in which I participated in St. Catharines and heard them)

9. Stop conservation programs.

10. The previous RES and RESOP programs that were very successful prior to the GEA, did not have an “additional contract payment” but the FIT program does and the LRPI still does. These generators are compensated for lost revenue as a result of curtailment. “Accordingly, electricity ratepayers still have to pay renewable energy developers even when those generators are not producing electricity during periods of curtailment.” (P.107, 2011 Auditor’s Report)

If the wind is blowing well and the sun is shining, our system first spills hydro-electric power, our cheapest energy source meanwhile paying high prices to wind generators. We even have to shut down nuclear reactors at times and compensate them and keep natural gas plants maintained and backing up wind power. If wind is curtailed, we still pay for their compensation.

11. Repeal the Green Energy and Economy Act. It’s putting ratepayers in poverty and killing our economy! More and more industries and businesses have closed or left the province to go where electricity prices are much cheaper.

12. Do not sell Hydro One.

13. Leave natural gas alone. Natural gas heats 75% of homes in Ontario. As Union Gas advertises: prices dropped about $50/yr on Jan.1, 2016. Heating your home and water with gas saves up to $3,000/year compared to using electricity, oil or propane. Homeowners pay the same price as Union Gas with no mark up. There are no expensive time of use rates for natural gas as there are for electricity. The use of natural gas for businesses strengthens the economy: it is reliable and affordable allowing businesses to thrive. It supports hundreds of thousands of direct and indirect jobs across the country. More businesses need access to natural gas. Ontario should continue assisting to provide more natural gas lines for agriculture, homes, businesses and industry. Do not put a carbon tax on natural gas.

14. Do not put carbon taxes on anything in Ontario. Electricity prices will increase again thanks to the carbon tax.

LTEP 2017 Discussion Guide Comments

1. P. 8 “For example, because Ontario’s electricity supply is largely emissions free, commitments in the Climate Change Action Plan foresee a switch from conventional fossil fuels to the use of electricity for heating and cooling buildings and powering transportation.”

You will not see people switching from conventional fossil fuels to heating with electricity because it is so costly. Give your head a shake! People will be switching from electricity to natural gas and propane to lower their costs.

2. P. 14 “Conservation and energy efficiency remain the most effective ways to manage electricity bills for all consumers. Shifting usage to off-peak periods can also reduce the strain on the electricity system and avoid or defer future system upgrades.”

Switching from electricity to natural gas or propane for heat would help manage their bills.

3. P. 15 The discussion Guide for the 2017 LTEP omits the fact that the Global Adjustment is a big part of the costs in the electricity line on residential and small businesses’ electricity bills. The Guide only says that Global Adjustment is a part of costs for industrial users. Not correct.

“…the electricity charge is made up of two components: the electricity market price and the Global Adjustment.” (Auditor’s 2014 Report, P. 377) The Glossary in the Discussion Guide for LTEP 2017 doesn’t even have Global Adjustment included.

I repeat: The Auditor wrote: “disclose the components of the TOU rates (electricity market price and Global Adjustment) separately on electricity bills so that the impact of the Global Adjustment is transparent to ratepayers.” (P.386, 2014 Annual Report of the Office of the Auditor General of Ontario, “Smart Metering Initiative”, Chapter 3, Ministry of Energy, Section 3.11)

Global Adjustment must be shown in a separate line on the electricity bill.

4. P.41 Questions for Consideration

a) What role should distributed renewable energy generation play in the ongoing modernization and transformation of Ontario’s electricity system?

It would be great if everyone could afford their own energy off the grid such as solar panels on the roof.

b) What strategies should Ontario pursue to harness the potential of its nuclear sector to meet its future energy needs?

Keep the nuclear fleet going and consider new build. It is reliable and great for baseload generation but wind and solar are not. It has provided 50% of our power for many years. Many jobs are involved in the nuclear industry, directly and indirectly.

c) What factors should Ontario focus on as it pursues opportunities for electricity trade agreements with nearby provinces and states?

Cost. Make sure Ontario’s ratepayers will not have increased costs. The bi-directional cables from Nanticoke to Pennsylvania on the floor of Lake Erie were not mentioned in the Guide. “ITC said it expects approvals to come in the second quarter of 2017, and construction would begin shortly thereafter. It could be fully operational by 2019.”

[Original Comment ID: 203289]