Environmental Defence just released a captioned “Gas is Not Green” five page report telling us we must eliminate using natural gas in order to achieve that “net-zero” emission target by 2050.
It’s a very short report and leans heavily on claims by many other “climate change advocates” with 42 references which takes four pages to just identify them. It also flies in the face of an article from the Canadian Energy Centre stating that Canada could become a major LNG (liquid natural gas) supplier to countries that are burning coal and who would benefit from reducing their emissions and pollutants by using LNG .
Here in Ontario we know natural gas plants frequently save us from rolling blackouts when the wind isn’t blowing, or the sun isn’t shining, but that knowledge seems to not matter to the eco-warriors out to save us all from the presupposed “global warming” they claim is caused by CO 2 emissions.
If they paid attention and actually did proper research, they would have no choice but to realize natural gas is a saviour by preventing the loss of electricity supplied by those natural gas plants sprinkled throughout the province ensuring no blackouts or brownouts and heating millions of households and businesses during our cold winters!
May 16th came and went and Ontario’s IWT (industrial wind turbines) generation demonstrated their unreliable nature! Recent examples of the latter are readily available from the IESO’s data files! Back, just three days ago, on May 13th those IWT were forecast to produce 62,852 MWh which represented 53.4% of their rated capacity but it wasn’t needed as demand was low. We should be pretty sure most of it was exported to Quebec, Michigan and New York at cheap prices as it wasn’t needed to keep Ontario’s lights on!
Now on May 16th it turns out the wind wasn’t blowing very hard and for the full day they only generated 11,626 MWh which was a dismal 9.9% of their rated capacity. Thankfully, Ontario’s natural gas plants, with their ability to ramp up or down, came to the rescue and generated 76,842 MWh (what 2.5 million Ontario homes consume daily) at the same time as our hydro generated in excess of 120,000 MWh and our baseload nuclear plants were producing about 180,000 MWh.
The foregoing makes it obvious, IWT with their preferential contracted, “first-to-the-grid” rights, frequently show up when they’re not needed but when demand may be higher, they are absent!
They demonstrated the foregoing on the 16th of May even though peak demand only reached 16,595 MW at hour 19. During hot summer days or cold winter days when peak demand is in the 20,000 MW range, they are even more likely to be absent!
So without our natural gas plants, even during low peak demand days, it is obvious we need power that can be ramped up and down and that basically leaves only hydro or natural gas plants to provide that capability. Ontario has a limited amount of hydro capability and no significant additional hydro power that can be exploited so the question becomes; what could replace our natural gas plants which are also our second cheapest source of electricity generation?
If you listened to the eco-warriors, you would hear them, these days, suggesting BESS (battery energy storage systems) are the answer! For May 16th that would mean to replace the natural gas generation of 76,842 MW, Ontario would need about 20,000 MW of BESS as they are only capable of storing four hours of their rated capacity and then would need to be recharged with surplus energy during low demand hours! What if the wind was absent for yet another day?
On May 17th those IWT managed to produce slightly more power but only 14,081 MW or 12% of their capacity and our natural gas plants once again stepped up and generated 71,981 MW. Peak demand only reached 16,341MW at hour 20!
So, another day, another big shortage without natural gas generation meaning replacing them with BESS would (at a minimum) add another 18,000 MWs of capacity. Oh yes, and what about the power needed to recharge those 20,000 MW of BESS units we needed for May 16th?
Conclusion
It seem obvious eco-warriors like Environmental Defence with their “charitable” status granted by the CRA (Canada Revenue Agency) haven’t a clue as to how we can currently replace natural gas generation to avoid rolling blackouts even during low demand days!
Now, try to realize; how much electricity demand will increase as the current Trudeau led government forces us to heat and cool our homes with heat pumps using electricity while also charging EVs with electricity! The 40,000 MW of BESS storage we would have needed over those two recent May days would undoubtedly need to be doubled or tripled just to avoid blackouts.
We should wonder if Environment Defence, the other eco-warriors and our Trudeau led government think natural gas generation can be replaced with more IWT, solar panels or BESS units or perhaps some unproven new sources such as “green” hydrogen?
April 14th and 15th arrived and as frequently happens in the spring, Ontario’s peak demand was low reaching only 15,757 MW on the 14th and 15,971 MW on the 15th with both occurring at hour 20 (hour ending at 8PM).
