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Mining Power Issues

Buying Quebec hydro power a dim prospect for Ontarians – by Konrad Yakabuski (Globe and Mail – January 13, 2017)

http://www.theglobeandmail.com/

The Green Energy Act was written by Liberal-friendly renewable energy
lobbyists who managed to persuade the former Dalton McGuinty government
that there were big political dividends in making Ontario a wind and
solar powerhouse….As long as this madness goes on, instead of common-
sense energy planning, it’ll be one (price) shock after another for Ontarians.

U.S. wholesale electricity prices hit record lows in 2016 to the delight of millions of residential and industrial power customers who pay rates tied to the spot market. Cheap natural gas, which displaced coal as the main source of U.S. power generation last year, boosted the competitiveness of U.S. industrial power users and even led to a drop in residential electricity rates.

In October, U.S. residential electricity prices averaged 12.5 cents (U.S.) per kilowatt-hour, or about 16.5 cents (Canadian), according to the U.S. Energy Information Administration.

That may not sound like a bargain compared to Ontario, until you consider it is an all-in price that includes distribution and transmission costs, as well as taxes. It also marks a 2.1-per-cent price drop from 2015.

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Turns out Ontario’s painful coal phase-out didn’t help pollution — and Queen’s Park even knew it wouldn’t – by Ross McKitrick (Financial Post – January 18, 2017)

http://business.financialpost.com/

Ross McKitrick is a professor of economics at the University of Guelph and a senior fellow at the Fraser Institute. His study “Did the Coal Phase-Out Reduce Ontario Air Pollution” is available at fraserinstitute.ca.

The federal Liberal government plans to impose a national coal phase-out, based on the same faulty arguments used in Ontario — namely that such a move will yield significant environmental benefits and reduce health-care costs. One problem: those arguments never made sense, and now with the Ontario phase-out complete, we can verify not only that they were invalid but that the Ontario government knew it.

Together with Fraser Institute economist Elmira Aliakbari, I just published a study on the coal phase-out in Ontario and its effects on air pollution over the 2002–14 interval. Our expectation was that we would find very little evidence for pollution reductions associated with eliminating coal. This expectation arose from two considerations.

First, ample data at the time showed that coal use had little effect on Ontario air quality. Environment Canada’s emissions inventories showed that the Ontario power generation sector was responsible for only a tiny fraction (about one per cent) of provincial particulate emissions, a common measure of air pollution.

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Industry and indigenous communities let the sun in on the shared problem of diesel – by Sunny Freeman (Financial Post – January 7, 2017)

http://business.financialpost.com/

One of Chris Angeconeb’s first jobs was documenting diesel spills near schools, health clinics and airports on northwestern Ontario reserves for his Lac Seul First Nation.

Today, 25 years later, as vice-president of junior miner AurCrest Gold Inc., he’s trying to forge bonds between his company and nearby indigenous communities over a shared goal: ending their reliance on diesel.

Using diesel energy means companies and residents alike are susceptible to blackouts due to shortages as well as hazardous leaks and spills. The lack of reliability, volatile pricing and cost of hauling the fuel, often via ice roads or planes, in addition to the increasing viability of alternatives, has made getting off diesel a priority for both miners and remote communities.

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Beware of desperate politicians seeking ‘environmental legacies’ – by Kevin Libin (Financial Post – December 22, 2016)

http://business.financialpost.com/

Here’s to wishing all Canada’s provincial and federal leaders much success, prosperity and terrific polling numbers for 2017. Let us hope they all sail comfortably through the new year on high approval numbers from their voters. Because as Canadians — and now Americans — are learning, there is little more dangerous than a political leader with nothing to lose.

On Tuesday, after eight years of stifling U.S. economic growth, Barack Obama announced yet another round of rules to restrict oil and gas, this time ordering vast expanses of the Arctic and Atlantic seaboard “indefinitely off limits” to new offshore oil and gas exploration.

The reasoning was supposedly “the important, irreplaceable values of … Arctic waters for Indigenous, Alaska Native and local communities’ subsistence and cultures, wildlife and wildlife habitat, and scientific research (and) the vulnerability of these ecosystems to an oil spill,” according to a White House statement.

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Faced with soaring energy bills, Ontario businesses demand ‘love’ from Queen’s Park – by Chris Selley (National Post – December 21, 2016)

http://news.nationalpost.com/

TORONTO — The Ontario Liberals’ electricity price nightmare has plenty of human faces: middle-class parents, gainfully employed, struggling to pay for an essential utility. The opposition attack ads in 2018 will practically write themselves: Ontarians have endured a more-than-70-per-cent rate hike over a decade, driven mostly by production costs that were the direct result of Liberal decisions.

