March 6th, 2010
AECL has been allocated $300 million for fiscal 10/11 on a cash basis in the federal budget. Given AECL’s track record in recent years of securing unbudgeted top-up payments through the year, taxpayers may well see greater cash losses this year. The stipulation in the budget that the funds are provided on a “cash basis” suggests that the allocation does not cover expected future losses, which are not specified.
My quote in the Telegraph Journal news story of March 5th: “We know the isotope business is a disaster - it’s an international embarrassment. But now it turns out that all the business acumen (AECL) brought to the isotope sector has been transferred the to refurbishment business.”
I am also quoted in the Globe and Mail news story of March 5th, wherein I am described as a consultant for the Association of Major Power Consumers in Ontario. Although this statement is true, it is not relevant to the story, not reflective the positions of AMPCO, and not an element of the interview I had with the Globe and Mail reporter.
Shawn McCarthy had an excellent update on AECL’s final taxpayer take for fiscal 09/10 in the Globe on March 4th — $824 million. Of this amount, at least $410 million has been earmarked to cover losses on CANDU refurbishment contracts. AECL is reliving OPG’s Pickering A refurbishment experience. Previous reports have indicated losses at New Brunswick’s Point Lepreau reactor and Ontario’s Bruce complex, but McCarthy’s report is the first to finger losses at the reactor AECL is refurbishing in South Korea. AECL is currently seeking a refurbishment contract with Argentina.
Tags: AECL
Posted in Energy and Environmental Notes | No Comments »
February 28th, 2010
The attached commentary, published in the National Post newspaper February 26, 2010, recommends that the federal government minimize future liabilities associated with AECL by terminating the CANDU development program.
Posted in Energy and Environmental Notes | No Comments »
February 11th, 2010
Attached is a transcript of a brief interview with CH TV February 10, 2010 for the show “Live at 5:30″ hosted by Mark Hebscher and Donna Skelly. In the interview, I praise OPG’s decision to not retube Pickering B. I also question why Samsung does not show up on the Ontario government’s official lobbyist registry.
See PFD: transcript-of-appearance-on-chch-tv-feb-10-2010
Tags: Add new tag, AECL, candu, Green Energy Act, Pickering
Posted in Energy and Environmental Notes | 1 Comment »
February 7th, 2010
The attached essay is the first of a series on the factors underlying the dramatic increase in power rates about to arrive on bills of Ontario electricity consumers.
Access PDF: electric-rate-shock-oeb.
Tags: Green Energy Act, OEB
Posted in Energy-related Administrative Law | 3 Comments »
January 24th, 2010
In what appears to be a rich power contract with the Ontario Power Authority, the existing Ontario hydro-electric operations of the international investment giant Brookfield have effectively been converted into a public utility earning guaranteed rates. The attached essay argues for a public airing of the contract terms.
The Brookfield deal appears to be signed, but progress in power dealing transparency remains urgent. The OPA is currently develop a large portfolio of new contracts with existing generators. Bruce B refurbishment is one example, with contract negotiations planned for 2010 and signing in 2011. Of the total capacity of 1700 MW of non-utility generation (NUG) contracts entered into by Ontario Hydro primarily in the period 1989-1993, 600 MW will expire before 2015. The first to expire is contract a for 103 MW cogeneration facility in 2010.
In its 2010 fees case at the OEB, the OPA indicated that 12 hydro-electric contracts and 5 NUG recontracts were let in 2009 and a further 5 hydro-electric contracts and 3 NUG recontracts are expected in 2010.
PDF: transparency-needed-for-power-dealing
Tags: Brookfield, OPA
Posted in Energy and Environmental Notes | 1 Comment »
January 21st, 2010
On Jan 19th, Canadian Press broke the story that the long-mooted green energy deal between the Ontario government and a consortium of South Korean companies led by Samsung was expected to be announced by Premier Dalton McGuinty this week (Jan. 20-22/2010).
The Toronto Star’s coverage Jan 21st continued to self-congratulate for breaking the original Samsung story, three days after it was posted here September 24th.
Keith Leslie at Canadian Press deserves special mention for getting the January McGuinty announcement story early and thoroughly.
In interviews with CFRB, 570News on Jan 21 and several print outlets, my main points were that consumers and competitors have suffered a blow but more importantly our standards of public administration have been damaged. Secret negotiations for multi-billion dollar twenty year government contracts invite corruption.
The names Samsung and Korea Electric Power Corporation still don’t show up on the Ontario Lobbiest Registry. What’s up with that? This absence is particularly difficult to understand since it appears that these foreign firms were able to get the Ontario government to issue a directive to the OPA to ensure preferred access to scarce transmission capacity. See: Directive to OPA to reserve transmission capacity
The National Post’s news report Jan. 22 quotes me as describing the deal as “ugly, ugly”. See: “Samsung has the power to impress”
Please send your comments, updates and analysis.
Posted in Energy and Environmental Notes | 18 Comments »
January 14th, 2010
The Globe and Mail has reported (January 13, 2010) on initiatives of the government of Newfoundland and Labrador’s energy conglomerate Nalcor to gain transmission access through Quebec for power capacity it hopes to develop on the lower reaches of the Churchill River. See: Hydro transmission tiff heats up
Nalcor is arguing that Hydro Quebec is flouting open access rules and making it difficult to gain access to transmission service through the province. Given HQ’s practice of allocating the costs of transmission lines providing dedicated service for remote generators to the network pool of transmission costs rather than to the cost of generation, Newfoundland would appear to have a powerful argument. However, it is ironic and hardly complimentary to Nalcor that it is litigating its case in the pages of the Globe and Mail rather than respecting the process of the Regie de l’energie.
