Further debate?

I’m honoured to rise today to speak to Bill 165—the “keeping costs down for Enbridge act,” I think is what it should be called, and “making the people of Ontario pay the bill for Enbridge’s operations act.” It’s outrageous, frankly, for the government to take the unprecedented step, for the first time in Ontario’s history, to intervene in the independent decision of the Ontario Energy Board, the regulator designed to protect the people of Ontario. It’s outrageous for the government to intervene in that way in order to continue to subsidize Enbridge, a giant multinational corporation, to expand fossil fuel infrastructure in this province, especially at a time when we’re facing a climate emergency.

Canada is on fire yet again. The toxic smoke from western Canada is blowing into Ontario as we speak, leading to more toxic air that we breathe.

The international energy association, an incredibly conservative organization, has made it absolutely clear that if we’re going to meet our climate obligations, we can’t continue to expand fossil fuel infrastructure.

The OEB, a very conservative organization, finally made a decision that actually takes into account the climate crisis and, quite frankly, what’s good for energy consumers in this province, and in less than 24 hours, the government asked to overturn it. We now know from the FOI request around the emails around this decision that even the government’s own lawyers were worried about the government taking this action, but the government said “No, no, no. We’re not going to listen to the lawyers. We’re not going to listen to the independent regulator. We’re going to listen to Enbridge and their $19-million CEO and actually put Ontarians on the hook for the stranded assets associated with ruling out fossil gas infrastructure.” And do you know what makes it more galling? If there was no alternative for people, then you might say the government has an argument here. But people can have heat pumps. The OEB decision, backed up by mounds of evidence, shows it will actually be 13% cheaper for people to install a heat pump rather than fossil gas infrastructure.

So we have to ask, who is the government acting for? Is it the people of Ontario or Enbridge Gas? It’s clearly Enbridge Gas.

An analysis independently done by Brandon Schaufele from the Ivey school describes it as this: Effectively, the OEB decision “shifts the upfront gas connection cost onto home developers in a manner similar to development charges for water and sewer connections,” other forms of infrastructure. “Unlike water and sewer, however, developers could decide to skip a natural gas connection altogether,” and install heat pumps, which would actually save people money.

“The government’s decision explicitly undermines the OEB and threatens credibility of” the independent regulator and “energy investment in the province.”

It’s a bad outcome for customers, but it’s a good outcome for Enbridge. So why is the government doing this when we’re in the midst of a climate crisis?

We know that investors around the world are pouring not billions, but trillions of dollars into the green energy transition. As a matter of fact, last year alone, $1.88 trillion went into the green energy transition—half of it into wind and solar, because they’re now the lowest-cost sources of electricity generation, but a big and growing chunk of it into heat pumps. Do you know why? Because heat pumps save people money and reduce climate pollution at the same time. That’s exactly why, over the last two years in the US, more new home developments have installed heat pumps over fossil gas. It’s better for the climate and cheaper for the people.

In Europe, right now, a 40% year-over-year increase in heat pump sales—do you know why heat pumps are growing so fast in Europe? They’re cheaper for people, good for people, good for the economy, good for creating jobs manufacturing heat pumps—not so good for giant corporations like Enbridge.

So which side of the ledger is the government on? I want to know.

What is especially infuriating about this is, not only are they ramping up fossil-gas infrastructure, which is going to increase climate pollution; they’re doing it at a time when Ontario has the worst performance in climate pollution now. The data released just 10 days or so ago shows that the province with the largest increase in climate pollution in the entire country in 2021-22 is the province of Ontario. As a matter of fact, 60% of the increase in climate pollution in Canada during that period comes from the province of Ontario.

This government not only wants to expand fossil-gas infrastructure for buildings, but they want to ramp up gas plants, which is going to increase climate pollution from the electricity sector by 580%.

I’ve heard the members opposite say what a clean grid we had. Yes, it was 96% clean when they took office. Now it’s 87% clean and going down, because they’re going to increase climate pollution by 580% for the rest of this decade, at a time when we’re all paying the price for the climate crisis.

Last year, in Ontario, one million acres burned. We had toxic air pollution all down the eastern seaboard. As a matter of fact, in just four days, from June 4 to June 8, in the province of Ontario, the health care system paid an additional $1.28 billion due to hospital admissions from toxic air exposure.

