Renewables ‘Scapegoated’ for Ontario Power Rate Hikes, Study Shows
Wind, solar, and bioenergy production under Ontario’s Green Energy Act only accounts for about one-eighth of the electricity prices that have been hitting ratepayers’ pocketbooks and roiling the province’s politics ahead of an election scheduled for next year, according to analysis released last week by Toronto-based Environmental Defence.
In fact, a close look at ED’s numbers shows that, at a cost of $20 per household per month, renewables consume 12% of the power generation costs built into the average Ontario power bill and deliver 13% of the electricity, according to the supply mix reported by the province’s Independent Electricity System Operator. Nuclear represents the largest share of the cost, at 24%, followed by natural gas at 8%, hydro at 7%, wind at 6%, solar at 5%, conservation at 3%, and biogas at 1%.
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(Delivery costs account for 31% of the bill, and the full list of admin costs comes in at 48%—but those system-wide expenses would apply to any and all forms of electricity.)
“Renewable energy is being unfairly and inaccurately scapegoated,” writes Environmental Defence Programs Director Keith Brooks. “Yes, wind and solar power installations have grown significantly over the past decade and, today, Ontario has more installed solar generation than anywhere in North America save for California and Arizona. The province is a leader in wind power, too. Yet, these sources of power are currently only responsible for a small fraction of what we pay for electricity.”
Ontario’s electricity costs are in line with other provinces and “very low by European standards”, he adds. And ED weighs the $460-million annual premium Ontario pays for renewable energy, according to the provincial auditor-general, against $4.4 billion per year in avoided health and environmental costs resulting from the province’s coal phase-out.
That move “reduced GHG emissions by approximately 34 megatonnes, the equivalent of taking seven million cars off the road,” according to an Environmental Defence backgrounder. “The coal phase-out also caused a dramatic reduction of nitrous oxides, sulphur dioxide, mercury. and particulate matter, all of which are serious air pollutants that have adverse effects on health and the environment.”
On the horizon, ED notes that Ontario Power Generation is angling for an 180% increase in its nuclear rate to cover the cost of rebuilding the Darlington generating station. “Spoiler: Prices for wind and solar are falling, while prices for nukes are projected to rise,” Brooks writes. “Renewables will win the future on cost alone.”