Monday, 19 September 2011

Green Energy in Ontario – Cutting Through the Convoluted Smog of Political Promises

If "our families" found out what this was costing, this is what a 2011 version of calvary hill would look like

Kitchener is not Shelburne or Essex, where the clash between citizens and the Liberal government over green energy is visible to all on roadside signs. But as an Ontario community, it figures into the same plan the Liberal government has made a central plank: The Green Energy Act. Sure, one will not encounter any “Stop The Wind Turbines” signs here. And the City of Kitchener website touts the town's green credentials by showcasing the new Kitchener Operations Facility and its 600 kW photovoltaic rooftop solar installation, the largest in Canada. People who have lived here long enough also remember that the city spawned the first ever blue box recycling program, in 1981. But is “being green” as simple as accepting the Liberal government's legislation and plans at face value?

If you haven't driven through the countryside of Southern Ontario this summer to see the places this is making waves for yourself, a “wind turbines Ontario” Google search will reveal an animated conversation surrounding this issue. There are alarming anecdotes of billions of dollars wasted. Studies ignored. Barely 30% of the power getting used, and New York State being paid to take it off of our hands. Multinational corporations being paid 80 cents a kilowatt hour, when the market rate is 6 to 9.5 cents on your hydro bill in Southern Ontario. How do we navigate and verify this information? What is it about green energy which inspires passion for some, while most of us haven't a clue what's at stake?

Green energy comes from wind turbines and solar panel installations, both large ones built with public-private partnerships and small ones built on peoples' properties. Once they are up and running, the government pays an incentive (a fee) to compensate the property owner or enterprise whose land they are on. This is called the Feed-in Tariff (FIT) program. So we pay 6 to 9.5 cents per Kilowatt hour, for regular electricity generated by coal, hydro, or uranium (nuclear), and “green electricity” is subsidized by the government so the producers of it earn up to 80 cents per kilowatt hour.

Now here's the crazy part. Someone with a windmill or solar panels could be generating their own electricity for themselves. But to qualify for that subsidy, the power has to go back (be fed in) to the grid. And more often than not, it doesn't get used. Only 30% of the electricity generated by wind actually gets used in Ontario. Technology to store and move the energy around as is done now with hydro, coal and uranium is not off the ground.

So why are we doing this?

The government will tell you why in a heartbeat: creating jobs, reducing our dependence on “dirty” energy, and being a world leader in a new industry. Win, win, win. But a lot of people find their hydro bills suddenly high, and it appears the opposition parties sense their electoral fortunes will greatly improve if they can demonstrate that it's due to these policies. They'd be right and they'd be, well, oversimplifying. Despite the complexity of this Green Energy program and the public's general disengagement from it, there are some concrete problems it's trying to address. Coal-related pollution is said to cause hundreds, if not thousands of deaths each year in Ontario. And the upgrades just to meet existing demand and maintain our nuclear fleet as is are in the tens of billions, not counting increased future demand. What do you believe, and who do you believe? Clearly, there are issues with our current energy system, so at the very least government should get points for effort for trying to address it. But I'm not going to leave it there and take their word for it.

When I started researching, I only understood green energy in vague terms. Going out to talk to some Kitchener Centre residents, I found out it was the same for them. While they may have been supportive of environmentalism and “clean” energy in general, they could not explain how this program actually works, and whether or not the energy is being used. That's a concern in a city and province three weeks away from an election in which this issue is a main one. Energy is already more expensive, everywhere, all the time, and Ontarians are not world-renowned for their conservation habits. Nobody should take for granted that green energy will solve all this; on the contrary, the current arrangement deserves scrutiny so voters can understand what it's all about. It's their money, their energy, and their future. So I hit the streets of Kitchener Centre to find out more about what people thought about green energy.

Local resident Connie said “Green energy's important because the environment it self’s only got so many resources to work with.”

Is she supportive of it right now under the current regime?

“It's a start. I don't know if its actually where we need to be, but its a start.”

I asked if she had a good understanding of how it fits in with “conventional” sources of energy.

“Not completely – I know we're trying to be environmentally conscious” She didn't know if all the “clean” or “renewable” energy gets used.

I then asked Jordan, another voter, if he was supportive of green energy. “A little bit...I'd like to be more, but I don't know if there's enough of it out there.” I asked him if he was supportive of the current green energy policy. He said hesitantly said “yes”, and when I asked him if he thought it all got used, he said he didn't know.

The voter has to assume that the intention is for future clean energy to make up a significant proportion of energy consumed in this province, rather than the token amount it currently provides. It's hard not to favour using already-blowing wind to power turbines to generate electricity over, say, enriching uranium or burning coal, if only the choice were that simple. But what to do with this inconvenient truth (and one of the main arguments of Wind Concerns Ontario and other anti-wind activists) that only about a third of the power generated can be used because the technology does not exist to store and transport it?