While those IWT (industrial wind turbines) were generating energy it wasn’t particularly high; nevertheless, due to low demand, it wasn’t needed but due to their contracts giving them “first to the grid” rights, all of what they generated was accepted. On the 14th they generated 35,168 MW (29.9% of capacity) and on the 15th they produced only 17,690 MW (15% of capacity) but absolutely none of it appeared to be needed based on what IESO were selling off to our neighbours in Michigan, New York and Quebec.
At this particular time a large portion of our nuclear plants are down for refurbishment (about 5,700 MW) with several more of them still in operation scheduled for future refurbishment. In addition to the foregoing a Ministry of Energy press release dated April 16th announced a “plan to refurbish its hydroelectric stations in the Niagara region, including the Sir Adam Beck Complex at Niagara Falls.“ The $1 billion refurbishment will commence in 2025 and is expected to be completed in 15 years and add 50 MW of capacity.
While all those refurbishment projects are happening; IESO’s Pathways to Decarbonization forecasts by 2050, we will have both an incredible amount of nuclear as well as 15,000 MW of hydrogen generation (currently an unproven source of low cost power) as one can see in the following chart. One should also note no natural gas plants will be in existence at that time! The chart also anticipates lots more IWT capacity will be added to the grid! We ratepayers must presume the “Demand Response” capacity will keep the “grid stable” while industrial companies will be severely impacted having to shut down on numerous occasions to contain blackouts!
As and when 2050 arrives we should also anticipate (laughingly) IESO’s plan is those IWT will have reached the stage where they will generate power only when needed unlike the recent two days which demonstrated their intermittent and unreliable nature.
The total generation for both of the two April days was unneeded as IESO were busy exporting the surplus power to our neighbours at an average HOEP price of $19.17/MWh on the 14th and $27.41/MWh on the 15th while they were paid $135/MWh! The net intertie exports (exports minus imports) on the 14th (39,836 MWh) and the 15th (51,925 MWh) both exceeded what those IWT generated meaning it was surplus to Ontario’s demand.
The net result of the foregoing was a cost to us ratepayers and taxpayers of over $6 million for those two days. We should expect that cost will surely rise should the Province of Ontario continue to believe we must “decarbonize” to save the planet from “climate change” resulting in an unreliable grid and further creation of “energy poverty” as all those EV and heat pumps gobble up whatever remaining dependable power is available in the future!
Why isn’t the Ford led provincial government fighting back on the inane push of the Federal led, Trudeau government to continue on the “net-zero” target and recognize what we are attempting in Ontario will not change the climate in any way!
Those IWT in the recent two days, demonstrated their innate ability to generate excess power when it’s unneeded and then to reverse course and be absent when it is needed.
On April 2nd they were humming all day generating 93,012 MWh which was 79.1% of their capacity and IESO were busy selling much of it off to our neighbours in Michigan, Quebec and New York at an average price of $29.27/MWh. In total IESO’s intertie data (net-exports) showed 55,013 MW weren’t required to keep the lights on In Ontario which was 59.1% of IWT generation on that day so we ratepayers and taxpayers in Ontario were forced to eat those costs of excess generation.
On April 3rd those IWT were still humming but most of the humming was in the early morning from 1AM to 7AM when they generated 24,894 MWh or 72.6% of their capacity while IESO sold off (net exports) of 15,184 MWh or 61% of the IWT generation at $29.87/MWh.
Later that day when demand was higher IWT generation fell off and for some reason IESO were busy importing power to keep our lights on! From hour 14 through to and including hour 22 IESO data notes we were net importers of 8,940 MW from Quebec and New York at an average cost of $86.89/MWh and almost three times what we sold off the excess power for earlier in the day. Over those same hours IWT generated 9,834 MWh which was only 22.2% of their capacity.
It’s unclear why IESO went through the import process as both our hydro and natural gas plants show their generation fell over the same period based on IESO data?
Fun Facts
The foregoing reminded yours truly of a fun fact related to the push to achieve that “net-zero” emissions target with IESO telling us in their 2024 Annual Report “full electrification will require the grid to increase “two per cent a year over the coming decades, from 154 TWh in 2025 to 245 TWh by 2050.“ IESO’s Annual Report also includes projections of generation from those IWT for the winter and the summer (30%+ for winter but only 15% for summer) but don’t mention their habit of much higher generation during the Spring and Fall when Ontario’s daily “peak demand” is much lower.
