Air quality in Ontario

The Toronto Star
January 25, 2000

Environment Minister Tony Clement put his best smudged face on a dirty air policy yesterday. And dirty it is – potentially a lot dirtier than what we have.

Clement’s spin on his policy was that it was “tough new actions” that will “strengthen an already aggressive campaign to improve air quality in Ontario.”

In fact, it does this: It weakens one of existing safeguards – the sulphur dioxide emission limit set by David Peterson’s cabinet in the mid-’80s to deal with acid rain. It does this by allowing Ontario Power to use so-called emission credits to exceed the Peterson government’s cap.

These credits will also allow Ontario Power to exceed current nitrogen oxide emission targets. Clement set a target of 36 kilotonnes, six times higher than the province’s doctors had recommended. Ontario Power says it will not be able to get below 50 kilotonnes. The smog from these emissions kills 1,800 people a year, according to Ontario’s doctors. Soon it could be worse.

There are no limits on the other pollutants produced when coal burns. These include carcinogens such as arsenic, and neurotoxins such as mercury that damage the brain cells of the young and unborn. The toughest action anyone faces on these co-pollutants is a requirement to report emissions to the government once a year. In addition to the loophole emission credits provide, Clement gave Ontario Power an even bigger one.

It can import coal power that creates even more pollution on the U.S. side than Ontario Power can create on the Canadian side – this in the name of new “emissions performance standards” for imported power.

Such limits are a good idea. But Clement set the allowable pollution so high – and Queen’s Park lets Ontario Power import so much – that U.S. coal plants will be well above Clement’s new limits for Ontario before they have to stop burning coal in the Ohio Valley.

Queen’s Park allows 34 million megawatts of imported power. At Clement’s performance standard – 1.3 kilograms of nitrogen oxide per megawatt hour – that can send up to 42 kilotonnes of smog toward the north shore of Lake Erie from U.S. coal plants, in the name of keeping Ontario air clean and avoiding health problems. Even the dirtiest U.S. utility – American Electric Power – can claim Snow White status under those rules.

And as a final insult, it looks as if our own coal plants are with us for as far as we can see. Their resumed use was supposed to be temporary, while nuclear capacity was being fixed.

But background papers on emission credits drop any “ifs” associated with the coal plants. “When Ontario Power Generation sells one of its coal powered stations” it will have to give a new owner emission credits, the papers say. This will allow the new owner to use the credits to run the coal plant at full blast, while credits make it look like there is a lot less pollution than there really is.

So Clement has given us tough action, all right.

Tough on our health.

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Energy Probe's position on emission reduction trading

Energy Probe
February 25, 2000

This is a summary of Energy Probe’s concerns over the Ontario Emission Reduction Trading (ERT) program announced in January. The government’s ERT program fails to meet the objectives of its November 1997 White Paper on electricity reform and should be substantially revised to achieve environmental improvement.

The ERT program does not cover all fossil generators but should. Only former Ontario Hydro coal- and oil-fired stations are covered. Gas-fired generators already cause significant NOX emissions. Both gas-fired generation and the associated air pollution are expected to increase in the new market.

The ERT program does not cover non-electricity sources of emissions but should. Artificial distinctions between electricity-derived air emissions vs. emissions from other sources such as industrial or transportation emissions have no environmental justification. As energy sectors converge, particularly through cogeneration, identifying what emissions relate to electricity generation and what emissions relate to production of steel, cement, chemicals or paper will become increasingly difficult.

The ERT program does not mandate declining emissions. The long political cycle to get environmental rules changed increases the need to include a schedule of emission reductions over time in the current changes. The last change in Ontario’s air emission rules was 14 years ago. The last change included a schedule for progress in the future. The Ontario government claims to be trying to achieve a 45% reduction in NOX by 2015 but the ERT program appears to have given up on this objective.

The ERT program does not cover air toxics or particulates like PM 10 and PM 2.5. Air toxics and particulates are very harmful to health and should be controlled.

The ERT program contemplates banking of emissions, a practice that could exacerbate time and location sensitive environmental problems, particularly smog. No banking of NOX emissions should be allowed to increase emissions in smog season. Other kinds of banking should be subject to significant clawbacks or overall limits should be cut if banking is allowed.

