The press release was issued on May 29, 2018, by the Ontario PC Party on behalf of Sudbury riding candidate Troy Crowder and Nickel Belt candidate Jo-Ann Cardinal
TORONTO — The NDP’s hydro plan will increase Ontario hydro rates, is based on numbers that don’t add up and will payoff Hydro One insiders at the expense of Ontario families, Ontario PC candidates Lisa MacLeod and Todd Smith shared today.
“Throughout the course of this campaign we have pulled back the curtain on the real NDP radical agenda to increase taxes and chase jobs out of Ontario,” said MacLeod. “Today we want to shine light on the consequences of the NDP’s real hydro policies. And how they will hurt you.”
In particular MacLeod and Smith focused on three key holes in the Ontario NDP plan:
• The NDP will immediately increase hydro rates by 25%, with an additional $600 million in higher hydro rates to follow once they shut down the Pickering Nuclear Generating Station.
• The NDP’s hydro numbers do not add up with a ’N/A’ price tag and a commitment to spend money that has already been allocated.
• Instead of using the Hydro One dividend to provide hydro rate relief to the people, the way the Ontario PC plan does, the NDP will instead use the dividend to pay off Hydro One shareholders as part of a 30-year quest to buy back Hydro One.
“The NDP plan is to spend money they do not have on a hydro savings plan that does not exist,” said Smith. “And along the way they are going to rip you off with skyrocketing hydro rates that Ontario families cannot afford.”
“I invite everybody to take a long look at their most recent hydro bill before they vote,” concluded MacLeod. “If you believe you should be paying more, then the NDP are for you. But if you believe that you are already paying too much, then you should vote for the only party offering real relief for the people: Doug Ford and the Ontario PCs.”
Backgrounder – NDP’s Incoherent Hydro Plan
May 29th, 2018
The NDP’s Unready Hydro Plan:
• The NDP hydro promise has not been properly thought through or adequately costed.
• Experts have called the plan an attempt to “put Humpty Dumpty back together again,” having an “air of unreality,” and lacking a “clear path."1]
• The NDP is just as responsible for getting Ontario into the hydro mess as Kathleen Wynne and the Liberals as Andrea Horwath and her NDP voted to support the Green Energy Act, which has led us to overpay on renewable energy by $9.2 billion according to the Auditor General.[2]
• The NDP wants to cancel the Fair Hydro Plan. That single policy decision will raise hydro rates by 25%, effectively cancelling out their alleged 30% reduction.
• Despite claiming to have a fully costed platform, the NDP lists the costs of their alleged 30% hydro reduction plan as “not applicable.”[3]
• The only thing they have costed out in their plan is their desire to re-acquire Hydro One, which they show will cost $300 million annually by using the Hydro One dividend paid to the province to pay off shareholders who currently own the company.
• Given that Hydro One was sold for $9.2 billion,[4] buying it back at a pace of $300 million a year, would take approximately 31 years to complete this transaction. Andrea Horwath would need to be re-elected nearly 8 times to see this through to completion.
• By using the Hydro One dividend to re-acquire Hydro One, Andrea Horwath and the NDP are proposing to take money paid directly out of every Ontario families’ hydro bill and use it to line the pockets of wealthy shareholders who already own Hydro One stock. This money should go back to families to reduce their bills.
• In addition, the prospectus that Hydro One and the government signed in 2015 prevents the province from ever securing more than 50% ownership. Andrea Horwath has not explained how she would terminate this agreement without penalty.
• Under the NDP plan, the average bill will only see a 17% savings.[5] The only people who will see a 30% savings are “urban seniors” who use electricity throughout the day.
• Next, the NDP wants to use the tax benefit Hydro One received of $2.6 billion to give back to ratepayers over four years. However, the Ontario Energy Board directed to Hydro One “that ratepayers receive 29 per cent of the savings and shareholders 71 per cent.”[6]
• That means this money is already being spent on rate reductions and on shareholder benefits. It cannot be re-spent by the NDP. This miscalculation is as much as 3.2% of their claimed 17% reduction.
• Next, 5% of the NDP plan relies on the federal government removing the HST from hydro bills. The NDP cannot guarantee that the Federal Liberal government will spend a single dollar reducing Ontario hydro bills.
• Even worse, The NDP wants to close Pickering early which will increase hydro rates by $600 million and remove 14% of the province’s power supply.[7]
How We Will Fix It:
• Doug Ford and the Ontario PC Party have a costed, affordable and realistic plan to reduce hydro rates by 12% for families, farmers and small businesses: Rebating the government’s portion of Hydro One’s dividend directly to ratepayers on their hydro bills. This will save the average Ontario household $70 a year – or roughly 4.7% – and will grow over time; Moving conservation funding to the tax base. This will save the average Ontario household $43 a year, or roughly 2.9%. Placing an immediate moratorium on any new energy contracts. Rebating the savings back to residential customers will save the average Ontario household $20 a year, or roughly 1.4%. Walk away from, or renegotiate, pre-notice to proceed contracts, where feasible. When rebated back to residential customers, this will save the average Ontario household $40 a year, or roughly 2.7%.
• A Doug Ford Ontario PC Government will also work with businesses to stabilize industrial hydro rates through a package of aggressive reforms.
Sources
[1] https://ipolitics.ca/article/putting-humpty-dumpty-back-together-again-ontario-ndps-hydro-plan-leaves-experts-cold/
[2] https://www.thestar.com/news/queenspark/2015/12/02/ontario-consumers-likely-paying-billions-extra-for-hydro-one-decisions-auditor-general.html
[3] https://www.ontariondp.ca/sites/default/files/Change-for-the-better.pdf (page 94)
[4] https://www.thestar.com/news/queenspark/2018/02/12/province-bearing-heavy-cost-of-hydro-one-sale.html
[5] https://www.ontariondp.ca/sites/default/files/final_ndp_hydro_announcement.pdf (page 1)
[6] http://business.financialpost.com/investing/hydro-one-getting-ready-to-rumble-over-tax-issue-tied-to-its-privatization
[7] https://www.opg.com/generating-power/nuclear/stations/pickering-nuclear/Pages/continued-operations.aspx
