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Mining Power Issues

Quebec-Ontario power-sharing shows energy synergy – by Martin Regg Cohn (Toronto Star – November 20, 2014)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Quebec has put separatism on the backburner. Is Ontario ready to reciprocate — by renouncing its own costly history of electricity separatism?

For decades, Ontario built political moats around its nuclear reactors — and raised the drawbridges to prevent the flow of cheaper hydroelectric power from our neighbouring province. But as Central Canada faces up to an era of economic upheaval and energy uncertainty, against a backdrop of newfound political stability, the calculus is changing.

We’ll get a hint of the economic and political benefits of energy co-operation Friday, when Quebec Premier Philippe Couillard and a dozen of his senior ministers sit down with Ontario’s cabinet. The meetings of ministers will produce a meeting of minds:

After months of negotiations kicked off by Wynne and Couillard, the two provinces are set to sign a historic power-sharing agreement — electrical, not political. The goal is to backstop each other’s base load electricity during peak periods, going beyond the traditional stop-gap approach of buying and selling power on short-term deals at peak periods.

This new approach will lead to ongoing power swaps without any money changing hands: Quebec’s peak load occurs during the winter heating season, when electrical baseboard heating puts a strain on its abundant reservoirs of hydroelectricity.

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How green energy is fleecing Ontario electricity consumers – by Ross McKitrick and Tom Adams (National Post – November 13, 2014)

The National Post is Canada’s second largest national paper.

Ross McKitrick is a Professor of Economics at the University of Guelph and Senior Fellow of the Fraser Institute. Tom Adams is an independent energy consultant and advisor.

Ontario’s green energy transformation – initiated a decade ago under then-Premier Dalton McGuinty – is now hitting consumers. The Nov 1 increase for households is the next twist of that screw. As Ontario consumers know all too well, the province has gone from having affordable electricity to having some of the highest and fastest-increasing rates in Canada.

Last year, in a report for the Fraser Institute called “Environmental and Economic Consequences of Ontario’s Green Energy Act,” one of us (McKitrick) explained how the Green Energy Act, passed in 2009, yielded at best tiny environmental benefits that cost at least ten times more than conventional pollution control methods, and was directly harming growth by driving down rates of return in key sectors like manufacturing.

But complex financial structures and a lack of official disclosure around large embedded costs have let supporters of the green energy act deny that green power is responsible for the price hikes. Green industry advocates, including the consulting firm Power Advisory and advocacy group Environmental Defense, have added up the direct payments to new renewable generators, and concluded that since those costs are relatively small, the impact of renewables on the total cost of power is likewise small.

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How green energy is fleecing Ontario electricity consumers – by Ross McKitrick and Tom Adams (National Post -October 30, 2014

The National Post is Canada’s second largest national paper.

Adding renewable generating capacity triggers changes throughout the system that multiply costs for consumers

Ontario’s green energy transformation – initiated a decade ago under then-Premier Dalton McGuinty – is now hitting consumers. The Nov 1 increase for households is the next twist of that screw. As Ontario consumers know all too well, the province has gone from having affordable electricity to having some of the highest and fastest-increasing rates in Canada.

Last year, in a report for the Fraser Institute called “Environmental and Economic Consequences of Ontario’s Green Energy Act,” one of us (McKitrick) explained how the Green Energy Act, passed in 2009, yielded at best tiny environmental benefits that cost at least ten times more than conventional pollution control methods, and was directly harming growth by driving down rates of return in key sectors like manufacturing.

But complex financial structures and a lack of official disclosure around large embedded costs have let supporters of the green energy act deny that green power is responsible for the price hikes. Green industry advocates, including the consulting firm Power Advisory and advocacy group Environmental Defense, have added up the direct payments to new renewable generators, and concluded that since those costs are relatively small, the impact of renewables on the total cost of power is likewise small.

However, such analyses ignore the indirect costs that arise from the way renewables interact with the rest of the power system.

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NEWS RELEASE: Miners launch successful one-day friendly invasion of Queen’s Park

This article was provided by the Ontario Mining Association (OMA), an organization that was established in 1920 to represent the mining industry of the province.

Scores of company representatives from Ontario Mining Association member companies constructively presented their industry’s attributes and contributions to politicians, staff and public servants in the province’s main political arena yesterday. There was a full day of activities helping to bring mining from around the province to Queen’s Park. “The theme today is Mining Builds Communities,” said OMA President Chris Hodgson.

At an evening reception, Michael Gravelle, Minister of Northern Development and Mines, said “Meet the Miners is a long standing tradition for all those who care about the mining industry in Ontario and it has been a tremendous day. Mining is important to the economy and communities.”

