Twitter

Mining Power Issues

Gas pains for Wynne – Thunder Bay Chronicle-Journal (February 1, 2013)

The Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

IT is hard to argue Kathleen Wynne’s first decision as premier-elect of Ontario. Facing an $11-billion budget deficit, the government must question every bit of proposed spending to ensure it’s in taxpayers’ best interest. Using that logic Wynne has said a public inquiry into the Liberal government’s cancellation of two suburban Toronto gas plants in seats it tried to save will be too expensive.

That might fly if she would approve an alternative to the NDP’s demand for an inquiry. But she has not committed to a Progressive Conservative call to reconstitute a legislative committee that was about to delve into the matter when Premier Dalton McGuinty suddenly resigned and prorogued the legislature.

It has already cost Ontario taxpayers at least $230 million to scrap the two gas-fired generating stations and the Liberals were guilty of failing to produce all of the paperwork — which the opposition charges will reveal even more cost.
Wynne has acknowledged there may yet be more documents that should be revealed.

But the discovery of an email from an energy ministry employee directing the Ontario Power Authority on which documents to release and which to withhold demands Wynne act decisively to mend this wound on the government’s reputation. If she won’t approve reforming the all-party committee how can she offer absolute assurance the whole story will come out? Surely she won’t ask us to simply trust her.

Read more

As cost pressures mount, Ontario’s wholesale power prices set to soar – by Shawn McCarthy (Globe and Mail – January 31, 2013)

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.

OTTAWA – Electricity consumers in Ontario face the prospect of soaring prices in the coming decade, a trend that would put additional cost pressure on power-hungry industrial users.

The cost pressures are rising at the province completes the closing of its coal-fired plants while its nuclear fleet faces further retooling and renewable power takes a greater share of the load. A new forecast by London Economics International predicts Ontario’s wholesale power price will jump by 74 per cent – to $55.80 per megawatt hour between 2013 and 2022 from $32. That figure does not include higher costs to distribute the power and for conservation and other demand-side programs.

Concerns about rising electricity prices will be one of the key economic challenges facing the incoming premier Kathleen Wynne as she prepares to assume power from the outgoing Dalton McGuinty. Ms. Wynne will have to take on opposition critics who have slammed the government for its election-related cancellation of a gas-fired power plant that result in $190-million in compensation payments to the plant’s financiers.

Ontario is not alone in anticipating sharply higher power prices. Alberta will see its wholesale prices decline slightly over the next few years, but then turn, beginning to rise significantly in the latter part of the decade. Western New York State could see wholesale electricity prices double, but from a lower base than Ontario, according to A.J. Goulding, president of the Toronto-based economics firm, which has produced a series of forecasts for provinces and states.

Read more

Ontario’s gas-plant stink will linger after Dalton McGuinty’s departure – by Andy Frame (Toronto Star – January 26, 2013)

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.

Andy Frame is a consultant in the electrical power industry. Formerly he was a senior adviser on electric utilities for the Ontario energy ministry, a municipal hydro chairman and chair of the Utility Association.

This weekend, the Ontario Liberal party will have a new leader, the province will have a new premier and — eventually — the legislature will begin a new session.

But one old question remains. The opposition parties are determined to force the government to bring out all the details of the McGuinty administration’s power plant selection process, which they claim will cost the province up to $900 million.

Let’s go back five years to when the Ontario Power Authority (OPA) first announced its plan to build two new gas-fired power plants to serve the GTA. At a meeting attended by more than 500 in Mississauga, an OPA manager explained the site-selection process and listed the 10 sites under consideration. Local meetings were to be held to meet with citizen groups and other interested parties to explain the need for more power and the site-selection criteria.

Read more

Whatever happened to global warming? – by Margaret Wente (Globe and Mail – January 24, 2013)

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.

Are you freezing? Join the crowd. Arctic air is sweeping across Canada. Snow and ice are wreaking havoc on Britain. Russians are dying from the cold. And Germans are sneaking into forests to cut down trees because their fuel bills are so high.

Hey! Whatever happened to global warming?

That’s a naive question, of course. Everybody knows there’s little or no connection between daily weather events and climate change (except when there’s a heat wave, a hurricane or some other natural disaster, in which case global warming is invariably to blame). Experts will tell you that our bitter winter weather proves nothing about climate change – that the world is still warming up at an alarming rate.

