Parker Gallant: Energy poverty in Ontario Chapter 3

(March 6, 2015) The prior Chapter in this series finished with the disclosure that many affected by “energy poverty” were seniors living on fixed incomes wanting to spend their final years; “aging at home” but rising energy prices were making that difficult.

When George Smitherman was Minister of Health he opined; by providing support and services to seniors they could “live independently where they want and how they want.” The “Aging at Home” strategy, launched when Dalton McGuinty was Premier promised a lot: The strategy vowed to transform community health care services “so that seniors can live healthy, independent lives in their own homes.” The strategy announced by Smitherman, the then Minister of Health, is summed up in speaking notes for him in 2008:

Our Aging at Home Strategy particularly breaks new ground in the care and support of seniors by focusing on the kind of innovation that’s being showcased here, today. We cannot underestimate the historic nature of this initiative, both in its scope and in its impact. Aging at Home will provide support and services seniors need to live independently where they want and how they want.

As part of a four-year, 1.1 billion-dollar strategy, local health integration networks will provide more access to health services by matching needs of local seniors with appropriate support, including more homecare, community services like meals, transportation, shopping and snow shovelling, thus supporting seniors”.

Smitherman moved from the Health Ministry to the Energy Ministry and created the Green Energy Act (GEA). The implications of the GEA should have been self evident, ie, it would drive up electricity prices. Smitherman insisted the GEA would cause electricity prices to rise only 1% annually. Without the benefit of a cost/benefit analysis or perhaps some common sense, he failed to connect the GEA with his prior commitment of the $1.1 billion dollar “health” care support for the “Aging at Home” strategy.

The rising price of electricity and its distribution costs have clearly dispelled the “1%” forecast and the facts contained in the earlier chapters of this series highlight those effects on creating “energy poverty! Toronto Hydro is but one example of how communities have been affected.

The information comparing the 2012 and 2013 Toronto Hydro LEAP (low-income energy assistance program) support indicates the number of households assisted and the amount of money allocated under the program both increased by 80% but still left thousands without support. There are probably thousands more unaware of the LEAP program who have been forced to alter their lifestyle, reduce their food or medication budgets to ensure they had money to pay their electricity bill. Based on the compensation levels of those in executive positions at TH and other LDC it appears they care little about the hardship the electricity sector causes. The CEO, Anthony Haines of Toronto Hydro for the year ended December 31, 2013 received compensation of $959,000 or $85,000 more than their entire LEAP allocations!

Examined another way, the $874K TH granted under LEAP represented about a tenth of 1% (1/10th) of their Gross Revenues (net of Cost of Power), less than 1% of pre-tax profits and 2% of dividend payments to the City of Toronto for 2013. TH paid $43 million in dividends in 2013 and in the first nine (9) months of the 2014 year paid $54.4 million, a 45% increase.

Withholding just $1 million of dividends paid to the City of Toronto or using the “incentive plan compensation” ($1,126,000) paid to the top five (5) executives would have gone a long way to assist those suffering from “energy poverty” and perhaps supported another 2/3,000 Toronto area seniors who wish to remain in their homes “aging in place” and those living with disabilities!

The “polar vortex” experienced in late 2013 also caused additional problems associated with natural gas prices which spiked as Ontario’s storage was depleted and Ontario’s and the Eastern US gas generation plants were ramped up just as demand for heating fuel was high. The gas generation plants were needed to supplement low output from wind and solar generation and shuttered coal plants. Because the spot prices of natural gas shot up the gas distribution companies (Enbridge, Union, etc.) requested and were granted substantial increases to gas heating prices by the OEB. Those increases are now being felt by anyone using natural gas furnaces. To complicate matters Enbridge changed the way they deal with LEAP and the WW (winter warmth) program. The entire program is now run by United Way Greater Simcoe County for the whole province rather than the Neighbourhood Information Post who ran it for Toronto.

The spokesperson at NIP told me that the move has created further hardship for people seeking assistance. The call in number has wait times of as much as an hour, the voice mail doesn’t always work, they lose intake forms, calculate income eligibility incorrectly, mail out application forms and provide limited assistance in their completion. In other words those who need help to ensure they have sufficient heat, experience delays causing stress and concern about having their natural gas supply cut.

It becomes obvious there is no way to determine how many Torontonians are living in “energy poverty” or how many households have had to live suffering from the cold but one should assume it is many more than those who received support from LEAP, the Emergency Energy Fund or United Way. No doubt it is thousands more than the 6,901 who initiated a call to NIP in 2014 seeking assistance.

The message to Premier Wynne should be: the “Aging at Home” and “Long-Term Energy Plan” (increasing supplies from expensive and intermittent generation from wind, solar and biomass generation) and time-of use (TOU) rates instituted by your government are in conflict, and create energy poverty. Seniors, people with disabilities and others living on fixed incomes are not able to adjust their lifestyles sufficiently to offset the increasing energy costs they require to survive in their homes.

The time has come to bite the bullet, cancel further wind and solar generation acquisitions and let experts plan our energy needs rather than politicians who fail to grasp that electricity is a “necessity of life”, particularly in our climate as this year’s record cold February has clearly demonstrated!

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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This entry was posted in Alternative Energy, Benefits and Risks, Climate Change, Conservation, Consumer Health, Costs, Electricity, Global Cooling, Natural Gas, Natural Gas Utility Regulation and Commodity Deregulation, Power Generation in Ontario, Reforming Ontario's Electrical Generation Sector, Reforming Ontario's Local Electrical Distribution Sector, Renewables, Utility Reform and tagged , , , , , , , , , . Bookmark the permalink.

4 Responses to Parker Gallant: Energy poverty in Ontario Chapter 3

  1. markwbell says:

    Parker: I don’t mind your railing as long as it it equal-opportunity railing. To harp incessantly to “bite the bullet, cancel further wind and solar generation acquisitions” without consideration of the other more significant cost increase elements (OPG’s recent application for a 23% increase for instance) is lame. You remind me of a Gorista, banging away on the same old tired ‘warming’ drum.

    • energy01 says:

      Just to be clear Mark, are you suggesting that Ontario should continue to procure more intermittent generators when we are paying existing wind projects not to produce and racking up huge export losses? Parker is not the only one sounding the alarm, read the last two Auditor General reports.

  2. Mark, any relation to the Mark Bell of Windstream Energy trying to develop offshore wind off of Wolfe Island?

  3. Or perhaps you are this Mark W. Bell with an extensive CV that claims responsibility for the 78 MW Raleigh Wind Farm in Chatham Kent? http://www.postjobfree.com/resume/acdcj2/geologist-wind-bsc-large-mw-pulp-toronto-on-canada

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