Parker Gallant: The Chiarelli charade

(May 3, 2015) Reading an April 27 interview in the Almaguin News with Ontario’s Energy Minister, Bob Chiarelli, gives one the impression that he resides in a state of mind the rest of Ontario’s residents don’t understand.

This blog by Parker Gallant was reprinted by the Almaguin News on May 7, 2015

Mr. Parker’s blog appeared as a response to the Almaguin News’ interview with Ontario Energy Minister Bob Chiarelli about Ontario’s electricity rates and decision to sell a portion of Hydro One, (“Energy Minister saus of hydro bills, it could be worse,” Page 5, April 30, 2015 Almaguin News).

He talks about the upcoming sell-off of Hydro One but doesn’t disclose that the province will be giving away shares in Hydro One to the Power Workers’ Union. A move designed to ensure he can claim “net zero” costs to reach agreement on an adjustment of their pension plan contributions and still provide them with an above inflation salary increase.

He has the unmitigated gall to claim the province made investments including: “implementing a Northern Ontario tax credit, and instituting the recently-announced low-income energy assistance program.”

Both of those “investments” come from the pockets of Ontario’s ratepayers not from the tax revenue base and will cost rate-paying households $120 million for the Northern Ontario Tax Credit and at least $200 million for the low-income energy assistance program. The Ontario Energy Board (OEB), the “rate regulators”, recently stated that 570,000 Ontario households live in “energy poverty” and that number will increase after the May 1, 2015 rate increase and again January 1, 2016 when the Ontario Clean Energy Benefit (OCEB) ends, increasing bills by more than 11% with the HST.

In the interview Minister Chiarelli also reached back four years by stating the OEB is “mandated to protect the consumer” and has proven so through its past actions — such as in 2011 when the Ontario Power Generation applied for a 6.2 per cent increase and the Energy Board not only denied the request, but also lowered the rate by 0.8 per cent.

What he failed to mention is that the OEB recently approved two large rate increases for OPG which will increase the price of electricity, by $600 million annually and those increases will show up on ratepayers electricity bills in the next 6 months. The additional $600 million represents 12% of OPG’s 2014 revenue and includes increases to cover the move to regulated hydro for all hydro production and a “top-up” to the pension plan of $300 million associated with nuclear employees.

Minister Chiarelli in the interview also claimed: “We’re much less expensive than cities like Detroit and New York,” and that “There are three other provinces that have higher prices than we do.”

Had he noted that those two US cities have seen recent price declines (perhaps because Ontario sells them cheap power subsidized by Ontario’s ratepayers) and actually named those “three provinces” (which don’t exist) he might have achieved some credibility but he didn’t.

In respect to the sale of 60% of Hydro One, Minister Chiarelli had this to say: “The new Hydro One will be a growth corporation and it will be a much more efficient company”.

From the perspective of the many rate paying customers of Hydro One, one would have to ask the question; Is the foregoing an admission by the Energy Minister that under Liberal management Hydro One is, or has become, an inefficiently managed company?

It is time to end the charade!

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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3 Responses to Parker Gallant: The Chiarelli charade

  1. Pingback: Energy Poverty « Newsbeat1

  2. James Snow says:

    >Had he … actually named those “three provinces” (which don’t exist) he might have achieved some credibility but he didn’t.

    Reddit would like you to provide details for this claim. Do you have a source for this?

    • Here is a link with May 2013 comparison for residential rates. Note that Ontario is the 3rd highest. http://www.ontario-hydro.com/index.php?page=electricity_rates_by_province Since then Ontario “commodity” price has increased as follows: off-peak was 6.7 cents per kWh and now is 8 cents per kWh. Mid-peak was 9.9/kWh and now is 12.2/kwh and on-peak was 12.4/kwh and is now 16/kWh. Nova Scotia increased their rates in 2014 but have not increased them this year. Ontario’s commodity price has increased by12% (average according to the OEB) since May 2013 and distribution rates have increased by approximately 50% (Toronto Hydro’s has increased by 52%). Mr. Chiarelli never includes all the other costs in his comparisons whereas most other provinces include all the charges.

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