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The decision to cancel 750 government contracts with wind power developers in Ontario has left rent seekers furious, and wondering where their next meal might come from?

Doug Ford’s eminently sensible decision will avoid thousands more of these things being speared across Ontario’s rural heartland, much to the delight of Ontario’s farmers. Not to mention saving power consumers hundreds of millions of dollars, over the long haul.

Squaring up with the developers may cost Ontarians dearly, but as Randall Denley details below, it’s a price well worth paying.

Randall Denley: Why it makes sense to cancel wind and solar contracts in over-powered Ontario

National Post

Randall Denley

5 December 2019

The cost and source of Ontario’s electrical power has been a hot topic for years, but happily for the PC government, it had dropped from the headlines. That is, until Energy Minister Greg Rickford was forced to defend the cost of cancelling 750 wind and solar contracts.

It ought to have been easy, because not going ahead with the extra generating capacity is the most rational thing the PCs have done on the electricity file. Ontario already generates more power than it needs and it sells the surplus at a loss. A 2017 study by the Ontario Society of Professional Engineers estimated that exporting power at big discounts cost Ontario up to $1.25 billion over two years. Adding more wind and solar would make that problem worse while doing nothing to make Ontario’s already-green power generation system greener still.

In Ontario, 86 per cent of power comes from emissions-free hydro and nuclear power. Wind provides seven per cent of the province’s electricity, with solar and biofuel contributing less than one per cent. Gas plants produce six per cent of power and act primarily as a backup for wind and solar, when it’s not sunny or windy.

That’s the power production, but a look at the capacity of the system should lower enthusiasm for more wind and solar. Wind makes up 12 per cent of the province’s generating capacity, nearly double its contribution to power produced. The most interesting number is natural gas, which could supply 27 per cent of the province’s power. This sector was massively overbuilt by the former Liberal government and at great cost. Less than 25 per cent of the province’s gas generation capacity is used.

If the goal is to cancel contracts as cheaply as possible, it’s probably not wise to announce that you have a bag of money to dispense

Ontario could introduce more wind and solar, but it would do nothing for emissions because that power would be replacing either hydro or nuclear. Besides, more wind in the province’s baseline power supply would mean more natural gas needed for back up, too. In environmental terms, the PC government was inarguably right when it decided to cancel unneeded wind and solar projects.

Thanks to some digging by the NDP, we now know the estimated cost of killing the power deals is $231 million. That figure created a furor on the opposition side of the legislature, but the math is pretty simple. The unneeded power would have cost ratepayers $790 million. Not buying it produces a net saving of $559 million. It would have been foolish to pass up that opportunity.

It’s fair to say the government played down the cost of the cancellations and did its best to keep the figure secret. If the goal is to cancel contracts as cheaply as possible, it’s probably not wise to announce that you have a bag of money to dispense.

It’s a pity the $231 million will have to be spent, but it would not have been necessary had the previous government not signed a raft of wind and solar deals simply for green optics.

Lacking support from either logic or arithmetic, the opposition parties saw their opportunity to grab headlines when Rickford made reference in the legislature to Germany, another jurisdiction with enormous enthusiasm for wind power. As Rickford noted, wind power in Germany has been heavily subsidized, but is now facing increased public resistance. The blowback has stalled Germany’s emissions reduction plan.

National Post