Which is it Minister of Energy, Todd Smith, a Surplus or an Emerging Supply Need?
Minister of Energy, Todd Smith, was the featured speaker at the prestigious Empire Club of Canada’s “Zoom Event” on January 28, 2022. Smith was coincidently introduced by the VP of LiUNA (Laborers International Union of North America) who back in 2018, just prior to the last provincial election, changed their support from the Ontario Liberal Party to the Ontario PC Party!
Smith’s 20-minute speech included much of what was also outlined in his January 26th and January 27th directives to IESO. The first directive was associated with the “Lake Erie Connector Project“ which would reputedly provide some “intertie enhancements” and “the creation of new opportunities to sell Ontario’s surplus electricity to the benefit of Ontario ratepayers by lowering electricity costs“! As noted in an article penned back on April 24, 2021 with the scheduled closure of the Pickering Nuclear Plant and it’s 2,500 MW capacity in 2025 it is apparent Ontario will not have the surplus power available for export. That suggests the Lake Erie line will provide only a marginal benefit associated with the “intertie enhancements” but ratepayers will be saddled with the full costs even though a large part of funding will come from the federal taxpayers via a $655 million investment from the CIB (Canada Infrastructure Bank). While Minister Smith includes some caveats in his directive about the connector project it seems strange that he even bothers to instruct IESO to push ahead with examining it further.
The second directive of 17 pages (English/French) of January 27th includes a “Background” which amongst other strange claims has a conflicting statement of the directive issued the previous day related to selling “Ontario’s surplus electricity”:
“After more than a decade of stable electricity supply, and at times, a surplus, IESO has forecasted an emerging supply need that grows through the latter part of the decade. This is a result of the upcoming closure of the Pickering Nuclear Generating Station, refurbishment schedules of other nuclear facilities, expanding electrification and increasing business investment in the province. Fulfilling this forecasted supply need will require IESO to procure electricity products and services from both existing and new resources.“
The foregoing comments seem ironic coming, as they do, from the Conservative Minister considering most of the prior decade the electricity file was misdirected by the Ontario Liberals under Premiers McGuinty and Wynne and drove energy prices up by well over 100% indicating an unstable supply from wind and solar that created the huge jump in ratepayer costs. Why would Minister Smith suggest his predecessors provided a “stable” supply; almost patting them on the back for increasing costs by well over 100%?
We should also take issue with the comment “at times, a surplus,” as the “surplus” has been significant since the addition of those reputedly “green” non-emitting IWT and solar panels. Ontario’s net exports (exports minus imports) soared averaging well over 10 TWh (terawatt hours) for the past several years and were sold for pennies of their actual costs.
Another worrying issue raised in just that first paragraph is the reference to “expanding electrification” and later on it mentions acquiring “storage facilities” presumably meaning batteries or pumped storage both of which will add costs. In Minister Smith’s speech at the Empire Club, he mentioned “electrification” several times suggesting he or Premier Ford has bought into the concept of ridding the province of gas- and diesel-powered transportation along with reliable gas plants.
When Minister Smith gets into the actual Directives, we should view 1. (related to 4.) and 3.e.as concerning!
Looking first at 3.e.; associated with MT RFP (Medium-Term Request For Proposal) note it states: “IESO shall offer contract extensions to contract counterparties whose facilities are successful in the MT RFPs, and whose existing contracts with IESO have expiry dates that occur before the start date of the respective facility’s MT RFP Commitment Period.”
Does the foregoing suggest he is in favour of extending expiring contracts for wind and solar or allowing them to be refitted? The implications of the foregoing are profound as they had promised to rid the province of IWT due to the harm they do to the rural human population and nature itself by killing birds and bats as well as negatively affecting aquifers in certain areas of the province!
The directives 1. And 4. are obviously about either battery storage or pumped storage or both but # 1. doesn’t reference either as the script is about; “Unforced Capacity (UCAP) basis, calculated in accordance with IESO’s published methodology for calculating such value for different electricity resources.“ UCAP was the subject of a IESO May 28,2021 Resource Adequacy Engagement and based on its 74 pages I was able to discern UCAP seems to be the ability to provide (on demand) a maximum of four (4) hours of power during peak demand periods. That clearly signals Minister Smith will be blessing the Oneida battery storage project and either or both of the two proposed pumped storage projects. One of the “pumped storage” projects is proposed by Northland Power for Marmora and an article penned about it back in late 2013 can be found on the Energy Probe website. Another article about the Oneida Battery Storage and the TCE pumped storge was written just over a year ago. Needless to say, those reviews on the three “storage” projects were not positive.
It sure appears while Minister Smith, in his speech at the Empire Club, claimed the Ford led government had reputedly resolved the electricity mess created by the McGuinty/Wynne leadership team they haven’t and want to make it worse. Minister Smith has declared a moratorium on any new gas plants as part of the “electrification” process and is seeking ways to close them down.
Should he have bothered to simply look at the mess the energy system is in the UK and the rest of Europe where electricity prices are skyrocketing to astronomical heights due to their dependence on renewable energy and their move to non-emitting “electrification” sources he might remember some of the chats we had back when he was simply the “critic” on the energy file!
How times have changed and does he not recognize taxpayers are now picking up about $6.5 billion annually just in an effort to not increase ratepayer costs further!
NB: When Minister Smith’s speech at the Empire Club became available, I reached out to several individuals with skill sets far surpassing mine seeking their views. I will bring those thoughts out in a separate post in a few days without naming names.