New study counters misinformation about the role of renewable energy in electricity costs
TORONTO, March 14, 2014 /CNW/ - Environmental Defence released a study today with new data that shows the relatively small role that renewable energy plays in Ontario residential electricity bills. Your Home Electricity Bill: A Study on the Costs in Ontario shows that just 9 per cent of the average residential bill is for non-hydro renewable energy.
"As the new kid on the block, renewable energy is all too often blamed for rising electricity costs. The truth is renewables play a fairly small role in Ontarians' electricity bills today," said Gillian McEachern of Environmental Defence. "But they have significant health and environmental benefits that aren't reflected in our monthly bills."
Over the last 10 years, Ontario has built a more reliable energy system and removed polluting coal from the mix. These changes brought benefits, including a more stable electricity grid, fewer smog days, and savings in hospital costs associated with coal pollution.
Using data by Power Advisory LLC, a respected independent energy consultation firm, the report calculates how much non-hydro renewable energy contributes today, and in the future, to the average residential electricity bill. The report illustrates that while electricity bills are expected to increase, much of this increase is due to the expiration of a rebate that was introduced to offset the price of HST - not the sources of electricity.
The report also shows that rather than being at the high end of the spectrum, Ontario falls in the middle range of North American costs for residential electricity bills. And it illustrates how energy efficiency can help offset projected rises in electricity rates.
- This year, wind, solar and bioenergy will be $5, $5 and $2 respectively on the average bill, or 9 per cent of the total.
- In 10 years, wind, solar and bioenergy will be $11, $10 and $4 respectively on the average bill, or 16 per cent of the total. By 2032, renewable energy's relative contribution declines to 12 per cent.
- Residential electricity costs in Toronto and Ottawa rank in the middle of major North American cities, and are cheaper than cities in Alberta, Saskatchewan and Nova Scotia.
- Between now and 2024, the average bill - based on a constant amount of electricity use of 800 kWh/household - will increase by approximately 15 per cent (in real 2014 dollars.) This is largely due to the end of a rebate introduced to offset the cost of HST.
- If a household reduced electricity use by 20 per cent, the average bill will be $140 in 2024 (in real 2014 dollars), compared to $137 this year. This shows that energy conservation and energy efficiency can largely offset increases in electricity costs.
"Conserving energy and investing in renewable energy are good for both the environment and our wallets," said Gillian McEachern. "Saving energy is the cheapest option for customers. And we're unlikely to see a spike in the price of sunshine, which makes renewable energy a more predictable bet than fossil fuels or nuclear, which can come with unexpected cost increases."
The report recommends that governments help homes become more energy efficient, adopt high quality standards for energy efficiency, require mandatory home energy audits and provide low-income households with assistance on energy bills.
Your Home Electricity Bill: A Study on the Costs in Ontario can be downloaded at www.environmentaldefence.ca/electricitybill
Printer-ready graphics from the report can be downloaded at http://environmentaldefence.ca/monthly-residential-bill-images
About ENVIRONMENTAL DEFENCE (www.environmentaldefence.ca): Environmental Defence is Canada's most effective environmental action organization. We challenge, and inspire change in government, business and people to ensure a greener, healthier and prosperous life for all.
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