I asked Liberal Cabinet Minister John Milloy, who is running for re-election in Kitchener Centre, if the government planned to improve this low conversion rate. He didn't comment directly on wind, but told me: “Technologies are developing. The solar (industry) is working on new ways to (move the panels around to) allow more of the energy to be captured.” He jokingly referred to himself as an “old guy, who remembers when a calculator was a major purchase for a household, and when laptop computers cost 5 or $10,000” In other words, the laptop computer I am writing this article on is much more powerful than a million dollar computer the size of this room from thirty years ago. The government is taking a gamble that the same trend will materialise in the green energy industry, and hopes it will pay off in the form of jobs and more environmentally friendly electricity. A big risk which could pay off, but could just as easily prove costly because of its size – big. I gathered as much when he said “The fact is we need to kick-start this that there's a market for it. People are going to start to invest and we need to incent development”

I then asked Mr. Milloy what the government's long term plan was for subsidising rates and when we could expect it to end, or basically have green energy available to be purchased at current market rates.

He explained to me that to produce this energy, “(We) negotiate iron clad contracts with individuals and companies. The first group in (right now) is paid at high rates. Every few years, rates are reviewed and the curve will start to go down.” He stated to me that “future contracts will not be as generous, because as costs go down, competition goes up. Of course the government wants to reduce the prices, he said, but the first priority is "to incent the activity...And to be crystal clear,” he concluded, “if you've signed a contract, you're guaranteed that rate.”

Through these subsidies, the government provided an attractive environment to operate in and convinced farmers or rural dwellers or companies that green energy projects were a worthwhile investment. The subsidies may seem extreme and possibly wasteful; coupling them with the problem executing green energy projects because we lack the ability to absorb energy that generates in unpredictable amounts and at erratic intervals leaves me wondering how supportive a fully aware electorate would be.

With that, I sought responses from the opposition candidates hoping to succeed Mr. Milloy on what needed to change with current green energy policy, starting with Kitchener Centre NDP candidate Cameron Dearlove:

“I think the main difference in our policy is that we believe we could build it ourselves and do so in a more cost-effective way. So I think if you look at the Green Energy Act, we really like it, especially for small scale producers, farmers, people that want to put solar panels on their property...we're all for that. The problem that we see is when we provide rates that are so high to large-scale producers who don't give as much local control to people as we would like. Also we have to consider that if its so lucrative for these companies who are coming in here and doing this...we could do it ourselves. Build it ourselves, for a lower price, and actually then build more...using the same amount of money.”

It seemed like he was supportive of the concept but questioned the opacity and the top-down directive nature of the government's dealings. There is also the multibillion dollar, no-bid contract that was granted to Samsung behind closed doors that is indirectly addressed in his comment. All the opposition parties are jumping on because of its terrible optics. I also asked Green Party Candidate Mark Vercourteren what he thought about all this unused power that was (pardon the pun) blowin' in the wind. He told me:

“There's a plan to make a smart grid where the idea is the energy would go to the closest place and then go farther and away. Places like Northern Ontario...get their energy from down here and then has to travel all the way up there. Energy generated locally would be used in the closest place first.”

I thought it sounded like a good theory, but it became abstract when I tried to visualise it, for the same reason of the unproven and undeveloped technology it would require.

Progressive Conservative candidate Dave MacDonald could not be reached for this article. Emails, phone calls and tweets to him all went unanswered. I did, however, listen in on a “tele-town-hall” with him and Tim Hudak yesterday (that I was solicited for as a voter; it had nothing to do with Speak Your Mind.) and Messrs. Hudak and MacDonald did not address green energy or the Green Energy Act specifically during the talk; only reiterated the points from Changebook, which are that they would scrap Smart Meters, HST on Hydro and Heat, and the Debt Retirement Charge on hydro bills. They also stated the need to focus on “reliable energy which is essential to our economy” and ending “expensive experiments”, but did not provide examples on what this meant or how they would make it happen.

I know that everybody likes clean, renewable energy, or should, but the Liberals seem to view any critique of the way they've rolled it out as a direct criticism of the idea itself. The PC platform, meanwhile, seems to have the best slogans, about “not making seniors wake up at six in the morning to do laundry”, but this is more of a grab bag of crowd-pleasers than substantive talk about what's wrong and where we need to go. The NDP and Greens have some concrete policies to address some of my concerns that came up as I learned more about Green Energy, but it is difficult to imagine them being legislated or put into practice.

I'm afraid I'm not much further than where I started. Its sad that when you go to vote, on this issue, you'll not be asking yourself “Which party's policy on Green Energy do I like best” but “Which party's incomplete and contradictory narrative on Green Energy do I like best.” Coming up next: The eternal “jobs” question, and the disillusionment surrounding it.

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