The 154 TWh forecast for 2025 also caught my eye due to a recent examination of IESO’s “Historical Demand” which has data for both the top 20 peak demand hours historically as well as Total Annual Ontario Energy Demand! In reviewing that historical information it became clear Ontario back in 2005 had an annual demand exceeding the 2025 projection and it was 157 TWh! Back then Ontario’s population was approximately 12.6 million versus our 2023 population of 15.6 million. What that means is back in 2005 our annual consumption per individual was 12.5 MWh whereas in 2023 when consumption was 137.1 TWh it drops to 8.8 MWh per individual! That represents a drop of 3.7 MWh per person or 29.6%!
Conclusion
We should rightly assume our drop in average consumption from 2005 had zero effect on the price we pay per kWh. We should suspect the cost per kWh will continue to increase as Ontario adds more renewables such as wind, solar and biomass and expensive storage such as batteries to try and offset the intermittent and unreliable nature of wind and solar. There is also the aspect of other expensive generation sources still in the early development stage that are reputedly “emissions free” power such as “green hydrogen” not to mention the tens of billions they plan to spend on grid expansion!
Yes, sit back and watch your electricity costs rise to the point where it will be “lights out” or starve!
Ontario’s IESO recently released their “2023 Year in Review“ and it confirms some suspicions, including less generation from IWT (industrial wind turbines) and solar despite their contracted “first-to-the-grid” rights.
The biggest surprise is the review revealed a year over year slight drop in Ontario demand from 137.57 TWh in 2022 to 137.1TWh in 2023. The drop happened despite the ongoing efforts to decarbonize our generation with demand reputedly increasing as IESO stated in their recently released; “Annual Planning Outlook” claiming we will see “steady demand growth year over year, with total demand increasing 60 per cent over the next twenty five years.“ Strangely enough, while demand declined by .47 GW (gigawatts) year over year it was reported by Statista that Ontario’s population grew 3% from 16.1 million to 16.6 million in 2023 yet electricity demand fell! Hmm, what do IESO attribute this to?
Well as we have come to expect during these times, IESO blamed it on the weather, stating: “Weather had a significant impact on 2023 demand, as the winter and summer months were milder than normal“and they also blamed it on “economic activity, which was diminished slightly owing to inflationary pressures.“
On the “weather” issue they said nothing about how an El Niño year affects the weather resulting in how “trade winds weaken and the Pacific Ocean tends to release more heat into the atmosphere.“ Despite the foregoing IESO in its recently released “Annual Planning Outlook” prattle on and on about “climate change” and “decarbonization” going as far as to state: “Climate science has demonstrated that the global climate is changing due, in part, to an accumulation of GHG emissions in the atmosphere.“ It seems obvious IESO Staff need to review the recent released Climate the Movie (The Cold Truth) in which prominent scientists debunk the claims of the Church of the Climate Change Cult!
On the “economic activity” issue we should suspect due to many small and medium businesses shuttered (120,000 across Canada) due to the Covid lockdowns that a good percentage of them were Ontario based so that presumably, represented the decline in “economic activity” resulting in diminishing electricity demand in 2023.
Let’s look at a few issues coming out of this “Review”
Peak demand in 2023 reached 23,713 MW on September 5, 2023, and the review gives it a lot of attention but compared to past peaks it pales as the highest summer demand peak hour was back on August 1, 2006, when it reached 27,005 MW. Had they bothered to review their history of the top 20 peak hours they would have noted the September 5, 2023 peak was over 1,600 MW short of number 20 on the “peak” list back on August 12, 2002!
The “Review” also has nuclear capacity showing as 13,144 MW but at no time during the year was it at that level as many of the units were, and still are, shut down for refurbishment. As of today the “grid connected” nuclear capacity is (as of hour 18) shown as 6,561 MW or slightly less than 50% of what IESO claim in their “Review”!
Looking at imports and exports it is interesting to note the former dropped from 7.9 TWh in 2022 to 4.1 TWh in 2023 and interestingly IESO blame it those Quebec wildfires (14 of them were caused by an arsonist now in jail but that’s not mentioned) stating it was one reason Quebec was unable to export hydro. The second reason was apparently “because of hot, dry weather contributing to lower hydroelectric output“. Ontario’s exports were also down by 1 TWh, but no reason is given by IESO.
