NDP calls on Wynne Liberals to repay $100M fraudulently tacked onto hydro bills

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Private Brampton gas plant gamed Liberal hydro system

QUEEN’S PARK – A private gas plant in Brampton gamed the Liberal government’s system for managing private electricity contracts, and now the NDP wants to know how Ontario families will be paid back for the $100 million that was passed onto hydro-bill payers as a result.

Over a three-year period, the gas plant collected more than $100 million in what the OEB called “inappropriate expenses” in a report exposing the fraud.

“That $100 million dollars went onto the hydro bills of everyday families,” said NDP MPP John Vanthof during question period Tuesday. “What is the Liberal government doing to repay them?”

The OEB investigation found the majority of the $100-million loss was through the Generation Cost Guarantee program. According to the investigation, the private Brampton gas plant’s manipulation of the program was obvious, and should have been discovered much earlier. Adding insult to injury, the OEB report on the chronic manipulation of the Liberal government’s program was completed almost a year ago, but was only released very quietly on the OEB website in November.

“There should be serious consequences for stealing money from the people of this province – people who are already suffering under the weight of sky-high hydro bills,” said Vanthof. “This $100 million is a massive fraud and the people of Ontario are the victims. Why did the Liberal government keep this information quiet?”

While hydro bills have already been painful for families, Hydro One continues to apply for hikes on hydro bills.

“The bottom line is that everyday families have already paid for these failures of privatization in our hydro system,” said Vanthof. “It’s time for a new plan to give families hope that bills will start going down, instead of continuing to go up.”

NDP Leader Andrea Horwath released a hydro plan in early 2016 which will put Hydro One back in public hands, and reduce everyone’s bills by about 30 per cent. Horwath’s plan ends mandatory time-of-use pricing. Meanwhile, Patrick Brown and the Conservatives recently committed to stand behind every aspect of Kathleen Wynne’s hydro scheme.


Hansard

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LEGISLATIVE ASSEMBLY OF ONTARIO

Tuesday 5 December 2017

Energy policies

Mr. John Vanthof: My question is to the Acting Premier. This morning we learned through media reports that a private natural gas plant in Brampton gamed the Liberal government system for managing private electricity contracts. Over a three-year period, the company cost Ontario families and businesses nearly $100 million in what the Ontario Energy Board calls “inappropriate expenses.” That’s $100 million that went onto the hydro bills of everyday families. What is the Liberal government doing to ensure that those families are paid back?

Hon. Deborah Matthews: To the Minister of Economic Development and Growth.

Hon. Brad Duguid: Again, I appreciate the member’s question. It’s tough sometimes when you’re in the third party and the question is asked initially, a response is given and then you have to ask it, but I think it’s important for all of us to pay close attention these kinds of issues.

Look, there’s no defending a company that tries to game the system. It’s totally inappropriate. I think what we need to do is make sure we have structures in place to ensure that we know what happened and why, and that the appropriate measures are taken to recover whatever losses have been had. The IESO has taken those measures, fully investigated the matter. They’ve recovered most of the costs, and in fact, they’ve delivered a $10-million record fine. I think on the surface that appears appropriate to me.

As well, measures have been taken to ensure that this kind of gaming cannot happen again in the future. There’s also a significant restructuring going on, called “market renewal,” that will further address the gaming issue. I thank the member for the question.

The Speaker (Hon. Dave Levac): Supplementary.

Mr. John Vanthof: The Ontario Energy Board investigation notes that majority of the $100 million this company received was through the generation cost guarantee program, a Liberal government program. According to the investigation, the private Brampton gas plant’s manipulation of the program was obvious and should have been discovered much earlier.

There should be serious consequences for stealing money from the people of this province, people who are already suffering under the weight of sky-high hydro bills, so I’ll ask again: How will families be reimbursed for the $100 million that the Liberal government paid to this private gas plant in Brampton?

Hon. Brad Duguid: I agree with the member. There should be serious consequences to any person or any company who tries to gain governments of any type or any organization, for that matter. In this case, there was a $10-million fine levied, a record fine. In this case, as well, in answer to his question, the costs have been recovered so taxpayers have been reimbursed for the majority of the costs.

The matter was fully investigated by the IESO. It did take some time to investigate because, I expect, this is a fairly complex matter. The matter was posted on record, and the fine was posted on the OEB website, which I think is appropriate. As I said, measures have been taken to ensure this doesn’t happen again.

I think the member is quite right to be concerned about this, as we are, as I know the minister is, and it’s an inappropriate action that took place.

I do think, on the surface, what I see so far is the IESO has responded appropriately.