For the same reasons that banking of NOX emissions that might increase emissions in smog season should not be allowed, trading of NOX emission credits should provide for a spot market for NOX, not just a long market. The spot market should be designed to generate high prices for NOX at times when air quality conditions are particularly sensitive.

Energy Probe recommends replacement of the proposed ERT program with a cap and trade program on the design of the proposal of the MDC.

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Gasoline refiners reducing sulphur

Dick Chapman
Toronto Sun
May 22, 2001

Canada’s major oil refineries are spending hundreds of millions of dollars to rid themselves of the well-deserved reputation of producing North America’s dirtiest gasoline.

Canadian lawmakers have already given refiners a Jan. 1, 2005, deadline to lower sulphur content by 97%.

The Irving Oil Co. has already achieved part of that requirement with a $1-billion retrofit of its New Brunswick refinery.

Petro-Canada plans to spend up to $450 million at three refineries – Montreal, Oakvile and Edmonton – to get sulphur out of its gasoline.

Imperial Oil is planning to spend $500 million to upgrade four refineries across Canada.

Low-sulphur gasoline would reduce summertime asthma attacks in Ontario, says Tom Adams of Energy Probe.

Sulphur clogs high-tech sensors that control fuel combustion in auto engines, he says. Incomplete combustion causes smog.

More than 5,000 premature deaths in Canada last year can be attributed to air pollution, says Environment Canada. In Toronto, more than 1,000 people die prematurely each year.

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Comments on EBR Registry Number RA01E00020

Tom Adams
Letter to John Hutchinson
August 30, 2001

John Hutchinson, Senior Policy Advisor
Air Policy and Climate Change
4th Floor, 135 St. Clair Avenue West
Toronto, Ontario, M4V 1P5

re. Comments on EBR Registry Number RA01E00020

Dear Sir,

Energy Probe has reviewed the above noted registry and makes the following comments.

Due to its reliance on forecast-based emission reductions instead of quantified actual emissions, as well as off-sets, credits, and banking the proposed air emissions policies are likely to lead to no improvement or a deterioration in the annual loadings of our airshed from emissions related to the electricity sector. Special treatment for fossil-fired generating facilities currently controlled by the government’s own generation company, will give OPG substantial market power in the emission credit market, thereby undermining competition. In these two respects, the proposed policy contradicts the government’s promises in the 1997 White Paper on electricity restructuring.

Energy Probe regrets that the government has ignored the advice of the Market Design Committee when it set out a legitimate emission trading regime based not on forecast-based emission reductions but on quantified actual emissions by capped entities. The MDC’s proposal was unanimously accepted by the members of the committee.

The proposed policy is inconsistent with the efforts of the U.S. EPA to manage downward air emissions in the United States. Until Ontario’s emission trading rules are harmonized with the U.S., the full potential of international trade in electricity may not be realized.

The policy is excessively reliant on bureaucratic discretion, thereby creating an atmosphere of uncertainty.

The proposed policy demonstrates the corrosive effect of conflicting interests within the Ontario government. Potential investors in fossil-fired generating assets in Ontario should realize that the proposed emission regulations are unlikely to withstand sustained scrutiny by the public downwind of this policy.

Sincerely,

Tom Adams
Executive Director

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Ontario air worse than it appears

Robert Cribb
Toronto Star
August 17, 2002

Fighting for air: Andrea Long and her daughter Callan both suffer from asthma and worry about the quality of air in Toronto.
Steve Russell/Toronto Star

The truth about the air we breathe in Ontario is about to be revealed.

And it’s going to be ugly.

With the province already heading for its smoggiest summer on record, an even bleaker pollution picture will emerge beginning next week as Ontario upgrades its Air Quality Index (AQI) to better reflect actual levels of poison.

For the first time, it will begin reporting levels of "fine particulates" – microscopic fragments of dust, fumes and chemicals that invade our lungs and can cause a host of health problems from asthma to cancer to heart attacks.

"We’re about to see a much less rosy picture," says air quality expert Dr. David Pengelly. "It’s about time."

Currently, smog warnings are triggered in summer due to high levels of ozone, a gas that peaks between May and September. Expanding the index to include fine particulates, which can soar throughout the year, will mean "poor" air days could happen any time, including the depths of winter.

