Investor: Hydro One has too many unknowns to be a good investment

IN concentrating on electrically driven cars, the UK’s new ten-point energy plans ignores the elephant in the room.

It fails to address the forecast six-metre sea level rise from global warming rapidly melting the Greenland ice sheet.

Rising sea levels and storm surge, combined with increasingly heavy rainfall swelling our rivers, threaten not only hundreds of coastal communities but also much unprotected strategic infrastructure.

New nuclear power stations proposed in this United Kingdom plan would produce radioactive waste requiring thousands of years to safely decay.

This is hardly the solution for the Green Energy future that our overlooked marine energy resource could provide.

Sea defences and barrier design, built and integrated with subsea turbines and heat pumps, can deliver marine-driven heat and power to offset the costs, not only of new Thames Barriers, but also future Severn, Forth and other barrages.

At the Pentland Firth, existing marine turbine power could be enhanced by turbines deployed from new tidal bridges to provide much of UK’s electricity needs from its estimated 60 gigawatt capability.

Energy from Bluemull Sound could likewise be harvested and exported or used to enhance development around UK’s new space station at Unst.

The 2021 Climate Change Summit gives Glasgow the platform to secure Scotland’s place in a true green, marine energy future.

We must not waste this opportunity.

THERE is no vaccine for climate change.

It is, of course, wonderful news that such progress is being made in the development of Covid-19 vaccines but there is a risk that, no matter how serious the Covid crisis is, it is distracting attention, political will and resources from the climate crisis, a much longer term and more devastating catastrophe.

They are intertwined. As climate and ecological systems change, vectors and pathogens migrate and disease spreads.

What lessons can be learned from one to apply to the other?

Prevention is better than cure. We need to urgently address the climate crisis to help prevent future pandemics.

We are only as safe as the most vulnerable. Covid immunisation will protect the most vulnerable; to protect against the effects of climate change we need to look far more deeply. Global challenges require systemic change.

Neither Covid or climate change respect national borders and, for both, we need to value and trust science and the scientific experts and separate them from political posturing.

Manitoba Hydro Court Ruling affirms the Public Utilities Board exceeded its jurisdiction by ordering a First Nations rate class, overturning an electricity rates appeal tied to geography, poverty, and regulatory authority in Manitoba.

Key Points

A decision holding the PUB lacked authority to create a First Nations rate class, restoring uniform electricity pricing.

✅ Court says PUB exceeded jurisdiction creating on-reserve rate

✅ Equalized electricity pricing reaffirmed across Manitoba

✅ Geography, not poverty, found decisive in unlawful rate class

Manitoba Hydro was wrongly forced to create a new rate class for electricity customers living on First Nations, the Manitoba Court of Appeal has ruled. 

The court decided the Public Utilities Board "exceeded its jurisdiction" by mandating Indigenous customers on First Nations could have a different electricity rate from other Manitobans. 

The board made the order in 2018, which exempted those customers from the general rate increase that year of 3.6 per cent.

"The directive constituted the creation and implementation of general social policy, an area outside of the PUB's jurisdiction and encroaching into areas that are better suited to the federal and provincial government," says the decision, which was released Tuesday.

Hydro's appeal of the PUB's decision went to court earlier this year.

At the time, the Crown corporation acknowledged many Indigenous people on First Nations live in poverty, but it argued the Public Utilities Board was overstepping its authority in trying to address the issue by creating a new rate class.

It also argued it was against provincial law to charge different rates in different areas of the province.

The PUB, however, insisted that legislation gives it the right to decide which factors are relevant when considering electricity prices, such as social issues. 

Special Manitoba Hydro rate class needed to offset challenges of living on First Nations, appeal court hears
Manitoba Hydro can appeal order to create special First Nation rate
The board had heard evidence that some customers were making "unacceptable" sacrifices to keep the lights on each month.

Decision 'heavy-handed': AMC
The Assembly of Manitoba Chiefs, an intervener in the appeal, had backed the utility board's position. It said on-reserve customers are disproportionately vulnerable to rate hikes over time.

Grand Chief Arlen Dumas said Wednesday he was surprised by the court's ruling. 

He argued Indigenous people are unduly excluded in the setting of electricity rates in Manitoba.

"I will be speaking with my federal and provincial counterparts on how we deal with this issue, because I think it's the wrong [decision]. It's heavy-handed and we need to address it."

The appeal court judges said there is past precedent for setting equal electricity rates, regardless of where customers live. Legislation to that effect was made in the early 2000s and a few years ago, the PUB recognized that geographical limitations should not be imposed on a class of customers.

