Long-Term Energy Plan Unplugged: A Behind the Scenes Live Interview with Minister Chiarelli

December 3, 2013

Long-Term Energy Plan Unplugged: A Behind the Scenes Live Interview With Minister Chiarelli

Chairman: Noble Chummar President, The Empire Club of Canada

Head Table Guests

Al Wiley, Vice-President, Development, Nextera Energy Canada, and Director, Ontario Energy Association;

Jamie Milner, Vice-President, Market Development and Customer Care, Enbridge Gas Distribution Inc.;

The Hon. David Peterson, Chairman, Cassels Brock & Blackwell LLP, and Former Premier of Ontario;

Cathy Sprague, Executive Vice- President, Human Resources, Bruce Power;

Tom Mitchell, President and CEO, Ontario Power Generation Inc.;

Kent Emerson, Director of Operations, Office of the Hon. Charles Sousa, Ontario’s Minister of Finance;

George Vegh, Counsel, McCarthy Tetrault LLP, and Director, Ontario Energy Association;

Peter Novotny, Head, North America, Photon Energy;

M.J. Perry, Vice-President and Owner, Mr. Discount Ltd., and Director, The Empire Club of Canada;

Tim Smitheman, Manager, Government and Public Relations, Samsung Renewable Energy Inc., and Director, The Empire Club of Canada;

Brian Bentz, President and CEO, Powerstream Inc., and Past Chair and Current Director, Ontario Energy Association;

Kevin Kelly, Chief Financial Officer, Bruce Power;

Steve Baker, President, Union Gas Limited, and Chair, Ontario Energy Association; and

Mel Ydreos, Interim President and CEO, Ontario Energy Association

Introduction by Noble Chummar

Today’s speech is about electricity. Our ability to harness and distribute electricity is arguably one of the greatest human discoveries of modern time. As the old saying goes, “Necessity is the mother of invention.” Our modern and electrified world has evolved from actual and metaphorical darkness only a few generations ago. Now, electricity is the mother of invention. Electricity illuminates light bulbs, but it is also the source of diplomacy, infrastructure, communication and agriculture. Quite simply put, electricity is now intertwined with the basic necessities of life. It was at this very podium at the Empire Club in 1907 that Sir Sanford Fleming described electricity as the magical discovery that has forever changed humanity. Mankind looked to the skies and harnessed the awesome power that defines modernity. The Empire Club is indeed honoured to host this luncheon with the Ontario Energy Association (OEA) that represents the entire energy sector in our province. Thanks in part to governments and to membership in the OEA, Ontario has emerged as one of the most energy-efficient economies in the world. To introduce our guest speaker today, please welcome Mr. Mel Ydreos, acting president of the OEA, to introduce our guest.

Introduction by Mel Ydreos

Well, good afternoon, everyone. It’s a real delight to be here in partnership with the Empire Club on what is sure to be a most interesting discussion with Minister Chiarelli, led by David McFadden. In a room full of energy experts, I don’t need to tell you why we’re here. This is very timely. But before we get into the discussion about Long-Term Energy Performance (LTEP), it’s video time again. As many of you know, last week Mr. Chiarelli launched Empower Me, a Web site designed to help consumers better understand how Ontario’s electricity system works. For those of you who may not have checked it out, mark this down:

Ontario.ca/empower me. Here’s a quick video on how electricity is made. Can you play the video, please?

[A video is shown]

Electricity powers our homes, our businesses and our communities. We can’t see it, but we know it’s there. To understand electricity, let’s take a closer look at how it’s made. About 200 years ago, a man named Michael Faraday discovered how to make an electric current using a metal coil and a magnet. Most of today’s electricity is still made exactly this way, but to generate enough electricity for a province the size of Ontario, we need to move big magnets around a wire. This is done with a turbine. The force to turn this turbine could come from wind, water, hot gasses, or steam. You can spin a turbine with a natural force like hydro, that’s water, or wind. You can burn natural gas directly in a combustion turbine. The hot expanding gasses are used to make it turn. This is essentially the same way jet aircraft are powered. You can also burn natural gas or oil to boil water and use the resulting steam to make it turn. Or you can boil water using heat from a nuclear reaction, which also produces steam to turn the turbine. Different energy sources, but all essentially the same result. Solar power is the only one that’s different. Instead, it converts sunlight into electricity using solar panels. The photons in a ray of sunlight hit the panel and get converted into an electric current. Hydro, wind, natural gas, nuclear and solar. Here in Ontario we use all of these forms of electricity to power our province. And that’s what we call generation. To learn more about how you can save energy, save money and how Ontario is building clean energy, visit Ontario.ca/empower me. Tell us what you think. Follow us on Twitter.