And bad air can take a heavy toll. Public health authorities blame air pollution for an average of 1,000 premature deaths each year in Toronto.

Measurements of particulates in downtown Toronto, recorded by the Star over the past week, frequently rose to levels experts call a serious threat to health.

The readings showed that, even when Ontarians are told their air is safe, there is no cause to breathe easy.

On Tuesday, for example, the official morning AQI indicated "very good" air quality in downtown Toronto. But the Star‘s readings showed particulate levels outside Union Station were more than double the traditionally acceptable limit.

The province’s AQI, announced each day in newspapers, on television and the Internet, has painted a relatively cheery portrait of air quality in Ontario.

"Ontario has good air quality 90 per cent of the time," claims the provincial Ministry of the Environment Web site. But that doesn’t mean our air is safe to breathe. Experts say such positive assurances are deceptive and create a false sense of security.

"It’s misleading," says Pengelly, a professor of medicine at both McMaster University and the University of Toronto. "It doesn’t reflect the reality of what we’re breathing and what it does to human health."

No one really knows what level of air pollution is safe.

While the AQI has been telling us our air quality is "good" or "very good" almost all the time, studies show that thousands of Ontarians are dying prematurely or being hospitalized each year due to smog-related pollutants.

Adding fine particulates to the index should increase the number of smog warnings and potentially double the number of "poor" air quality days in Ontario, experts say.

According to one proposed method of measurement, Toronto would have pollution levels posing a "high" or "extreme" health risk one day out of every four.

"Fine particulates are responsible for a significant amount of health problems," says Monica Campbell, an air quality expert with Toronto Public Health. "Yet there’s been little attempt to give the public a greater understanding of the health risk."

Public health’s research shows toxic air triggers 1,000 premature deaths and 5,500 hospitalizations in Toronto alone each year. A growing body of scientific evidence also shows bad air is prompting heart attacks, cardiovascular diseases, lung cancer and increased cases of respiratory problems in young people.

"When I run, I start coughing a lot," says Callan Long, a 10-year-old Mississauga girl who suffers from asthma, along with her 13-year-old sister and mother, one of a dramatically growing number of young people to have the disease. Together, the three take medication up to four times a day to help them breathe.

"It gets much worse on bad days when it’s really hot," she said, adding she often coughs through the night and can’t sleep when the air is particularly bad.

Outside Union Station last week, about 30 teens stepped off two idling school buses and into a chemical soup. The air filling their lungs, and those of hundreds of passing pedestrians, was packed with tiny particles that can cause an array of health problems.

At one point, the Star‘s testing showed the teens were inhaling air containing 220 micrograms of certain-sized particulates — a concentration experts fear could alter the way young bodies develop, trigger respiratory conditions, and cause long-term health problems with extended exposure.

The Star used a portable monitoring device that measures particulates. Readings were taken this past week outside Union Station every five minutes for half-hour periods several times a day, and then averaged.

The results were unsettling.

Fine particulate levels, not reported in the AQI, were dramatically high on several occasions.

While the province has traditionally measured "suspended particles" in the air, its equipment hasn’t been sensitive enough to trace the smallest particles that pose the greatest danger.

Pollutants measured in the AQI include sulphur dioxide, ozone, nitrogen dioxide, carbon monoxide and total reduced sulphur compounds. Fine particulates, spit from vehicles, factories and coal-fired power plants, take to the air in the form of solid particles or fine liquid droplets.

Within days, the province will target these tiny threats by measuring particles as small as 2.5 microns. One micron is 50 times smaller than the width of a human hair.

Ontario will also focus on particles 10 microns in diameter, called PM 10. The provincial standard for PM 10 is 50 micrograms per cubic meter over a 24-hour period.

The Star‘s readings frequently exceeded the upper limits of that concentration during downtown rush-hour periods, when the streets teemed with people.

On Aug. 9, a day that featured a cloudless blue sky and an AQI rating of "good," measurements of PM 10 rose to an average high of 211 micrograms during the morning rush hour – more than four times the 50-microgram cut-off. During five days of readings, it was the morning rush hours – a time when hundreds of thousands of people fill the downtown core – that consistently registered the highest levels of PM 10.

