Why power pricing is off the grid
By Lorrie Goldstein, Sr. Associate Editor Toronto Sun
I’ve been struggling to come up with two words to describe electricity pricing policies under Ontario Premier Dalton McGuinty. I think I’ve found them: Insane and misleading.
Insane because no government in its right mind would do what McGuinty is doing in the middle of a deep recession, which is to send electricity prices skyrocketing.
How? By (a) hiking prices 8% on July 1 under his Harmonized Sales Tax (b) pushing Ontario into a regional cap-and-trade market in carbon dioxide emissions with a handful of other provinces and U.S. states (c) yelling at Stephen Harper to get ahead of Barack Obama in creating a North American cap-and-trade market and (d) forcing us to subsidize expensive and (as yet) unreliable renewable energy under his new Green Energy Act.
All four of these initiatives amount to the same thing — putting new consumption taxes on electricity and sending prices through the roof in a province reeling from a multi-year, job-killing recession, which has gutted its manufacturing sector.
Worse, because electricity is used to create so many goods and services in an industrialized economy, these will in many ways be new taxes on everything.
That’s the insane part. The misleading part is the years of pledges by McGuinty and his energy ministers — the last of whom was George Smitherman, now running for Toronto mayor — that things like installing “smart meters” in millions of homes will save us money on our hydro bills.
No they won’t — at least not in the common sense way most people would interpret “saving” money to mean that, using smart meters, our bills will go down compared to what they were before we had them.
That’s not going to happen. All smart meters will do going forward is perhaps save us a (very) small amount of money (and the jury’s still out on that) on the far higher electricity prices we’re all going to be paying very soon.
Reporters describe a “gaffe” in politics as what happens when someone in government accidentally tells the truth.
That appeared to happen recently when an aide to interim Energy Minister Gerry Phillips, responding to a report by Sun Media’s Jonathan Jenkins that most Toronto Hydro customers are seeing their electricity bills increase following the installation of smart meters, noted: “The smart meters are more about creating awareness of energy use, rather than helping people to save money.”
Bingo! After years of double talk by McGuinty and Co. about saving money by doing our laundry at 3 a.m., somebody finally told the truth.
That is, the goal of smart meters and all kinds of other stuff being sold to us as ways of “conserving” energy and cutting our costs, has nothing to do with saving us money, for the simple reason that if you lower electricity prices, people use more of it.
The only way you get people to use less — and thus in McGuinty’s brave new world to emit less pollution and greenhouse gases —is to make electricity (and gasoline, also going up by 8% July 1) more expensive.
In a sane world, we’d be paying less for electricity now because the recession has blunted demand and when demand goes down and supply goes up, prices should fall.
That this isn’t happening indicates just how !@!@#$-up the system is. In fairness, that’s not all McGuinty’s fault.
Long before he came along, Conservative, Liberal and NDP governments let the old Ontario Hydro run amok, blew the budget on nuke plants like Darlington (for which we’re still paying) and botched regulation and privatization.
That’s why we’re in the mess we’re in now, which McGuinty is about to make a whole lot worse.