Ontario expects rates to drop for green power

By Susan Taylor, Reuters

The Canadian province of Ontario is expected to reduce the rich rates it pays for green energy next year, but the government will introduce changes in a way that continues to support investment in clean power sources, the minister of energy told Reuters on Wednesday.

“I think most in the industry would expect that the rates will likely go down, but we’re confident we’ll do that in a way that maintains confidence in the investment climate in Ontario,” Brad Duguid said in an interview.

Canada’s most populous province launched an incentive program for renewable energy producers last year, aiming to create jobs and eliminate coal-fired power generators.

On Tuesday it expanded on its green energy program by outlining a 20-year plan that will emphasize nuclear power, renewable energy, and conservation, but will also see a doubling of electricity rates over that period.

Feed-in tariffs introduced in October 2009 offer above-market prices to producers of energy from renewable sources like the sun and wind. They are the richest and most comprehensive in North America and follow similar programs in Europe.

It is expected that any rate changes would be discussed and made in consultation with an industry group, similar to a group formed this summer when the province said it wanted to cut the rate for small ground-mounted solar projects, Duguid’s spokesman said.

Tariff rates are reviewed every two years by the province, a process that starts in 2011 and will conclude by the autumn, Duguid said.

Japan complained to the World Trade Organization in September that Ontario’s Green Energy Act and its local procurement requirements represent a “prohibited subsidy.”

Duguid said WTO talks are currently under way, so he could not comment on progress or provide any details.

NUCLEAR “CLOUDS TO CLEAR”

Under the 20-year plan announced on Tuesday, Ontario committed C$87 billion ($86.1 billion) to meet its future energy needs and lower greenhouse gas emissions.

It plans to buy two nuclear reactors and refurbish 10 others, while investing in new wind, solar, hydroelectric, and biomass power. Coal power will be eliminated by 2014.

Critics say Ontario is significantly underestimating nuclear expansion costs, throwing into doubt the province’s forecast of a 3.5 percent annual electricity rate increase over the next 20 years.

The federal government’s plan to sell its troubled nuclear technology agency, Atomic Energy of Canada Ltd, from which Ontario planned to buy the two reactors, raises further questions.

“There’s no question that the federal government’s decision to put AECL up for sale was problematic for us in the middle of our procurement process,” said Duguid.

“We’re eagerly awaiting for the clouds to clear around AECL. We expect that will be soon, and when that takes place we will determine where we go from there in our efforts to purchase two new units, and ensure that we do so at a fair price.”

The province will spend about C$33 billion on nuclear power, which represents the “best possible estimates” currently available, Duguid said.

Nuclear power will continue to make up around half the province’s power supply, while renewable energy sources will increase to about 13 percent in 2018 from 3 percent today.

“The 10,700 megawatts of renewable energy that we plan to have online by 2018 is a target; we could ultimately end up with more,” Duguid said.

18 thoughts on “Ontario expects rates to drop for green power

  1. Our local evening news featured an article on how people can save energy by wraping up in a blanket while at home or wearing heavy sweaters.

    So the MSM hard sell for reducing our standard of living has begun. Do these newscasters have any idea of how many people used to die from cold related issues ~ 100 years ago? Cold homes are very hard on young children and the elderly.

    All in the cause of saving planet earth!

  2. “It is expected that any rate changes would be discussed and made in consultation with an industry group, similar to a group formed this summer when the province said it wanted to cut the rate for small ground-mounted solar projects, Duguid’s spokesman said.”

    “Weasel words” like this is exactly what one would suspect from people who “hide” behind Pink Walls that invite Lobbyists and NGO’s inside while not able to gather the courage to talk to one single CITIZEN who is being harmed and having their home destroyed by these decisions!

    The word “gutless” comes to mind but then that’s not “Politically Correct” is it?

  3. Dugiud, the man with a bad plan. Ontario, our lands are for the taking by Duguid. He doesn’t believe that we should be the caretakers of our communities. Our resources and livelihoods are his to sell.

  4. Barbara:

    “Our local evening news featured an article on how people can save energy by wrapping up in a blanket while at home or wearing heavy sweaters. ”

    Those who don’t remember history…

    During the NEP (National Energy Plan) crisis — Trudeau was recommending sweaters. At least you can walk around in a sweater. The blanket might cause you to trip. Should you use a blanket and trip I suggest you sue the station, the reporter and McGuinty — and why not all the recent five energy ministers.

    But, Relax. They are simply showing their level of understanding of Global Warming and the Energy Crisis. (We do have a electricity generation shortage don’t we?) Hope that the less educated media reporters go no further — if McGuinty starts listening to them he will start importing oil soaked ducks from the tar sands to ignite underneath wind turbines in an effort to prevent icing of the blades.