Ontario has actually been measuring fine particulate matter in some cities for several years because of its known contribution to health problems. But the province has not included those measurements in its AQI calculations.

So while the public health information has been available, it hasn’t been released.

"There has been concern over the instrumentations and the reliability of the results," explains David Yap, co-ordinator of air quality with the Ontario Ministry of Environment and Energy. "It’s been a gradual evolution. The pollutants that have given us the biggest concern, and exceeded (levels) the most, are ozone and particulates." Ontario is the first province to add fine particulate data to its Air Quality Index. Other provinces are expected to do the same in coming months.

But many experts say the province is still only going half way. They say it fails to achieve the real goal: An index that warns people about health risks, rather than simply measuring air quality.

And they’re pushing for a new health-based AQI by as early as 2004.

The prevailing idea for reworking the AQI would toss out words such as "poor," "moderate," "good" and "very good" to describe air quality – replacing them with terms that reflect the threat to health such as "low," "medium" and "high" risk.

Campbell says the public has long been misled by ministry assurances that "good" air on the index has "no known health effects." "That’s in conflict with scientific studies," she says. "It would be appropriate to have more careful messaging so people with special vulnerabilities can take steps to improve their health. The AQI (should) help people protect themselves."

The push to transform the index into a health-based warning system is driven by a new realization among scientists – there is no safe level for some of the pollutants we inhale every day.

Even when ozone and particulate levels are low, there can be a loss of lung capacity in all of us, experts now say.

"There’s no lower limit that’s safe," says Dr. Jim Young, one of the original creators of the AQI system and a consultant specializing in air quality. "We now know air pollution is one of the determinants of how long we live as humans."

So it’s misleading to label air containing even low levels of ozone or fine particulates "good," many scientists now agree.

"It’s something the scientific community has been really struggling with," says Mark Raizenne, air quality research manager for Health Canada. "We’ve been underestimating environmental impacts for a long time. If you thought the air had no effect on your health, those days are gone." Phil Blagden, heading a federal task force looking at a health-based AQI for Canada, says there is widespread agreement among researchers that the index must change to reflect growing health concerns.

"We’re trying to cope with data that tells us there’s no detectable threshold for impact on human health, so what does it mean when we say air quality is `good?’" he asks.

Experts agree an AQI based on health risk would dramatically change the message the public receives about the air it breathes, painting a much gloomier – but more useful – portrait.

A Health Canada study using 1999 air pollution data, including fine particulates, in five cities shows a health-based AQI system would provide especially sobering news for southern Ontario residents.

Windsor topped the bad air list in that study, with 33 per cent of the year registering as a "high" or "extreme" health risk. Toronto was close behind, at 25 per cent. The picture is better in other parts of the country with Ottawa at 10 per cent, Calgary at 2 per cent and Vancouver at 0.3 per cent.

Among the more troubling findings in North American studies is evidence of dramatic physical changes in young people as a result of pollution.

A 1996 Health Canada study showed long-term exposure to bad air can affect lung growth, development and function in children.

That finding was echoed more recently in a groundbreaking California study that found smog not only makes asthma worse, but may actually create asthmatics. Active children in high smog areas were three times more likely to develop asthma than their counterparts in clean-air zones.

Another Health Canada study last year showed a 35 per cent increase in daily hospitalization of Toronto children under the age of 2 for respiratory problems when ozone levels in the air were high.

"If you live in an area where pollution levels are high, you’re more likely to have respiratory problems such as asthma or bronchitis and your lungs will be less likely to reach full capacity," says Raizenne. "It’s affecting everybody, not just people with illnesses. And you have no choice. It’s obligatory exposure as a result of where you live."

There’s almost no escape.

On most days, pollutant levels are just as high – or even higher – in rural Ontario as in downtown Toronto. Air currents carry toxins far and wide, much of them coming from smoke-belching factories and power plants in the United States.

"There’s nowhere you can move to," says Pengelly. "It doesn’t matter whether it’s London, Peterborough or even Dorset, you’re going to be subject to this problem."

