Electricity rate hike shocker

Brad Duguid laughs as he sells out Ontario

by Lorrie Goldstien Toronto Sun
A 25% increase is just the start. Government plans to price carbon will drive bills ever higher

Bad enough energy experts predict the cost of electricity in Ontario is going to skyrocket by about 25% by the end of next year.

That’s scary in a time of high unemployment, frozen salaries, fixed incomes and a still shaky economic recovery.

What’s more frightening is this massive hike in electricity rates — which shows no signs of slowing down post-2011 — hasn’t yet factored in the cost of putting a price on carbon dioxide emissions, either directly through a carbon tax, or indirectly through cap-and-trade.

This, ostensibly, to fight climate change. Ostensibly, because cap-and-trade, the form of carbon pricing preferred by most Canadian politicians, including Premier Dalton McGuinty and Prime Minister Stephen Harper, has failed to lower greenhouse gas emissions in Europe.

Today, every time another price hike in electricity rates is announced, politicians like McGuinty and Energy Minister Brad Duguid, along with hydro officials, solemnly lecture us about the need to fight climate change. But most of these rate increases have nothing to do with that.

The two biggest hikes Ontarians face on their hydro bills at the moment are a 12% increase in the regulated electricity price approved by the Ontario Energy Board, which took effect May 1 and will raise rates to consumers by 8%-9.5%, plus another 8% hike July 1, when Ontario’s new Harmonized Sales Tax comes into effect.

The HST will also increase the price of gasoline by 8%, as well as the price of natural gas and oil used for home heating, which again has nothing to do with putting a price on carbon dioxide emissions.

Far from addressing climate change, our electricity rates are going through the roof mainly to generate more revenue for government, a better return on equity for utilities, to upgrade our aging electrical grid and pay off debt.

The only impact on climate change is a brutal and unfair one to consumers. It’s that at some point, which obviously varies from household to household, electricity becomes so expensive, people cut their consumption not for the sake of the environment or because they have a choice, but because they can’t afford to pay for the electricity they need.

That’s already happened in the U.K., where millions of households have been driven into “fuel poverty”, defined as paying more than 10% of income for home energy costs alone.

Ontario’s multi-billion-dollar subsidy of wind and solar power — which basically means forcing consumers to pay more than the market price for electricity — is just starting to kick into hydro rates and will have a major upward impact in future.

Presumably, this will lower greenhouse gas emissions, if that power is used to replace fossil fuel-generated electricity.

But unless the government puts a price on carbon dioxide emissions — thereby raising electricity prices even more — these subsidies make no economic sense over the long term.

All that will happen is renewable energy companies will happily gobble up these inflated government subsidies, which last about 20 years, until they run out, then close shop.

In order for wind and solar power to become major energy sources, economically viable over the long term, they have to become price competitive with fossil fuels.

The whole point of putting a price on carbon dioxide emissions, whether through a carbon tax or cap-and-trade, is to speed up this process, by raising the cost of fossil fuels.

Eventually, so the theory goes, breakthroughs in research and technology will make renewable energy less expensive and more reliable, to the point where it will one day replace fossil fuels as a major energy source, funded primarily by private investment.

Whether all of this will ever happen, or work according to plan, is anyone’s guess.

For now, McGuinty and Duguid need to tell people the truth. That is, most of the recent price hikes to electricity have nothing to do with fighting climate change.

If we want to do that, it’s going to cost us even more for electricity than we’re paying now (as well as for almost everything else), even with a 25% rate hike by the end of 2011.

As hard as that may be to believe. Or stomach.

lorrie.goldstein@sunmedia.ca

12 thoughts on “Electricity rate hike shocker

  1. Great article Lorrie, if this doesn’t wake people up I don’t know what will! This article should cause such an uproar that I almost want to look south out my window from Orillia and see if there is rioting in the streets of Toronto! We should be making ‘The Boston Tea Party’ look like childs play!

  2. It’s funny that only Lorrie Goldstein speaks out about these Ontario Liberal Government abuses…It seems like most of the left-wing press aside from a few journalists at the National Post are just brain-dead cheerleaders for the Ontario Liberal Government…

  3. Thank you Lorrie Goldstein for the critical investigative reporting you are doing and in supporting the poor tax paying slobs who are working their butts off to pay for this madness.

