Politicization of Ontario Energy Board not good for consumers

In an interesting note on his blog, Tom Adams argues that the politicization of the Ontario Energy Board by the McGuinty government has sacrificed the interests of consumers to political expediency:

The Green Energy Act moved the Ontario Energy Board further away from its once-clear mandate as a dedicated independent arbiter reconciling the interests of gas and electricity providers with the interests of consumers. The gold standard used to be rates that were just and reasonable. Instead, the Green Energy Act has pushed the OEB further towards being yet another puppet agency pushing prevailing government policy.

This legislative change, together with the government’s appointments practices in recent years, have weakened the Board. Other than the Chair and the one part-time member, only one member of the OEB is currently appointed to a term that extends beyond seven months from now. The lack of tenure security gives the government undue influence over the Board, something we don’t allow with our courts. 

Adams also questions whether the debt-strapped McGuinty government is changing the rules to pump up the value of Hydro One before privatizing it: 

About the time the deficit-addled McGuinty government started suggesting that it might privatize Hydro One, the Ontario Energy Board released a decision on the cost of capital, dramatically boosting your future electricity and gas rates and the profitability of utilities…

Could this decision have been influenced by the McGuinty’s government’s proposed privatization of Hydro One or a desire to bailout municipalities, who own most of Ontario’s electricity distribution utilities, without adding to the provincial deficit?

He discouragingly concludes: 

Facing the combined effects of renewing aging infrastructure and imprudent policy adventures, Ontario electricity consumers face a bleak outlook. If we are to strike a more reasonable balance for consumers, Ontario must rebuild the legal foundation of our energy utilities, re-establishing regulatory independence from government fiat. Utility regulators need the protection of long and firm terms of appointment. We can green our energy system without trashing consumers, but to achieve that balance, utility regulation must focus on rates and service quality while environmental regulators focus on issues like emission controls and habitat protection. The Green Energy Act is stuffing your power bill with hidden charges. The Act will blow over eventually, but it will leave a legacy of damage long after it is struck down. 

With the Green Energy Act in effect, Ontario is unlikely to be able to escape its have-not status any time soon.

 

MSM: Talking their book

Many reasons have been put forward as to why the mainstream media have largely presented a one-sided view of the global warming debate. But, new revelations in the UK suggest they may also have been talking their book:

STRIKING parallels between the BBC’s coverage of the global warming debate and the activities of its pension fund can be revealed today.

The corporation is under investigation after being inundated with complaints that its editorial coverage of climate change is biased in favour of those who say it is a man-made phenomenon.

The £8billion pension fund is likely to come under close scrutiny over its commitment to promote a low-carbon economy while struggling to reverse an estimated £2billion deficit.

Concerns are growing that BBC journalists and their bosses regard disputed scientific theory that climate change is caused by mankind as “mainstream” while huge sums of employees’ money is invested in companies whose success depends on the theory being widely accepted.

Despicable if true.

 

Our green future…

…is coming to this.

ht: Moose & Squirrel

 

With friends like these…

…it is beginning to look like the notion of catastrophic climate change is becoming a hard sell:

DUBAI — Al-Qaeda chief Osama bin Laden blamed industrial nations for global warming, and urged a boycott of the U.S. dollar to end “slavery,” in an audio tape aired by Al-Jazeera television on Friday.

“All industrial nations, mainly the big ones, are responsible for the crisis of global warming,” bin Laden said in the message attributed to him by the pan-Arab news channel based in Doha.

In an unusual message possibly timed to coincide with the World Economic Forum meeting in Davos, he warned of the impact of global warming by saying that “discussing climate change is not an intellectual luxury, but a reality.”

You’ll just have to take Osama Bin Laden’s word on this.

 

Green Tape

It never stops:

The SEC has been pressured to address the interpretation of its rules relating to climate change since 2007, when a coalition of state governments, institutional investors, and environmental groups petitioned the regulator to issue guidance on disclosing climate risk. Investors gained more traction on the issue when Mary Schapiro took over as SEC chairman a year ago, says Jim Coburn, senior manager of investor programs for environmental-advocacy group Ceres. “The new SEC leadership has been very interested in protecting investors and giving them better information,” he says.

Only 17% of companies made any reference to climate change or greenhouse-gas emissions in their annual report filed in 2009, according to a review of about 400 companies by law firm McGuireWoods. To be sure, not every company has material climate-change risk to disclose.

I don’t suppose all these climate-change disclosure advocates ever considered the possibility that corporations know what they are doing. What is the real risk to these corporations that needs disclosing: catastrophic climate change or governments doing something stupid to address it?

 

Ontario-Samsung deal: branch-plant redux

Gerson Lehrman Group provides an interesting assessment of Ontario’s $10 billion dollar deal with Samsung:

Ontario governments like to crow about how great this province is. The Samsung deal reflects a much different reality, a tacit admission that the best the Province is capable of is assembling things under careful supervision from foreign companies (Auto-Pact revisited.) To make it even more vivid, Samsung, which is a relative newcomer to the green energy business, has said it is looking to use expertise from its other heavy industry divisions, including its shipbuilding group, to establish itself as a major manufacturer of wind turbines!