A friend has suggested that with New England Renewable Energy Certificates (REC), currently at approximately $8/MWh, and the NEISO Forward Capacity Market, currently $4500/MW-Month, and wholesale power in New England priced based on natural gas over the long term creates substantial opportunities, particular for vendors with transmission rights. I see the REC value to be vulnerable to politics and forward power prices in New England to be highly volatile. On transmission, I note that when New Brunswick was auctioning space on its new international power line a few years ago, Nalcor did not participate.
The best market for Nalcor may be Ontario. With Ontario, Nalcor would face no currency risk. There is a much better demand outlook in Ontario vs. New England due to more nuclear replacement requirements in Ontario. The Ontario government has a high willingness to pay for renewables. Ontario’s existing interties with Hydro Quebec have significant spare capacity.
Newfoundland faces credibility challenges in negotiating with Ontario and Quebec, particularly due to the caprious way Newfoundland treated participants in its 2005 “Expression of Interests (EOI) and Proposals” process related to Churchill development. For the announcement canceling the EOI process see: NL cancels EOI
The federal government, with its constitutional authorities with respect to interprovincial trade, could play a positive role in promoting a negotiated settlement for transmission access, although the federal government would be well advised to continue declining persistent requests and proposals for federal funding for transmission development. Specific consumers, not general taxpayers, should be responsible for paying for their own energy usage.
Posted in Energy and Environmental Notes | 1 Comment »
January 6th, 2010
This post provides data current to January 5, 2010 on the productivity and variability of output of Ontario’s wind farms. The tendency of more productive wind farms to produce power with greater annual variability of output is observed.
During 2009, the average capacity factor for all the large wind farms in Ontario with in-service dates in 2008 or earlier was 27.3%, below the long run average.
Kruger Energy’s wind farm near Port Alma completed its first year of service with an average capacity factor of 37.2%, the best annual result seen so far in Ontario.
Prince Farm, located near the eastern outlet of Lake Superior and owned by Brookfield, performed very poorly in its most recent full year of production with output of only 20.5%. Annual production results were dragged down by particularly poor results during the summer of 2009 when the average capacity factor of that farm was only 14.6%.
PDF link: ontario-wind-farm-productivity-and-variability-by-inservice-year
Tags: capacity factor, variability, wind
Posted in Wind Power | 5 Comments »
December 16th, 2009
In Canada, following the shocking numbers coming out this summer on the cost of building an Advanced Candu Reactor (ACR) in Ontario many key nuclear industry players are now advocating against the ACR that AECL has been touting. Recently, technicians at Chalk River have tried to distance themselves from ACR, as has the influential Power Workers Union in Ontario. So far this year alone, the federal government has poured $633.274 million into AECL with no end in sight. Alberta just said OK to nuclear but no provincial money. Given conditions in Alberta’s competitive power market, it hard to argue that nuclear has any future there. Nuclear refurbishments in Ontario and New Brunswick are going horribly with delays and cost overruns.
Internationally, notwithstanding liquidation of its profitable transmission and development businesses, Areva is still sucking cash from shareholders. The main reason is problems with the two reactors it is building, one in Finland and the other in France. The brightest spot for nuclear world wide is China but how can we trust the claimed results.
New shale gas technology now flooding energy markets, falling power demand, and the flood of new renewables technologies getting installed (albeit heavily subsidized like nuclear) all indicate less need for nukes. Indeed in Ontario, there are increasing constraints for nuclear generators trying to find room on the grid, with some Bruce reactors going off-line for significant periods due to surplus power.
Here is a televised debate addressing these issues presented on Business News Network, December 16, 2009 on the show “Midday Markets”.
Tom Adams debating nuclear’s future with Neil Alexander of the Organization of Candu Industries
Posted in Energy and Environmental Notes | No Comments »
December 2nd, 2009
The following essay, “Get past the bombast”, coauthored with Brian Lee Crowley, appeared in the New Brunswick Telegraph Journal newspaper December 5, 2009. Attached to this document are comments from December 5th replying to criticisms of the essay posted to the TJ discussion site.
essay-with-crowley-in-tj-dec-5
The following comments were posted to the same site December 6th-8th.
comments-from-tom-adams-posted-december-6th
The following essay, coauthored with Brian Lee Crowley, appeared in the Globe and Mail November 28th.
charged-with-hydro-hyperbole-gm-november-28-2009
The following link to the Globe and Mail site contains comments on the essay: G&M Comments site
The CBC presented a summary of some of my comments from one of the radio interviews I did on December 1st, and also comments, here: Summary of interview Dec. 1 re. NB Power Sale
Here are some of my posted comments and one from an anonymous commentator firing back at opponents of the sale of NB Power to Hydro Quebec responding to the CBC news article “Longtime NB Power critic plugs deal” Dec. 1, 2009. responses-to-critics-of-nb-power-sale1
Tags: NB Power
Posted in Energy and Environmental Notes | No Comments »