[End of video]

Minister, congratulations to you and your staff for launching a very informative and timely Web site, and I encourage all of you to spread the word. If you go on the site, it’s got a lot of really, really simple but very, very valuable information to help customers better understand our very complex energy system. It’s been less than 24 hours since they released the Long-Term Energy Plan, and like many of you I have spent a fair bit of time poring through the document. I know many of us have questions for the minister, who has graciously put himself before us today to face the inquisition. I will say that the OEA is very pleased with what we saw in the Long-Term Energy Plan. We feel it strikes a balance between ensuring Ontario’s electricity system delivers reliability through flexibility, while also tackling affordability of electricity rates to consumers. This move was one of the key recommendations in the OEA’s LTEP submission to the government. We look forward, Minister, to working with you and your ministry as we implement the Long-Term Energy Plan.

It’s now my distinct pleasure to introduce our featured guest. Slightly less than a year ago, our next speaker became the subject of intense scrutiny, interest and anticipation. As Ontario’s Minister of Energy, Bob Chiarelli has quite literally jumped from the frying pan into the fire. I think we can admit as a sector we’re not the easiest stakeholders to deal with. Sometimes dealing with my colleagues in the sector reminds me of a Mark Twain quote: “In all matters of opinion, our adversaries are insane.”

But despite the challenging nature of our industry, the minister has made a valiant effort to reach out. We in the sector believe strongly that successful energy policy is created in partnership with industry. I can think of no better example of this than the LTEP document. While the rubber will only hit the road with implementation, I know from speaking to our members that we’re all pleased to see the government is moving in the right direction. But the minister hasn’t been limiting his outreach to the energy sector. No, indeed. The last few weeks he has been busy soliciting pictures of Ontarians’ mo’s or moustaches via Twitter, so he could pick the best to make a donation in honour of Movember. While he wasn’t clear on his selection criteria, the minister did make a donation to a gentleman who had a moustache that actually looks suspiciously like the one I used to sport. He described it as bigger, bolder and bushier than ever. Unfortunately, I did not get to participate in Movember this year, but minister, if you’re planning to donate again next year, I have two words for you: challenge accepted. Ladies and gentlemen, please join me in welcoming our featured guest, the Honourable Bob Chiarelli.

As our interviewer for today’s speaker series, we welcome our very own 2013 OEA leader of the year—David McFadden. David is a partner and chair of the International Group at Gowlings. His leadership in the energy industry has been exceptional. He is a friend and mentor to many of us and has been a strong proponent of the energy sector for the last 30 years. David is also no stranger to Ontario politics. In the mid-eighties, he was elected as the MPP for the riding of Eglinton, which also happened to be a minority government. This history gives him a unique understanding of the political climate we’re facing in Ontario today. Ladies and gentlemen, please join me in a round of applause welcoming the minister and David to the stage.

David McFadden

Thank you very much, Mel, and Minister, welcome. I notice the title of the event today is the “Long-Term Energy Plan Unplugged.” But what I’m hoping is that, by the end of the comments by the minister today, we’ll all be plugged in on exactly what’s expected on the energy plan. As Mel said, the plan only came out yesterday, almost exactly 24 hours ago. And I’ll tell you, it says something for the minister that he’s here, within a day, so soon, to share his thoughts in terms of what was on the government’s mind in developing the plan and what’s really in the plan. Could we start off with a question? You did a lot of consulting before this plan was prepared across the province. You went out, and your ministry staff went out. What was it you heard from the general public, from the energy industry and other industries on what should be in the plan?

