By Randall Denley, Ottawa Citizen
Have you heard about the taxpayers’ brilliant plan to screw the electricity consumers?
It’s a bit complicated, but here are the steps. First the taxpayers, represented by the Ontario government, create a plan to buy solar electricity at up to 10 times the normal price of power.
Then the taxpayers at the City of Ottawa move to cash in. They turn to the taxpayer-owned Hydro Ottawa to rent taxpayer-owned roofs to the taxpayer-owned power company, netting up to $250,000 a year in leasing fees, all paid by the electricity consumers.
That’s free money, and the best part is that the taxpayers don’t have to put up a cent. Sure, it will cost $32 million to put the solar panels in place, but that’s not taxpayers’ money. That’s power consumers’ money, paid to Hydro Ottawa.
The taxpayers are gouging the power consumers, and using their own money to do it.
That’s as brilliant as solar power on a sunny day.
The only flaw in the whole scheme is that the taxpayers and the power users are essentially the same people. Most people wouldn’t borrow money to enable themselves to pay more for something, but that’s exactly what the city’s plan entails.
What’s next? Are we going to buy a chain of gas stations and charge ourselves $10 a litre so we can make a killing?
This issue goes to the city’s new environment committee next week and the way it has been framed, it’s bound to pass.
The city gets to do something people think is green, and it makes money, too.
What’s wrong with that?
The short answer is plenty. This project is expensive, of limited environmental and power-generating value and it contributes to the inflation of provincial power rates.
Sure, the McGuinty government has created a pricing regime that lets companies create uneconomical electricity and stick consumers with the bill, but why would a consumer-owned power company do that to its own customers?
Solar power under the provincial program is so expensive that Hydro Ottawa will still net a 12-to 15-percent return on your money, after taxes. It’s a fantastic guaranteed return and some of it will trickle back to the city through the Hydro Ottawa dividend. Pity that you have to pay higher power rates to get it.
Solar power is a wonderful concept and it will be a great thing when it becomes efficient and inexpensive enough to power your house at a rate that’s at least similar to other power sources.
That’s hardly the case today. The capital costs of solar are high and it doesn’t produce much electricity. The city says its rooftop plan can power 300 homes. That’s a puny number for a $32-million capital investment, and one of the reasons is that solar panels produce only about 15 per cent of their nominal power output. They’re dandy on a sunny day in the summer, not so useful at night or in the short days of the winter.
Solar rooftop power generates little electricity because rooftops can’t hold many panels. To have any real impact, solar requires a lot of real estate and a huge numbers of panels. The city has already approved a “solar park” at the Trail Road landfill that will occupy 48.5 hectares and cost about $60 million to set up. That one will power 1,500 homes.
In all, it’s a lot of money for a little power, and the environmental impacts are oversold, too. Ontario’s power is already pretty green. On a typical January day, three-quarters of our power is hydroelectric or nuclear. Replacing a teeny-tiny amount of that with solar will make no consequential difference to the big environmental picture.
There are a couple of points in favour of the solar power plan. Solar at least produces its power during peak daytime hours. One might also argue that if we weren’t getting into the game through Hydro Ottawa, some other outfit would be building the solar and gouging us. Is that worth $92 million in public investment?
The real reason for the high solar power prices is to create jobs in the renewable energy sector, but the provincial solar energy program might well be counterproductive. If Ontario wants to encourage commercially-viable solar power, it won’t do so by offering an inflated rate and guaranteeing it for 20 years. Once these solar money generators are in place, what’s the incentive to innovate and drive down the cost of solar?
It will be interesting to see if councillors can figure any of this out. Mayor Jim Watson favours the plan. A spokesman says Watson regards it as “a significant opportunity to secure new revenues for the municipality.”
One might say it’s a way to take money our of your pocket without having to raise taxes to do it.