In respect to the latter perhaps the reason for lower exports was related to those IWT (industrial wind turbines) whose generation fell by 1.6 TW from 2022 as did the grid connected solar which fell by .5 TWh. Ah yes, the vagaries of wind and solar! Despite those drops by wind from 13.8 TWh in 2022 to 12.2 TWh in 2023 and solar, IESO reported exported generation in 2023 was 16 TWh (enough to power 1.8 million average Ontario households) and we sold it for pennies as the average HOEP (the wholesale price) was a miserly 2.99 cents/kWh!
Should one do the math on the foregoing and simply deduct the imports of 4.1 TWh from the exports of 16 TWh it comes to 11.9 TWh or almost exactly what those IWT generated (12.2 TWh) in their unreliable and intermittent way! If we go further and suggest all of those exports were either IWT generation or caused baseload generation to be exported, the cost associated was approximately $1,251 million! The latter is a simple calculation: the 11.9 TWh of net exports caused IESO to manage the grid and they sold it to our neighbours at an average price of $29.9 million/TWh so it would have generated revenue of about $356 million (11.9 TWh X $29.9 million). The cost of that, if it was all IWT generation or caused other generation (baseload) to be exported at $135/MWh, would have been approximately $1,607 million (11.9 TWh X $135/MWh). If one deducts the $356 million earned from the export sale it indicates, we Ontario ratepayers/taxpayers were forced to absorb the above noted $1,251 million in costs representing about $260.00 per Ontario household!
Natural gas plants stepped up
While those IWT and solar panels generated less power in 2023, Ontario’s natural gas plants with their ability to ramp up or down came through when needed and their generation increased from 15.2 TWh in 2022 to 19.1 TWh in 2023 while hydro generation fell slightly by .6 TWh.
Ontario’s Minister of Energy, Todd Smith’s on a Podcast
Interestingly enough, Ontario Energy Minister, Todd Smith was on a podcast February 27, 2024 discussing the Federal CER (Clean Electricity Regulations) created by the Federal Minister of the Environment and Climate Change, Steven Guilbeault and had this to say:
“So when it comes to generating electricity, for the time being, natural gas is going to play a vital role as the insurance policy to keep the lights on. However, as more storage is added to our system and potentially long duration storage, which has the potential ability to dispatch electricity for 10 to 12 hours at a time will be less reliant on our natural gas fleet over time.
For home heating here in Ontario, there’s well over 70% of our homes that rely on natural gas for heat right now. We have several pilot projects that are underway in municipalities across the province to move to a hybrid electric heat pump, which is being well received in certain communities. But if we were to move, let’s say to all electricity for home heating, we would have to build several more Bruce Powers to make sure that we have the electricity that we need. And our system operator told us that in our pathways to decarbonization report that I asked them to produce for us on what it would take to get to net zero by 2050, and they said it would take 18 gigawatts of nuclear alone, but hundreds of billions of dollars in new transmission and new generation of other types as well.“
When asked further about the “transition” demanded by the CER Minister Smith had this to say: “Yeah. So I mean, there are other ways to reduce emissions and this is not the way to do it. By ensuring we have that reliable,affordable system, we’ll be able to reduce emissions where the actual emissions are in our transportation, in our electric arc furnaces, in our home heating potentially.“
In the podcast he goes on to brag about the new EV plants as well as expanding our transmission lines to accommodate increased electricity demand required throughout the province to accommodate the CER but says nothing about the relative costs.
We Ontarians should find it disappointing the province is acting in such a meek and mild way in fighting the CER as the “net-zero” transition will drive up costs tremendously as we are refurbishing nuclear plants, adding short term storage while pushing heat pumps for heating and building new transmission lines at huge costs despite our electricity system currently being 90% emissions free.
Conclusion
It is truly disappointing IESO have seemingly abandoned what was formerly their unbiased disclosure of “facts” and seem to now be endorsing the “climate change” cult and abiding by the dictum of the Federal Government via its Clean Electricity Regulations (CER), released in August 2023! The CER “outline steps to mandate the decarbonization of electricity systems across the country. The IESO has released its formal response to the draft CER, which provides comments aimed at supporting an orderly transformation of the electricity system.“
IESO obviously take their direction from Minister of Energy, Todd Smith, who fails to recognize his positioning in response to the CER is simply an endorsement of it. The minor changes made to the CER will do nothing to change the IESO forecast in its “Pathways to Decarbonization Report” stating it would cost “hundreds of billions of dollars in new transmission and new generation of other types as well.“NB
Refurbish our nuclear plants but ditch the rest!
