Tuesday, January 11, 2011

Ontario customers paid $52.8 million last month to subsidize electricity users in the United States and Quebec.

By Don Butler,

Postmedia News January 11, 2011

Ontario producers sold a record amount of electricity to neighbouring jurisdictions in December. But if you think that's good news, think again.

What it really means is that Ontario has so much surplus power, it has to unload it at whatever price it can get. And lately, market prices have been well below what Ontario residents pay for the same electricity.

Because wholesale electricity prices are in the basement, "we're losing money on every kilowatt hour that crosses the border," says energy consultant Tom Adams. He calculates that Ontario customers paid $52.8 million last month to subsidize electricity users in the United States and Quebec.

There was so much surplus electricity flooding the market, Ontario generators even had to pay users as much as 13 cents a kilowatt hour to take surplus power off their hands at times.
Typically, those negative prices only apply to a few isolated hours. But on New Year's Day, the hourly Ontario energy price for the whole day was negative, averaging -$20.29 per megawatt hour -- the lowest daily average since records began.

As a result, Ontario power generators paid $1.46 million to external markets to rid themselves of power on Jan. 1, according to the province's Independent Electricity System Operator.
In theory, Ontario businesses and residents also benefit from low or negative wholesale power rates.

But those savings are offset by something called the global adjustment charge.
Global adjustment, formerly known as the provincial benefit, accounts for the difference between the spot market price and the minimum rates paid to regulated and contracted electricity generators.

Those rates vary widely, depending on the generation source. But right now, they're higher -- sometimes much higher -- than the wholesale price, which averaged 3.79 cents per kilowatt hour last year.

© Copyright (c) The Windsor StarRead more: http://www.windsorstar.com/Power+exports+necessarily+good+thing/4089636/story.html#ixzz1AkOp1bqq


  1. That includes all wind and solar too. Not one erg of wind power was consumed in Ontario.

  2. The govenment needs to lower our rates so people will use more energy, then we are not paying people outside of the province to take the excess, since that means those costs will have to be obsorbed by the ontario consumers. and I for one feel that we are already paying enough for the mistakes of Ontario Hydro (for examples: retirement fund)

  3. when there is an over supply of electricty/power and you can sell it at whatever price. great. this power is not stored in a battery its use it or lose it, so to myself that money was a good deal. what happens when evrything is running full tilt /nuclear plants are being closed or refurbed electric cars are the norm etc and demand far exceeds supply.are we ready for that?

  4. In a recent IEO report they don't expect demand to start to increase until 2018, and then an additional 8 years to return to the highest demand of 2005. By that time we will have several nuke reactors back on line. A report I read from the US claimed that a reliable power system needs at least 15% capacity over demand.

  5. is it not great to feel assured that you will never be sitting in the dark no matter what the cost. I think that we have to be concerned about the future of this planet so that others will have a chance as well.. It is all nice to think that everything can be accomplished with out negative problems but you can not have your cake if you are eating it too.

  6. Anonymous said... "It is all nice to think that everything can be accomplished with out negative problems but you can not have your cake if you are eating it too."

    If by this you mean that you agree that private companies can suck us dry of every last dollar we earn for the sake of our planet then you are deluded. Governments could offer a very mild incentive to private enterprise to develop green energy sources, they dont have to offer them billions of tax payers dollars like what is happening now. It just way too much profit.


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