# Killing the Feed-in Tariff won't stop rate hikes



## andrewf (Mar 1, 2010)

There's an article in the Hamilton Spectator about a Pembina Institute Study suggesting that hydro rates will rise by the same amount with or without the FIT program for renewables. Their rationale is that natural gas will make up the difference, and that for a variety of reasons, natural gas prices will rise in the medium term (environmental concerns over fracking, build-out of US gas plants, use of natural gas in transportation) and that there will be some sort of carbon price. Put these factors together, and the gas we'll be using will be comparable in cost (or potentially more) than what we're spending on renewables under FIT.

I'm not certain I buy all of these assumptions, but it's definitely food for thought. 

It's also worth noting that FIT is not really what's driving rates right now. Rates are rising to help pay for infrastructure buildout, such as billions in retrofits for Hydro One transmission lines and new gas and nuclear plants that we'll be needing.

In other words, when some slick politician whispers sweet nothings in our ears about cheap abundant power if only we elect them to kill the FIT, we might want to take it with a grain of salt.

Link to Spectator Article


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## HaroldCrump (Jun 10, 2009)

Yeah, there is a similar article on the CBC too:
http://www.cbc.ca/news/canada/toronto/story/2011/07/05/ontario-electricity-costs.html

I agree that the FIT program is not causing the rate hikes (or most of it).
Therefore, canceling it won't help much.
What would help to some extent is taking out the HST tax grab from hydro bills (immediate 8% benefit).
And perhaps less full cream milk and honey for the bureaucrats and fatcats at OPA, OPG, and H1.


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## carverman (Nov 8, 2010)

It doesn't matter what programmes are added or deleted, electricity, like other commodities is now a return on investment, and there are people behind
the scenes that are responsible for rising prices. 

We will see more of that in the years to come.
Shaving 8% tax off the HST is not the real solution,
as they will just sneak in another charge..like the DRC which we will be paying for a long long time.


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## andrewf (Mar 1, 2010)

I thought they announced that the DRC was going to be retired soon? DRC was to pay the stranded debt from our last foray into politics+electricity--nuclear reactors. Apparently on-again, off-again project management makes for expensive nuclear reactors.


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## carverman (Nov 8, 2010)

andrewf said:


> I thought they announced that the DRC was going to be retired soon? DRC was to pay the stranded debt from our last foray into politics+electricity--nuclear reactors. Apparently on-again, off-again project management makes for expensive nuclear reactors.


Andrew..you are dreaming in technicolor! 

They aren't quite ready to to retire the DRC, while it is shrinking (slightly) ....for now it's a cash cow now..and
they got us over a..well electrical socket!

Since the breakup of the old Ontario Hydro they estimated/calculated that the residual stranded debt was
7.8 Billion. 
Now in practically 10+ years they haven't managed to pay off that amount with the DRC charge that
everyone in the province pays? 

Is it because they really don't have a clue and these are all "guesstimates" and the estimated retirement date of the stranded debt "could be somewhere between 2014 and 2018? 
Lets see some real graphs of the amount of stranded
debt still on the books and what actually has been paid
since the DRC has been applied to every electricity bill!

As a suggestion: With fuzzy math like that..why not add that to Hudak's political platform besides "killing the HST (pst) on electricity usage? 

see "debt repayment plan" 
http://www.oefc.on.ca/debtmanage.html


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