FACT CHECK: Wildrose gets it wrong on PPAs, sides with electricity companies over Albertans

FACT CHECK: Wildrose gets it wrong on PPAs, sides with electricity companies over Albertans 

Claim: The NDP was warned about the impact of the SGER increase, and the implications were clearly understood.

Fact: The FOIPed briefing note from the Balancing Pool – produced in September 2015, three months after the government announced the increase in SGER –clearly concludes that, based on the electricity price forecasts at that time, the management of the Balancing Pool “does not believe any Buyer is likely to terminate its PPA position at this time.”

Fact: The note confirms what is well understood – that the SGER charge “will have a relatively small impact on the breakeven price for various PPAs, adding less than $5/MWh.”

Fact: The note says absolutely nothing about the ability of PPA Buyers to exercise the change in law provision should they be rendered “more unprofitable.” This is in no small part due to the fact that based on the forecasts, those units were “expected to be economic over their remaining lives.”

Fact: The only reasonable conclusions that could be drawn from this note are:

  1. PPAs will remain profitable even with the SGER change;
  2. It is unlikely that they will be returned to the Balancing Pool; and
  3. There was not mention of the risk that an unprofitable PPA might be handed back due to becoming “more unprofitable.” 

Claim: The Wildrose is claiming that PPAs can be returned because of the impact of SGER.

Fact: Not even the companies themselves are claiming that they were made unprofitable by SGER. The SGER charge was marginal – what the companies are saying is that they want ratepayers to cover their market losses. The SGER increase merely provides what they believe is the necessary trigger to exercise the unlawful Enron clause.

Claim: The Wildrose has been warning the government about this for months.

Fact: The Wildrose continues to get this wrong. They believe that the government should let profitable electricity companies offload their losses onto Albertans, costing all of us $2 billion. All this because of a bad deal made between the former government and Enron, a discredited and now-bankrupt US electricity operator.