Mr. Gravelle referred to the recently released OMA gold mine study “An Au-thentic Opportunity: The economic impacts of a new gold mine in Ontario” in his address. There are impressive statistics in the new OMA gold mine study and it provides an opportunity to educate the positive impact of mining.”

Interim Progressive Conservative Leader Jim Wilson said “I am pleased to meet with the representatives of your Association. We want to make Ontario one of the best mining jurisdictions in the world and we know you want greater predictability and support on electricity pricing and skilled trades development.”

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Maximizing the mess with Ontario’s electricity assets – by Parker Gallant (National Post – October 21, 2014)

The National Post is Canada’s second largest national paper.

Hydro One paid $93-million for Norfolk Power, about 28.5 times profits. That’s pure insanity

Ontario’s electricity sector is in rough shape, burdened with escalating costs and an interfering government. Not much change or improvement is likely if the government takes up the schemes promoted last week in a speech by Ed Clark, the former CEO of TD Bank who now heads the province’s “Advisory Council on Government Assets.” The objective of the council is to look at three current government monopolies so as to “maximize the value to the people of Ontario.”

We’ll leave Mr. Clark’s comments on the liquor business to others. When it comes to the two electricity monopolies – Ontario Power Generation and Hydro One – Mr. Clark and his council’s proposals seem destined to maximize the mess rather than the value of Ontario’s power sector.

On OPG, the $39-billion asset company that owns gas, hydro and nuclear power installations all over the province, Mr. Clark proposed that it be split into two entities: one to manage existing generation sources and another to manage the Darlington nuclear refurbishment. The speech is silent on what happens to the Pickering nuclear plant.

The OPG proposal looks like an effort to simply create another electricity bureaucracy. For that reason it is impossible to see what benefits will be generated that will “maximize value.” Many large European and U.S. generators successfully produce power from a variety of fuels and there is no reason why OPG cannot do the same if properly managed.

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NEWS RELEASE: New Polling shows Northern Ontario First Nation residents’ perceptions on energy and mining

(October 16, 2014, Toronto, ON) New polling of Northern Ontario First Nation community residents that explores their attitudes towards renewable energy and resource develop was presented today by Oraclepoll Research President Dr. Paul Seccaspina at the Renewables & Mining Summit and Exhibition.

Issues surveyed in Northern Ontario First Nation Residents’ Perceptions on Energy and Mining, included:

• First Nation community residents’ attitude towards new energy generation sources (including renewable, nuclear and natural gas).
• Willingness to pay for new energy generation sources.
• Attitude towards provincial government renewable energy and conservation initiatives.
• Acceptability scenarios involving incentives and energy sources associated with a hypothetical mine development.

The research was conducted between September 26 and October 2, 2014 utilizing live person-to-person telephone calling to a random selected audience of First Nation community residents. Of the 200 respondents, a minimum of eight percent lived in communities not connected to the Ontario electricity grid and rely on diesel generation for electricity. The poll was commissioned by Environmental Communication Options, a firm actively engaged in a range of renewable, resource-focused and First Nation matters.

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Renewable energy a tough sell for prospective RoF developers – by Henry Lazenby (MiningWeekly.com – October 16, 2014)

http://www.miningweekly.com/

RONTO (miningweekly.com) – Among the many challenges facing as many as 20 mining companies holding claims in the Ring of Fire (RoF) mineral region of Northern Ontario, the most significant might be the limited infrastructure.

However, besides having to deal with exploration, project planning, First Nations negotiations and local capacity building, project proponents were under mounting pressure from stricter legislation, environmental lobby groups and locals to include renewable-energy sources in their future project plans.

Ontario government RoF Secretariat senior policy adviser Blaine Bouchard on Thursday told delegates at the Renewables and Mining Summit and Exhibition, in Toronto, that the nine-member group of Matawa group First Nations, who inhabit the province’s Far North, had made it clear in multilateral discussions that current diesel-based electricity generation was prohibitive of economic development and posed serious environmental impacts.

The First Nations living in the remote region were completely dependent on diesel electricity generation for their energy needs, owing to the province’s energy grid only reaching as far north as the Dryden region.

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The North is the Future of Ontario – Dave Canfield (Netnewsledger.com – September 26, 2014)

http://www.netnewsledger.com/

Northern Ontario is Ontario’s Future

THUNDER BAY – “We are the future of Ontario,” stated Northern Ontario Municipal Association (NOMA) President Dave Canfield. Speaking to the Northwestern Ontario Regional Conference, Friday morning Canfield updated the delegates,

“Getting our communities up and running is critical,” added Canfield, sharing with the delegates that at the recent AMO meetings, that the provincial government is listening. “Premier Wynne was present for the entire hour,” added Canfield, explaining that was the first time that had happened”.