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Hidden taxes hurt democracy

Tom Adams

March 30, 2002

 

Letter to the Toronto Star editor:

Re: "Toronto’s out-of-sight Hydro kitty," March 30, 2002.

Your reporter, John Spears, has done by far the best, most sustained job of any member of the Ontario press corp following the consumer elements of Ontario’s electricity restructuring. His latest contribution, following Toronto’s hidden tax increases buried in our new higher electricity bills, should raise serious concerns about the prospects for municipal democracy. Municipal politicians across Ontario can now raise funds by indirect means, through higher electricity rates. Taxpayers had a tough enough time keeping our local politicians accountable back when municipal funds came only over the table through property taxes. When municipal politicians offer free lunches, check for hidden taxes collected on your electricity bill.

Tom Adams, Executive Director
Energy Probe

To read the Toronto Star article, "Toronto’s out-of-sight Hydro kitty," by John Spears, please click here.

Posted in Reforming Ontario's Electrical Generation Sector | Leave a comment

Electricity switch costly for many

Martin Mittelstaedt
Globe and Mail
February 1, 2002

Nearly a million Ontario electricity consumers have recently signed expensive long-term contracts to buy power, often from high-pressure door-to-door marketers and at fixed rates more than a third higher than likely market levels. The contracts take effect when Ontario’s electricity market opens for competition on May 1 and have prompted controversy.

Marketers are selling power on the doorstep for nearly six cents a kilowatt-hour, although the Ontario Energy Board, the provincial regulator, has forecast prices will likely be around 4.3 cents a kwh when the market opens.

Based on the board’s forecast and typical residential power bills, consumers could be paying about $200-million above market for electricity each year.

Jack Gibbons, an environmentalist whose organization has posted an Internet consumer advisory on the contracts, is blunt: "They’re 35 per cent to 38 per cent higher than what the [provincial regulator] is forecasting."

Consumers mulling over a contract might also want to consider what the province’s two top electricity regulators are doing for their own household power supply.

Floyd Laughren, chairman of the energy board, said almost a million ratepayers have contracts, but he isn’t among them. "Me personally? No I haven’t" signed.

Neither has Dave Goulding, president of the Independent Electricity Market Operator, the provincial watchdog that will run the new wholesale electricity market. "I haven’t signed a contract with anybody and I don’t intend to."

Mr. Goulding and Mr. Laughren both spoke yesterday to reporters after speeches at a business event.

Marketers have generally been offering prices of 5.7 cents to 5.9 cents per kwh for up to five years. A kilowatt-hour is the amount of juice that keeps a 100-watt light bulb illuminated for 10 hours.

The energy board posted its notice of 4.3 cents a kwh last year because of concerns that the province’s four million ratepayers didn’t have enough information to deal with the doorstep sales.

Mr. Laughren said the board has had to come down hard on some of the marketers, known as retailers, who often also sell natural gas.

"There has been some problems with some of the retailers and we’ve called some of them in and taken them out to the woodshed," he said. Of the marketing going on, he said: "It’s very aggressive. It’s commission selling and so inevitably you’ll get some problems."

Mr. Goulding refused to say what he thinks electricity will cost when its price is set by market forces in May, but he did say Ontario Power Generation, the provincial utility, is getting about four cents a kwh for its coal-fired power.

Consumers signing contracts receive the stability of fixed electricity rates, much like having a fixed mortgage. They will also be protected if Ontario’s experiment in power deregulation turns into a California-type disaster.

But Mr. Goulding said Ontario has much better supplies and won’t suffer the price spikes and shortages that gave deregulation a bad name last year in California.

Although Mr. Goulding is one of the province’s savviest electricity analysts, he believes it isn’t his job at the government-owned company to help other consumers.

"The last thing I’m here to do as the market maker is give advice to the public as to whether they should sign contracts or shouldn’t sign contracts. That would be [an] absolutely and totally inappropriate thing for me to do," he said.

When competition starts, most consumers will automatically receive the price set by demand and supply at Mr. Goulding’s organization, which is known as the IMO in the industry.

But those who signed contracts will have to pay the price they pledged to pay.

Posted in Reforming Ontario's Electrical Generation Sector | Leave a comment

Cost of electricity 4 cents an hour

John Spears
Toronto Star
February 1, 2002

Four cents and change: That’s what you’re paying for a kilowatt hour of electricity today if you’re a householder in Ontario.

