TORONTO

The Ontario government's energy conservation program is a multibillion-dollar boondoggle that wastes public money and doesn't lower the cost of electricity, according to a new report by the Fraser Institute.

Authors Tom Adams, an independent energy and environmental consultant, and Ross McKitrick, an economics professor at Guelph University, contend in "Demand Side Mismanagement: How Conservation Became Waste," that Premier Kathleen Wynne's government is making outlandish claims about how much money it has saved through energy conservation that have no basis in reality.

In November 2012, Adams correctly predicted the public cost of then premier Dalton McGuinty's cancellation of two gas plants in Oakville and Mississauga would exceed $1 billion.

His estimate, based on government documents available at the time, was $1.3 billion.

McGuinty's response was: "Of course I fully reject that calculation. We're very confident that the costs are in total $230 million."

A year later, the Ontario auditor general put the cost at up to $1.1 billion.

In this new report released Tuesday, Adams and McKitrick say the Liberals are equally in the dark about their conservation program. "Queen's Park is betting heavily that conservation programs will provide an effective and low-cost means of managing power needs in the coming decades," they write. "Unfortunately, Ontario energy plans rely on unsubstantiated and overly-optimistic claims. We closely examine(d) the analyses behind the province's 'Conservation First' plans, and find either an absence of credible data, or overly-optimistic numbers based on methodologies known to be unreliable."

This refers to a 2013 government document, "Conservation First: A Renewed Vision for Energy Conservation in Ontario," in which Wynne commits to spending billions of dollars from 2015 to 2020 on programs similar to McGuinty's.

"Overall we find the information contained in the province's conservation strategy nowhere near credible enough to overturn the strong expectation, based on decades of data ... that Demand Side Management (the government's approach) will cost Ontario a lot and yield very little," Adams and McKitrick write.

They specifically challenge a claim by Wynne's energy minister that "between 2006 and 2011, investing $2 billion in conservation allowed Ontario to avoid more than $4 billion in new supply costs."

The authors note they wrote repeatedly to the energy ministry between June and September 2015, asking for a breakout of the government's conservation spending by year and agency, plus "any external audit" performed on the Ontario Home Energy Savings Program and the Ontario Home Energy Audit Program, to back up this claim.

The government replied "external financial audits were not performed on these programs," and the rest of the information given was too vague to assess the government's claims.

Adams and McKitrick conclude: "Ontario seems determined to gamble on costly new energy conservation programs without first stopping to weigh the costs and benefits objectively. As with the Green Energy Act, we expect this experiment to end badly, with Ontario taxpayers and ratepayers paying far more for the programs than they save in power costs."

lorrie.goldstein@sunmedia.ca