Ontarios Electricity Subsidy Undercuts Conservation
It’s a lengthy read, but it’s worth it…
Ontarios Electricity Subsidy Undercuts Conservation
Ontario’s Electricity Subsidy Undercuts Conservation
Toronto, June 14, 2011 – Ontario’s Environmental
Commissioner says the Ontario Clean Power
Benefit (OCEB) is a perverse incentive that could
endanger the energy conservation savings the government is hoping to achieve.
In his Annual Energy Conservation Progress Report
- 2010 (Volume One): Managing a Complex Power
System, released right now, Gord Miller says “The 10
per cent rebate on electricity bills is an
artificial subsidy on the price of electricity so
it encourages buyers to use far more.” A study by
energy analysts estimated that the OCEB could
wipe out a third of the planned conservation savings over the subsequent 4 years.
Miller praises the government for introducing
time-of-use pricing that encourages households
and companies to shift their consumption away
from periods of high demand, but noted that cost
subsidies undercut this development. Costs will
necessarily rise since of a backlog of
transmission investments and new generation
projects. “Unfortunately, the government hasn’t
addressed the problem of rising prices in a way
that prioritizes conservation,”says Miller.
“Instead it has continued the failed policy
approach of the past where the government’s only
answer to greater electricity rates is to
artificially lower electricity prices.”
If the government feels the require to aid
customers with the greater energy costs it could
make the benefit a fixed amount, rather of tying
it to consumption levels. “That way,” says
Miller, “the Clean Power Benefit would be less
of a disincentive to electricity conservation.”
Miller is also concerned about delays in rolling
out Ontario’s critical Conservation and Demand
Management (CDM) programs. Among now and 2014,
electric utilities, supported by the Ontario
Power Authority, are supposed to minimize overall
electricity use, as nicely as peak demand.
“Province-wide conservation programs had been all
supposed to begin in January 2011, says the
Commissioner, but the delays mean we will miss opportunities this year.
The Environmental Commissioner is also
questioning a recent choice by the Ontario
Energy Board to freeze conservation budgets for
Union Gas and Enbridge Gas Distribution,
especially at a time when the government has
cancelled its own conservation programs for gas
shoppers. “The Board has too narrow a view about
the advantages that will come with increased
conservation. It is ignoring the avoided
infrastructure costs and decreased greenhouse gas
emissions that will come with reductions in consumption of natural gas.”
To watch the Commissioner’s pre-recorded comments, please pay a visit to:
www.youtube.com/user/EcoComms
For more information, get in touch with:
Maria Leung
Communications and Outreach Coordinator
Environmental Commissioner of Ontario
416-325-3371 / 416-819-1673
1-800-701-6454
Maria.leung@eco.on.ca
For French language release and bilingual support, please get in touch with:
Jean-Marc Filion, 705-492-6997
The report is accessible for download at www.eco.on.ca