And that’s the price to compare with the rates of electricity retailers, who are offering fixed rate contracts at up to 5.95 cents a kilowatt hour for a five-year deal.

The two men most closely involved with opening Ontario’s electricity market to competition agree the current cost of power is a little over 4 cents a kilowatt hour.

Floyd Laughren, who chairs the Ontario Energy Board, and Dave Goulding, chief executive of the Independent Electricity Market Operator, pegged today’s price at around 4 cents after making a joint presentation to the Toronto Board of Trade.

Floyd Laughren, former Ontario finance minister, is chair of the Ontario Energy Board, which licenses participants in Ontario’s energy market.

The energy board licenses market participants; the independent operator will run the 24-hour-a-day electricity auction when Ontario’s market is opened for competition on May 1.

A study prepared for the energy board last year predicted the Ontario price will average 4.3 cents a kilowatt hour in its first year.

Prices could be volatile during periods of peak use, however, and there’s no guarantee the forecast will hold, especially over a 5-year period.

For householders who want to lock in a rate, electricity retailers are offering rates ranging from 5.69 cents a kilowatt hour to 5.95 cents a kilowatt hour, for terms of one to five years.

At the moment, however, customers can’t look at their bills and see how much they’re paying for power alone – which is what the retailers are offering.

Toronto Hydro, for example, lists its cost of power at 6.46 cents a kilowatt hour. But that includes the rate charged by Hydro One to carry the power from generating stations to Toronto Hydro. And it includes other expenses, such as the cost of operating the system so that supply and demand are matched across the grid throughout the day.

To really compare today’s rate with the rate offered by the retailers, you’d have to subtract the transmission rate and other charges from your current bill. According to Laughren and Goulding, that will give you a rate of slightly more than 4 cents a kilowatt hour.

That’s the same figure quoted by a spokesperson for Ontario Power Generation when asked for the current cost of power.

The precise rates for all the charges currently being lumped into one line on your utility bill haven’t been fully separated, however.

And utilities aren’t required to untangle, or "unbundle," all those separate rates on electricity bills until May 1, when the competitive electricity market opens.

In the meantime, 1 million Ontario households – nearly one in four – have signed fixed term contracts with retailers.

Laughren said it was an early policy decision of the province to allow retailers to sell electricity contracts before the components on the bill were clearly calculated and unbundled.

"All of that’s just coming together now," he said.

The energy board has a code that requires electricity retailers to explain that the price they’re quoting is only a portion of the total electricity bill. In Toronto, for example, while the cost of power alone is about 4 cents a kilowatt hour, the total for all charges is 8.215 cents a kilowatt hour. Customers also pay a basic $10.20 a month.

"The retailer cannot pretend that what they’re offering is an all-in cost," said Laughren.

For the record, neither Laughren nor Goulding have signed fixed price contracts for their own homes.

Goulding says since he’s running the marketplace, he figures he should live by it.

"I have full conviction in my own business," he said yesterday. "I haven’t signed a contract with anybody and I don’t intend to. To the extent possible I’ll take whatever the marketplace goes."

Goulding says his choice should not be taken as advice to others.

"The last thing I’m here to do as the market maker is to give advice to the public as to whether they should sign contracts or shouldn’t sign contracts."

Laughren said he’s also going with the market price, but says the choice is an individual one.

 

Posted in Reforming Ontario's Electrical Generation Sector | Leave a comment

Don't show your bill

Tom Adams

February 6, 2002

 

ENERGY PROBE PUBLIC NOTICE

"Don’t show your bill," watchdog warns Ontario consumers

Energy Probe, a national consumer and environmental watchdog, is warning consumers to avoid showing their gas and electricity bills to door-to-door representatives of energy marketers.

Utility bills contain confidential customer identification numbers. A customer identification number is the utility equivalent of a credit card number. And a customer information number is what the energy marketer needs to get a utility account switched so that a portion of the customer’s utility payments flow to the marketer. The marketer can only capture business if the customer has no outstanding contract with another marketer. In discussions with marketers and when considering purchasing options, Energy Probe recommends that consumers refer to their bills, particularly to find their consumption volumes, but without showing the bill to the marketer.