Through 2014, auditor general Bonnie Lysyk found last year, the system extracted $37 billion extra from Ontarians’ pockets. The nightmare might soon have a more recognizable corporate face. A group of small-to-medium-sized businesses calling itself the Coalition of Concerned Manufacturers of Ontario invited reporters on a tour of Leland Industries’ fasteners plant in Scarborough on Tuesday.

There were the good-paying blue-collar jobs. And here was a group of employers saying Ontario’s electric bills, and its forthcoming cap-and-trade system, were pushing them toward the brink.

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Amazon chooses Montreal for its Canadian data centre operations due to cheaper hydro costs than Ontario – by Vito Pilieci (National Post – December 20, 2016)

http://news.nationalpost.com/

Internet giant Amazon Web Services has opened a cluster of data centres near Montreal due to the ready availability and cost of hydro-electric power in Quebec.

The company, which is notoriously secretive about its data centres, said there are now at least two data centres just outside Montreal to offer web-based services to the “Canada Region.” Canada joins 15 other regions around the globe from which Amazon is running data services on behalf of clients.

Teresa Carlson, vice-president of public sector with Amazon Web Services, said the cost and availability of hydro-electric power is ultimately what made Amazon choose Quebec as its Canadian home. “We picked the area that we did because of the hydro power,” said Carlson. “We did find them (Quebec) to be very business friendly.”

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It’s time to expose the lie that expensive green energy won’t hurt Canada’s prosperity – by Philip Cross (Financial Post – December 20, 2016)

http://business.financialpost.com/

It is naïve or wilfully misleading to pretend there is an overall
economic benefit from higher energy costs. There is no possible
way of putting a positive economic spin on the doubling of electricity
prices in Ontario since 2002. It is a drain on household budgets and
a burden to the competitiveness of businesses.

We heard it repeated ad nauseum in the ongoing debates over Canada’s climate-change policy, this hackneyed catchphrase that our society does not have to choose between clean energy and economic growth. This makes it sound as if there are no economic risks in our choice of energy sources. Nothing could be farther from the truth.

The exploitation of energy is fundamental to economic growth. Ruth Sandwell, in her recent book Powering Up Canada, divides human economic development into two eras according to their principal sources of energy. The first was based on inefficient organic sources of energy, mostly plants and animals as well as wood, that produced a low standard of living for most of human history.

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Ontario business owners say high electricity rates are a threat to their survival – by Showwei Chu (Globe and Mail – December 20, 2016)

http://www.theglobeandmail.com/

Independent business group says energy prices are the number one issue for members

Tor Krueger has big plans for Udder Way Artisan Cheese Co., which sells handmade goat cheese in Stoney Creek, Ont. But crushing hydro bills are hurting the artisan cheese maker’s plans to modernize his facility so he can get federal certification and sell his cheeses across the country.

“After payroll, hydro is consistently one of my top three operating expenses,” Mr. Krueger said. Hydro One charges him upward of $2,000 a month, and “I don’t have any equipment in here that I would say is drawing a lot of power.”

Other small and medium-sized businesses (SMBs) in Ontario, such as restaurants Berkeley North of Hamilton and Fred’s Not Here of Toronto, are struggling to pay their hefty hydro bills. “That right now is the No. 1 issue for our members,” says Plamen Petkov of the Canadian Federation of Independent Business (CFIB), which has 42,000 members in Ontario.

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Revolution-era New York mine could produce hydro power – by Andrew Topf (Mining.com – December 19, 2016)

http://www.mining.com/

Mine in Mineville, 100 miles from Albany, contributed iron for one of the first naval battles of the Revolutionary War

Flooding a mine is a closure strategy that mining companies often use as part of a rehabilitation plan usually decided at the beginning of a mine’s operating life.

Once the tunnels are flooded, the mine and its workings become submerged, not just in a physical sense but in the minds of the public, who then regard that mine as finished, and the lake that fills the former pit probably assigned a recreational use.

An abandoned mine in New York state seemed to be destined to a similar, ignominious fate, but for a group of engineers who saw the historically-significant iron ore mine serving a more useful purpose.

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Ontario’s energy fiasco needs a fix, and a new report from the Chamber of Commerce is a good start – by Terence Corcoran (Financial Post – December 14, 2016)

http://business.financialpost.com/

Ontario’s electricity disaster is now so well known that everybody takes the grim facts for granted: Absurdly high prices, a billion-dollar smart grid boondoggle, huge overcapacity problems, energy poverty among consumers, hundreds of millions paid annually to companies not to produce electricity. Less well known is what some of the solutions might be.

A new report released Wednesday by the Ontario Chamber of Commerce outlines some ideas on how to fix the fiasco, including the welcome idea of getting the politicians out of the business of making decisions on energy supply. But that and other ideas from the chamber are unlikely to be enough for a system that needs radical reform.