We know from the Financial Accountability Officer that the cost to infrastructure in the province of Ontario alone—just public infrastructure, just this decade, the next six years—is going to be $26.2 billion.

According to the Insurance Bureau of Canada, the damage to insured assets last year due to the climate crisis was $3.1 billion. They estimate that the cost of uninsured assets is three times that, almost $10 billion, costing everybody in this country an additional $750.

The cost of the climate crisis is only going up. We’re all paying for it.

We have solutions that will save us money, like heat pumps. We have solutions that will create jobs—by installing things like heat pumps. And we have the opportunity to actually move in that direction. We have an incredibly conservative energy regulator actually saying, “Do you know what? We should maybe start thinking about this. If we’re going to do a 40-year amortization period starting in 2025, that takes us to 2065, 15 years after the country’s commitment to be net-zero, so why would we make a decision like that, leaving the stranded assets on the backs of energy consumers in this province?” It will be the people of Ontario who will pay for it. That’s exactly what the OEB decision said.

When we have a truly competitive market, people would make a financial decision and say, “We’re not going to take on that risk.” But Enbridge doesn’t have to make that decision because they’re a regulated monopoly, and the regulator said, “Do you know what, Enbridge? We’re going to make you decide to take that risk by removing the 40-year amortization period, because the people of Ontario should not bear the risk of your business decisions, especially when there are cheaper, cleaner, better alternatives.”

Mr. Speaker, I’m pleased to rise and speak in strong support of Bill 165, the Keeping Energy Costs Down Act, 2024. This legislation is a critical step forward in our ongoing efforts to ensure that energy remains affordable, reliable and accessible for all Ontarians, while also supporting our housing and economic growth.

Since day one, our government has been dedicated to making life more affordable for the people of Ontario. We have introduced policies that have cut costs, such as scrapping the cap-and-trade carbon tax, cutting the gas tax, and implementing the Ontario Electricity Rebate. These measures have saved families and businesses significant amounts of money.

The Keeping Energy Costs Down Act is another crucial piece of our comprehensive strategy to keep costs low and support the needs of our growing province.

Let me start by addressing a critical issue this bill tackles: the recent decision by the Ontario Energy Board to require new customers to pay 100% of natural gas connection costs up front. This decision, if left unchallenged, would add approximately $4,400 to the price of new homes, and tens of thousands of dollars for homes in rural Ontario. This is unacceptable.

Bill 165 gives the province the authority to reverse this decision, restoring the previous arrangement where these costs were spread over 40 years. This change will help prevent unnecessary financial burdens on new home buyers and ensure that we continue building homes across Ontario without delay. It will protect the dream of home ownership, especially for those in rural areas, and keep our housing market moving forward.

Natural gas is not only essential for heating our homes, but also for powering our economy. By restoring the natural-gas-connection-cost rules, we are ensuring that businesses—particularly small businesses and farms—do not face prohibitive upfront costs. This is vital for economic growth not just in my riding of Carleton, which has numerous small businesses and family-owned farms, but also for maintaining Ontario’s competitiveness.

The proposed legislation also preserves the existing treatment of gas transmission projects. This means new customers will not have to incur upfront contributions, ensuring that these critical infrastructure projects can proceed without financial barriers. This is especially important for sectors like agriculture and manufacturing, which rely on affordable and reliable energy.

I have to look no further than my own riding of Carleton, where one such natural gas expansion helped bring natural gas, which was desperately needed, to the community of York’s Corners in the eastern part of my riding, bringing natural gas to homes as well as Stanley’s Olde Maple Lane Farm, a staple of the Ottawa agriculture industry—finally, after years of requesting it.

Again, this expansion is especially important for sectors like agriculture and manufacturing, which rely on affordable and reliable energy.

Another significant aspect of Bill 165 is the emphasis on public engagement. The OEB’s recent decisions highlighted a lack of adequate consultation with affected sectors. This bill mandates broader engagement, ensuring that future decisions by the OEB reflect the priorities of all Ontarians. The legislation empowers the government to direct the OEB to conduct separate hearings on any matter of public interest. This ensures that decisions are made with comprehensive input and are aligned with the public’s needs and government policy priorities. By involving more stakeholders, we can ensure that the energy policies we implement are fair, informed and beneficial for everyone.