Bob Chiarelli

Well, there were some common threads. First of all, one issue that came up regularly was affordability, both in the industrial sector and with ratepayers. Another question that came up, a very, very important issue for the industry, was that they wanted an energy policy that was predictable and sustainable. It’s very difficult, for example, for people in the renewable industry, solar for example, to not know when the next procurement is going to take place, whether it’s going to take place in four months, six months, or maybe we’re going to have a moratorium on it. So we were very, very determined to create policies which were sustainable and predictable.

The other thing that we heard on a regular basis was flexibility. The sector is so dynamic now. There are so many exciting things happening in storage, in conservation, in demand response that we wanted to move forward with a plan, but we had to be able to adjust it as we go. So in order to solve that problem, we came up with the concept, and that was part of the plan of having an annual energy report that would be produced by the Independent Electricity System Operator (IESO) and the Ontario Power Authority, defining where we are with supply and demand, and what we’ve had to do collectively—all of our government agencies, the ministry and the sector—to keep ourselves whole and to respond to the dynamics that are happening.

I’m very excited about the energy sector and I got more excited as I got into it. Particularly, what we’re seeing now is a tremendous interface between information technology and the energy sector. We’re seeing demand response programs that require sophisticated software. We’re seeing a company in Ottawa, Solantro, that is using software, creating a much more efficient converter for solar. You can go on and on and on with storage and smart grid and how to manage the system. We’re going to be, I think, changing for the positive very, very quickly in a similar way to what we’re seeing in the communications business with cell phones and other technology sectors. So we want to be flexible. That was one of the things that we heard.

Another thing that we heard was a tremendous respect for Aboriginal communities—First Nation and Métis communities. There’s a real willingness on the part of the sector to partner economic development. They realize that that’s the way to go. It’s a respectful thing to do. It makes good business sense. And so we have seen now in the last three or four years an unbelievable acceleration of First Nation and Métis communities partnering and investing and participating in the energy sector. We’re very pleased to see it and we will continue to encourage it.

David McFadden

You have actually answered about half of my questions already. The minister’s a very easy guy to interview, I should tell you. I suppose one of the big elephants in the room is energy pricing.

Bob Chiarelli

Yes.

David McFadden

You mentioned that consumers raise that with you. Needless to say, it’s all in the media. If you read the media in the last 24 hours, you’d think all the plan had in it were price signals. I wonder if you can address the issue of energy pricing, electricity pricing in Ontario, and how you see the plan dealing with that issue.

Bob Chiarelli

We’re going to start communicating better with the public. Their understanding of the electricity system is when they get their bill and if their lights go out. Everything else is between; they don’t know a lot about it. They’re starting to become conversant in conservation in a fairly significant way, but we need to communicate to the public how complex the sector is and we’ve got to try to simplify it for them, so they will understand pricing. In the media in the last 24 hours, the only issues that have come up, not even industrial/commercial pricing, were pricing for residential people and the on-bill energy products that we can generate. Those were the only two areas that came up really from the media. So we have a lot of work to do. Tonight I’m meeting with the CEOs and the board chairs of our agencies, Ontario Power Generation (OPG), IESO, etc. I have asked some people in the industry privately to come up with the idea of an energy education trust, where we can collectively get together and fund the type of communications that are necessary for people to understand the sector. They have a lot of challenges understanding it. Just by way of example, I was out of politics for three and a half, four years, before I came back in a by-election and I was on the board of the IESO. In casual conversation people would say, “What are you doing?” And I’d say, “Well, I’m doing some consulting work at the University of Ottawa and I’m on the board of IESO.” I’m talking to people who are well networked, most of them well educated. They have no idea what it is. They have no idea what it is to manage the system. So we collectively have to do better to engage them, especially now that we’re creating tools that they’re going to be able to use—smart metres with peaksaver, with on-bill financing. There are a whole series of things, microFIT, for example. So we have these new products and these new directions and the more people understand it, the more they’ll understand pricing, and the more they’ll understand how they can control their pricing.

David McFadden

One question on pricing is that over the years we’ve had projections, various projections from different agencies. Unfortunately they tended not to get it right and it’s undermined to some extent the credibility of the industry with the consumer. Are you pretty satisfied that the new projections have taken into account some of the shortcomings of the past and be a little more accurate in the next little while?

