Ontario gov't ignored chance to cut $1.5B in hydro bills: documents
Dario Balca, CTVNews.ca
Published Sunday, May 22, 2016 11:09AM EDT
Newly unearthed documents suggest Ontario’s Liberal government could have saved hydro customers $1.5 billion by terminating an agreement with Samsung, but decided against it.
The papers, uncovered by Progressive Conservative Finance Critic Vic Fedeli, relate to the 2009 Samsung green energy agreement that would take $10.5 billion from Ontario hydro bills, and pay it to a Samsung consortium over 20 years. In return, Samsung would deliver green energy and build factories in the province, employing 900 people.
Four years into the deal, however, a confidential document from staff at the Ministry of Energy advised the government it could save hydro customers $5.2 billion by terminating the agreement. This was because the Korean consortium was missing contract targets and deadlines on electricity projects that Ontario didn’t even need anymore.
But instead of calling off the deal, the Liberals renegotiated the contract to save only $3.7 billion --leaving $1.5 billion in hydro savings on the table.
“Even though we don’t need the power, and even though we can get out of this for nothing, (the Liberals) already told the public how important this deal is,” Fedeli told CTV Toronto, suggesting that the government ignored the potential savings “just to save face.”
Fedeli uncovered the documents among hundreds of thousands of pages concerning the gas plant scandal.
The new documents suggest public relations plays a role, citing a “risk of being perceived to be walking away from an investment agreement, that in past, has been described as an important job creation initiative.”
Fedeli said the decision not to terminate the agreement with Samsung will cost the taxpayers.
“We’ve been paying and we’re going to be paying for 20 years,” he said. “It’s a 20-year contract--$1.5 billion that the taxpayer need not have had to pay.”
But the Liberals are accusing Fedeli of “spinning conspiracy theories,” arguing that the deal has created jobs and green energy solutions for Ontario.
A spokesperson for Ontario’s minister of energy said Samsung now has four manufacturing plants up and running in the province, but has yet to create the 900 jobs promised in the deal.
With a report from CTV Toronto’s Paul Bliss