Since the board's new order didn't extend the same savings to First Nations members who don't live on reserve but face similar financial circumstances, it is clear the deciding factor was geography, rather than poverty or treaty status, the judges said.

Manitoba Hydro temporarily cutting 200 jobs, many of them front-line workers
"In my view, the PUB erred in law when it created an on-reserve class based solely on a geographic region of the province in which customers are located," the decision read.

While Manitoba Hydro objected to the PUB's order in 2018, it still devoted money to create the new customer class.

Spokesperson Bruce Owen said the utility is still studying the impact of the court's decision, but it appreciates the ruling.  

"We all recognize that many people on First Nations have challenges, but our argument was solely on whether or not the PUB had the authority to create a special rate class based on where people live."

Owen added that Hydro recognizes electricity rates can be a hardship on individuals facing poverty. He said those considerations are part of the discussions the corporation has with the utilities board.

Related News

• Electricity Forum News

• Energy Policy News

As Toronto's population and economy continue to expand, the demand for electricity in the city is also increasing rapidly. In response, the Ontario government, in partnership with the City of Toronto and various stakeholders, has launched an initiative to enhance the electricity infrastructure to meet future needs.

The Ontario Ministry of Energy and the City of Toronto are focusing on a multi-faceted approach that includes upgrades to existing power systems and the integration of renewable energy sources. This initiative is critical as Toronto looks towards a sustainable future, with projections indicating significant growth in both residential and commercial sectors.

Energy Minister Todd Smith highlighted the urgency of this project, stating, “With Toronto's growing population and dynamic economy, the need for reliable electricity cannot be overstated. We are committed to ensuring that our power systems are not only capable of meeting today's demands but are also future-proofed against the needs of tomorrow.”

The plan involves substantial investments in grid infrastructure to increase capacity and improve reliability. This includes the construction of new substations and the enhancement of old ones, along with the upgrading of transmission lines. These improvements are designed to reduce the frequency and severity of power outages while accommodating new developments and technologies such as electric vehicles, which are expected to place additional demands on the system.

Additionally, the Ontario government is exploring the potential for renewable energy sources, such as solar and wind, to be integrated into the city’s power grid. This shift towards green energy is part of a broader effort to reduce carbon emissions and promote environmental sustainability.

Toronto Mayor John Tory emphasized the collaborative nature of this initiative, stating, “This is a prime example of how collaboration between different levels of government and the private sector can lead to innovative solutions that benefit everyone. By enhancing our electricity infrastructure, we are not only improving the quality of life for our residents but also supporting Toronto's competitive edge as a global city.”

The project also includes a public engagement component, where citizens are encouraged to provide input on the planning and implementation phases. This participatory approach ensures that the solutions developed are in alignment with the needs and expectations of Toronto's diverse communities.

Experts agree that the timing of these upgrades is critical. As urban populations grow, the strain on infrastructure, especially in a powerhouse like Toronto, can lead to significant challenges. Proactive measures, such as those being implemented by Ontario and Toronto, are essential in avoiding potential crises and ensuring economic stability.

The success of this initiative could serve as a model for other cities facing similar challenges, highlighting the importance of forward-thinking and cooperation in urban planning and energy management. As Toronto moves forward with these ambitious plans, the eyes of the world, particularly other urban centers, will be watching and learning how to similarly tackle the dual challenges of growth and sustainability.

This strategic approach to managing Toronto's electricity needs reflects a comprehensive understanding of the complexities involved in urban energy systems and a commitment to ensuring a resilient and sustainable future for all residents.

California's legislators are about to vote on a bill that would impose stricter regulations on how utility companies spend the money they collect from ratepayers. This legislation directly responds to the growing discontent among Californians who are already grappling with high electricity bills, which can be partly attributed to wildfire prevention efforts.

Consumer rights groups have been vehemently critical of how utilities have been allocating customer funds. They allege that a substantial portion of this money is being funnelled into lobbying efforts and advertising campaigns that yield no direct benefits for the customers themselves.

The proposed bill would significantly broaden the definition of what constitutes prohibited advertising and political influence activities on the part of utility companies. This would effectively restrict the ways in which utilities can utilize customer funds for such purposes.

While consumer advocacy groups have favored the legislation, it has drawn opposition from utility companies and some labor unions. Opponents contend that it would hinder utilities' ability to communicate effectively with their customers and advocate for their interests. Additionally, they express concerns that the bill could result in job losses within the utility sector.

