Lies, damned lies, and hydro promises

The Ontario New Democrats’ very bad plan for electricity will make consumer hydro bills shoot up, the Progressive Conservatives charged Tuesday. As opposed to the Tories’ very good plan, which will make bills shoot up later.

“Today we want to shine light on the consequences of the NDP’s real hydro policies and how they will hurt you,” Nepean Tory candidate Lisa MacLeod said in Toronto, with fellow incumbent MPP Todd Smith. They’re the Tories’ former and current energy critics, potential future ministers. Specifically, MacLeod and Smith said, the NDP would cancel the Liberals’ “Fair Hydro Plan” bill reductions, and that would cost consumers a lot of money. The Liberals cut retail hydro prices by 25 per cent last year, for no other reason than that Ontarians want cheap power. They’re doing it by literally putting the costs of electricity on credit for a while. According to the auditorgeneral, this will save $24 billion on our bills over the next few years, but then cost us $21 billion extra in interest by the 2040s. The New Democrats want to not do that.

“We will cancel the Liberals’ borrowing scheme that adds billions in new debt to finance short-term bill reductions,” their platform says. “It was a desperate move, and completely unsustainable.”

It’s a multibillion-dollar pledge, dealt with in passing and not mentioned anywhere in a separate document outlining the NDP’s hydro plan specifically. The thing is, the Liberals have already done some of this stuff. They’re making Ontario Power Generation, the utility that runs nuclear plants and hydro dams, borrow the money to cover the difference and OPG is already in hock $900 million because of it, on 15- and 20-year loans at about 3.5 per cent interest.

Hydro bills are lower now, as you’re aware if you pay one. The NDP could stop the borrowing from here on out. But if the government stopped subsidizing hydro prices, we’d no longer get subsidized hydro prices. The Tories say cancelling the Fair Hydro Plan will make bills increase 25 per cent. (To get back to where they used to be, they’d increase 33 per cent. The NDP aren’t the only party that buggers up simple math.)

“I invite everybody to take a long look at their most recent hydro bill before they vote,” MacLeod said.

“If you believe you should be paying more, then the NDP are for you.”

The Tories, in contrast, will keep borrowing money to lower bills temporarily just like the Liberals. Without magic, those loans will come due for the Tories, too. In the legislature, MacLeod has (rightly) called the scheme a “shell game” and labelled it the “unfair hydro plan” and now it’s her party’s policy.

The NDP say they’ll find a way to make it work.

“We are going to wind up the Fair Hydro Plan in a way that’s responsible and protects consumers to keep bills from going up, and in fact ensure they go down, by gradually taking private profit out of the hydro system,” NDP spokesperson Andrew Schwab said by email, when asked how an NDP government would keep bills from rising if the government stops subsidizing them. “The mechanics of wrapping up the Fair Hydro Plan, and replacing it with our priorities that deal with the underlying costs (as outlined in our plan) will have to be developed with ministry, OPG and our panel of energy, planning and financial experts,” he added. If you’re getting a sense that all the major parties’ hydro plans are bad, you’re right.

The Liberals’ Fair Hydro Plan lowers bills now, and paying all that money back with billions extra in interest later.

It leaves Hydro One as a half-privatized mutant, unsure whether it’s a public utility or a private corporation.

The NDP’s plan buys back control of Hydro One, removes a lot of incentives to use electricity more efficiently, and hopes the feds agree to cut sales taxes on it because, why wouldn’t they? They say this adds up to a 30 per cent price cut, though from where bills were before the Liberals did their trick.

The Progressive Conservatives’ plan is to fire the top people at Hydro One and transfer some expenses off hydro bills and onto tax bills. They’ve also repeatedly promised to “stabilize industrial hydro rates through a package of aggressive reforms” but haven’t said what those are. They say this works out to a 12 per cent price cut on top of the Liberals’ 25 per cent price cut, though they’d have to sort things out on the tax end somehow and also pay back the same loans as the Liberals. Only the Greens say yup, we’d cancel the Fair Hydro Plan and bills would rise and that’s the way it should be. They are the only party talking about this issue as if we’re grown-ups.

All the others shuffle costs around without making electricity any cheaper to generate or transmit. Nobody can do that unless they’re willing to attack the wages of tens of thousands of power-industry workers, which nobody is.

So they’re just offering us different ways to fool ourselves.