Doug Ford’s Enbridge ‘scandal’ must be investigated: climate groups

The Ontario Green Party and environmental groups are calling for an investigation into Premier Doug Ford’s government’s decision to override an independent regulator to help Enbridge lock-in gas customers for decades to come.

In a May 7 letter to Ontario auditor general Shelley Spence, Ontario Green Party Leader Mike Schreiner said there were sound reasons behind an Ontario Energy Board (OEB) decision that shot down Enbridge’s proposal to pay for a massive gas network expansion using money collected from existing customers through utility rates for 40 years.

“The OEB outlined extensive evidence … that factored in affordability, the economy and the climate,” the letter reads. “The government’s unprecedented choice to overturn a decision by an independent body sets a concerning precedent.

“For these reasons, I am requesting that your office conduct a value for money audit and review of the financial and environmental costs of this government’s decision.”

At the centre of the OEB’s concern was that gas infrastructure, like pipelines, is typically paid off over 40 years through consumer gas rates. With the energy transition off fossil fuels well underway, there is a risk the gas infrastructure could become worthless. As people increasingly replace gas furnaces with electric heat pumps, there will be fewer customers for gas, leaving a shrinking pool of people to pay for the infrastructure. That would push rates up, encouraging more people to ditch gas, creating a vicious cycle called a “death spiral” for utilities.

To mitigate against this risk, the OEB in December ordered that rather than stretching the cost of new infrastructure out over decades, developers must pay for gas lines upfront. In his letter, Schreiner refers to this as ending a subsidy to Enbridge because it would have meant homeowners would no longer pay for Enbridge’s gas expansion. Previously, Schreiner told Canada’s National Observer the subsidy was worth $2 billion over five years.

When the independent regulator announced this change, Ford’s government announced legislation overriding the regulator to Enbridge’s benefit. That legislation, called Bill 165 or the Keeping Energy Costs Down Act, was tabled in February by Ontario Energy Minister Todd Smith, who called the OEB’s decision “rushed” and “outrageous.”

Smith said government intervention was necessary to avoid housing costs increasing because of the decision, even though experts say the ruling would have, in fact, lowered housing costs.

Smith’s office did not return a request for comment about calls for an investigation.

Schreiner is asking Ontario’s auditor general to investigate:

• The environmental impact of the decision.
• The financial impact on Ontarians’ bills.
• The extent to which the Ford government’s legislation will result in customers bearing the cost of stranded assets.
• The process Ontario is using to make long-term decisions and whether or not it's evidence-based.

The Ontario Auditor General's office would not confirm whether it has received an official request for an investigation, but a spokesperson told Canada's National Observer "we will be reviewing the ministry’s compliance with its consultation requirements as part of our legislated responsibilities under the Environmental Bill of Rights."

On Thursday, climate advocates from Stand.earth, Clean Air Partnership, Seniors for Climate Action Now!, Harbord Village Residents Association and the Ontario Climate Emergency Campaign held a press conference backing the request for the investigation.

“The Conservative government is pushing full steam ahead to pass this bill and we could see it become law in the next week,” Stand.earth climate campaigner Lana Goldberg told Canada’s National Observer. “Climate groups in Ontario are alarmed that this bill would pave the way for Enbridge to get its subsidy paid for by ordinary people, which will increase their monthly energy bills and will increase Ontario's emissions.

“It is a scandal,” she said.

“While the majority of the country and the world are figuring out ways to responsibly phase out fossil gas, this government is acting as the arm of Enbridge and bending political decision-making to serve its corporate interests,” she added. “Given this government’s propensity to serve special interests, it is important for Ontario’s auditor general to investigate the impacts of Bill 165.”

In Queen’s Park this week, Ontario NDP critic for energy and the climate crisis Peter Tabuns accused the Ford government of stripping Ontarians of protection from Enbridge’s attempts to use customers like “an ATM.”

“This is straight out of this government’s Greenbelt playbook: decisions made in backrooms to protect powerful private utilities; not to protect you, not protect the Enbridge customers who are out there, not to protect the constituents who you represent, but to protect Enbridge,” he said.

“It is focused on making sure Enbridge makes as much money as it possibly can.”