Bob Chiarelli

I’m satisfied that they’re as good as we’re going to get. That’s the reason why we’re going to an annual energy report, because the system is changing very quickly. You can have recession; you can have boom. You can have new technologies. You can have renewables coming into the system. There are a lot of changes. And so we have to fire with a rifle, not a shotgun, in the energy sector. That’s one of the policies underlying the plan that we have.

David McFadden

Moving on from pricing to conservation, page one of the report talks about conservation first, and that is repeated over and over again in the plan. Perhaps you might want to share with this audience as well as the folks on television what exactly you mean and what the government means by conservation first.

Bob Chiarelli

Well, we’re talking about what is known traditionally as conservation, but we throw in with that demand management, demand response, and storage, because they’re new. Conservation is not new but the others are newer and becoming much more sophisticated. And so, it’s very important that we make every effort to solve our energy requirements other than through generation. Generation is extremely expensive. There’s a long wait time to get it up and running for certain particular types of it. So if we can, if we have a requirement hypothetically for 500 megawatts, if we can create that on a permanent basis through conservation, demand management, demand response and/or storage, that’s the way we should be going, because it’s less expensive than generation. It also, incidentally, is much more efficient.

David McFadden

You’ve raised generation. Let’s have a brief chat about that, because obviously a lot of people sitting here in this room have got a vital interest in that. Could we start off with nuclear? Nuclear in many ways is the workhorse of the Ontario electricity sector. Certainly that combined, I suppose, with water power. And right now, over 50 per cent of electricity consumed in Ontario comes from nuclear power. You’ve already announced previously that new build may not be in the offing. And I wonder if you could just go through what is in the plan for nuclear and where you see this whole industry going in Ontario. This is really a made-in-Ontario industry in many ways.

Bob Chiarelli

The new nuclear is being deferred indefinitely for a number of reasons because of a reduction in demand. And demand comes from a number of reasons. It’s a more efficient service. There’s more conservation. There’s more demand management. The economy is changing significantly in Ontario. There used to be a lot more manufacturing base, high-intensity consumption. Unfortunately RIM is having some problems, but we will use them as an example of creating jobs—eleven, twelve thousand jobs, most of them here in Ontario—that are very, very low energy intensive. If you look at what we used to call the high- tech capital of Canada, Ottawa, it has a huge, huge IT sector. If you look at Markham, Mississauga, you see a lot of it. There’s the entertainment business, movie-making, that has made huge investments in employment in Ontario. And they’re not energy intensive, so we don’t have the same demand. In 2010, we had in that plan new nuclear. Now it’s indefinitely deferred. And we are 100-per-cent committed to nuclear as being our base load moving forward. It’s still going to be close to 50 per cent. It’ll be in the forties. In order to sustain that, we’ve announced as part of our Long-Term Energy Plan that we’re going to refurbish the Darlington units and the Bruce units. And we’ve announced that we’re starting with one Bruce unit and one Darlington unit, starting the actual work of refurbishment, we hope, in 2016. So we’re very excited about it. The reaction from the public is very, very positive. Ontarians like nuclear, and they like the fact that we’re going to stay with nuclear as our base load.

David McFadden

One question to follow from that is the future of CANDU technology. If you don’t do any new build in Canada, there is the risk of perhaps that particular technology being sun-setted. It doesn’t mean the nuclear industry is over with, but I’m just curious about what your feeling is about the future of CANDU technology and where you see that going. That’s again another Ontario based industry. But where does it go from here in light of this do you think?

