Response to Comments on Power Dumping

It was an honour to work with Parker Gallant on “Ontario's Power Trip: Power dumping.”  I wanted to follow-up on some of the comments now attached to the article.  I don't do this necessarily as a response to the commentators, but some of the arguments recur frequently in government and ENGO releases, so I have worked on some responses.

Ontario’s Power Trip: Power dumping

The article,by Parker Gallant and myself, first appeared in the Financial Post

During the spring months in Ontario, the winds blow a lot. For companies in the wind-power business, that’s good news. For the province’s electricity consumers, though, it’s another financial disaster that, on an annual basis, drains up to $400-million out of consumers’ pockets. But that money doesn’t directly fund green electricity for Ontarians who pay for it. Instead, the bulk of wind power is essentially surplus power that is exported to the United States and out of province at rock-bottom prices. Ontarians are paying $135 for units of power that are dumped on the export market at prices as low as $20. Sometimes, Ontario has to pay other jurisdictions to take the surplus off its hands.

This past May, Ontario’s wind producers generated 284,000 megawatt hours (MWh) of electricity. For each MWh, the producers collected $135, for a total of $38-million. That money is paid out of the churning slush fund that is now the Ontario electric power system. The system, through its byzantine structures, sold that same power into the electricity market at market prices. The average market price for electricity in May was about $25 a MWh. Wind power, however, rarely gets even the average price.

Because wind often blows when power is not needed, and the Ontario government has mandated wind, the Ontario power system is stuck with surplus power that has to be unloaded, at whatever the market will bear, which is usually below average market prices.

The Fog Around Emissions From Electricity Generation

I've been mulling over tackling this topic since the ENGO's launched a campaign, to support the Green Energy Act and related FIT lotteries, built around implications of increasingly large heath costs due to the use of coal plants - despite a 90% reduction in the use of those coal plants. Recently there's been a great deal of news related to the points I thought were pertinent, the primary one being that if pollutants from electricity generation are decreasing, and respiratory problems are increasing, you should probably look at other urban issues,

Pembina is an Oilfield

An article in the Toronto Star, Don't blame green power: Energy bills rising anyway, alerted me to the latest marketing pitch from the Pembina Institute. Behind the Swithch, Pricing Ontario Electricity Options is the latest propaganda release. It claims to consider 2 scenarios: in one Ontario's Green Energy Act (rumoured to have been penned by a cabal including Pembina) continues to gut Ontario, and an allegedly worse one where the the legislation is dismantled and somehow a greater reliance on fossil fuels is the outcome. They then make some bad assumptions which serve to deceive Ontario about the impacts, on pricing, the scenarios are expected to have.

Ontario's Electricity System Halfway into 2011

Ontario's electricity sector experienced more of the same during the first half of the year - which continues to betray the ongoing mistakes of the government and the Ontario Power Authority (OPA).

The headline figures for the first half the year, when June's numbers are finalized in a couple of weeks, should be anemic demand growth accompanied by inflation in pricing of almost 10%. But the same headlines should have been written one year ago. Instead, Ontario's residents continue to be subjected to errant implications an insatiable appetite for ever more electricity is driving the price hikes.