  4. very good article. yes johana, we are paying for this madness. but as u know most canadians are passive and don’t make waves. so when the next election comes along, i will work for any party that is not for wind and solar power.

  5. The Carbon Emissions Trading scheme is so virtually corrupt and riddled with criminal activity that it will make every payment from our pockets to Hydro One as “furthering the proceeds of organized crime!”

    We in essence will be contributing to the pockets of gangsters and we should all be arrested.

    Possibly also charged with “aiding and abetting” a criminal organization!

    If you don’t believe me then go to this link and read it fully……….even the link at the bottom…enough said!

    http://mvwind.10.forumer.com/viewtopic.php?t=2232

  6. I sent a letter to Ms Dombrowsky my MPP a month or so ago..
    quote…..

    Ms Dombrowsky..

    The Green Energy Act is wrong.. Signing a secret deal with Samsung is wrong..

    Now we read that Samsung is subject to giving bribes..

    http://business.timesonline.co.uk/tol/business/industry_sectors/technology/article3730708.ece

    quote from that link.. above..

    “The inquiry follows allegations by one of Samsung’s own legal team that the company had created a 200 billion won slush fund used for bribing government officials – an accusation denied by Mr Lee and the Samsung Group.”

    I ask you Ms Dumbrowsky.. How can you be a party to this?

    Jacqueline Allan

    I got a regular mail reply from her…telling me she was forwarding my email to Brad Duguid.. asking him to reply to me.. and maybe comment on what I was suggesting..or infering..

    Nothing yet.. I do not think she liked me linking Samsung and bribary etc etc..

    I wish papers and TV here in Canada reported the actual news..

  7. Way to go, Jackie. The more we make them know that WE KNOW and put the pressure on…the better. So far, they’ve gotten away with murder without the media or public questioning a thing.

  8. Lee Kun-Hee, Chairman of Samsung was convicted of Bribery charges in Korea and given a 3 year prison sentence. He was then given a suspended sentence but had to pay a 109 million dollar fine.

    He was given the suspended sentence I suppose so that Samsung could continue doing business in the World.

    Of course look who embraces this ex con?……..McGuinty!

    And who pays for it?…..US!..how’s that for making our tax dollars work for US!

    See: http://mvwind.10.forumer.com/viewtopic.php?t=2236

  9. Lorrie Goldstien is doing a great job in providing some of the consequences of these wind transactions that are only for the good of a few greedy men that laugh all the way to the bank with our money. The 25% increase is just the start as Lorrie points out, but the implications are not only higher electricity bills. Increases will be necessary for any consumer products requiring electricity to process, store and sell. The electricity bill we get is the least of our worries, it will be the increased cost for frozen goods or climate controlled environments that let us have apples all year. Consumer goods in stores, Pumping gasoline will even cost more. Apartments with utilities included in the rent will have to increase the rent to cover these increases. Call it a tax or the price of doing business but don’t call it necessary. The ability to produce cheaper, reliable energy will always be required and is already available. There is no need for industrial wind turbines anywhere.

  10. Lorrie Goldstien is doing a great job. Most of the rest of the MSM have their collective heads in an unmentionable place.

    I am shocked that there is so little investigative journalism these days.

    A decade ago the manager of Canada’s second largest business magazine told me that his reporters were lazy –that most of his material was just worked over press releases. He must have noticed my look of disbelief — he got the latest issue and a stack of press releases and waited till I was done. Then he handed me his only serious competitors magazine. …mostly press releases. I guess it’s called “investigation” now if you read it as you type it in….

    Maybe we should be sending press releases — see if the health point of view gets published. Maybe we can send a press release pointing out that the Wind Power has to be duplicated by something else…

    Also — hats off to the small town newspapers. Clearly they are on the forefront of investigative journalism. They put the big city newspapers to shame,

    Hats off to Owen Sound, and Windsor and….

  11. congrats Lorrie… Its about time the truth was told.
    At the rate the Liberals are going, they will soon have not only ontario bankrupt but everyone living in Ontario…This is sad to say the least.

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