The vote on the bill is expected to take place on Monday. The outcome of the vote is uncertain, but it is sure to be a closely watched development for Californians struggling with the burden of high electricity bills.

California's Electricity Rates: A Burden for Residents

A recent report by the California Public Utilities Commission (CPUC) revealed that the average Californian household spends a significantly higher amount on electricity compared to the national average. This disparity in electricity rates can be attributed to a number of factors, including the financial costs associated with wildfire prevention measures, investments in renewable energy infrastructure, and maintenance of aging electrical grids.

Examples of Utility Company Spending that Raise Concerns

Consumer rights groups have specifically highlighted instances where utility companies have used customer money to fund lavish executive compensation packages, sponsor professional sports teams, and finance political campaigns. They argue that these expenditures do not provide any tangible benefits to ratepayers and should not be funded through customer bills.

The Need for Accountability and Prioritization

Proponents of the bill believe that the legislation is necessary to ensure that utility companies are held accountable for how they spend customer funds. They believe that the stricter regulations would compel utilities to prioritize investments that directly improve the quality and reliability of electricity services for Californians.

The impending vote on the bill underscores the ongoing tension between the need for reliable electricity services and the desire to keep utility rates affordable for Californians. The outcome of the vote is likely to have a significant impact on how utility companies operate in the state and how much Californians pay for their electricity.

Sudbury, Ont., is consuming more power than ever, according to green energy organizations that say meeting the demand will require cleaner energy sources.

"This is the welfare of the entire city on the line and they are putting their trust in electrification," said David St. Georges, manager of communications at reThink Green, a non-profit organization focused on sustainability in Sudbury.

According to St. Georges, Sudbury and northern Ontario can meet the growing demand for electricity to charge electric vehicles (EVs) and smart devices. 

According to the Independent Electricity System Operator (IESO), making a full switch from fossil fuels to other renewable energy sources could require more power plants.

"We have forecasted that Ontario's electricity system will need significant expansion to meet this, potentially more than doubling in size," the IESO told CBC News in an emailed statement.

Electrification in the industrial sector is adding greater demand to the electrical grid. Algoma Steel in Sault Ste. Marie and ArcelorMittal Dofasco in Hamilton both aim to get electric arc furnaces in operation. Together, those projects will require 630 megawatts.

"That's like adding four cities the size of Sudbury to the grid," IESO said.

Devin Arthur, chapter president of the Electric Vehicle society in Greater Sudbury, said the city is coming full circle with fully electrifying its power grid.

"We're going to need more power," he said.

"Once natural gas was introduced, that kind of switched back, and everyone was getting out of electrification and going into natural gas and other sources of power."

Despite Sudbury's increased appetite for electricity, Arthur added it's also easier to store now.

"What that means is you can actually use your electric vehicle as a battery storage device for the grid, so you can actually sell power from your vehicle that you've stored back to the grid, if they need that power," he said.

Harneet Panesar, chief operating officer for the Ontario Energy Board, told CBC the biggest challenge to going green is seeing if it can work around older infrastructure.

"You want to make sure that you're building in the right spot," he said.

"Consumers are shifting from combustion engines to EV drivetrains. You're also creating more dependency. At a very high level, I'm going to say it's probably going to go up in terms of the demand for electricity."

Fossil fuels are the first to go for generating electricity, said St. Georges.

"But we're not there yet, because it's not a light switch solution. It takes time to get to that, which is another issue of electrification," he said.

"It's almost impossible for us not to go that direction."

By Mark Winfield

While the troubled Site C and Muskrat Falls hydroelectric dam projects in B.C. and Newfoundland and Labrador have drawn a great deal of national attention over the past few months, Ontario has quietly been having a hydro crisis of its own.

One of the central promises in the 2018 platform of the Ontario Progressive Conservative party was to “clean up the hydro mess.” There certainly is a mess, with the costs of subsidies taken from general provincial revenues to artificially lower hydro rates nearing $7 billion annually. That is a level approaching the province’s total pre-COVID-19 annual deficit. After only two years, that will also exceed total expected cost overruns of the Site C and Muskrat Falls projects, currently estimated at $12 billion ($6 billion each).

There is no doubt that Doug Ford’s government inherited a significant mess around the province’s electricity system from the previous Liberal governments of former premiers Dalton McGuinty and Kathleen Wynne. But the Ford government has also demonstrated a remarkable capacity for undoing the things its predecessors had managed to get right while doubling down on their mistakes.