The Speaker (Hon. Dave Levac): Final supplementary.

Mr. John Vanthof: This information came to light this morning only after the CBC went digging and found the report, which was completed almost a year ago. There was no fancy press release. This $100 million is a massive fraud and the people of Ontario are the victims. Why did this Liberal government keep this information so quiet and not do a press release, as it does with all other hydro announcements?

Hon. Brad Duguid: Mr. Speaker, the amount recovered, as I said before, is the vast majority of the amount that was lost. In fact, there’s a $10-million fine on top of that. So on the surface it looks as though justice has been done with this company. There is no defending what this company has done. The taxpayer has been reimbursed for the funds, which I think is probably the most important thing.

Also important, Mr. Speaker, is number 1, to ensure that the company does pay a price, and they did, but number 2, to ensure that this doesn’t happen again. I know that the IESO has taken measures to ensure this kind of gaming could not happen again, and I don’t have the details of what those measures are. I know the minister would probably have that.

Also, they’re restructuring the system so this won’t happen again in the new system.

Energy policies

Mr. John Vanthof: Once again, my question is to the Acting Premier. Private gas plants in Ontario are gaming the Liberal system for payments to the tune of $100 million while the Liberal government keeps the information quiet.

They are also standing by while the privatized Hydro One plans to install prepay hydro meters to get around the current ban on wintertime hydro disconnections. Since we know the Liberal government can direct Hydro One to do things that benefit their party, will the Acting Premier direct Hydro One to do something that will actually help the people of Ontario, and stop the private company from using prepay hydro meters?

Hon. Deborah Matthews: Minister of Economic Development and Growth.

Hon. Brad Duguid: Mr. Speaker, I think sometimes the NDP, when they get a hold of word, they try to vilify the word. So the word of the week is “prepaid hydro meters,” as though somehow prepaid bills are something that is somehow bad for people.

The fact of the matter is, Mr. Speaker, the minister has made it very, very clear that nobody will be in any way told that they have to have a prepaid meter. It will be a choice.

There are folks who, in light of budgeting, would prefer to have their bills prepaid. It gives a choice to consumers to be able to do that. There’s nothing untoward; there’s nothing evil. There’s nothing non-transparent about this—

Interjections.

The Speaker (Hon. Dave Levac): Wrap up, please.

Hon. Brad Duguid: I don’t know why the NDP would want to take away that choice from consumers, Mr. Speaker, to be frank.

The Speaker (Hon. Dave Levac): Supplementary.

Mr. John Vanthof: Speaker, let’s be clear: Prepay meters will hurt vulnerable Ontarians. They take away the option of working out a payment schedule if families get behind on their bills and instead force them to feed the meter or go without heat during the winter.

The Premier and her Liberal government seem quite willing to direct Hydro One’s activities when the result is a benefit to the Liberal Party. Why won’t they do the same when the benefit would be for struggling Ontario families?

Hon. Brad Duguid: It’s just not true, Mr. Speaker. What the member is saying is just completely false. No residential customer will be without power during the winter months regardless of the type of meter used. That’s just a bogus argument—I guess trying again to vilify a word called “prepaid metres.”

Mr. Speaker, there are all kinds of circumstances where consumers will prepay their bills. Sometimes it’s a budgeting issue. Sometimes consumers prefer to do that so that they don’t fall behind or if they’re on a commission-type of salary, to ensure that they have a little bit of room left. Some people even prepay their taxes to governments to ensure that, indeed—it just helps them with their budgeting. It’s a choice for consumers to opt in. Nobody will ever be forced to do this. It’s not evil. There’s nothing that affects vulnerable people in any way about this. It just gives them another option, Mr. Speaker.

The Speaker (Hon. Dave Levac): Final supplementary?

Mr. John Vanthof: The Liberal government’s defence of prepaid hydro meters is mind-boggling. Their inability to detect $100-million fraud is beyond belief. The bottom line is that, every day, families are paying for these failures of privatization in our hydro system.

Why is this Liberal government spending its time defending the private electricity system that clearly is not working in the best interests of Ontario families?

Hon. Brad Duguid: It’s a two-part question. We wouldn’t even be talking about this Goreway issue at all if the matter hadn’t been detected so I’m not sure what the member is talking about. He says that the matter hadn’t been detected. If the matter had not been detected then the IESO wouldn’t have launched an investigation. If the matter hadn’t been detected then the IESO would not have recovered the majority of the costs. If the matter hadn’t have been detected then the IESO wouldn’t have registered a $10-million record fine.

What the member is saying, Mr. Speaker—I actually find mind-boggling what that question is. Why would we be talking about this had it not been detected?