Parker Gallant: Minister of Energy Bob Chiarelli; firmly in control of our hydro bills

(December 11, 2013) Ontario’s Minister of Energy, Bob Chiarelli, on November 27, 2013, launched a new website reputedly designed to provide the populus with “Energy Literacy”.

During the minister’s presentation he made the following statement according to a TorStar article:

They’ll have to manage consumption, because they can’t expect lower prices,” and also said: “What we are doing is taking very significant steps to allow people to better control their consumption and other factors that allow them to impact on their rates.

The minister also used his recently developed “less than a cup of Tim Horton’s coffee” math as the following demonstrates, reports Torstar:

He said current projections show annual price increases over the next 20 years averaging 3.4 per cent. That compares with average increases of 3.5 per cent over the past 20 years, he said.” 

Well I searched for information that would verify Charelli’s claim as well as data to see how we “manage consumption” but I couldn’t go back 20 years to verify what he stated. I did venture back to 2006 when we first got time-of-use (TOU) pricing and discovered: Off-Peak rates have gone up 106%, Mid peak 45% and On-Peak 23%. I found those on the Ontario Energy Board’s website along with the Regulated Price Plan rates which show an all-in increase of 51% or 7.3% per annum since 2006.

Minister Chiarelli only one week later regurgitated his math capabilities by telling us prices wouldn’t go up as much as the past Liberal Energy Minister, Brad Duguid said they would. Minister Duguid had called for the rates to increase 7.9% per annum and Minister Chiarelli told us they would only go up by 42% over 5 years which works out to 8.4% per annum.  Going back to Minister George Smitherman’s days in the Energy chair, we were told they would only increase 1% annually. Liberal math is evolving!

Ratepayers in Ontario also recognize (without the benefit of “energy literacy”) that the price of electricity isn’t the only line on their bill and the “delivery” line also has seen sizeable increases. That line reflects what your local distribution company (LDC) charges and represents somewhere between 25% to 40% of your hydro bill. Again, some information is available on the OEB website but only to the end of 2012 and it is presented by individual LDC. I checked out the biggest LDC; Hydro One and using the limited information available was able to determine that their “delivery” charge increased by 53.8% in 6 years or 9% per annum.

It certainly appears that Mr. Chiarelli’s 20-year claim was made to convince Ontarians that the cost of electricity rose only slightly more than the cost of living (COL) during the time the Liberals have managed the Energy portfolio, when the facts would indicate that in just the last 7 years it has outpaced the COL by a factor of four (4) at a minimum.

Now let’s examine how Ontario’s ratepayers have handled their consumption of electricity!

In 2006 Ontario consumed 152 terawatts (TWh) or 152 billion kilowatts (kWh) and in 2012 that had dropped to 141.3 TWh or 7.4%. In the meantime the number of ratepayers increased by 303,000 or 6.6%.  In 2006 our exports were 11.4 TWh and by 2012 they had jumped 3.2 TWh or 28%. Sure sounds like ratepayers were doing exactly what Minister Chiarelli was advocating just a few days ago and had done a great job as conservatists but to what avail as we have seen our hydro bills skyrocket.  Minister Chiarelli however, wants more!

Ontarians have demonstrated that we can conserve but it has not allowed us to control our rising hydro bills despite the rhetoric of the past and present Energy Ministers. Since 2006 electricity commodity costs have jumped 51% and delivery costs 53% which far exceeds our ability to conserve.

It is time for the Liberals to give up their “plan” and allow it to revert back to people that actually know what planning is all about before they drive us all into energy poverty.

Minister Chiarelli, we are already “energy literate” so give us back control of our hydro bills and step away from future planning!

Parker Gallant is a retired bank executive and a former director of Energy Probe Research Foundation. As with all independent bloggers on this site, Parker’s views do not necessarily reflect those of Energy Probe.

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