The Price of Power

Bruce Laurie caused a stir with his article, “No one can make electricity cheap again”. I tend to agree with him, if only for his observation that the Darlington nuclear plant was built:

“10 years late and almost $12 billion over budget. No one could afford to pay the real cost of Darlington, so Ontarians carried that debt for the next three decades.”

With billions more committed by the Ontario government to refurbishment of our nuclear plants, there is no likely escape from this scenario in the near future.

Some critics blame Mr. Laurie for his role in higher prices as a “former director of the Ontario Power Authority (OPA) and Ontario’s Independent Electricity Systems Operator (IESO). He served as a member of the Electricity Transition Committee under the Harris government.”

So how high is ‘high’ for electricity prices? Hydro Quebec and Financial Post published comparative figures for 1,000 kWh of electricity from suppliers across North America (U.S.  figures were converted to Canadian dollars). InnPower came in at $182.09, which is not that different from Toronto Hydro at $181.95. ‘Low density’ rural Ontario had an average bill of $229. In Ontario our power relies on nuclear (60%) and hydro (24%).

Looking further afield, Montreal was $100, Winnipeg was $117, Ottawa $224, Halifax $220 and Vancouver $148. If we look across the US border, 1000 kWh averaged $409 in New York, $383 in Boston, $161 in Miami, $156 in Houston, $118 in Indiana.

How can we account for these variations?  Continue reading

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Turning the Tables with Smart Meters

My last article described the benefits of smart meters, which primarily provided savings to electric power generators and distributors. The objective of reducing costs to consumers through time-of-use conservation has not been realized. About half of the electric bill consists of a “global adjustment” for a constantly fluctuating market price of electricity. Yet the two-way metering by smart meters will allow consumers to eventually turn the tables.

As the centralized model of energy generation and distribution begins to disintegrate, consumers will have an opportunity to achieve real savings through the use of renewable technologies. Households will find it easier to install wind and/or solar arrays as costs drop. More people will generate some or all of their electricity requirements themselves. With net metering, surplus power can be fed back to the grid and the smart meter then reduces electric charges proportionately to as low as zero. Continue reading