Wednesday, December 31, 2014

Electricity in Ontario as 2014 ends: high prices, demand destruction, and governance in decline

I ran my numbers earlier today to update my weekly shadow reporting page.  I expected the figures to be bad (they are), and this week I contributed to making them worse.

On average, each hour of the past week Ontario was exporting 2,827 megawatts more than it was importing.
That's a record for any week since the alleged market opened in 2002.

The weighted average Hourly Ontario Energy Price (HOEP) was $5.66/megawatt-hour (MWh), which is slightly over half a cent a kilowatt-hour and slightly under the charge Ontario's consumers pay to allegedly pay down an allegedly stranded debt.

The HOEP is calculated only on Ontario Demand. Weighting the hourly price to net exports indicates an average rate under $4/MWh over the just past week. The best price an Ontario electricity hostage rates is $77/MWh (7.7 cents/kWh). So the most optimistic presentation on the pricing of exports is that every hour Ontario's supply was sold outside the province for $206,000 less than captives of Ontario's regulated price plans paid for the same quantity of product.

One of the year's disappointments for me was the Ontario Energy Board's Market Surveillance Panel's rebuttal of statements from Parker Gallant. I can only assume the resolute imbecile willing to continue to numbers such as those from last week actually indicate a profit of $4/MWh on exports is first up for the next needless, yet lucrative, position.

Tuesday, December 16, 2014

November 2014 Sets another record—wind blows harder than ever!

By Parker Gallant and Scott Luft
[first appeared at Wind Concerns Ontario]

It was another “wow” month for the electricity sector in Ontario for November: power generation from wind set a new record of 879,000 megawatt hours (MWh). The cost for that production aloneadded over $108 million to ratepayer bills and coupled with curtailed wind production of over 70 thousand MWh cost ratepayers about $116 million dollars in a month that valued all generation at about $1.1 billion.2 

Wind made up 6.6% of total supply and represented 10.7% of what the market valued all generation at, but it also drives down the market rates which transfers costs to the smaller Ontario ratepayer. No small wonder why our electricity rates are continuing their relentless march upwards!

The Global Adjustment didn't set a new record as it did in October, but at $870.2 million it is the second highest on record, as is the $82.32/MWh class B rate. Coupled with the $16.49 HOEP (Hourly Ontario Energy Price), the “bare bones” price for the commodity will be 9.9 cents/kWh for most Ontario ratepayers. That price is before inclusion of all other nickel-and-dime charges such as regulatory, debt retirement, delivery, HST, etc.