The Liberals did have some significant achievements. Most notably: coal-fired electricity generation, which constituted 25 per cent of the province’s electricity supply in the early 2000s, was phased out in 2014. The phaseout dramatically improved air quality in the province. There was also a significant growth in renewable energy production. From  virtually zero in 2003, the province installed 4,500 MW of wind-powered generation, and 450 MW of solar photovoltaic by 2018, a total capacity more than double that of the Sir Adam Beck Generating Stations at Niagara Falls.

At the same time, public concerns over rising hydro rates flowing from a major reconstruction of the province’s electricity system from 2003 onwards became a central political issue in the province. But rather than reconsider the role of the key drivers of the continuing rate increases – namely the massively expensive and risky refurbishments of the Darlington and Bruce nuclear facilities, the Liberals adopted a financially ruinous Fair Hydro Plan. The central feature of the 2017 plan was a short-term 25 per cent reduction in hydro rates, financed by removing the provincial portion of the HST from hydro bills, and by extending the amortization period for capital projects within the system. The total cost of the plan in terms of lost revenues and financing costs has been estimated in excess of $40 billion over 29 years, with the burden largely falling on future ratepayers and taxpayers.

Decision-making around the electricity system became deeply politicized. Legislation adopted by the Wynne government in 2016 eliminated the requirement for the development of system plans to be subject to any form of meaningful regulatory oversight or review. Instead, the system was guided through directives from the provincial cabinet. Major investments like the Darlington and Bruce refurbishments proceeded without meaningful, public, external reviews of their feasibility, costs or alternatives.

The Ford government proceeded to add more layers to these troubles. The province’s relatively comprehensive framework for energy efficiency was effectively dismantled in March, 2019, with little meaningful replacement. That was despite strong evidence that energy efficiency offered the most cost-effective strategy for reducing greenhouse gas emissions and electricity costs.

The Ford government basically retained the Fair Hydro Plan and promised further rate reductions. To its credit, the government did take steps to clarify real costs of the plan. Last year, these were revealed to amount to a de facto $5.6 billion-per-year subsidy coming from general revenues, and rising. That constituted the major portion of the province’s $7.4 billion pre-COVID-19 deficit. The financial hole was deepened further through November’s financial statement, with the addition of a further $1.3 billion subsidy to commercial and industrial consumers. The numbers can only get worse as the costs of the Darlington and Bruce refurbishments become embedded more fully into electricity rates.

The government also quietly dispensed with the last public vestige of an energy planning framework, relieving itself of the requirement to produce a Long-Term Energy Plan every three years. The next plan would normally have been due next month, in February.

Even the gains from the 2014 phaseout of coal-fired electricity are at risk. Major increases are projected in emissions of greenhouse gases, smog-causing nitrogen oxides and particulate matter from natural gas-fired power plants as the plants are run to cover electricity needs during the Bruce and Darlington refurbishments over the next decade. These developments could erode as much as 40 per cent of the improvements in air quality and greenhouse gas emission gained through the coal phaseout.

The province’s activities around renewable energy, energy storage and distributed energy resources are at a standstill, with exception of a few experimental “sandbox” projects. Globally, these technologies are seen as the leading edge of energy-system development and decarbonization. Ontario seems to have chosen to make itself an energy innovation wasteland instead.

The overall result is a system with little or no space for innovation that is embedding ever-higher costs while trying to disguise those costs at enormous expense to the provincial treasury and still failing to provide effective relief to low-income electricity consumers.

The decline in electricity demand associated with the COVID-19 pandemic gives the province an opportunity to step back and consider its next steps with the electricity system. A phaseout of the Fair Hydro Plan electricity-rate reduction and its replacement with a more cost-effective strategy of targeted relief aimed at those most heavily burdened by rising hydro rates, particularly rural and low-income consumers, would be a good place to start.

Next, the province needs to conduct a comprehensive, public review of electricity options available to it, including additional renewables – the costs of which have fallen dramatically over the past decade – distributed energy resources, hydro imports from Quebec and energy efficiency before proceeding with further nuclear refurbishments.

In the longer term, a transparent, evidence-based process for electricity system planning needs to be established – one that is subject to substantive public and regulatory oversight and review. Finally, the province needs to establish a new organization to be called Energy Efficiency Ontario to revive its efforts around energy efficiency, developing a comprehensive energy-efficiency strategy for the province, covering electricity and natural gas use, and addressing the needs of marginalized communities.

Without these kinds of steps, the province seems destined to continue to lurch from contradictory decision after contradictory decision as the economic and environmental costs of the system’s existing trajectory continue to rise.

Mark Winfield is a professor of environmental studies at York University and co-chair of the university’s Sustainable Energy Initiative.