Bob Chiarelli

I’m very disappointed, and I know a lot of other people are disappointed, in the federal government’s handling of nuclear. They basically off-loaded it. They gave it away, in my opinion. I mean, there was a price paid, but what they gave away was a tremendous opportunity for Canada; for international trade to keep Ottawa, to keep Canada and Ontario in particular, in the forefront of the nuclear industry. We believe that there is now a significant international component to the nuclear energy sector in Ontario. There’s a lot of work being done on maintenance, equipment. There will be refurbishment work internationally. We are so well known internationally that the U.K., for example, is moving forward with new nuclear. They’ve come over here to Ontario. They’re trying to attract our best engineers. They’re trying to generate partners, who can help them move forward with their nuclear. In terms of new nuclear, we have France and the U.K., some South American countries, and some Eastern European countries, who are still moving to new nuclear. So there’s a huge market. I would like to, in the foreseeable future, see our nuclear sector reach out internationally. There are a lot of jurisdictions that appreciate our nuclear. There are some that appreciate our energy expertise and efficiency outside nuclear on how to manage and operate a system. There’s a very large Asian country that visited with our ministry a month or two ago, wanting to create business to business with Ontario businesses and Ontario agencies in terms of helping them with the efficiency of the system. They have a lot of brownouts. They don’t have the same software and the same management we do in operating the system. So there is tremendous opportunity around the world, not only for nuclear but for energy across the board. I’m hoping that I can make that become a priority in the sector, working with the stakeholders in the sector.

David McFadden

I’m wondering if we can switch from nuclear to natural gas. Over the last 10 years, natural gas has grown to be a very significant source of energy for Ontario. It hasn’t been without its issues. As we know, plants have been relocated and some controversy has been created around that. But nevertheless, natural gas has really come on strongly in this province. Where do you see it going now over the next planning period, the next five, 10 years?

Bob Chiarelli

Well, I see it increasing and having a very important role in the energy sector. My perspective is, if you go across Ontario and you actually do a count of the number of residences and businesses who are consuming gas and/or oil every single day, and we’re not a big producer of gas or oil, then you’ll realize we need transmission. We need pipelines. And so, for people to say they’re against pipelines, it’s to say they’re against the economy and they’re against basically a good quality of life, because everybody’s using it and everybody needs it. So we have to be respectful of the oil and gas industry. We also believe we have economic opportunities in oil and gas for technology. With our universities, our research, our innovation, there’s a lot of opportunity. Alberta is feeling somewhat sheepish or guilty about the energy sector. It has actually made some very goodwill gestures to Ontario. Albertans met with people in my ministry and with me to see how they can engage us in the oil and gas industry from a technological point-of-view, from a business point-of-view. We recognize that there’s economic development there as it expands and Ontario will be part of it.

David McFadden

One thing I did notice. For the people in smaller towns in northern Ontario, the provision in the plan to connect more gas infrastructure into rural and northern communities was certainly well received. What kind of timing do you see on that, because would certainly be well received by a lot of people I know?

Bob Chiarelli

Well, a lot of that is up to the private sector, the distribution companies in Ontario. We certainly would be happy to facilitate that in any way we can. In the Far North, northwestern Ontario for example, we’re going to certainly move forward with more electricity for First Nations. There are seven or eight First Nation communities who will be well served by the North of Dryden Plan that is now on the OPA Web site. We’ll be investing about $2.2 billion in northwestern Ontario, predominantly in transmission. But we will be moving that into First Nation communities. It’s a sad situation that we as a country, federally and provincially, have not been able to address those issues sooner, but it’s a priority for this government. The OPA has it as a priority, and we’re moving forward. If there’s any way we can accommodate more gas, and that can take different forms as well, we’re more than happy to sit down with the gas sector and try to facilitate those solutions.

David McFadden

We seem to be on one after another. Let’s go to renewables— wind, solar, and everything to do with it. Where do you stand on this? I know that there’s been some change in the government’s plan on the rollout of renewables. Where are we moving on the renewable front over the next while?

Bob Chiarelli

There’s not much change in renewables in terms of siting, etc. We can talk about that. In terms of renewables, by 2025 we’re predicting that renewables will be 50 per cent of our electricity. We had projected in the 2010 Long-Term Energy Plan 10,700 megawatts by 2014, I believe. We didn’t meet that target, so we are maintaining that procurement target. We’re going to finish it. Up to 2021, we’ll have the 10,700 megawatts in and we’ll go beyond that. Certainly there have been some challenges, particularly with respect to wind and siting. We have taken some very significant steps. We’ve taken large fit, out-of-the-fit program and the OPA has done a lot of work, a lot of consultation. They’re still wrapping up a new procurement process for wind, which will pretty well ensure that it will be very difficult for an energy proponent to win a contract unless they have a significant engagement with the municipality. There’s no veto. We believe a veto will be negative for the system under certain circumstances, but certainly the overwhelming number of large renewables will have an engagement with the municipality.