Well, maybe not so alarming. Global temperatures have now held steady for 16 years. They levelled off around 1997. The latest data come from Britain’s weather and climate agency, the Met Office, which says you can’t draw any conclusions from such a short span of time. Still, the data are proving awkward for leading climatologists, who are reluctantly admitting that their projections have their limits. Nor is the news likely to increase support for activists such as NASA scientist James Hansen, who warned, in an interview with The Guardian back in 2009, that Barack Obama had only four years to set an example for the world and avert disaster.

Read more

Why are we still awaiting [power plant] decision? – Thunder Bay Chronicle-Journal Editorial (Globe and Mail – January 20, 2013)

The Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

When it comes to meeting Northwestern Ontario’s growing energy needs, “a few months” has become something of a mantra.
There has been a great deal of uncertainty around how to power the North since November, when the provincial government first hit the pause button on the conversion of the Thunder Bay Generating Station from coal to natural gas. The decision came after the Ontario Power Authority stated the region’s energy needs could be better met in other ways. Halting the conversion, the OPA said, would save $400 million.

That claim was enough to cause Energy Minister Chris Bentley to — temporarily — halt the project and tell the OPA “show me.”

That’s fair, as $400 million is no small sum. However, the OPA has yet to show anyone how that money will be saved.
In addition, the timing was unfortunate. The North is sitting on the cusp of a mining boom. Those mines will need energy; a 500-megawatt bump in regional power demand is expected by 2016.

Time, meanwhile, continues to tick toward Dec. 31, 2014, when all coal-fired power generation in Ontario is to stop. Unless Thunder Bay’s plant can somehow be grandfathered and continue burning coal, it will need to shut down if it’s not burning natural gas.

Read more

Power plan just months away – by Kris Ketonen (Thunder Bay Chronicle-Journal – January 18, 2013)

The Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

The province will have a plan in place on how to meet Northern Ontario’s growing energy needs within a few months, Ontario’s energy minister assured Thursday.

The question of how, exactly, to provide the necessary power to the region as it prepares for a mining boom was the topic of discussion at a meeting Thursday between Energy Minister Chris Bentley and representatives of the Ontario Power Authority (OPA) and the City of Thunder Bay.

The gathering didn’t produce anything concrete, save for an assurance that there will be more meetings on the matter.
Bentley said that was the point.

“I was determined that we not come in with a conclusion,” he said after the meeting at the Airlane hotel. “We didn’t come in with a report from the OPA, because I said we need to hear, in detail, from the energy task force and from the experts in the region.

“We’re not leaving with a conclusion, because they’ve got more work to do — both sides have got more discussions to have, so that we make sure we fully identify not only what the opportunities are, what the load energy requirements are, but the timing of those requirements, so we can get the infrastructure right.

Read more

Ontario coal-burning power plants to close this year – by John Spears (Toronto Star – January 10, 2013)

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 last coal-burning power plants will close by the end of this year, Premier Dalton McGuinty is expected to announce Thursday. The closure is either one year earlier than scheduled, or six years late, depending on your perspective.

The current deadline for closing the coal plants is Dec. 31, 2014 — which makes the new deadline a year early. But the McGuinty government had ridden into office in 2003 promising to close the coal plants by the end of 2007.

By that measure, the closure comes six years late. Closing the coal plants had been one of the Ontario Liberals’ signature promises, which they used to differentiate themselves from the Progressive Conservatives in the 2003 election.

“We’ll replace our dirty, outdated coal-fired electricity plants — the biggest source of air pollution in Canada — with cleaner burning natural gas, and renewable energy such as wind and solar,” McGuinty had vowed during the campaign.

Once in office, McGuinty found he couldn’t meet his 2007 deadline, as demand for power grew and Ontario struggled to keep the lights on.

Read more

The end of an era Dalton McGuinty’s sudden resignation announcement was the biggest story in a wild year for Ontario politics, writes Steve Paikin. – by Steve Paikin (Ottawa Citizen – December 26, 2012)

http://www.ottawacitizen.com/index.html

Dalton McGuinty had just completed his press conference, explaining why, after 22 years in public life, 16 of them as leader of the Ontario Liberals, and nine of them as premier of Ontario, he was stepping down.

