Time to Deep-Six the Green Energy Act Ontario CA

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Parker Gallant: Time to Deep-Six the Green Energy Act

Comments Email Twitter inShare0Parker Gallant Mar 3, 2011 – 2:22 PM ET | Last Updated: Mar 3, 2011 8:54 PM ET

The second round of large-scale renewable energy projects totalling 872 MW of new generation contracts was announced by the Ontario Power Authority (OPA) Feb. 24. These contracts included 215 MW of solar and 615 MW of wind renewable, which the Ontario ratepayers will subsidize at a cost (over existing wholesale prices) of $3.3-billion over the next 20 years.`

Let’s hope this is the last of Ontario’s extravagant installations under the Green Energy Act before the provincial election in Ontario. Whoever wins then—even the Liberals—will hopefully begin the process of dismantling the act.

When George Smitherman was Minister of Energy and Infrastructure he shepherded the Green Energy Act through the Ontario Legislature. Smitherman was also Deputy Premier and had the full support of Premier Dalton McGuinty, who had announced closure of coal-fired generation plants by 2007 as one of his 2003 campaign promises. That date was moved to 2014 amid concerns about a shortage of power before Ontario became a “have not” province.

The GEA was fashioned with the advice of environmentalists: Bruce Lourie, Brent Kopperson, Kristopher Stevens, Deborah Doncaster, David Suzuki, all founders of the Green Energy Act Alliance through their respective advocacy groups. The GEA envisaged a plethora of renewable energy to replace coal plants and provide clean air bragging rights for years to come.

Imbedded in the GEA were powers that superseded rights of municipal governments and created an “energy dictator.” The act stripped the Ontario Energy Board of its ability to regulate the sector in a balanced way and gave the minister the power to simply issue “directives” to the OPA, which had been created by the Liberals in 2004. The GEA gave the minister the following powers:

“The Minister may enter into such transactions, arrangements or agreements as are necessary to promote energy conservation and energy efficiency and the transactions, arrangements or agreements must conform to such requirements as may be prescribed.”

“The Minister may direct the OPA to undertake any request for proposal, any other form of procurement solicitation or any other initiative or activity that relates to … the procurement of electricity supply or capacity derived from renewable energy sources.”

“The Minister may, as part of a direction under subsection (4.1), specify that the OPA is to use a competitive or a non-competitive process as part of the initiative or activity” and

“… allow the Minister to specify the pricing or other economic factors to be used or achieved by the OPA.”

With those powers Smitherman and his successors used the embedded powers to sign a $7-billion contract with Samsung and ordered the OPA to create the FIT and MicroFIT programs. The FIT program led to a run to Ontario by investors seeking to cash in on over-market pricing. The FIT and MicroFIT programs took a big hit recently as McGuinty and three of his ministers tried to quietly back away from some of the more onerous aspects of the GEA. No offshore wind, due to a voter backlash, and mea culpas (via the OPA) to 1000 small solar investors due to technical problems on hooking up micro electricity providers a little breathing room for a reexamination.

Is it time to deep-six the GEA and give regulating power back to the OEB?

It would appear that the Conservatives are headed in that direction as its leader, Tim Hudak, declared himself in a radio interview with Steve Madely on Ottawa’s 580 News Talk. When questioned on wind and solar pricing by Madely he said: “I would eliminate these massive subsidies” and went on to say the Conservatives would “have a transparent, competitive process so you get the best technology at the best rates.” Hudak went further saying he would “restore the ability of local municipalities” to make the decisions on renewable energy projects slated for their municipalities.

Will economic reality in the energy portfolio override the green social policies that the GEA has created and finally get the McGuinty government to admit their mistakes?

Parker Gallant is a retired banker who looked at his electricity bills and didn’t like what he saw.

http://opinion.financialpost.com/2011/03/03/parker-gallant-time-to-deep-six-the-green-energy-act/

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What is being renewed with renewable energy?