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Ontario’s Long Term Energy Plan: A Way Forward

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This month saw the release of Ontario’s latest Long-Term Energy Plan (LTEP) by Energy Minister Bob Chiarelli. There was a lot of talk about what the LTEP will achieve for the energy needs of Ontario, and it seems that the plan has thrown up a few surprises, even for its most ardent skeptics.

Conservation First

The main objective of the latest LTEP is “Conservation First”. It means that the focus will be on conserving the energy rather than making any new commitments to the generation and transmission projects. Ontario has seen a marked change in its power sector since 2003; however, it has come at the expense of the province’s ratepayers.

One striking aspects of Ontario’s power sector in the last decade or so has been the number of avenues of power generation. The Liberal government has reduced the province’s dependence on coal, and in the process, it has looked to capitalize from renewable sources such as solar energy, wind energy, and hydroelectricity. According to the LTEP, this diversity in power generation will be sustained, but now the focus will shift onto the conservation of power. Considering the scenario in the global economy, conservation might be the best bet for Ontario in the long-term.

Flexibility

Another impressive feature of the LTEP is its acceptance of “flexibility”. Although the plan is aimed at the long-term, the Energy Ministry will keep on updating the LTEP based on its own annual reports, and also from the inputs of the Independent Electricity System Operator (IESO) and Ontario Power Authority (OPA). There were hopes that the plan will talk about amalgamating IESO and OPA, but the latest LTEP doesn’t talk about any such plan.

Pressure on Local Distribution Companies (LDCs)

Consolidation of LDCs has been a point that has been raised by a lot of people in the past, but remarkably, the LTEP hasn’t taken a defiant stand on this issue. However, the plan does emphasize that it expects the LDCs to cooperate in electricity ratepayer savings. Given the strong focus on the conservation of power, it remains to be seen whether or not the LDCs buckle under the pressure of maintaining efficiency standards.

Tariffs will Increase Steadily

One important reason LTEP was so anticipated was because people wanted to know how much they will end up paying for energy in the years to come. Well, according to the plan, there will be a steady rise in the prices in the next two decades; from the current rates of $125 per month, the prices will steadily rise to $210 by 2032. Industrial rates on the other hand, will grow from the current rate of $79 to $123 by 2032.

Raising Awareness

As the main motto of the LTEP is conservation of energy, there are a lot of measures that are in place for achieving this objective including the implementation of the Demand Response to cater to 10% of peak demand by the year 2025 and providing financial tools to customers so that they invest in retrofits.

To achieve its objective of energy conservation, the Energy Ministry will be launching a campaign to raise awareness among people about the best practices to use electricity judiciously. Part of this awareness campaign will see the launch of web feature emPOWERme, which will host interactive tools to educate the masses.

It has been around a fortnight since the LTEP has been released, and it has had positive reactions from the public. Given the objectives it has laid out, it needs to be seen whether it brings about a sustainable change in Ontario’s power sector in the times to come.

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