As he walked jacketless from the Government Caucus Room toward his office at the opposite end of the second floor of the Ontario Parliament Buildings, he hugged his wife Terri and watched a phalanx of photographers blast him with their flashes.

After the flashes died down, I sidled up to the premier.

“You surprised?” he asked me.

“Nope,” I responded. “Absolutely shocked.”

“Good,” he said. “That’s what I was going for.”

The timing of Dalton McGuinty’s departure, announced at a hastily called caucus meeting this past October, was one of the best kept secrets in Ontario political history. Almost everyone seemed to be caught off guard.

Read more

[Newfoundland] Muskrat folly – by Tom Adams (National Post – December 19, 2012)

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

Tom Adams is a Toronto-based electricity consultant.

Newfoundland pushes project to exact revenge on Quebec

The governments of Newfoundland, Nova Scotia and Canada have teamed up to deliver what may prove to be the worst hydroelectric project ever in Canada — Muskrat Falls.

The plan involves building a dam and generating station on the Churchill River near Goose Bay, plus transmission lines to deliver power from Labrador to the island of Newfoundland and on to Nova Scotia. In 2010, the price tag was pegged at $6.2-billion with a modest contingency. Today, the price has ballooned to $7.7-billion, a figure that would be higher except that the contingency allowance was slashed by $370-million. Neither figure includes interest during construction that will add over a billion more.

To smooth what would otherwise be a drastic rate impact for Newfoundland consumers if conventional utility finance models were applied, the government plans to use a unique financial structure that shifts the main financial burden of the generator portion of the project up to 57 years into the future.

A joint federal-provincial review in 2011 refused to endorse the project.

Read more

[Ontario] Grits extend energy rebate – by Sebastien Perth (Sudbury Star – December 15, 2012)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

A provincial program that saves millions in energy costs for large industries in Northern Ontario has been extended for three years.

Northern Development and Mines Minister and Sudbury MPP Rick Bartolucci made the announcement Friday at Xstrata Nickel’s operations in Falconbridge.

The Northern Industrial Electricity Rate program can provide a company with a rebate of two-cents per kilowatt hour up to a maximum of $20 million a year. The program was set to expire in March, but will now be in effect until 2016.

To access Northern Industrial Electricity Rate funding, companies must provide a plan showing how they will reduce their energy consumption.

“They have to develop a plan that has to be in discussion with the Ministry of Northern Development and Mines and the ministry of Environment then they have to make sure that the plan is implemented and we follow to make sure that energy conservation is taking place,” Bartolucci said. “You see the success of the program and the importance of the program and if I am still where I am now (in the future), I’d be advocating for the program because it’s so good.”

Read more

[Ontario] Energy policy unintelligible – Thunder Bay Chronicle-Journal Editorial (November 30, 2012)

The Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

IT is becoming increasingly difficult, if not impossible, to understand Ontario’s energy policy. No more so than in Thunder Bay and Northwestern Ontario where the policy is marked by fits and starts instead of a stable program for reliable electricity that grows with demonstrated need.

Ontario is short of revenue and it is at times short of electricity. More electricity can and will lead to more revenue, both in terms of general economic development and through taxation. The recent Ambassadors study by Lakehead University demonstrated clearly that if just the nine most promising mining projects in this region proceed, $135 billion will be spent and $17 billion will be paid in taxes, a third of it to Ontario.

It is not an exaggeration to say that the new Northwestern mining boom can be the economic driver for all of Ontario. But it must have the electrical power on hand to run things.

As this newspaper reported Wednesday, as part of its responsible clean-air goal to phase out coal-burning power plants, Ontario drew up plans to convert the Thunder Bay Generating Station to natural gas.

Read more

Fight to keep power plant far from over – by Bryan Meadows (Thunder Bay Chronicle-Journal – November 29, 2012)

The Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

Thunder Bay’s Liberal MPPs continue their fight to keep the Thunder Bay Generating Station in the energy mix in Northwestern Ontario. Thunder Bay-Atikokan MPP Bill Mauro said Wednesday that he believes the plant conversion from coal-fired to natural gas can still happen.

