Financial Post – July 21, 2010
Ratepayers on hook for solar pricing
By Parker Gallant

Last week in a letter to the editor, Brad Duguid, Ontario’s Minister of Energy and Infrastructure, defended the recent reduction in prices for ground-mounted solar panels contracted by the Ontario Power Authority.

Duguid failed to say that the Liberals had given the OPA carte blanche to create the Feed-in-Tariff (FIT) program that set sky-high prices for solar. The OPA was then overwhelmed with applications for solar panels and wind farms, a clear indicator that the OPA, while taking marching orders from former Ministers Dwight Duncan and George Smitherman, took their pricing model from the green activists. All one needs to do is look at the agenda of the Association of Power Producers of Ontario’s 2007 conference. “NIMBY” was a key issue of discussion and the OPA sent 36 people (10% of its staff) to the conference.

The rush of foreign investments in wind and solar coming into Ontario will see a similar rush of ratepayer monies exiting the province in the not-too-distant future. Is the OPA being set up as the “fall guy” come the next election when the energy mess is likely to be a major election issue?

The OPA’s Dec. 31, 2009 annual report has an asset (receivable) listed for $173-million with the description “due from IESO,” the Independent Electricity System Operator. But if you look at IESO’s annual report for Dec. 31, 2009, it doesn’t have a corresponding liability. Its accounts payable totals only $20-million. Both annual reports were fully audited by external auditors. So what was it?

Contact with the Auditor General’s office finally resolved the difference. IESO acts as a clearing agent/transfer point between the local electricity utilities that collect from the ratepayers and the OPA, which is obligated to pay the private generators for the contracted power under the Standard Offer and FIT programs. The $173-million represents the monies that will be paid by the ratepayers (under future pricing adjustments) and have nothing to do with IESO. So why not call the receivable what it is – due from ratepayers?

Read the complete article here.