 

[2.2] the deal had a familiar shape of a developing country “standard”. One partner was a successful international consortium with deep pockets and manufacturing expertise, the other a backward jurisdiction so hungry for jobs that it had to pay the big company what amounts to a bribe to do the deal. The whole thing was arranged directly with the jurisdiction’s leader without the bother of competition. It’s the kind of deal one might expect in the Third World, except that it was Ontario on the Third World side of the equation. But the worst is yet to come: 

[2.3]   there are numerous Ontario companies trying to get a foothold in the green energy business. After all, “wind turbines derived from the shipbuilding”, as was Samsung claim, don’t seem to be a rocket science métier.  If the government had cut a similar deal to support made-in-Ontario innovation, it could perhaps have been justified. Instead, it is slamming the door on these Ontario companies right in their own backyard.

 

“The Samsung deal is not just about manufacturing wind turbines,” said OEC spokesperson Paul Kahnert.”…It’s a private scheme to generate electricity at outrageous … rates -for years to come….” Kahnert said the province’s electrical utilities operators can buy, install and maintain made-in- Ontario windmills more cheaply without Samsung in the picture. The fact of the matter is therefore quite simple.  The Ontario Government has given away $7B of taxpayer’s money to offshore interests with NO assurance that Ontario society’s investment will create the promised jobs and economies of scale for alternative power generation.

Too true.

 

Wind business is electricity’s corn ethanol

According to Robert Bryce with John Stossel on Fox News:

The wind business…is the electricity sector’s equivalent of corn ethanol. It is a scam from beginning to end.

(at about the 6:30 mark).

ht: Allegheny Treasures

 

Smitherman sticks Ontario ratepayers with a $10 billion bill

Poor Brad Duguid. Three days into his new job as Minister of Energy and Infrastructure and he’s stuck with the blame for the $10 billion bill that his predecessor George Smitherman left behind for Ontario electricity ratepayers.

When government and industry talk about green energy, what they mean by green is the green stuff that will be going into the pockets of special corporate and government interests.

In a dramatic move yesterday, Ontario Premier Dalton McGuinty struck a green electricity deal — allegedly the biggest of its kind in the world — that will transmit a subsidy worth as much as $10-billion into the hands of a Korean state enterprise and corporate giant Samsung.

Green economics is a wonderful thing, except for consumers.

The subsidy means that over the next 25 years Ontario electricity users will pay 50% more for the wind and solar electricity produced under the Samsung deal than they would buying the same power from conventional sources. In return for the subsidy, the only thing the average consumer will receive is a warm and fuzzy feeling for having saved the planet from global warming.

With a start like this, it is going to be hard to live up to his name and “do good” for Ontarians.

But not to worry, the Toronto Star is in your corner spouting nonsense.

What’s not to like about a $7 billion investment that will bring four new manufacturing plants and 16,000 jobs to Ontario, as well as supplying 2,500 megawatts of clean energy?

Plenty, according to the provincial opposition parties.

The Conservatives dumped all over the agreement signed yesterday between the Ontario government and a Korean consortium that includes the giant Samsung corporation. They called it a “sweetheart deal” and “a massive multi-billion-dollar giveaway to a foreign-based conglomerate.” The New Democrats described it as a “backroom deal.” The Greens said it was “shocking.”

If this reaction sounds overwrought, it is. As Premier Dalton McGuinty pointed out yesterday, the Samsung agreement is similar to past deals that lured foreign investors to Ontario and away from competing American jurisdictions. As an example, he cited the subsidy to Toyota to put an auto assembly plant in Woodstock.

The aim, said McGuinty, is to make Ontario “the place to be for green energy manufacturing in North America,” and the Samsung deal provides the “critical mass” to achieve that goal.

The horse has already left the barn on this one. Such reactive,  interventionist, industrial policy is doomed to fail.  Assembling wind turbines and solar panels using foreign technology is not the way to prosperity. This is simply bad public policy.

 

Global cooling?

That’s one theory:

Britain’s big freeze is the start of a worldwide trend towards colder weather that seriously challenges global warming theories, eminent scientists claimed yesterday.

The world has entered a ‘cold mode’ which is likely to bring a global dip in temperatures which will last for 20 to 30 years, they say.

Summers and winters will all be cooler than in recent years, and the changes will mean that global warming will be ‘paused’ or even reversed, it was claimed.

Big chill: Scientists have claimed that the world has entered a ‘cold mode’ which could last three decades, a theory that challenges climate change

The predictions are based on an analysis of natural cycles in water temperatures in the Pacific and Atlantic oceans.

They are the work of respected climate scientists and not those routinely dismissed by environmentalists as ‘global warming deniers’.

Some experts believe these cycles – and not human pollution – can explain all the major changes in world temperatures in the 20th century.

 

The sh*t hits the turbine

It is only a matter of time before the reality of Smitherman’s and McGuinty’s green legerdemain becomes fully evident. While wholesale electricity costs have been going down, Ontario consumers’ electricity bills have been going up.

Ontario has a power problem.

A strategy to subsidize the province’s nascent green energy industry is starting to sting businesses and many households that find themselves paying the biggest markups on electricity pricing in the country.

Even as electricity demand — and market prices — dropped last year with the global economic downturn, electricity bills have risen steadily on the back of generous contracts signed by the province’s power planning agency. Now, the government of Premier Dalton McGuinty is preparing for a looming political backlash.

[...]

The government is sitting on a “political time bomb,” said Toronto energy lawyer Peter Murphy. “While renewable energy is a great thing for the environment, it’s also expensive.”

[...]

Ontario does not have the highest electricity costs on the continent, but it stands out for the gap between the market price of power and the price charged to consumers. Toronto ranked in the middle of the pack among North American cities, according to a study of consumer prices done by Hydro-Québec last April. But industry observers say prices will increase substantially in Ontario over the next two years as the cost of higher priced renewable energy flows through to consumers.