NB: What the Pathways to Decarbonization Report said: “In terms of both transmission and supply, the Pathways scenario would need $375 billion to $425 billion in new infrastructure investment, and result in an annual total system cost of approximately $60 billion by 2050.“
Unbeknown to most Ontarians is the fact we have a high dependency on nuclear power as baseload power and the message always handed out to us and the media is that we have over 10,000 MW of that baseload in operation. While the foregoing is true it doesn’t recognize the important fact that the four Darlington units representing almost 3,400 MW (850 MW per unit) were all undergoing refurbishment, which is a fairly long process. OPG had announced back on March 18, 2023, that Unit 3 had been reconnected and would “produce an extra 3 terawatt-hours of energy, enough to power 350,000 homes for an entire year.“
Here we are one year later and for some unknown reason Unit 3 was shut down on March 17th but at this point the reason why the shutdown occurred has not been disclosed! None of the Darlington units are currently operating.
While the Spring and Fall months tend to be Ontario’s low demand months, they are also the time of year when wind and solar generation usually brings us surplus demand. What the latter means is IESO sells off wind and solar surplus power for pennies of its cost to our neighbours in Michigan, New York, and Quebec or frequently curtail production. Those happenings end up costing us Ontario ratepayers millions of dollars, almost on a daily basis.
With the Darlington Unit 3 currently shut down for some reason it is interesting to review IESO data for March 22nd!
As the 22nd was a somewhat cooler than normal Spring workday throughout the province peak demand was reached early in the day coming at Hour 9 peaking at 18,730 MW and demand stayed around the 18,000 MW level for most of the day. The result of that demand was without the 850 MW Darlington Unit 3 in operation IESO considerably reduced its intertie activities (coincidentally net exports averaged only 864 MW per hour or what “Unit 3” would have generated) as we had considerably less surplus generation. One of the other reasons for less exports was those IWT (industrial wind turbines) only operated at 15.7% of their rated capacity whereas on other spring days they will reach as high as 80%! Interestingly for two hours (Hours 20 and 21) IESO were actually importing more generation than they were exporting.
Thankfully Ontario has a fairly large amount of contracted natural gas generation plants, and they were busy for the full 24 hours generating a total of 106,138 MWh or about what 3.5 million Ontario households would consume over the day. Without those gas plants we should suspect we would have experienced rolling blackouts but we didn’t, thanks to the “fossil fuel” generation from those gas plants!
Now, those telling us what is needed in the province is “storage” in the form of “BESS” (battery energy storage systems) instead of natural gas plants; we should wonder; how much would we have needed? Those BESS units will generate just four (4) hours of their rated capacity before having to be recharged, so, to replace gas generation for March 22nd we would have needed a minimum of 27,000 MW of storage (106,138/4 hours). If one examines IESO’s 2024 Annual Planning Outlook it states; “While batteries and other storage technologies are proven and currently participate in Ontario at a small scale, participation of these resources is expected to increase in the middle of this decade as a result of IESO action and government announcements.“
As it presently stands the only significant BESS contract is the Oneida Energy Storage (OES) project, a 250MW/ 1,000MWh grid-connected lithium-ion battery storage facility being developed on 10 acres of land. So, the 27,000 MW of BESS capacity would need about 270,000 acres of land or about 422 square miles which is about 2/3rds of the size of the City of Toronto.
Conclusion:
Perhaps the Ford led Ontario Provincial Government will pick the Greenbelt for the BESS units to end the use of fossil fuels in the electricity sector as they comprise 2 million acres. Just over 13% of it would be needed in order to insert the BESS units and save us from the emissions of those natural gas plants! Only time will tell if that is what happens but in the interim Ford and all the MPPs should perhaps spend some time and watch “Climate-the Movie”! If they did, they might start to think logically!
Brian Lilley a great reporter for the Toronto Sun and the National Post kindly invited me to be on his Full Comment podcast to discuss the electricity sector along with what is happening with the issue of EV and what the future looks like.
We cover a lot of ground during our chat and you can listen to the full podcast here:
Let’s go back a few years to examine how politicians and the bureaucrats did their job. The example is related to the auto industry and specifically to VW who were caught claiming their vehicles powered by a “2.0-litre Volkswagen and Audi diesel engine reduced emissions but they used “defeat devices” during official tests to obtain that claim. As a result they were faced with huge fines in Canada ($2.1 billion) by the Competition Bureau and in the US they were fined $14.7 billion by several authorities under their competition laws as well as the Environmental Protection Agency (EPA). VW were forced to lay off 30,000 employees globally after settlement!