Energy remains a focus for NOMA. Canfield explained that in talks with OPA, most of the time the elected officials, and communities are right. Getting the needed power in the region, not just for mining, but for forestry is important.

Infrastructure funding is a success for the north. There was $100 million announced in the budget. Canfield explained that it might take a bit of time to get it going, but the groundwork has been done.

Forging a New Path – NAN Grand Chief Yesno

Nishnawbe-Aski Nation Grand Chief Harvey Yesno addressed the delegates. One of the goals is building permanant infrastructure into our communities. The Grand Chief spoke on how high costs for transportation and food is impacting the region.

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Power grid connection for First Nations to save millions, report says – by Jody Porter (CBC News Sudbury – September 24, 2014)

http://www.cbc.ca/news/canada/thunder-bay

Ontario Power Authority report says 21 First Nations to be taken off diesel, connected to grid

The Ontario Power Authority says getting 21 First Nations off diesel generation and onto the provincial power grid will save a billion dollars over the next 40 years. The draft Remote Community Connection Plan outlines the business case for building power lines in the remote north.

The report states: “The $1 billion cost savings reflects only the avoidable cost of diesel fuel and system expansion. It does not reflect the additional economic, societal, developmental and environmental benefits that would also arise from transmission connection of remote communities.”

The federal government would reap the majority of the savings, as it is currently the major source of funding for diesel generation in First Nations.

However, all electricity customers in Ontario would benefit through a reduction in the rural and remote subsidy portion of their bills, according to Power Authority planning analyst Stephanie Aldersley.

“By having transmission connection we’re reducing some of the need for that cost so that’s how Ontario customers stand to benefit from the connection,” she said. Aldersley said there could be additional cost savings if a proposed mining development in the area moves ahead, but the plan doesn’t rely on it.

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Merkel’s Taste for Coal to Upset $130 Billion Green Drive – by Julia Mengewein (Bloomberg News – September 22, 2014)

http://www.bloomberg.com/

When Germany kicked off its journey toward a system harnessing energy from wind and sun back in 2000, the goal was to protect the environment and build out climate-friendly power generation.

More than a decade later, Europe’s biggest economy is on course to miss its 2020 climate targets and greenhouse-gas emissions from power plants are virtually unchanged. Germany used coal, the dirtiest fuel, to generate 45 percent of its power last year, its highest level since 2007, as Chancellor Angela Merkel is phasing out nuclear in the wake of the Fukushima atomic accident in Japan three years ago.

The transition, dubbed the Energiewende, has so far added more than 100 billion euros ($134 billion) to the power bills of households, shop owners and small factories as renewable energy met a record 25 percent of demand last year. RWE AG (RWE), the nation’s biggest power producer, last year reported its first loss since 1949 as utility margins are getting squeezed because laws give green power priority to the grids.

“Despite the massive expansion of renewable energies, achieving key targets for the energy transition and climate protection by 2020 is no longer realistic,” said Thomas Vahlenkamp, a director at McKinsey & Co. in Dusseldorf, Germany, and an adviser to the industry for 21 years. “The government needs to improve the Energiewende so that the current disappointment doesn’t lead to permanent failure.”

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Resetting the energy debate won’t be easy, despite premiers’ pact – by Claudia Cattaneo (National Post – September 3, 2014)

The National Post is Canada’s second largest national paper.

With Canada’s premiers agreeing to an energy strategy that is similar to what Ottawa has been pushing for years, the political classes seem to be in agreement that energy and its alter ego, climate change, should be at the top of the national agenda.

It’s a big achievement for a policy area that has been a minefield for Canada in the past. Will we finally make it happen? It won’t be easy given the reality on the ground, which is rife with conflict over energy-expansion plans.

From the City of Burnaby, B.C., fighting Kinder Morgan’s TransMountain expansion plans, to aboriginals mobilizing against all manner of energy infrastructure, to communities refusing to accept fracking to unlock natural gas, to anti-oil activists agitating to keep the oil sands in the ground, to disagreement over what needs to be done about climate change — a cacophony of special interests has been pushing priorities they believe are more important than the greater good.

They have chosen the streets, the courts, the regulatory system to press their case, and been pretty successful at it. Important projects have been delayed. Investors are getting nervous.

But last week’s provincial agreement has the potential to reset the debate by reminding us what Canada stands for — a moderate approach that strikes a balance between promoting energy development and improving environmental protection.