    Was the station a CTV affiliate? They are famous for those gaffs…

    You can’t make this stuff up!

  5. Was CBC. Of course they also threw in the saving GHG emissions.

    People who lived in cold houses often developed what were known as chill blains in their legs,feet and hands. The house does not have to be that cold to cause this condition during the winter months.

    In order to pay for green energy in Ontario people will have to reduce their standard of living. Dare say most people aren’t even aware of this fact yet.

  6. These news releases sound to me like after all the Green Energy crows of Ontario is following the outlines of the leaked Susses “Renewable Energy Matters-Campagn Outline” report. Read it to know what is coming next. Playing down the price of renewables and tryingto lull people into a false sense of security by promising compromises — remember all their lies to date when you mark your ballot at election time!

  7. This is just a ploy to shore up investor confidence in Ontario continuing it’s support for wind turbines and solar panels. Once investors lose confidence that Ontario can continue with these alternative energy projects the green energy game is over.

    By now these energy investors must be aware that there is mounting opposition to green energy projects in Ontario. No longer a safe investment for them?

  8. The Ontario government is working hard to keep up the illusion as they have a lot to loose. Company donations to the Liberals depend on investors investing in these schemes. When that stops so do the donations. Not having a chance of getting voted in next election should see donations go elsewhere as well. Double whammy.

  9. Well for all those living in la la land, I already sleep in a 3 season trailer with the night time temperature set for 48 C, saved by a – 7 C sleeping bag with an overlay of 2 comforters.

    In order to put my mind in a frame that allows me to relax and get a restorative sleep, I imagine myself to be a part of an Antarctic expeditionary group trying to find the cause of global warming and therefore the need for Industrial Wind Turbines to generate electricity and reduce GHG. Some times though, the windproof tent shelters do get a bit restrictive.

    This noble cause sustains me in the daily challenges our group faces.

    I look forward to seeing you all again under more civilized conditions.

  10. This whole Wind Agenda is beginning to sound like a really bad “Horror Novel” that just never ends…………….

    I believe we are going into one of the darkest periods of our modern history at the hands of a very demented and evil Leadership!

  11. The German SOLAR Model – ya, danke. 18-19% of total electricity coming from renewables now with solar pv rooftop about 6% of this (I believe).

    Perhaps 200,000 solar rooftops there from what I hear from German solar business people I know who are here to do business. First thing they told me was “wow, you guys sure waste a lot of energy here (part 1 of the GEA conservation of 10,000MW) hint, hint.

    Whats the impact at 80.2cts kwh in the residential sector?

    There’s 22,000 microFIT apps in now and about 13000 conditional offers given, with only 1500-1800 installed max.

    The Government has a goal of 100,000 rooftops. (commercial and resi).

    IE. 10,000 residential rooftops with 5kW solar each. (about 25 panels)
    Thats 50 MW, a mere “fly on the Titanic’s first class railing” vs the 35000MW total electricity pie. (only first class can afford solar panels fyi)

    On the buy side at $7000 /kw installed thats $350 MILLION to buy 50MW.
    About 20% is for labour to install, 50% for panels and 30% for inverters, racking, cabling etc.

    So right away there’s $70MM going into local economy’s across Ontario- mainly to FIT young males who will be “up on the roof”. (Hopefully they’ll be careful screwing in the racking lag bolts directly into the rafters and not through the plywood, creating a hole). (tip, insist on a “perforation penalty of $250 per hole and take photos in your attic)

    The “green” rate payers will collectively be on the hook for 20 yrs:

    10,000 rooftops of 5kW each is 50MW, or 50000kW of solar PV capacity and will generate about 60,000,000 kilowatt hours per year in Ontario.

    1kW of solar produces 1200 Kwh /yr x 80.2cts= $962./yr x 20 yrs=$19,248.

    50000kW = $48,000,000 in year 1 that OPA will have to pay owners.
    x 20 yr OPA contract = $960,000,000 contractually owed to solar producers by the 4.5 million existing rate payers. (and OPA can’t renege on rate contracts).

    So 100,000 rooftops would be $9.6BILLION over 20 yrs. at the existing microFIT rate of 80.2cts /kWhour.

    Germany has created 50% of the world’s solar PV industry. It’s at crtical mass, some companies are in the $250MM to 1BILLION range. BOSCH is now in solar PV, etc. BUT, they are doing this on a country scale and have much higher energy cost and supply risk. (they are also more sustainable citizens).

    OPA microFIT application bottlenecks:

    Unfortunately the reality at the installer level is a bit bleaker right now. There are 150 solar installers across Ontario. Some are electrical contractors, HVAC guys and many NEW companies less than 12 months old.

