Ontario FAO misleads on electricity costs

Peter Harrison, the Chief Financial Analyst at the Financial Accountability Office Of Ontario (FAO), wrote a commentary on Home Energy Costs in Ontario.

Hours later, the Toronto Star blissfully titled its requisite sorta reporting on a sorta positive for the ruling Liberal party with, “Ontario hydro cheaper…”

The headline is false – and I should, and will, explain why. However, the bigger questions for me are; does the commentary fit with the intended role of the financial accountability officer and, if it does not, was this work intended to mislead people in exactly the way the poor Torstar headline writer indicates?

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Estimating Ontario’s Electricity Supply Costs with OEB data

I’ve been asked on a couple of occasions for costs of Ontario’s electricity from unbiased sources. I answer with a single snapshot source, but that – in my opinion – can’t communicate much about what is behind changing pricing, so I also provide some other sources so people could estimate costs in 2013, 2014 and 2015.

In this posts, I’ll cite the data sources, run the estimates, note some shortcomings – and end with a look at some of my own estimates.

The singular best data is from  the 2015 Auditor’s report chapter on power system planning – only the Auditor has extracted a coherent set of numbers on both production and costs from the system operators (IESO).

The data the IESO provided the Auditor is different than the data the IESO posts on its website. The difference is due to generation embedded in distribution networks, and the IESO’s inability to update its reporting to include that supply.

Most starkly, the IESO reports on its website 2014 solar generation of 0.0185 TWh (billion kWh). With the auditor they revealed 1.8 TWh-essentially 1.8 billion kilowatt-hours more.

So… for reputable accounting of annual generation and costs, I suggest looking at the less frequent, but more reliable, documents from the Ontario Energy Board (OEB).

a poor Connecticut: Ontario Electricity Pricing

I found myself in front of some U.S. Energy Information Administration data today, and, as anybody would, thought that with a little summarizing and some formatting it might make for a pretty enthralling scatter plot.

How right I was!

I looked up the data after seeing some comments on a recent article by Parker Gallant (And the winner is : Hydro One! Most expensive residential power rates in North America).

I know I paid about 20 cents/kWh in 2015 (up to ~23 in 2016), so I wanted to check U.S. EIA data to see how that compared – and when I want to check data, I want to check base data. This I found in the form EIA-826 data for Sales and revenue. The data is by utility and state, and it includes revenues, sales and the count for consumer groups – including residential.

Forgetting Ontario temporarily, I summarized data by state and created the posted scatter plot to test for a connection between consumption, and pricing. It seems to exist and that seems pertinent beyond a rant – as well as important within a rant.

The one state where rates are higher than mine (ignoring currency valuations) is Hawaii – which also has the lowest average consumption.