David McFadden

Let’s shift off generation to innovation. You mentioned that at the outset. As you know, Minister, I’m the former Chair of the Ontario Centre of Excellence. And we launched the Centre for Excellence a number of years ago. It’s done some really excellent work. I think it was very attractive that the plan talked about innovation. Could you talk a little more? You mentioned the smart grid fund, but how do you see the role of innovation in Ontario being part of the answer? Clearly in other industries, such as the telecom sector, innovation has revolutionized that sector. Where do you see us going in terms of the energy sector?

Bob Chiarelli

I think IT will revolutionize the energy sector and it’s on its way. There are a lot of people in the IT sector who are aware of that now and they’re starting to go into it. I mentioned Solantro, which is in Ottawa. That company is a start-up company. It was started up by Antoine Paquin and he did some other start-ups in the IT sector. He went down to California. He came back to Ottawa, and he started Solantro using IT technology to build a better inverter for solar. If you look at Temporal Power, they’ve got a flywheel, which is storage, which is an improvement over a lot of the storage that’s available. When we visited that site and they opened the panel of the flywheel, it’s all technology. It’s all technology-driven. If you look at the demand response in terms of aggregating and getting the IESO to gets its systems in harmony with all these aggregated contracts, it’s all IT, or a lot of it is IT, information technology. So I see that accelerating at a rapid pace, the way technology has done in other sectors. There are a lot more brains in technology, and a lot more start-ups now in demand management, demand response, and storage. That’s another thing that’s going to push the demand down and with less requirement for new generation in the future.

David McFadden

I remember about 12 years ago or a little more, there was talk of convergence between gas and electricity, which never actually occurred. It may be that what we’re seeing is the convergence of IT and energy.

Bob Chiarelli

I believe it’s smart grid and how things are heading. I think it’s a fact of life. We went to Ryerson University for the green button launch. It was actually initiated in the U.S., but we have probably more capacity to do it in Ontario because of the smart metres. With the green button, you can go on your iPhone and connect with the Web site of your LDC, your utility, and you can push a green button and download, either in your iPhone or in your computer, all the information that’s in your own smart metre in your residence. We have a competition going on now, which we started at Ryerson with financial rewards for people to create apps. So hypothetically, to use a flippant example I guess, David Peterson could be down in Florida on vacation and he wants to know what’s happening back home or with his grandchildren. He can go on his iPhone and he can see what the consumption is in the residence. He knows whether there’s a party going on or whether they’re not attending to turning off the lights and turning down some of the appliances. There are a lot of apps that are going to be coming out. A number of apps have been created in all the other sectors—sports apps, shopping apps, you name it. There will be a whole pile of energy apps that will be coming out. So the IT sector has arrived. It’s here to stay, and it’s flourishing in the energy sector.

David McFadden

I don’t know if those Ryerson students have thought of the impact of what they’re investing on their life. Their parents will be able to keep track of them in a way that never happened before.

Bob Chiarelli

They’re doing this in a little enterprise centre, a digital enterprise centre at Ryerson. I forget the official name of it.

David McFadden

The DMZ.

Bob Chiarelli

I spoke to some of the students. They create corporations as students and they create apps. And they’re making money on them. They’re creating intellectual property. I talked to some. There were these three young women students who were in one of these corporations and they had big smiles on their faces. They’re paying their way through university by creating apps in the actual courses they’re taking. So that’s also a change in education. There’s a lot more entrepreneurial initiative in education.

David McFadden

Sounds like better than a summer job, anyway.

Bob Chiarelli

It sure is.

David McFadden

One thing you were describing was the Ontario Energy Report. There’s a lot of paper out on this industry, as you well know. I mean the IESO has reports out, the OPA has reports out, the OEB has reports. We have reports on reports. How is this new report going to be better than this plethora? Is it going to eliminate a lot of the other reports and will this be the bible? How do you see this evolving in terms of reports? We’ve got a lot of them. There’s a load of paper around.

