CHESTERVILLE-Energy issues were examined from every angle during the annual meeting of the Dundas Federation of Agriculture Feb. 24.
Ted Cowan, a researcher with the Ontario Federation of Agriculture explained the challenges facing Ontario residents and farmers in an entertaining way.
Natural gas prices have fallen during the past three weeks because of a mild winter and Louisiana production is fully restored, and Cowan gets a lot of calls from people wondering whether prices are going to stay low.
"I believe those prices will stay low through ‘til mid-July. If we have a hot summer and gas is in demand for electricity for air conditioning then prices will come back up. If we have a moderate or mild summer, then prices will start back up in the early fall as storage reserves are replenished," he said.
"You might be able to lock in at 40 cents a cubic meter in the next few months, if your timing is really good. In any event, long-term gas supply is shrinking. Alberta is cutting back the reserves it has for sale in order to reserve gas for oil sands production."
In addition, the northeastern United States has expanded its natural gas distribution areas by about 15 million customers in the last six years.
"It’s as if they add an entire country of Canada to customers for market to Alberta gas every six to seven years. It doesn’t look as if prices are going to come down. The only forecast I’d give you for lower prices is a massive North America-wide recession, and if you want that to bring gas prices down, you have a slightly twisted sense of humour," he added.
Cowan accused every Ontario government over the past 20 years of taking its energy policy either from the comics or from the Ann Landers column. "There’s been no significant additions to the generating capacity since 1983 and the total working capacity of generators has gone down." The province has gone from being an exporter to a net importer, even during the low periods, when approximately 10 per cent of generators are idled for maintenance.
With a debt retirement charge of .7 cents a kilowatt hour on everyone’s bill, collecting just over half the interest on the old hydro debt, the total debt has grown by almost $6 billion., putting the province’s credit rating at risk.
Cowan said the province’s lack of resolve on energy issues over the past 15 years is costing everyone in the province "big time".
To name a few examples, "GM told us they’re thinking about closing down the plant in Oshawa. The Ford plant in St. Thomas is to close, and jobs from the Imperial Tobacco plant in Guelph will be in Mexico next year."
The energy crisis is also impacting on farms by increasing production costs and closing plants that affects off farm jobs, the "largest farm subsidy" in the country.
What to do about the hydro problem on the farm?
Cowan proposes two choices, either a generator or a night storage system which is actually a solar system without the solar cells, and can be obtained from a cottage supplier.
A system with solar cells costs between $15,000 to $20,000 and is suited for a large operation, while a system without the cells costs about half.
The batteries are charged with power from the grid overnight when it is only 3.2 cents a kwh. "In the morning, you fry your eggs and milk your cows with 3.2 cents power, instead of 5.8," said Cowan.
Cowan said customers on an ordinary meter will save between 2-6 cents a kwh, while customers on a demand meter will also save on demand charges. In some instances, they’ll save over $1,000.
There are other hydro savings to be had by buying fluorescent light bulbs, instead of regular bulbs. Sixty fluorescent bulbs are costly at $400, but will save more than that over a period of 18 months. They also run more coolly, so the risk of fires from faulty wiring will go down.
The government is introducing a Standard Offer program to allow people who connect a clean green power generator to the grid the opportunity to sell power at a fixed price. This will allow producers to make a decent profit and provide power at lower costs, than paying for new public generating facilities.
Over the last 100 years, the world has six billion people to feed instead of one billion, although a half billion still go hungry. But with improvements in agriculture and in the ability of peoples to feed themselves, Cowan foresees North America will not always be the breadbasket of the world.
However, there are other ways to make money on the farm, through the production of ‘farmaceuticals’ or feed stocks for fuel-producing chemical plants. "We’ll substitute carbohydrates that we grow for hydrocarbons we get out of the earth," said Cowan.
One substance with much potential is corncobs, which provide 25 million BTUs for $100, compared to 33 million BTUs from coal at the same purchase price.
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"They’re not as heat intensive as coal, but they have the benefit of being available in Ontario and relatively speaking are a good buy," said Cowan.
Cowan said there is another advantage to using carbohydrates for fuel instead of hydrocarbons. Carbohydrates produce no greenhouse gases and very few heavy metals, compared to hydrocarbons, which combine with the atmosphere, contributing to both pollutants.
"It burns like nobody’s business. You can have corncobs for quite a while yet and they’re another use for corncobs besides a pipe. You can put the smoke in chimneys instead of in your mouth."
From the Archives:
News, March 2006
