Ford government’s cancellation of renewable energy projects to cost at least $231M

Thestar.com
November 20, 2019
Rob Ferguson

The Ford government’s cancellation of almost 800 renewable energy projects after taking power last year will cost Ontarians at least $231 million, sparking comparisons with a previous Liberal government’s costly axing of two natural gas-fired power plants.

When the projects were cancelled, Energy Minister Greg Rickford repeatedly refused to discuss the costs of any penalties. He said legislation would be passed to keep them “as low as they can be,” and that the move would save electricity consumers $790 million.

“How can the premier claim he’s saving taxpayers and ratepayers money when he’s throwing away $231 million not to build renewable energy?” New Democrat MPP Peter Tabuns said of the July 2018 decision to halt 758 projects and the White Pines wind turbine farm in Prince Edward County.

“Wasting $231 million to cancel hydro contracts is the sort of thing the previous Liberal government did during the gas plants scandal,” Tabuns added. “The similarities are striking.”

The $231-million figure was found by the NDP in the latest public accounts from the Ministry of Energy under operating expenses in a subsection called “other transactions.” It was later clarified for the legislative library by the ministry as funds “to wind down renewable energy contracts while ensuring that the costs of terminating those costs are not borne by electricity consumers.”

Ontario’s auditor general found the cost of former premier Dalton McGuinty’s decision to scrap two politically unpopular gas plants in Mississauga and Oakville before the 2011 election could cost up to $1.1 billion over 20 years. The Liberal government’s initial estimates of the total cost were a fraction of that.

On Tuesday, Associate Energy Minister Bill Walker defended the government’s decisions. “We believe we had to take those actions to try to ... lower costs across the board,” he told the legislature.

“Our government has been very clear it would act to cancel any unnecessary contracts. Ontario has an adequate supply of power right now.”

Walker noted the White Pines project was the subject of local objections and a downsizing order by the Environmental Review Tribunal, reducing it by two-thirds to nine wine turbines. The turbines were opposed by the local municipality and many area residents in the Bay of Quinte riding of cabinet minister Todd Smith, in part over concerns about migratory birds and the Blandings turtle.

The tribunal decision “should have led to cancelling the contract at that time,” Walker said, blaming the Liberals for signing “reprehensible” contracts with terms that were “written so stringently.”

Observers have suggested the White Pines cancellation alone could cost $100 million, but Walker would not comment on that figure.

Tabuns said he finds the government’s defence of the $231 million cost “a bit rich.”

“I sat through the whole of the gas plant experience,” he told reporters. “The Conservatives went out of their minds over the waste that was committed by the Liberals, and now they’re doing exactly the same thing.”

Tabuns also compared the cancelled renewable energy projects to a 1995 decision by the Progressive Conservative government of Mike Harris to stop construction of an Eglinton subway line, only to see the project resurrected at the Eglinton Crosstown Line in recent years with a scheduled completion date of 2021.

“We’re going to have to have more renewable power in the next few decades,” he said, “and simply rolling things back -- literally demolishing renewable energy projects -- is taking us backward on fighting the climate crisis.”

Green Leader Mike Schreiner said it was wrong-headed for the Ford government to order White Pines dismantled -- even though he agrees the Liberal government chose a bad location -- because more renewable energy is needed to fight climate change.

Get more politics in your inbox
Make sense of what's happening across the country and around the world with the Star's This Week in Politics newsletter.
Sign Up Now
“Once the wind turbines were put in place, they should stay in place, especially because the company put in mitigation measures to address some of the concerns around endangered species,” Schreiner said.

The government also had to pay a kill fee of $103 million U.S. when American state regulators rejected Hydro One’s takeover of a northwestern U.S. utility called Avista Corp. over concerns about political interference in the ouster of Hydro One’s CEO, and has earmarked $30 million for a court battle over Ottawa’s power to impose a carbon tax, Schreiner noted.

“We’re starting to get into Liberal gas plant territory when you add all those numbers up,” he said.