    They need 3-5 $25k Solar SALES PER MONTH to break even and employ the minimal 4-5 staff to service clients. 90% of all installers have less than 8-10 sales TOTAL since last year when microFIT started. A very few have more than 10.

    These companies are insolvent and have NO way of closing sales unless the OPA issues conditional offers to consumers. The backlog now is 3 months, 10,000 apps.

    Yet, they are asking consumers for deposits of up to 50% of the total solar installation to “pay for panels etc”. (ie. $5-20k). (yeah they need to EAT as Kevin O’Leary would say).

    Consumers who pay installers deposits are at great risk of seeing these companies slip into bankruptcy and monies that should have gone to panel distributors etc, will be lost. INSIST on a TRUST ESCROW ACCOUNT with your local lawyer so that the panels and hardware are at least purchased for YOUR install. OR find out WHO their suppliers are (hopefully a large disti/mfgr.) and make sure your deposit goes to them. CANSIA should set this TRUST fund up so consumers can relax about these COMPLEX purchases which are second to the house itself in total dollars spent.

    If the OPA really wanted to create LOCAL jobs and new business, they would have figured this out 2 years ago (MBA anyone) and HIRED 10 more clerks to process microFIT applications which at 10kW and less, simple installs and connections for the LDC to figure out.

    If the Gov wants to play solar biz market maker and attend Samsung, IKEA, LOBLAW’s cocktail parties then they gotta take care of the “little people” or else they’ll be sent home to wash their tights after the next election.

    regards,

    Stuart Armstrong

  12. Maybe I’m living in la la land too when I describe the sleeping bag as being designed for – 7 C then change to indoor temp and forget that I’m using a Fahrenheit reading!

    Quell horreur!

  13. And to drive home Lynnes point…

    NOTE THE DATE!

    *********************************

    http://www.juandemariana.org/repercusion/3455/green/stimulus/money/costs/more/

    13/04/2009 – CNSNews

    Every “green job” created with government money in Spain over the last eight years came at the cost of 2.2 regular jobs, and only one in 10 of the newly created green jobs became a permanent job, says a new study released this month. The study draws parallels with the green jobs programs of the Obama administration.

    President Obama, in fact, has used Spain’s green initiative as a blueprint for how the United States should use federal funds to stimulate the economy. Obama’s economic stimulus package,which Congress passed in February, allocates billions of dollars to the green jobs industry.

    But the author of the study, Dr. Gabriel Calzada, an economics professor at Juan Carlos University in Madrid, said the United States should expect results similar to those in Spain:

    “Spain’s experience (cited by President Obama as a model) reveals with high confidence, by two different methods, that the U.S. should expect a loss of at least 2.2 jobs on average, or about 9 jobs lost for every 4 created, to which we have to add those jobs that non-subsidized investments with the same resources would have created,” wrote Calzada in his report: Study of the Effects on Employment of Public Aid to Renewable Energy Sources.

    Obama repeatedly has said that the United States should look to Spain as an example of a country that has successfully applied federal money to green initiatives in order to stimulate its economy.

    ************************

    This was known before the GEA was enacted.

  14. We got Global warming-babble, green energy babble, Dalton babble and Brad Du-No-Guid babble

    Oh, sorry, that would be one-and the-same babble!

    A fine state of affairs!

    Oh, BTW, this was not the first cut Spain has made to her green energy subsidies…
    Pretty sure the cuts began in earnest shortly after the program started. Spain has been hurting for a while now, getting worse by the minute.

    See my previous post today on the rapidly deteriorating global situation…

    B.B.W.

  15. The true economic value of wind and solar power is the cost of the coal or natural gas it displaces. This is a tiny fraction of of market prices, maybe 2 or 3 cents /kwh.
    At times when wind and solar output pushes generation above provincial demand and we have to export it at spot market prices, which are very low; sometimes negative.
    As in Denmark where they essentially donate surplus wind energy to Sweden and Norway, we essentially donate very high cost energy to the US.
    Spain got the message and are slashing wind and solar subsidies.
    But McGuinty refuses to look at the European economic disaster and is following the example in Spain, which is teetering on the brink of economic collapse.

  16. McGee…

    “The true economic value of wind and solar power is the cost of the coal or natural gas it displaces.”

    Have you been sleeping for the last twenty years or so?

    Wind and solar don’t (can’t) actually “displace” ANY other form of electrical generation.

    In fact the absolute best humanity has ever done in this regard is currently in the Falkland Islands.

    They have 18% grid capacity in wind AND their wind turbines have massive battery backup. Total fuel saved: 3%! It goes down from there for the rest of the world sometimes in to the negative numbers.
    Just ask Denmark!

    B.B.W.

Comments are closed.