Bob Chiarelli

It will be the mandate of these two agencies to create a report that is usable and practicable and correct for the industry. We know where we are on supply and we know where we are on demand. We know what the trends are, what the innovations are, and where the sector is going. I think it’s very timely, given the nature of the innovation and changes that are going through the sector.

David McFadden

One thing you probably wouldn’t be surprised if I ask you about is local distribution companies (LDCs). I think the distribution network in Ontario is undervalued. Its reach-out to consumers is tremendous. What role do you see LDCs playing in terms of this whole energy plan and how should they be dealing with it? There seems to be a real role there.

Bob Chiarelli

I was the shareholder representative of an LDC, Hydro Ottawa, for six years when I was the mayor of the City of Ottawa. I learned then that there was a certain amount of frustration in the LDC sector. It was like a racehorse that was being held back. They had a lot of ideas for innovation, for move, for change, etc. and they felt they were somewhat in a straitjacket on what conservation programs they could do and innovations they wanted to do. As part of the consultation in this Long-Term Energy Plan, we consulted very closely with LDCs. In fact, we designated a senior person to go and speak with the CEO and/or chair of every LDC across the province to find out where they feel they could go to add more value to the system. And we also spoke about these issues with other stakeholders in the sector.

One of the follow-ups of this plan is actually to provide more avenues for innovation and participation in conservation. It may very well be that the on-bill financing will be administered by the LDCs moving forward or utilities moving forward. They will also have more leeway. We have some details to work out with the Ontario Energy Board. I don’t know if Rosemarie Leclair is here. We’re not doing anything behind your back, Rosemarie. We really feel that we can move forward with LDCs. The LDCs are closest to the customer. If you’re talking about on-bill financing, they’re the closest. If you’re talking about conservation, it’s on the ground.

Let’s take peaksaver PLUS, for example. There was a study that was in the Toronto Star that was released on the first results of peaksaver PLUS. I’ll explain what this is in a moment, but there’s an average saving on your electricity bill of nine per cent. This is a monitor and new types of thermostats that Toronto Hydro or Hydro Ottawa would put into your residence free of charge, as long as you do the plan with them. You can save nine per cent on your energy costs. This study has shown that that’s the result after one year. So I am saying to every person if this is televised or is going out, call up Toronto Hydro, call up Ottawa Hydro and say, “I want peaksaver PLUS.” It will be delivered to your door, you’ll have it and you’ll be able to save on your energy costs. So when we’re talking about pressure on prices, we’re making decisions to put pressure on prices coming down. We’re taking $70 billion out in the next 20 years, so prices will be mitigated. But in addition to that, we have to create tools for people to take control of their electricity prices. Peaksaver PLUS is new technology. It’s smart metres. Smart metres are unbelievable technology. The IESO spent three years working with IBM on a major, major IT contract. When it was supposed to arrive, it arrived, and it’s one of the best assets that we have among all the energy sectors across North America.

David McFadden

Bob, our time’s almost up. Could I ask you one question just before we leave? What are the next two or three steps you’re going to take to implement this plan? What do you see as the next two or three critical steps that you’re going to take, the ministry’s going to take?

Bob Chiarelli

Well, I think there are critical steps for every major component of the plan. If you’re talking about nuclear refurbishment, we’ve got to do the procurement, and we’ve got to move forward. And Bruce and OPG now know that it’s a go-ahead. The refurbishments are going to start. If you’re talking about large renewables, then we’re going to be doing the new procurement. And that new procurement is probably going to be available before the end of the first quarter of 2014. If you’re talking about storage, our smart grid fund, we hope we can renew it in the next budget. We’ve had two rounds of it, $25 million each. There are people in the sector operating here in Ontario creating new technology in Ontario. So we want to incent them to do more on storage. Demand response, the same thing. So with every element of that plan there is a next specific step moving forward.

David McFadden

Thank you very much, Minister.

Bob Chiarelli

My pleasure.

David McFadden

I hope everybody here in this room and on television agree that you’re more plugged into the LTEP than you were at the start.

Thank you Bob for being with us and being here so rapidly after the plan was released.

Bob Chiarelli

David, it’s a pleasure. Thank you.

The appreciation of the meeting was expressed by Ms. Cathy Sprague, Executive Vice-President, Human Resources, Bruce Power.