“I think it can be salvaged,” he said. That’s despite an Ontario Power Generation decision to cancel a Union Gas contract, at a cost of more than $5 million, that would have tied the power station to the utility’s pipeline system.

Mauro said “if the conversion goes forward, those costs will not be lost, just included as part of the project. “It’s my belief that this will happen. The money will become part of the project. “I feel this is a cost-effective project, for our future it makes a tonne of sense,” he said.

“The cost of conversion is minimal compare to the value of the asset (of the Thunder Bay Generating Station).” Thunder Bay-Superior North MPP Michael Gravelle agreed, noting that Energy Minister Chris Bentley has made it clear that the suspension of the conversion plan is a pause in the process.

Read more

Ontario’s Power Trip — The gas bungle: $800M? – by Jan Carr(National Post – November 29, 2012)

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

Jan Carr is a director on several electricity-sector boards and former chief executive of the Ontario Power Authority.

Cancellation costs could have paid for five recent hospital projects

Decisions to relocate two Ontario electricity generating stations from the Toronto suburbs of Mississauga and Oakville to locations further afield in Sarnia and Lennox were driven by partisan political attempts to win at the polls. The relocations have a cost, however.

The exact costs are unknown, mainly because the provincial government has released only limited amounts of information, despite the highly publicized production of 56,000 pages of documents. The documents cover a period of time prior to the end of 2011, while the deals to relocate the plants were finalized in 2012. With the Ontario legislature prorogued, there are no legal channels to force publication of the final numbers.

The government has announced a $40-million “cost to taxpayers” for relocating the TransCanada Energy (TCE) plant from Oakville to Lennox and a “total cost” of $180-million for relocating the Eastern Power (EP) Mississauga plant to Sarnia. The credibility of these figures was first undermined by the discovery of an additional $10-million paid to EP related to a 1998 dispute over a different power plant contract. The long settlement delay indicates that the unannounced $10-million was negotiated as part of the current plant relocation agreement, bringing the total Mississauga cost to $190-million.

Read more

Power plant costs pile up – by Bryan Meadows (Thunder Bay Chronicle-Journal – November 28, 2012)

The Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

The bills are piling up amid failed attempts to convert the coal-fired Thunder Bay Generating Station to alternate fuels. The Chronicle-Journal has learned that Ontario Power Generation has cancelled a contract with Union Gas, at a cost of more than $5 million, that would have tied the power station to the Union Gas pipeline system.

The project was integral to converting the coal-fired plant to burning natural gas as fuel. Timmins-James Bay MPP Gilles Bisson said Tuesday that the Liberal government has now spent $20 million on its on-again, off-again plans to convert the Thunder Bay GS from coal to natural gas.

“If the government’s going to spend $20 million, they should walk away with something more than the bill they hand ratepayers,” Bisson said. “Instead of building responsibly to meet our province’s electricity needs, this Liberal government spends whatever they need to meet their party’s needs at election time.”

Bisson noted that the conversion of the Thunder Bay plant from coal to gas has been started and stopped twice. Conversion of the plant was announced in 2005 but the plan was cancelled in 2006. In August 2011, work started again, but it stopped this month.

Read more

[Northern Ontario] Forestry in transition – Thunder Bay Chronicle-Journal Editorial (November 26, 2012)

The Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

RESOLUTE Forest Products has made two major announcements in Northwestern Ontario in recent days. The company is idling a kraft mill and paper machine at its pulp and paper plant in Fort Frances, due to what it calls challenging market conditions.

The Montreal-based forestry company said it is closing the mill indefinitely as the market for specialty printing papers is expected to remain tenuous. About 239 employees will be affected.

Within days, Resolute announced plans to build an industrial wood pellet plant in Thunder Bay that will turn residual material into a source of renewable energy. The company said construction of the $10-million plant is expected to begin shortly and should be completed in 2014. It will hire 24 new employees.

Herein lies the changing nature of forestry. One market is fading just as another emerges. But let us not assume paper is a thing of the past. And let us not count on burning yet more fossil fuels as the answer to our energy needs.

Fort Frances is complicated by plant limitations and the decision by its main kraft pulp customer in the U.S. to buy elsewhere at less cost. Here again the Canadian dollar’s high value hurts Canadian exporters.

Read more