Today we should wonder what has happened to the Competition Bureau here in Canada and in the US by the EPA related to “mileage claims” by EV manufacturers. Those manufacturers are being called out frequently because their claims often vastly exceed the actual range. One such article: “On Car and Driver‘s 75-mph highway test, more than 350 internal combustion vehicles averaged 4.0 percent better fuel economy than what was stated on their window stickers. But the average range for an EV was 12.5 percent worse than the window sticker numbers, the magazine says. Uh oh.“
We should wonder will the EPA in the US and the Competition Bureau here in Canada follow up and fine those EV manufacturers to the same degree as VW which in the latter’s case represented $20K per vehicle sold in Canada with that diesel engine. We should suspect not as EV will reputedly reduce our emissions! The latter claim by our politicians are humorous when one realizes that most of the batteries utilized to power those EV were manufactured in China where they operate over 1,140 coal fired generation plants used to produce those batteries! So because those batteries are manufactured in China, they contain no emissions nor did they create any, ha, ha!
Other Politically Induced EV benefits for Manufacturers:
Despite all the billions thrown at the concept of “transportation” conversion by pushing the EV narrative over the past several years there is lots more destined to find its way into their revenue stream! One of those in the US are “regulatory credits” which keep growing and will continue to grow as more automobile manufacturers convert to producing more of them in order to comply with the political push. As one example in reviewing Tesla Inc’s December 31, 2023, financial statement filed with the SEC one notes they report revenue from “regulatory credits” amounted to US $1.790 billion which represented 31.7% of Tesla’s net income after taxes. We should suspect selling those “regulatory credits” did not entail Tesla increasing their costs of operation to any great extent!
So we should all wonder what are those “regulatory credits”?
A July 2020 article from Yahoo Finance titled: “What Are EV Regulatory Credits And Why Is Tesla Selling So Many Of Them?“ gave us the answer which is: “Environmental emissions programs around the world, such as the Zero Emissions Vehicle (ZEV) program in California, give out credits to automakers that produce and sell electric vehicles. In addition to California, there are at least 13 other U.S. states that have similar programs in place. If an automaker doesn’t have enough credits by the end of the year, it could face punishment from state regulators.“ The article goes on to cite the following: “For example, Fiat Chrysler Automobiles NV (NYSE: FCAU) has reportedly committed to buying $1.27 billion in credits from Tesla to comply with new European environmental regulations that go into effect in 2021.“ It appears to be simply more punishment for any manufacturer of ICE vehicles for the benefit of those producing only EV! It also raises the price of an ICE presumably to decrease the difference in price between those nasty fossil fuel emitting vehicles and those non-emitting batteries (sarcasm intended) supplied principally by China!
The scandal, hidden away in the Federal Register, challenges the integrity of the government’s approach to enforcing fuel-efficiency rules for electric cars. Unlike the high-profile cases involving diesel emissions cheating, this scandal surrounding electric cars has garnered considerably less attention. The article notes:
At the heart of the issue is a little-known rule buried on page 36,987 of volume 65 in the Federal Register and articulates it as follows:
The Values to Be Used: Automakers must use actual values measured in a lab environment whentesting gasoline-powered vehicles for compliance with the Transportation Department’s fuel-efficiency regulations. However, the Energy Department has a different set of rules for electric cars.
The incredible SCAM:
According to this rule, carmakers are allowed to multiply the efficiency of electric cars by a factor of 6.67 arbitrarily. This means that a 2022 Tesla Model Y, for example, which tests at the equivalent of about 65 miles per gallon in a laboratory, is counted as having a compliance value of a staggering 430 mpg.” I would note the Car and Driver testing range did not find one Tesla model that achieved a total charged range of 430 miles and perhaps that is why on January 5th, 2024 an article in Yahoo Finance stated: “Tesla has cut back claims about how far its electric cars can travel as it faces scrutiny from the US government.“ The article stated Tesla did not give a reason for the adjustment.
Is the SCAM coming to Canada:
Surely many Canadians are familiar with our Minister of the Environment and Climate Change, Steven Guilbeault’s push to impose his “Clean Energy Regulations”, encompassing rules, to force each and every province and territory in Canada to abide by his views on saving the planet from CO 2 emissions. The provincial pushbacks were extensive so those plans have recently been slightly modified but will still impose incredible harm on the generation of reliable electricity due to their push for a “net-zero” grid. The proposed changes were recently summarized in a article in the Financial Post but as noted the changes are moderate so Guilbeault has sought further input but we should suspect he will simply ignore any that deviate from his inane desire to impose his personal views!