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Ontario talks hydro trade with Quebec and Manitoba – by John Spears (Toronto Star – August 27, 2014)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Ontario’s energy minister Bob Chiarelli has talked to Quebec and Manitoba about increased hydro power imports

Ontario’s energy minister says he has held direct talks with his counterparts from Quebec and Manitoba about importing more electricity into Ontario.

But Bob Chiarelli cautioned that making deals is “not a slam dunk in any way.” Chiarelli made the comments at the annual meeting of federal and provincial energy and mines ministers, which wrapped up Tuesday in Sudbury.

He said the one-on-one meetings with Quebec and Manitoba officials during the federal-provincial conference were useful.

“We discussed specifically and in detail the opportunities and the challenges that exist for us to have more energy contracts to supply Ontario,” he said at a news conference following the meeting.

Ontario is mulling huge new investments in nuclear power, and has established programs for renewable power developments. But Premier Kathleen Wynne has spoken publicly about buying more electricity from Quebec as well.

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Quebec-Ontario electricity trade is smart, but not simple – by Christopher Ragan (Globe and Mail – August 26, 2014)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Last week, Quebec’s and Ontario’s premiers announced their desire to work together on crucial issues, including climate change, interprovincial trade and infrastructure. It is very positive for Canada when our two largest provinces recognize the benefits of co-operation. We should certainly hope they succeed, but let’s also be mindful of the obstacles in their way.

Especially interesting is the prospect of greater interprovincial trade in electricity. This would be a game-changer in Canada, and a very positive one. Quebec has a great deal of low-cost hydroelectricity available to export, and its current U.S. markets are becoming less interested in purchasing long-distance hydro power because of their own development of low-price shale gas.

At the same time, Ontario’s economy continues to grow but has few options for increasing its electricity capacity at costs anywhere close to Quebec’s. So the idea of Ontario buying electricity from Quebec is obviously sensible.

Any idea that is so obviously sensible must have serious problems, and there are at least three that come to mind.

The first will be the pressures from within Ontario to resist importing cheaper Quebec electricity. It will be argued that Ontario has built a world-class nuclear industry and that refurbishing existing nuclear plants and building new ones is necessary to keep this expertise at home.

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Wynne, Couillard to push national energy strategy at premiers conference – by Jane Taber (Globe and Mail – August 25, 2014)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Bolstered by the new partnership with her Quebec counterpart, Ontario Premier Kathleen Wynne is eyeing Quebec’s abundant hydro power to light up Northern Ontario’s Ring of Fire development and reinvigorate talks for a national energy strategy.

She and Quebec Premier Philippe Couillard, both rookie premiers with majority mandates, recently forged a central Canadian alliance to co-operate on issues and bring prosperity back to their provinces.

Beginning on Aug. 26, all of the premiers will meet at the Council of the Federation in Prince Edward Island, and she and Mr. Couillard hope to come to the table with a “shared position” on a Canadian energy strategy. Under the previous separatist government – Mr. Couillard defeated Parti Québécois premier Pauline Marois in the spring provincial election – Quebec refused to participate in a Canada-wide strategy.

“It’s a different situation when there’s a strong federalist premier in Quebec,” Ms. Wynne said in an interview.

In addition, their new alliance calls for potentially increasing electricity trade between the two provinces. Northern Ontario is in dire need of infrastructure to help develop the Ring of Fire, which could provide thousands of jobs to the province and about $60-billion to its economy, according to the provincial government’s estimates.

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Ontario’s Wynne, Quebec’s Couillard forge central Canadian alliance – by Jane Taber (Globe and Mail – August 22, 2014)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Ontario and Quebec are forging a central Canadian alliance to co-operate on issues, including potentially expanding electricity trade, hoping their combined clout will bring back prosperity to both provinces.

Ontario’s Kathleen Wynne and Quebec’s Philippe Couillard announced the new regional partnership in Quebec City on Thursday. It is the first time the rookie Liberal premiers – both leading so-called have-not provinces – have met in person. According to one senior Ontario official, there is “a lot of personal like-mindedness and great rapport between the two.”

A bullish Mr. Couillard said the new central Canadian alliance signals the two provinces are “back as a very important block of influence in the country.”

“I think by acting together we will be more efficient,” he said. “When we have common concerns like infrastructure, like climate change, like energy strategy, it’s good that we voice those concerns together … Western provinces do the same, Maritime provinces do the same. It was time that Quebec and Ontario, again, do that.”

As have-not provinces, Ontario and Quebec rely on millions of dollars of federal equalization payments as they struggle in the federation economically.

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