Air Pollution – Ontario Energy Policy

 
TECHNICAL REPORTS
A PROPOSAL FOR GETTING ONTARIO POWER PRICES DOWN

Together with coauthors at the Fraser Institute I have published a study looking at how to get Ontario electricity prices down.


We delve into Ontario public accounts data and show that subsidy payments to the renewables sector now comprise the largest component (about 40%) of the Global Adjustment, adding about 4 cents per kWh to our power prices. But renewables provide very little power in Ontario. Surprisingly, ninety percent of the revenue to the renewables sector is GA-funded subsidy, with only ten percent deriving from actual power sales. We recommend that these liabilities be terminated through legislation. Other savings on the GA are possible but lack of disclosure prevents detailed calculations. 

THE IMPACT OF HIGH ELECTRICITY COSTS ON ONTARIO MANUFACTURING EMPLOYMENT

Elmira Aliakbari and I completed a report for the Fraser Institute looking at the changes in Ontario's manufacturing sector since 2005, isolating as best we can the effects of rising electricity costs. We estimate that energy cost increases cost the province about 75,000 manufacturing jobs since 2008, roughly 2 jobs lost for every 1 the province claims was created by its Green Energy Act. 
The study received a higher-than-normal amount of media attention including articles in almost all daily papers across Canada, and countless radio interviews including 6 CBC affiliates.

DID THE COAL PHASE-OUT REDUCE ONTARIO AIR POLLUTION?

I coauthored a report with Elmira Aliakbari looking at declining air pollution in three large Ontario cities (Hamilton, Toronto and Ottawa). We constructed a statistical model to see how much of the decline could be explained by the phase-out of coal-fired power generation, as opposed to reductions in other domestic and US sources. Our study was published by the Fraser Institute on January 17, 2017:
Data and code archive here, We found that eliminating coal reduced fine particulates (PM2.5) a small amount, but the drop was statistically insignificant in Toronto and Hamilton. NOx does not appear to have been reduced and ozone was significantly reduced, but the effect was offset by an increase associated with the expanded use of natural gas. We show in the report that these findings are in line with internal forecasts analyses done by the province prior to the shutdown. 
DEMAND SIDE MISMANAGEMENT: HOW CONSERVATION BECAME WASTE
Tom Adams and I published a report through the Fraser Institute looking at energy "efficiency" programs. We focus on the large amounts Ontario is proposing to spend on such programs and make the case whey they are, in fact, a waste. It might seem counter-intuitive to argue that conservation is waste and efficiency is inefficient. But it's the government programs we are criticising. It should not come as a surprise that there is no basis for the belief that money spent on government-run energy conservation programs actually pays off in terms of at least that amount of money saved through reduced energy consumption. 
GREEN ENERGY AND THE GLOBAL ADJUSTMENT MECHANISM
October 2014: I coauthored a report with Tom Adams looking at the soaring path of electricity prices in Ontario since 2005. The report is: We examined the role of the so-called Global Adjustment (GA), a regulation-driven component of electricity prices that funds side-deals and price contracts with selected generators, including wind and solar operators. A combination of institutional analysis and an econometric model of the growth of the GA shows that wind and solar capacity expansion is a major driver of increases in the GA, with effects much greater than the value of direct payments to suppliers, due to the way renewables interact with the rest of the power system. We also make recommendations about how to mitigate the cost increases. Our report is available here from the Fraser Institute. R code and data for the econometric model are available here. 

