Electricity is not a new electoral issue for Ontario Liberals. In 2011, thousands of Ontarians worked together to decimate the Ontario Liberal rural caucus (including three cabinet ministers), reducing them to a minority government over the Green Energy Act.
Those local communities were fighting for-profit developers, mostly heavy donors to the Liberal Party. Urban voters lied to, being told that wind would replace coal and electricity bills would rise just one per cent per year for fifteen years, as a result. Neither of these claims was true. The 50,000 jobs promised never happened either.
Ontario Premier Kathleen Wynn talks to the media about her plan to reduce hydro rates.March 2, 2017. (Photo: Bernard Weil/Toronto Star via Getty Images)
Ontario's Auditor General reported Ontarians had overpaid for electricity by $37 billion dollars between 2006 and 2014, and would be on the hook for $137 billion more. The government negotiated multi-billion dollar contracts with companies lining their party's election war chests, while trampling local democracy, ignoring science and refusing to accept the legitimate concerns of host communities. Kathleen Wynne eventually banned that kind of cozy relationships she and her predecessor Dalton McGuinty previously enjoyed.
Here are some ideas Wynne can implement today that would address the chronic oversupply of expensive and unreliable electricity in the grid, lower prices for consumers, and keep prices competitive:
Create a per megawatt levy on private electricity producers
The government has the right to tax and manage energy within their jurisdiction, and could create levies designed to pay the cost of transporting electricity to market to shift some of the burden to for-profit power producers. A separate levy could be applied against the global market adjustment, meaningfully reducing electricity bills for all power users. Neither of these moves would require renegotiating a single contract and would address the Auditor General's over payment findings.
Remove the cap on market value assessments so for-profit power producers pay their fair share of tax
The Green Energy Act caps the market value assessment on wind turbines to just $40,000 per megawatt, despite having a construction value closer to $2.5 million per megawatt. Municipalities hosting wind turbines are not getting their fair share of taxes.
Ontario could remove this regulation at the next Cabinet Meeting without a contract renegotiation or even a vote in the legislature, increasing municipality and school board budgets to offset increased electricity costs.
Allow electricity fuel type to be determined by science, not political dogma
Wind generated electricity has been around since the 1880s and has never been able to compete with hydroelectricity or any fossil fuel because you cannot control the supply of power. Without the ability to store massive amounts of wind energy that gets created when it isn't needed, we essentially 'waste' any surplus by selling it below market rates to neighbouring jurisdictions. Ontario has built fossil fuel plants to back it up.
Ten years ago, Ontario should have focussed on building the most affordable power, using reliable, safe, and dispatchable forms of electricity production, and would benefit from doing so now.
Restore public ownership of electricity production and transmission
Instead of borrowing money to invest in public infrastructure, Ontario Liberals let their donors build costly power plants, forcing Ontario electricity users to bear the burden of long term power purchase agreements through their hydro bills.
Electricity would be less expensive if profit margins and rates of return on debt weren't built into our electricity pricing. It is far more practical when power generation resources are publicly owned and controlled. Ontario could then mothball provincially-owned surplus systems without any other considerations.
Protect people and the environment from for-profit electricity producers
There is evidence that wind turbines cause a degradation in the overall health of a segment of the population living near them. The wind industry, Health Canada, and courts around the world accept this. Wind turbines built inappropriately close to the Great Lakes are having adverse effects on bird and bats, including endangered species. Ontario's wind turbines killed nearly 50,000 bats and birds in 2015.
A 2013 study by the U.S. Fish and Wildlife Service suggests wind turbines should not be placed within five kilometres of the shore line of the Great Lakes, while the Nature Conservancy of Canada believes the distance should be eight kilometres, and American Bird Conservancy supports a 16 kilometre buffer. Ontario should review the current placement of wind turbines and shut down those that cannot safely operate.
The steady litany of human and animal health and environmental concerns from the imposition of wind projects in rural areas shows these projects are fundamentally flawed and need to be reviewed. If developers have created conditions that adversely impact humans or the environment, Wynne can act. The Supreme Court has ruled a government cannot fritter away their power through commercial contracts.Developers with unsafe projects do not have an automatic legal right to compensation and as long as the Liberals don't do a repeat of the gas plant scandal and hand their donors billions of dollars they didn't need to legally, this move would be a major money saver for Ontarians.
Wynne Can Act -- Doesn't Need to Negotiate With Anyone
Each of these five ideas are easily implemented without contracts being renegotiated or having to be cancelled. All of them would make life better in Ontario and could be enough to convince the voting public that Kathleen Wynne's political deathbed conversion on energy might just be real.
One thing is for sure, the cynical 25 per cent off hydro bills isn't going to save the Ontario Liberals from an electoral disaster, but the ideas above just might.
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