The chamber’s report is aimed at influencing the province’s 2017 Long-Term Energy Plan (LTEP), which in practice is a quasi-Stalinist attempt to come up with regular 20-year revisable Gosplans for the province’s electricity system.

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If the hydro file finally knocks the Ontario Liberals back to earth, it will be nothing less than fitting – by Chris Selley (National Post – December 14, 2016)

http://news.nationalpost.com/

More than 1,400 Ontario households may soon get an unexpected gift: the miracle of alternating current electricity, with which to heat their homes and roast their geese and snuggle up on the couch and watch The Muppet Christmas Carol.

It’s Hydro One’s “Winter Relief Program,” under which customers who’ve been cut off for not paying their bills will be reconnected, free of charge, “for the remainder of the winter.” They will be offered “what payment arrangements they can afford” for amounts in arrears and, presumably, for the considerable costs they’ll rack up over the winter.

“This program is about doing the right thing for our customers who are experiencing hardship,” Ferio Pugliese of Hydro One said in a statement. The move follows a Global News report about “Carol,” whose family of six lived for half a year on generators, flashlights and bathwater her husband hauled home in garbage cans from his full-time blue-collar job.

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Be afraid: The brains behind Ontario’s energy disaster are now advising PM – by Graeme Gordon (CBC News Opinion – December 7, 2016)

http://www.cbc.ca/beta/news/opinion/

Phasing out coal, a feverish pursuit of green energy, new tax regimes — where have we heard all this before? It is uncontroversial to call Ontario’s energy situation a disaster. As Premier Kathleen Wynne has herself conceded: Ontarians are now having to “choose between paying the electricity bill and buying food or paying rent.”

Wynne’s polling numbers suggest that most Ontarians know where to square the blame, with a pitiful 15 per cent approval rating and 58 per cent of the electorate believing she should resign.

However, Wynne alone shouldn’t bear the burden for the fact that hydro bills for the average consumer have skyrocketed over recent years; it was former premier Dalton McGuinty and his Liberal team from 2003 to 2012 — including his former principal secretary and “policy guru” Gerald Butts — who set Ontario on this financially bleak, dead-end road. And now, Butts is headed on the same path, leading not the premier, but the prime minister, on the way down.

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Exclusive: Chile copper firms try to rejig contracts to tap renewable energy – by Gram Slattery (Reuters U.S. – December 7, 2016)

http://www.reuters.com/

SANTIAGO – Mining companies in Chile, by far the world’s largest copper producer, are examining their energy contracts to see if they can renegotiate terms to incorporate now-cheaper renewable power, company sources say.

The mines, long reliant on coal and gas to power everything from milling to drilling, are also inviting a broad range of wind and solar producers to major energy tenders for the first time.

The shift away from dirty energy in some ways reflects the unique situation of Chile, which has virtually no local gas or coal reserves, but a long, arid coastline amenable to wind and solar power.

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Wynne admits that breaking Hydro was a mistake. Ontarians will keep paying the – by Kelly McParland (National Post – November 24, 2016)

http://news.nationalpost.com/

Oshawa Mayor John Henry recently told the Oshawa Express, “The cost
of energy is destroying the economy of Ontario.”

Kathleen Wynne has admitted it was a “mistake” to so radically reshape Ontario’s power industry that people have to decide between buying food or paying their electricity bill. Even more, she has accepted the blame personally. In a confessional moment on the weekend, she confided: “I take responsibility as leader for not paying close enough attention to some of the daily stresses in Ontarians’ lives. Electricity prices are the prime example.”

It’s worth noting that Wynne offered her mea culpa not to the people of Ontario, i.e. the ones paying the usurious bills that drop through the mail slot, but to fellow Liberals meeting to discuss party issues, who were no doubt concerned at the government’s plummeting popularity.

A few more months scraping along below 20% approval and serious re-election doubts might arise. So Wynne’s admission may be an attempt to reassure agitated party colleagues as much as a show of remorse towards the great unwashed — or in this case the great unheated.

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Push to end energy poverty in indigenous communities underway – by Shawn McCarthy (Globe and Mail – November 24, 2016)

http://www.theglobeandmail.com/

For remote indigenous communities across Canada, the lack of clean, reliable energy is a major contributor to the grinding poverty that is a part of everyday life.

Some 200 communities in the country are not connected to an electricity grid and must rely on diesel generators for their power. They experience blackouts, fuel spills and a shortage of capacity that frustrates growth and development plans. While subsidized, the diesel is expensive – especially when warm winters melt ice roads and limit the ability of communities to truck in their fuel supply.

Governments at various levels are now working with indigenous leaders and energy companies to find new solutions to end that energy poverty. Federal, provincial and territorial ministers are due to meet in January with the various partners to come up with a joint plan to clear away institutional barriers to projects that would provide reliable electricity.

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