ANALYSIS OF THE ONTARIO GREEN ENERGY ACT: 
April 2013: I released a report through the Fraser Institute examining the economic effects of the Ontario Green Energy Act, and pointing out that it costs far more than an alternative strategy that would have yielded the same environmental benefit. 
The report is available here and the statistical analysis logfiles are here. I was interviewed on television on April 13 in the morning, and later on the radio. 
OP-ED IN THE OWEN SOUND SUN-TIMES: more on wind energy. 
RESPONSE TO CRITICS: Various responses to my Fraser Institute Report on energy policy have come out, including ones from the wind industry and the Ontario Environment Commissioner. I was sent a series of questions about these rebuttals by a journalist,  and my replies are here. 
REVIEW OF THE GREENWICH WIND FARM ECONOMIC ANALYSIS: (March 2013) Some residents of the Eastern shores of Lake Superior asked if I would look at a report by a consulting firm called Crupi Consulting Group, which was prepared for the Ontario Ministry of Natural Resources and is disseminated on the MNR website (you won't learn the URL from me). The report seems to have greatly impressed a lot of staff members in the Ontario government and may lay the groundwork for even more atrocious ruination of the priceless North Superior shoreline through erection of yet more wind farms. The report is deeply flawed as a basis for understanding the net economic consequences of such developments. Indeed it is so ridiculous I can't believe the MNR staff disseminates it, let alone has put the Ontario government logo on it. Here is my letter to the group of residents explaining some of the flaws in the report. And this is what they are fighting to preserve: 
THERMAL POWER PLANTS 
Ontario's government has adopted the regrettable idea of shutting down our thermal power plants. I have presented counter-arguments in a few places. The most comprehensive is:
A 2007 presentation, to a conference organized by the Queen’s Institute of Energy and the Environment, made the same case very briefly:
I also did a review of the Ontario Cost-Benefit Analysis for the Power Workers’ Union in 2004. These two papers emerged from that work.
A related paper is my 2004 paper on particulates and affluence, published in the Fraser Forum.
In 2004 I made a presentation to a conference of the Association of Major Power Consumers of Ontario. Among other things I showed that the model used by the Ontario Medical Association to connect air pollution levels to death and disease rates at today's low pollution levels would have predicted implausibly high non-traumatic death rates in the mid-1960s given the then-higher pollution rates. In February 1965 it would have predicted more air pollution deaths than there were deaths from all causes. The text is here:
COMMENTARY & OTHER
EARTH HOUR ESSAY: 
In 2010 I was asked by a journalist for my views on the importance of Earth Hour. Here is why I do not celebrate it.
PRESENTATION TO THE HARVARD ELECTRICITY POLICY GROUP PANEL ON CARBON PRICING

I was invited to participate in a meeting of the HEPG which met in Scottsdale AZ on December 8-9, 2016. My PPT slides are here. The voice-over for slide 6 would be something along the lines of "It might be tempting to think the optimal tax is here but in fact it is [go to slide 7] here." I was one of four panellists in a session on carbon pricing. The others were Gernot Wagner of Harvard, Steven Rose of EPRI and Jerry Taylor of the Niskanen Institute. My presentation provided a summary of some core theoretical concepts of optimal emission pricing and the uses and abuses of Social Cost of Carbon numbers. Much of this material was drawn from my Ctax paper for the Calgary School of Public Policy and also from a short course I just finished teaching for Masters and PhD students at Queen's University. I also fitted in brief summaries of my work on empirical ECS and the social cost of carbon, and the temperature-indexed approach to carbon pricing. Chatham House rules forbid specific attribution of comments, but the event confirmed for me the extent to which even PhD-trained economists who work full time on environmental policy seem unaware of what the economic theory of carbon pricing actually says and how little support it gives for most current proposals.
THE DOWNSIDE OF ENERGY CONSERVATION: 
May 23 2014: A correspondent has asked me on Twitter what is the downside of energy conservation. Twitter being what it is, rather than try to go through all the reasoning in 160-character snippets, I have written up a 2-page note in reply. My thanks to @cswaine for the query. 
AFFIDAVIT IN PROVINCIAL ENVIRONMENTAL REVIEW TRIBUNAL 
October 2013: I was asked by a lawyer involved in an appeal against the Provincial government's decision to dump a thousand megawatts worth of wind turbines in the backyards of a group of rural residents, if I would submit an affidavit and then provide expert testimony in rebuttal to the government's case. The Tribunal, having given the government several weeks to get its case together, gave our side a day to assemble its response, and my affidavit was therefore put together in about two hours. Nonetheless I think it is pretty persuasive.  On Thursday October 10 I went into downtown Toronto to testify and be cross-examined on it. Instead of addressing the Tribunal I ended up sitting in a corridor outside the Hearing room for nearly 3 hours while the government lawyers argued that I should not be admitted as an expert, because my affidavit was irrelevant to the issues in the case. Eventually it seems the learned Tribunal accepted that point that since my affidavit rebuts material introduced by the government's expert witnesses, if the material I address is irrelevant, then by implication so are the affidavits of their experts, and they ought also to be excluded. This may yet happen. In the meantime, here is my affidavit (and I now have another date scheduled for giving testimony). 
February 2013: Letter to the Ontario Energy Board: I am regularly contacted by members of the public who live in rural areas of Ontario under threat from the invasion of massive industrial-scale wind turbine installations. I am highly sympathetic to the plight of rural folks as they contemplate lost property values, increased stress and nuisance, destruction of scenery, and community divisions under this policy-induced menace. Making matters worse, the economics for the province as a whole are disastrous and the environmental benefits are mythical. From every angle the Ontario Green Energy Act looks like a calamity, except to the rent-seekers who are profiting from the Feed-in-Tariff program at the expense of their neighbours and fellow citizens. In response to a request from a courageous community group trying to prevent the ruin of their township, I wrote a letter to the Ontario Energy Board to apprise the panelists of some of the realities of the situation, as they decide whether or not to approve a proposed wind energy project. The OEB is constrained only to look at two aspects of such projects when they make their decision. My letter points out that if they actually follow the instructions they have been given, they will realize that wind energy projects are not in the public interest. 

