I don’t believe in free lunches. Whenever somebody offers me anything for “free” I immediately ask myself what’s in it for them. If the answer doesn’t bother me, I may go with the offer. microFIT PV is no different, so here is the best explanation I could think of.
This is the fourth part of a series analyzing what are the incentives for the Government to offer such a generous price for the solar-produced electricity. If you didn’t do it before, you may want to read first part 1, part 2 and part 3.
You may notice that I didn’t talk about the green aspect of microFIT. I did this on purpose, because I think it’s obvious. Nobody denies the solar electricity is sustainable and really green.
Currently, Ontario has a big problem and not a lot of time to fix it. The McGuinty government promised to close the coal-burning power plants until 2014. Conjugated with the closing of the nuclear plants due to aging, this will leave a significant void in the electricity supply (mind you, the Ministry of Energy webpage linked here seems to be outdated, but the direction is clear, anyway).
Filling at least part of the gap with green energy is a really smart idea, without doubt, and it may be considered even visionary. But the real genius is in the execution. They are so good in sugar-coating it that ordinary people rush to pay tens of thousands of dollars to install solar panels, probably borrowing most of the money. The price will be eventually paid by all the consumers in the province, since the high green energy cost will be mixed and blended in the overall electricity rates. Which will be obviously be a just little bit higher. But the taxes will no go up an inch for this, and the people will have no reason to complain about their leaders! Brilliant, isn’t it? This way, the government will appear as the Green Knight, ready to do everything to save the planet. A perfect PR strike! Who cares that the regular citizen is forced to pay for this?
Now, don’t get me wrong… I don’t blame them for going towards more green energy (which is is more expensive), or because they close the coal-firing plants, which I also support. Wearing my consumer hat, I hate hidden things, and this continues to hide the real price of electricity. In fact, I consider that all the hidden subsidies that we have in place to keep electricity cheap should go away, because they distort the reality. In my opinion, putting a price on the externalities like pollution and CO2 emission is the way to go. I prefer to know the exact price of what I’m using. Then maybe more people will understand that conservation is better and the cheapest energy is the one you don’t use at all…
P.S. If you want to read the rest of my analysis, go on and read part 5.
Update: I found one article on the fact that all the consumers will pay in fact for the green electricity, but there are probably more out there.
Update: From what I’ve read, the power (pun intended) to force people to buy the expensive green energy is given by the Green Energy Act. In fact, there are people complaining that this is in fact an indirect tax, and it is thus unconstitutional.