Now let’s focus specifically on how this bill will improve life in rural Ontario. Rural communities, such as those in my riding of Carleton—including North Gower, Richmond, Metcalfe, Ashton and more—are the backbone of our province, contributing significantly to our economy through agriculture, manufacturing and other vital industries. However, these communities often face unique challenges when it comes to energy access and affordability.

In rural areas, new home construction often requires more extensive infrastructure for natural gas connections, leading to higher upfront costs. The OEB’s decision would have added tens of thousands of dollars to the cost of new homes in these areas. By reversing this decision, Bill 165 ensures that these costs are spread over 40 years, just like a mortgage. This will significantly lower the financial barriers to building new homes in rural Ontario, making home ownership more attainable for families, and supporting the growth and vitality of these communities.

Rural businesses, particularly small farms and local enterprises, are crucial to Ontario’s economy. The high upfront costs for natural gas connections could deter new businesses from setting up in rural areas and hinder the expansion of existing ones. By restoring the previous cost structure, this bill will encourage more investment in rural Ontario, fostering economic development and job creation.

In rural areas, natural gas is often the most reliable and affordable heating option. The OEB’s decision threatened to limit this choice by making natural gas connections prohibitively expensive. Bill 165 ensures that rural residents can continue to choose natural gas, preserving their ability to access reliable and cost-effective heating.

This bill also maintains the existing treatment of gas transmission projects, ensuring that new customers do not have to pay upfront contributions. This is especially beneficial for rural areas, where the infrastructure costs can be significantly higher. By alleviating these financial burdens, we are making it easier to expand and improve essential energy infrastructure in rural communities like those in my riding of Carleton and across the province.

Bill 165 also addresses concerns regarding the leave-to-construct process. Municipalities and agricultural organizations have raised valid concerns that the $2-million threshold for pipeline projects, set two decades ago, is outdated. Inflation and increased construction could mean that many projects now exceed this threshold, leading to unnecessary delays and regulatory burdens. This bill proposes to streamline the LTC process by allowing the government to prescribe conditions to exempt certain small projects from requiring LTC. This change will reduce delays and costs, helping to build housing and transit infrastructure faster. It will ensure that we can meet the needs of our growing population efficiently and effectively.

Let me illustrate the importance of this bill with a concrete example from rural Ottawa, in my riding of Carleton. The community of York’s Corners recently benefited from a natural gas expansion project completed by Enbridge Gas. This project brought much-needed natural gas infrastructure to the area, significantly improving the quality of life for residents.

Prior to this expansion, families in York’s Corners relied on more expensive and less efficient energy sources for heating. The introduction of natural gas has provided these households, as well as local business Stanley’s Olde Maple Lane Farm, with a more affordable and reliable heating option. This has not only reduced their energy bills but has also improved the overall comfort and quality of their homes. It’s also made the operation of Stanley’s Olde Maple Lane Farm more feasible and efficient.

The success of the York’s Corners project underscores the importance of making natural gas connections accessible and affordable across all rural communities in Ontario. By passing Bill 165, we can ensure that other rural areas will similarly benefit from natural gas expansions, fostering economic growth and improving the quality of life for residents.

In conclusion, Bill 165, the Keeping Energy Costs Down Act, is a comprehensive piece of legislation and I am proud to support it.

I really appreciate the energy minister’s question, and I appreciate his spirited defence for the independent regulator, the Ontario Energy Board, which is sort of perplexing for me. This independent regulator that has kept gas prices relatively affordable compared to Europe made a decision to protect gas consumers in the province of Ontario, and less than 24 hours later, the energy minister made the unprecedented decision and announced we’re going to overturn the independent regulator’s decision that protects gas consumers. I’m just confused now, because the minister is saying, on the one hand, that the regulator has done a pretty good job over the years and we should be happy with that, but on the other hand, he’s actually overturning the decision of the regulator to protect the people of Ontario.

I’m going to stand with the regulator that’s protecting the people of Ontario.