In the past, there have been allegations of door-to-door sales agents obtaining access to customer identification numbers, forging the customer’s signature, and locking them into long-term energy deals. Customers trying to get out of unfavorable deals have had to obtain copies of their contracts from energy marketers, which has led to protracted disputes between marketers and their clients.

Energy Probe continues to recommend that customers who can withstand some fluctuation in their electricity bills do not take up electricity offers currently available from Direct Energy, First Source, Ontario Hydro, and Toronto Hydro. Energy Probe estimates that these contracts are 20% to 40% above the current price consumers are paying for the commodity portion of their bills, which Energy Probe estimates to be approximately 4.2 cents/kilowatt hour.

For more informatin on Gas Markerters, click here. 

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How to get out of your long-term hydro contract

Robin Harvey
Toronto Star
March 6, 2002

Consumers who feel they were hoodwinked or misled into signing a long-term electricity deal can fall back on the industry’s code of conduct for help.

All the major retailers say if it can be proved an agent violated the code, the contract will be void. Retailers will investigate the complaint and if it is not resolved, it can be taken to the Ontario Energy Board. The code states:

• All retailers, no matter how they solicit your business, must immediately and truthfully identify themselves to the consumer and say exactly for whom they are working. They must "not mislead or otherwise create any confusion in the mind of a consumer about the identity of the marketer."

• The agent "must not exert undue pressure."

• He or she must also give "sufficient time for a consumer to read thoughtfully and without harassment all documents provided."

• Agents must not make any statement or representation or do anything that is false or likely to mislead a consumer with regard to any term in an offer.

• They must not say anything that is not contained in the written offer.

• They must provide "only timely, accurate and verifiable and truthful comparisons."

• And they must not use print size or type on a contract that makes it hard to read.

Even so, some contracts have the terms and conditions listed on the back that are in very fine, small print on a tough-to-read coloured background.

The following complaints sent to Consumer Watch appear to violate the code.

Though rare, some of the worst and most serious cases have involved signature forgeries. Nick Guilford, senior vice president for Direct Energy, confirms that St. Peter and Paul Ukrainian Catholic Church was switched to a long-term contract using forged agreements. He has assured the church that the agent has been fired and the forgery reported to police.

Another common complaint is about agents who gave a vague identity, saying they were from "the hydro company" or "your hydro company."

M. Savoia was approached by an agent who said she was from his hydro company and was just signing him up for a new program. When she asked to see the bill to get a contract number, Savoia became suspicious and called his hydro company. They said the information was misleading and they were not trying to get him to sign any deal.

Others have contacted Consumer Watch and said an agent compared the price listed on the consumer’s hydro bill to the retailer’s fixed rate for electricity as proof the long-term rate is a better deal.

This happened to Binh Ha of Toronto, who was told the fixed rate of 5.79 cents per kilowatt hour she signed for was better than the 6.4 cent rate listed on her current utility bill. This is misleading. The hydro bill rate reflects the cost of electricity and other charges, while the fixed-rate contract rate quoted as a comparison was for electricity only.

Ralph Paidcock said he was seriously pressured into signing a contract by an agent who swore hydro prices were sure to go up and if he didn’t lock in now, he would face very stiff bills in future. He was also told the 5.79-cent per kilowatt hour rate he signed was in fact the current rate he was paying anyway and he would simply be locking into that rate. In fact, no one knows yet how the market will perform after the market is deregulated on May 1.

Etobicoke’s Laura Sciascia says she was on her way out when the agent showed up and he would not go away. Finally, she said she signed to get rid of him. Not once did he mention the length of the five-year contract and she was given no time to consider the offer.

Consumer Watch is forwarding all of the complaints above, as well as several already sent, to the appropriate retailers for action.


Contact Consumer Watch through e-mail at conwatch@thestar.ca, by fax at 416-945-8611 or through our Web site, http://www.thestar.com/conwatch. Include your full name, address, a day phone number, any documents and a detailed history of your problem. It will take six to eight weeks to review cases. You will not be contacted unless we can pursue your case.

Posted in Reforming Ontario's Electrical Generation Sector | Leave a comment