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OPG wants 30% rate hike for nuclear generation; would add $5.36 to monthly bills

TORONTO – Already increasing electricity bills will soar even higher if Ontario Power Generation gets approval for a 30 per cent increase in the rate it is paid for electricity generated by nuclear power, the New Democrats warned Tuesday.

“You’re seeing rates go up faster than they should,” said NDP energy critic Peter Tabuns. “As long as the Liberals see a blank cheque as a parachute to get out of any tough spots, our bills are going to go up.”

OPG said the rate increase, if approved by the Ontario Energy Board, would add about $5.36 each month to the bill for typical residential customers.

The reasons for the requested hike “include ensuring obligations for used nuclear fuel management and decommissioning costs are met,” the government-owned utility said in a statement.

“As well, we will make investments in the plants over the next couple of years to set up the long-term operation of Darlington for 30 more years following refurbishment.”

However, the government pointed out there’s no guarantee the Energy Board will approve the rate hike for OPG, which has not had an increase in its rates since 2008.

OPG is currently paid 5.7 cents per kilowatt hour for nuclear generated electricity, while privately run Bruce Power is paid between 5.2 and 7.1 cents.

In 2011, the Energy Board not only rejected an OPG application to hike its base rate by 6.2 per cent, it actually lowered the rate by 0.8 per cent.

There will be public hearings on OPG’s new application as it comes under review by the OEB before any decision is made. OPG wants to increase the rate Jan. 1, 2014.

Opponents of nuclear power say Ontario should shut down its aging reactors and abandon plans to refurbish nuclear generating stations.

A report by the Ontario Clean Air Alliance said that every nuclear project in the province’s history has gone massively over budget, on average by 2.5 times.

If the OPG rate increase is approved, it will cost electricity consumers in the province $755 million a year, said Alliance spokesman Jack Gibbons.

“Cancelling the Darlington rebuild would save consumers more than $1.2 billion a year between 2020 and 2050,” he said.

Ontario’s Liberal government recently decided against building two new nuclear reactors, saying there was no need to spend more than $10 billion when the province doesn’t need the electricity.

The NDP complained that decision also added to hydro bills because millions were spent in prepatory work on the new reactors that won’t be built.

“They were irresponsible with the $1.1 billion spent to cancel gas plants in Oakville and Mississauga. They spent $180 million on a nuclear plant people knew wasn’t going to go forward, and they’ve committed $1 billion to refurbishment when they don’t even know the full costs of doing that work,” said Tabuns. “They are not thinking about and caring about public money.”

Ontario gets about 50 per cent of its electricity from nuclear generation. Energy Minister Bob Chiarelli said nuclear will likely fall to about the 47 per cent mark of the energy mix when the province’s long-term energy plan is released later this year, but building new reactors won’t be part of the strategy.


Budget 2014: Incentives for clean energy generation

OTTAWA—The federal Tories instituted in the 2014 document a Capital Cost Allowance (CCA) system that provides accelerated amortization deductions for certain clean energy generation and energy conservation equipment acquired before 2020.

The budget expands eligibility for accelerated capital cost allowance for clean energy generation equipment to include water-current energy equipment and a broader range of equipment used to gasify eligible waste.

The budget item includes a variety of stationary equipment that generates energy by using renewable energy sources or fuels from waste, or conserves energy by using fuel more efficiently. It allows the cost of eligible assets to be deducted for tax purposes at a rate of 50 per cent per year on a declining-balance basis—faster than would be implied by the expected useful life of the assets.

The feds estimate these measures will reduce federal revenues by a small amount in 2014–15 and by $1 million in 2015–16.

The CCA applies to equipment acquired after February 10, 2014, that had not previously been used or acquired for use.


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