In a sense—I said this at committee—what the government is doing is kind of like socialism for Enbridge and capitalism for the rest of us, because a lot of this comes down to capital market risk. Who’s going to assume the risk of the death spiral of stranded assets as people transition away from fossil gas? Is it going to be Enbridge or is it going to be the people of Ontario? The OEB said it should be Enbridge, not the people of Ontario. The government is saying it should be the people of Ontario, not Enbridge.

Speaker, I’m going to stand up for the people of Ontario to help them save money, reduce their costs and fight climate change at the same time.

It was this government that cancelled 750 renewable energy contracts, saying we didn’t need the power. Now they’re getting up and saying we don’t have enough power to accommodate heat pumps. Which way is it?

I always find it unusual when this government that is about the free market decides to put their thumb on the scale and tip in favour of a huge monopoly like Enbridge.

The Ontario Energy Board found that it was cheaper to build homes designed in the first place for heat pumps than to retrofit them afterwards for natural gas.

Even the minister, at the committee, talked about—I think it was about 900 metres of pipe for a new home in Peterborough and how expensive that is.

So this idea of only relying on natural gas, this idea of doubling down on stranded assets that consumers were paying for makes absolutely no sense. I think it’s $14 billion in capital expenditures that will be stranded assets, paid for by consumers.

If developers want to put natural gas in new hookups, that’s on them. Why should consumers be forced to have natural gas and not be given a choice between heat pumps and natural gas? Let the market decide.

Questions, please?

I’d like to thank the leader of the Green Party for his always thoughtful commentary that he brings to the House. He does a great job. It was very enjoyable listening to his 10 minutes of comments. He cherry-picked a lot of interesting statistics that he threw out, and it’s a lot to unpack in a one-minute question.

He did touch on the fact that we do have very, very affordable and reliable natural gas home heating in our province. and it is rate-regulated. I think that’s really important.

The member talked about how people are moving en masse to heat pumps in Europe. Well, there’s a reason for that. It’s because the cost of natural gas across Europe has soared over the last number of years, far beyond the price of natural gas in our regulated province.

The question I have for the member opposite is, does he believe that the system operator, the IESO, is prepared to power all of those natural gas heaters—sorry, that would be coming off with heat pumps?

Does the leader of the Green Party believe in an orderly transition, or does he just believe in going all green and torpedoes be damned?

Questions, please, from the opposition?

I have a question. You didn’t mention anything about climate change or the emissions that Enbridge is responsible for. There was a proposal at a shareholder meeting calling on Enbridge to disclose indirect emissions from pipelines. Those emissions are methane gas—that’s what natural gas actually is. The CEO actually called employees and asked them to vote against this measure and also called shareholders. So I wonder if you think that a company should not be responsible to disclose when their business is emitting methane gas and that they have no responsibility right now to disclose.

Thank you to the member for that question.

Through the Keeping Energy Costs Down Act, the government is seeking to support fair and inclusive decision-making at the OEB to foster affordable communities. The OEB’s December 2023 decision demonstrated opportunities for improvement. For example, the decision noted that it was reached without an understanding of the impacts to the province’s electricity grid as the province’s Independent Electricity System Operator was not invited to provide evidence on the change to the revenue horizon. The decision also noted that impacted sectors were not invited to participate or provide evidence.

I find it rich, Madam Speaker, that the member refuses to acknowledge the fact that the only dissenting opinion here was that of a strong, independent woman. And I find it rich, Madam Speaker, that the member can stand in this House and say that our government is not listening to women, yet that member is ignoring the only dissenting opinion on the OEB which actually supports this piece of legislation.

Madam Speaker, I don’t even have natural gas. I have propane where I live in my riding of Carleton. For someone like me, a single person living in their house, the price of propane has gone up exponentially. It is almost unaffordable. So I can only imagine how much more expensive it is for those families who live in my riding of Carleton who rely on propane or even oil because they don’t have access to natural gas.

Natural gas plays an important role in meeting Ontario’s energy needs and that’s why I support this piece of legislation and I encourage everyone to support it as well.

To the member: I noticed in her presentation the member repeated something that the Minister of Energy said as well. The claim was made that the Independent Electricity System Operator was not a participant in the OEB’s decision. I just want to direct the member to page 5 of the decision and order December 21, 2023. When you look at the list of, let’s see, 33 different names of people who applied for intervenor status, right there, item number 17, is, in fact, the Independent Electricity System Operator.

