Prices Roil Ontario Clean Energy Plan

The government in Ontario is tweaking and defending its aggressively green energy plan, trying to stamp down criticism brought on by spiking electricity costs linked to heavy investment in renewables.

Liberal Premier Dalton McGuinty’s government headed an announcement on the policy with word that the province will shut down its last coal-fired plant by 2014, that its policy is creating 50,000 green jobs and that renewable sources like wind, solar and bio will comprise 13 percent of the province’s power supply by 2018, up from 3 percent now. The government also said it will slash monthly electricity bills by 10 percent on January 1 and stretch off-peak pricing by 10 hours a week.

Wind turbines, Ontario energy policy

image via Ontario Ministry of Energy and Infrastructure

But even as it promised short-term price breaks, the government admitted that in the long-run, the 20-year plan it began in 2009 will be expensive. “To keep the lights on with energy powered by clean sources, residential and small business electricity bills are forecasted to increase by 3.5 per cent annually over the next 20 years,” the release from the Minister of Energy said. “Industrial rates are forecasted to increase by 2.7 per cent annually over the same timeframe. “

And that’s where the critics are aiming their fire. “While the switch to green energy may produce 50,000 new jobs, the higher energy prices the Act will provoke could kill that many (or more) jobs in existing energy-intensive industries such as manufacturing and agriculture,” the National Post wrote. And the Globe and Mail said: “Ontarians are about to start paying heavily for green energy. And for the next few years, the investment will be wildly disproportionate to its role in the system.”

Conservative leader Tim Hudak has called the Liberal energy plan “pie in the sky schemes.” The energy policy figures to remain in the spotlight as Ontario heads toward provincial elections in October 2011.

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Pete Danko is a writer and editor based in Portland, Oregon. His work has appeared in Breaking Energy, National Geographic's Energy Blog, The New York Times, San Francisco Chronicle and elsewhere.