Minister Guilbeault is taking Canada on the same path as California and those other 13 US states pushing the EV agenda as the above noted article states: “Companies would also be allowed to buy carbon offsets to compensate for overshooting their assigned limits.“ The Government’s webpage goes further as it states: “ Canada is joining some of the world’s largest economies – including the United States – in committing to clean electricity to power our vehicles, heat our buildings and support our industries.“ One should wonder who will be allowed to sell those “carbon offsets”? Many of the companies forced to purchase them will be provincially owned “fossil fuel” generation plants in most provinces adding costs to the price of electricity delivered to your home or business.
Based on the outright lies Minister Guilbeault spouts off about in his two-minute video such as his claim the transformation to green energy will create over 2 million jobs as reputedly claimed in the following chart!
Interestingly, it appears the Trudeau led government fully anticipates the foregoing will happen as they already appear to have released draft regulations under tax legislation which only appears to have been noticed by the larger business-related law firms but not by the media!
The Law firm Osler presented a good synopsis of the draft regulations on their website referenced as: “Canada releases long-awaited draft legislation for tax credits supporting the clean energy sector. The article focuses on draft legislation for the “Clean Technology Investment Tax Credit (Clean Technology ITC)“ which will hand out “tax credits” to “renewable energy companies” but the article does not clarify if those tax credits will reduce their taxes or allow them to sell them for revenue!
The article stated the “tax credits” will be handed to eligible companies involved in all of the following “green” technologies:
“zero-emission electricity generation technologies, like solar, wind, small hydro, concentrated solar energy and small modular nuclear reactors;
electricity storage systems that do not use fossil fuels in their operations, like batteries, flywheels, compressed air energy storage, pumped hydroelectric energy storage, gravity energy storage and thermal energy storage;
certain active solar heating equipment, air-source heat pumps and ground-source heat pumps;
equipment used exclusively for generating electrical energy or heat (or a combination) solely from geothermal energy, but excluding any equipment that is part of a system that extracts both heat from geothermal fluid and fossil fuel for sale or use; and
non-road zero-emission vehicles that are fully electric or powered by hydrogen, and charging or refueling equipment primarily used to support such vehicles.“
At this juncture Canada’s production of EV are nil with the only exception being some buses for transit use purposes along with some school buses. Those transit and school buses have not met the standards of similar ICE powered ones creating problems for communities from coast to coast even though their costs were approximately double of what ICE powered ones would have cost. Needless to say they received lots of taxpayer dollars suppled by Federal, Provincial and municipal governments.
While no electric vehicles are currently manufactured in Canada they are reputedly on the way if and when the VW and Stellantis EV plants in Ontario are up and running after receiving combined (federal and provincial) taxpayer subsidies of $30 billion. We should suspect when they are in production, they will be either handed “tax credits” or “regulatory credits” to sell, similar to the US!
Conclusion:
What we taxpayers should be concerned about is how the bloom is slowly falling off the rose of EV replacing ICE as for the first time in a decade, EV sales in California fell in the last half of 2023 and throughout the US dealer lots have twice the level of inventory of EV as ICE. On top of that many auto manufacturers have postponed their planned expansions. In Canada, BC and Quebec have almost achieved the 20% EV sales target mandated for 2026 but the balance of the provinces are well behind that target. The question then becomes, what happens if the targets set for EV (20% of all sales by 2026, 60% by 2030 and 100% by 2035) miss their mark or are not hit in certain provinces? Will those provinces where sales miss the targets suffer from Federal cutbacks or from penalties such as higher taxes for its citizens and businesses?
It sure looks like Canada may be heading for a downward spiral in our economy caused by the Trudeau Government much like Tesla Inc is experiencing currently with its market value having fallen by $188 billion and having been overtaken by BYD of China in overall EV sales globally!
We should wonder, why have politicians and bureaucrats done an about face on commonsense planning due to CO 2 emissions by embracing rules and establishing regulations demanded by eco-warriors to the detriment to the citizens of democratic countries?
Oh yes, EV get 430 miles to the equivalent of a gallon of gasoline and pigs can fly!
