Thursday, March 3, 2016

Electricity executive gets a grilling

Bruce Campbell, president and chief executive officer of the Independent Electricity System Operator, got a tough grilling from the audience at the annual meeting of Ontario Agri-Food Technologies in Guelph today.

Several said companies planning to build plants are going elsewhere because electricity costs are too high in Ontario.

Campbell said that when the entire package, including conservation incentives, is taken into account, Ontario rates “are competitive”.

That prompted another man to say he goes online to the Independent Electricity System Operator website to learn about conservation incentives and is referred to local distributors.

Yet when he logs on to them, he gets referred back to the IESO. He said it’s been like that for more than a year and said he checked it again in the 15 minutes before he raised the issue with Campbell.

Campell said conservation is a high priority program with the IESO and said he’s going to check “when I get back to the office.”

He also conceded under close questioning that sometimes electricity generators engage in “negative pricing,” meaning they pay customers to take electricity off their hands.

He said nuclear plants at Bruce, Darlington and Pickering are an example, such as a Sunday afternoon when demand plunges. If they cut back below a minimum generation rate, it would take too long to boot up again for Monday demand, he said, so they pay to have their electricity taken.

He said it’s usually exported at a low price. In fact, Ontario sometimes pays customers in Michigan and Ohio to take it.

He said the IESO buys electricity at the lowest price, but did not explain whether this means it doesn’t buy whenever demand is less than at system capacity from the highest-price suppliers - those who signed start-up 20-year contracts for solar and wind power.

Gord Surgeonor said he knows some large companies are building their own natural gas electricity generating plants because that’s less expensive than buying from the Ontario electricity grid.

That, however, means that the customers who remain on the grid are left to shoulder the costs for maintaining the grid.

Campbell said that’s one of the challenges the IESO is well aware of.

He said it’s necessary to plan for demand 20 years or more in the future, yet that’s becoming more difficult all the time with the advent of electric cars, improved conservation technologies, clients going off the grid and the coming carbon tax and/or cap-and-trade policies.

Campbell sat with one of his new board members, Deborah Whale who is also vice-chairman of the Ontario Farm Products Marketing Council and a new inductee into the Ontario Agricultural Hall of Fame.