So the question I then have for the member is, was she aware of this factual inaccuracy in her presentation? Secondly, if the IESO sought intervenor status and didn’t actually follow through and participate, what’s the bigger issue here?

Thank you to the member from Carleton for her presentation. I know you mentioned the importance for rural areas—of getting gas infrastructure there and getting the supply to those communities so that they can have natural gas. I know how important natural gas is as an energy source in rural communities as well. I just wonder if you could tell us, for your riding, is this an important addition to make sure we have the natural gas infrastructure to build new homes?

Further questions?

Not you, John.

That’s what it did.

That’s what it likely did, right? Because no one is going to tell me that gas prices that have any semblance of the cost of getting the gas to northern Ontario or getting the gas—because it goes up and down so quickly. The last one—the government was talking, and we’ve heard this so many times. And let’s make it clear that the NDP provincially have always been opposed to the individual carbon tax. The government blames every problem, every price increase, on the carbon tax. The increase in the carbon tax in April was two cents, I believe. Gas went up, like, 12 cents, so it wasn’t just carbon tax. It’s so frustrating.

That’s why people like natural gas: because they believe, and rightfully so, that because it’s regulated, they’re paying a fair price. And it has gone up recently—we have lots of complaints—but they feel that it’s fair.

It’s the job of the Ontario Energy Board, an independent regulator, to look out for the stability of the system and the price for consumers, because they can’t realistically—when a company that supplies the gas, like Enbridge, makes an application to the energy board that they need more money for their product, the way I understand the system, Speaker, is they make their case—I’ve been in business my whole life; if they can’t make a profit selling their product, the market will no longer be stable. And so, the energy board takes that into account and makes their decisions on where the price should be based on that, based on the facts given by the energy company and also by other independent advice. That’s where they make their decisions.

What makes this bill different is that the Ontario Energy Board ruled that it wasn’t fiscally prudent to amortize costs for infrastructure for 40 years when that infrastructure may very well not be used for the next 40 years. That’s important. We’ve heard a couple of people here, members on the government side, talk about, “It makes sense. It’s like a mortgage.” And I don’t advise anyone to take a 40-year mortgage, but with the price of housing now, if you take a mortgage for 40 years, you do have an expectation that when you are finished paying the mortgage, you will still have a house or something that is usable, that has equity in it.

What the Ontario Energy Board was worried about is that those pipes that the consumers are paying for might not have a value in 40 years. In fact, they may not have a value in 10 or 15 because as we are facing—we are not facing climate change in the future; we are facing climate change now. And as a result, there are developments. Every day, we see advances in how to deal with climate change, how to transition to practices that impact the climate less. I would think that the government would believe that, since they are subsidizing the production of electric vehicles by billions of dollars, right? So the government recognizes that there is a need, that the world is going away from fossil fuels, from carbon fuels for vehicles. I think we all recognize that. But in this case, the Ontario Energy Board is basically saying the same thing, that those pipes that you are paying for now, that we are using now, might not be—and you’re forcing people to put payments on for 40 years; they might only have a 10-year usable span.

So all of a sudden, people are making—someone has to pay these bills for those pipes. That’s why the Ontario Energy Board said, “Hold it, hold it.” So I welcome questions from the government. I might be totally wrong on this. But the Ontario Energy Board said, “Hold it, people should pay for those costs upfront when they build the home, and that way they can make a decision.” So if you pay, I believe it’s $4,000 or whatever upfront, that adds to the cost of the new home. When you’re doing that, then you have to make a decision: Okay, so $4,000 for the hookup. Let’s say another—what does a natural gas furnace cost?

Interjection.

The government has decided to overrule the energy board so that everyone has to pay for those pipes in new builds, even though they all know that those pipes might not be viable for 40 years. Basically, since everybody is paying for the pipes, not just the person buying a new house—and I get that. The incentive is, “Oh, well, since the pipes are there, we might as well put a natural gas furnace in.”

Interjection.

So, basically, it’s kind of an incentive to become an Enbridge customer.

One of the comments when we were listening to one of the speeches was that sometimes some of the government members accuse us of being socialists—

Questions?

What about a 60-year-old car?

Overrules.