OEB LETTER UPDATE (March 13 2013): I have been contacted by many people across the province, who have asked permission to use my OEB letter to assist their own submissions to planning authorities in cases where it is equally applicable (basically everywhere wind turbines are proposed). I hereby give permission, and to facilitate its usage I have rewritten it into a generic form. I hope that anyone who ought to read it is given many, many opportunities to do so in the days ahead, by people who are facing the consequences of this horrific blight. (The photo is the actual view from a home in what was once one of the most beautiful places to live in Ontario -- now described by the resident as "a hideous place to live now".) 
DUNDALK COMMUNITY MEETING ON WIND FARMS, March 24 2014: On March 24 I spoke to a very large crowd at the Dundalk Community Centre in Southgate Township. Southgate is one of the few remaining municipalities in the area that, until last night, had not yet passed a motion declaring itself a willing or unwilling host for wind turbines. News had gone around that the Council intended to declare the Township a willing host. A local family (the McNaltys) helped organize a meeting featuring three speakers: me, a local realtor to discuss effects on property values, and a resident who discussed the effects on her health after turbines went up near her house. My presentation slides are here:
The other speakers were very good. The woman who spoke first had originally been in favour of turbines, and had approved their nearby installation. She did not initially connect the medical symptoms that she and her family started experiencing with the turbines, but noticed their abatement when they traveled elsewhere. She described the miserable series of ailments they started suffering and the evidence that finally convinced her they were due to the turbines nearby. She then described the ordeal of trying to get help from government agencies, only to find that in Ontario, the apparatus of government is structured only to advocate on behalf of the wind energy firms, and their victims are completely without recourse. 

The realtor who spoke next gave detailed evidence about the wreckage of property values, not only within the immediate vicinity of turbines, but in any district where they might potentially be installed. He described the growing number of unsellable lots even in areas that have before now been subject to increasing interest as recreation properties for people from Toronto. 

My presentation focused on the phony air pollution argument used by the province to ram the Green Energy Act through, the negative macroeconomic effects, the waste of money and the fact that, if anything, the GEA will raise rather than lower air pollution levels. 

Samsung Inc., the company behind a major proposed turbine project in Southgate, sent three employees to watch and answer questions. Written questions were read out by the moderator. Most were directed towards the Samsung guys, whose demeanour while answering struck me as arrogant and dismissive, like they had no intention of taking a bunch of rural yahoos seriously. 

It was a standing-room-only crowd, and there was no doubt by the end where the room stood on the question. 

I was informed this morning (April 3 2014) that Southgate Township Council last night voted to declare itself an unwilling host for wind turbines. The Samsung project is dead, as are any others planned for the area. 

I applaud the McNaltys and all those who made the effort to pull this meeting together, and I am pleased to have been able to help stop the spread of this grim plague. A pox on a provincial government that has inflicted so much misery on communities across the province.
ONTARIO's GREEN ENERGY ACT: In 2011 I published a column in the Financial Post on why Ontario should roll back its Green Energy Act. The Environment Canada emissions inventory data I referred to can be obtained here (box 2A). Unfortunately I made an error in the column. I pointed out that coal-fired power plants emit 699 tonnes of PM2.5, and I said that wood-burning fireplaces emit 65% more, or 1,150 tonnes. That is not correct. Residential fuel-burning fireplaces emit 1,150 tonnes of PM2.5. Residential wood-burning fireplaces emit 23,303 tonnes, or 33 times the amount from the power generating plants. 

WIND ENERGY CONFERENCE: In October 2010 I made a presentation to the Society for Wind Vigilance conference on wind energy and social justice. My presentation was called