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‘Green energy’ simply doesn’t exist

Ronald Reagan used to have a funny line. He would say that the eight most frightening words in the English language were: “I’m from the government. I’m here to help.”

Ronald Reagan used to have a funny line. He would say that the eight most frightening words in the English language were: “I’m from the government. I’m here to help.”

You could add “government energy policy” to the list of scary words.

Always remember, no one can screw it up as bad as government. No one.

A couple of weeks back, a local environmental activist took me to task on the basis that he felt an old column of mine was misleading in my assertion that the subsidies for and nature of wind power meant that in a place like Alberta you have to tap three megawatt equivalent of natural gas or for every megawatt of wind power you actually generate.

The argument is that, if you finance wind power with coal, oil, and gas royalties, supposed greenhouse gas reductions to be found from wind power are as mythical as Camelot. This whole scenario is better explained by a recent situation in Ontario, which has embarked on an ambitious and disastrous expansion of wind-sourced electricity.

Along with a subsidy that’s roughly (and somewhat curiously) equal to the value of natural gas, wind power producers are entitled to sell all the power they can generate, regardless of demand.

In early October, Ontario wind producers generated a record 31,000 MWh of electricity in one day, for which they were paid $135 per MWh. This is about double the going residential retail rate for electricity in Ontario.

It goes downhill from there.

Ontario relies heavily on nuclear power, as well as coal-fired power plants. One of the advantages of coal and nuclear is that they can generate massive amounts of electricity from a relatively small power plant. One downside is that the nature of their steam generation means that they can’t react quickly to load fluctuations, which are incidentally exacerbated by wind power.

If demands on the grid load up quickly, it’s vital to have natural gas and hydro generation available in order to spool up generation rapidly. Excess power is sold across the grid where needed, and (rarely) simply dumped as steam if no buyer is available.

This is very expensive, because you have all the costs associated with power generation, while not having the benefit of selling any electricity down the line.

For that reason, utility companies use the big coal and nuclear plants running at high production levels to meet the “base load” and then use the smaller coal, hydro, and natural gas plants to meet the variations above base load.

It’s complex and costly.

Back to Ontario’s windmills.

The record wind power production in Ontario came during a period of low demand. In spite of the low demand for power, Ontarians paid substantially higher than standard rates for electricity that they neither wanted nor even needed.

All 31,000 megawatt hours produced by Ontario’s windmills during this period was sold on the open market at $21 per MWh, a net loss of $124 per MWh.

At the same time, Ontario Hydro’s Bruce nuclear power plant was forced to dump the equivalent of 14,000 MWh of steam as they had no takers for their excess power as Ontario law puts wind power generation at the front of the line.

This cost the ratepayers an additional $1 million, due to other power producers demanding — and winning — some form of compensation for costs arising from the preferential treatment given to wind power in these circumstances.

The bottom line is that, in one single day, Ontario taxpayers are out some $4.5 million for the privilege of generating power they didn’t use. They instead subsidized electricity that was consumed in Ohio, Michigan and New York.

In Ontario, wind power generates a tiny fraction of the electricity used in that province, yet it accounts for a third of the average homeowner’s power bill, and Ontario Hydro’s finances are backstopped by the Ontario taxpayer.

If you haven’t looked lately, Ontario’s public finances are in desperate straits. Ontario made no net contribution to equalization last year, and likely won’t this year.

There is no plausible scenario whereby Ontario will be able to continue financing wind power fiascoes such as this without the economic engine that is the much-maligned Western Canadian energy industry.

In short, Ontario can be adventurous and profligate with wind power subsidies only because the nations’ public accounts are fattened by resources drilled and dug out of the Alberta ground. Without the oil industry, the wind industry can’t exist. This reduces greenhouse gases exactly how?

Bill Greenwood is a local freelance columnist.