‘Fair Hydro’ law merely kicks the can down the road

By MPP Toby Barrett

Ontario electricity rates are at all-time highs, in part, because the Ontario government has added $35 billion in generation costs since 2003.

The recently introduced Fair Hydro Act is the third attempt by this government to overhaul the electricity system since 2009. The first attempt, the Green Energy Act, is what brought us to this point.

Across Ontario we now have high prices, excess supply, diminishing demand, and over-priced contracts.

Case in point, the largest coal-fired generating station in North America, at Nanticoke, will soon be dismantled and replaced by solar panels. That means a 4,000 megawatt generating facility that produced electricity at 3 cents/kilowatt hour will be replaced by a 44-megawatt facility that will cost electricity users 15.67 cents/kilowatt hour. And the millions in municipal taxes, economic spinoff and 650 high paying jobs are now long gone.

Another example of out-of-control electricity would be this year’s Easter weekend – a very costly weekend for Ontarians at $78 million. Not only did government spend $28 million on the Thursday night before Good Friday to pay off a cancelled wind generator, but also government paid $50 million to balance the grid. Easter had variable weather – wind, sun, cloud, rain in repeating cycles – resulting in stop and go generation from wind and solar. When you have to be constantly peaking up gas plants to fill the gaps, you’re paying a price for that. As a result, Ontario paid $50 million for natural gas generated electricity when demand was the third-lowest in the province’s history.

The Fair Hydro Act is a fictional 25 per cent band-aid solution. This latest hydro scheme doesn’t help struggling families; it’s designed to help a party with struggling polling numbers.

A recently leaked cabinet document, says very clearly that because of their hydro plan, there will be a temporary 25 per cent decrease, but it will be matched—by a 61 per cent increase after the next election. So ratepayers get a temporary decrease and then a 61 per cent hit.

As Opposition leader Patrick Brown explained during Question Period: “This fair hydro plan is a borrowing plan: It kicks the can down the road. It does nothing on reining in executive salaries. It does nothing on these bad contracts. It does nothing on the water power spilling every day. It does nothing on the hydro we’re giving for free to Michigan, Pennsylvania, Ohio and New York. It’s not a plan; it’s a re-election gimmick. When will the government actually show us a hydro plan with hydro rates going down?”

Coming on the heels of the leaked cabinet document, we also learn from reports that the cost of the gas plant scandal more than doubles to over $3 billion. Ratepayers will be on the hook for an additional $1.56 billion to pay for the replacement gas plants in Sarnia and Napanee, in addition to the original $1.2 billion to cancel the plants in Oakville and Mississauga.

The present government has spent fifteen years driving up electricity costs. This proposed legislation stretches 15 years of mistakes over 30 years. It’s not fair – it does nothing to actually fix the underlying costs in the system that will still be there after the next election when the band-aid comes off.