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Sparks fly over electricity, rising prices

With a biogas plant in the works, Elmira finds itself on the front lines of the changes in Ontario’s electricity market. The transition has not been a smooth one.
The local project’s rough ride is in many ways indicative of the buffeting the provincial government has experienced on the energy file, especially since introducing the Green Energy Act last year.
Projects such as the one proposed by Woolwich Bio-En Inc. are part of the transition from dirty coal-fired plants to cleaner, more-sustainable sources of electricity. Few Ontarians may have issues with reducing greenhouse gas emissions, but where the controversy develops is in the rising costs and a backlash against the locations of some of the projects.

In Elmira, some residents are concerned about potential odours from a plant that will convert organic waste into methane, which will in turn power a generator. Opponents praise the idea, but would rather see the facility someplace other than the proposed site, an industrial property in the north end of town.

Everybody is supportive of green energy, says the president of the company behind the Elmira plan, but the opposition comes down to the potential impacts, mostly odour and traffic concerns.

A LENGTHY PROCESS Chuck Martin, president of Woolwich Bio-En Inc., is looking to finalize the paperwork for the Elmira project by early next year, after which time it will be reviewed by the province.

The key to easing those fears is more public information, said Chuck Martin, who took part in another open house session Tuesday night at Lions Hall in Elmira.

“We’re telling people, ‘yes, we’re working with smelly stuff here – and here’s what we’re doing to avoid any odour problems,’” he explained of Bio-En’s efforts.

Opposition here has been relatively mild, however, in comparison to the pushback against wind turbines. Under the umbrella of Wind Concerns Ontario, some 53 community groups in 31 counties in the province have been fighting against wind energy development. In fact, a Chatham-Kent organization this week launched a legal challenge against the first-ever project to get the nod under the Green Energy Act’s renewable energy approval process, a plan for eight 2.5-megawatt wind turbines near Thamesville.

Such local challenges are playing out against a wider backdrop of higher prices for electricity, the issue that has the most public play.

The provincial government expects electricity costs to rise 46 per cent over the next five years. The higher rates paid for renewable energy – in some cases, up to 20 times the market rate – will be part of those increased costs, though much smaller than, say, the expenses related to upgrading the aging grid that carries our electricity.

At Waterloo North Hydro, for instance, the need to spend on infrastructure led to the utility seeking an 18.5-per-cent increase on its portion of the electrical bill. If approved for implementation next May, the hike would add $69 a year to the average bill for residential users in Woolwich, Wellesley and Waterloo.

The increase would be the first since 2004. Rather than small annual increases, the province permits only infrequent rate adjustments, meaning when increases are approved, they look much higher than if you average them out over time, say hydro officials.

“Our primary job is to distribute electricity and to maintain the infrastructure for distributing it in our service area,” said spokesman John Janzen, noting the utility requires money to keep the system reliable, but has no influence on the cost of generating the electricity it carries.

“The transition to renewables will be more expensive. There will be upward pressure on rates.”
Martin, who serves on the WNH board, agrees.

“Renewable energy does come with a cost, but it also comes with benefits such as new jobs and a cleaner environment.”

To ease that transition, the province last week announced the Ontario Clean Energy Benefit (OCEB), which provides a 10-per-cent rebate on electricity bills for the next five years. The hope is to diffuse the public reaction to higher rates.

“The McGuinty government is listening and we are providing direct relief where it matters to Ontarians: in their pocketbook” said Kitchener-Conestoga MPP Leeanna Pendergast. “After decades of deregulation and cutting corners, our government is making the difficult, but necessary, investments to upgrade our energy infrastructure to produce reliable clean energy.”

With governments of all stripes having neglected the infrastructure for at least two decades prior to Dalton McGuinty’s election in 2003, the government has been trying to play catch-up ever since. That costs money.

There’s no room to try to cap rates, as the Harris government did after its aborted attempt to privatize Ontario Hydro, running up a tab of more than $900 million, she added.

“A cap is not a responsible thing to do.”

Pendergast predicts rates will stabilize over the next five years as the OCEB program plays out and the debt-retirement charge comes off of electricity bills.

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