Well, with the return to winter weather in Ontario the snow was falling, and the wind was blowing yesterday and those IWT which generate, on average, 29/30% of their capacity annually were humming and generated 89,215 MW which was 77.1% of their capacity. That was much higher than earlier this month when on one day they only generated 1.8% of their capacity. Their peak hour generation yesterday occurred at hour 9 generating 4,377 MW or 90.8% of capacity and their low hour was Hour 24 when they managed to produce 2,250 MW or 46.7% of their capacity.
While they were generating all those MWh our neighbours in Quebec, Michigan and New York were loving it as they scooped up 70,958 MW (79.5%) of what those IWT generated at bargain basement prices. The HOEP (hourly Ontario energy price) averaged over the 24 hours was a miserly $22.01/MWh or 2.2 cents/kWh. What that means is they only paid about $1,567,000 for what they purchased whereas we paid $9,792,000 (refer to 2023 cost by generation source) for those 70,958 MW they gobbled up if we assume they were all those surplus and unneeded IWT generated megawatts!
Quite the price per MWh:
What the foregoing implies is; it cost us Ontario ratepayers and taxpayers $8.225 million ($9.792 million minus $1.567 million) for the exports and added to the cost of the remaining 18,257 MW generated by those IWT of $2.519 million it brings the cost per MWh to $588.49/MWh ie; $8.225 million + $2.519 million [18,257 MW X $138/MWh] = $10.744 million divided by 18,257 MW = $588.49/MWh or 58,8 cents/kWh!
More Battery Storage Contracted
A great contact of mine, Scott Luft of Cold Air who taps into IESO data regularly sent me the following chart of IESO outlining their current Contracted Generation List associated with BESS (battery energy storage systems) and it suggests they are expecting to contract for 1,140 MW!
BESS are able to provide their rated capacity for four hours meaning the 1,140 MW could provide 4,560 MW before needing to be recharged. It is humorous the megawatts those BESS units may be able to provide is only slightly more then the IWT provided during their peak generation hour yesterday. Today at Hour 9 those IWT only generated 316 MW!
At this point we should wonder if the batteries to be utilized by those BESS contracted generators will include CATL batteries, manufactured in China and now banned in the USA as pointed out in a recent article. If so, Canada could be in trouble with its neighbour, the USA, who have security concerns about CATL batteries. That may have a negative impact on our intertie connections with US States, amusingly, where much of our surplus IWT generation went to yesterday!
What has recently come to light out of the US media is the fact that most of the BESS (battery energy storage systems) whose purpose is to provide power when the sun isn’t shining, or the wind isn’t blowing are fitted with Chinese manufactured batteries. Those batteries have been supplied by the Chinese firm; Contemporary Amperex Technology Co Ltd (CATL).
With global tensions between the US and China having risen U.S. lawmakers have suddenly become concerned. As noted in an article from just a couple of days ago it stated “lawmakers and experts fear that the use of Chinese storage batteries could threaten the power grid, but few alternatives are in the offing, at least in the short term.“
The article goes on to state; “Experts say that these batteries could be used maliciously by China to destabilize and even destroy portions of the US power system.“ Sounds scary and threatening to many areas of the country so the pressure is on to both find new battery suppliers as well as to shut down existing BESS units with those CATL supplied batteries! The problem is amplified as CATL has 40% of the global market and “none of the current top ten manufacturers of storage batteries are American, and eight of them are Chinese rivals to CATL.“
What is also interesting is that back in 2021 CATL tried to acquire a Canadian company called Millennial Lithium with a major lithium holding in Argentina but they were outbid. As it turned out they were actually acquired by Lithium Americas Corp for US $400 million!
Returning to the actions by the US lawmakers; shortly after their expressions of concern they appear to have approached US companies who had worked with CATL and established BESS units and one of those was Duke Energy. Just a few days ago Duke agreed to decommission CATL-produced battery units amid those security concerns.
Interestingly enough back on June 12, 2023, Brookfield Renewables, a part of the Brookfield group, where Mark Carney sits as the Chair of Brookfield Asset Management; agreed to purchase Duke Energy’s renewable portfolio for $2.8 billion. The Brookfield press release noted the acquisition of Duke’s renewable portfolio “operates about 3.4 gigawatts of solar, wind and battery storage.“
At this point it’s unclear if Duke’s agreement to decommission the BESS units will have implications for Brookfield Renewables or the $2.8 billion Brookfield paid for the full Duke renewable portfolio?
Putting aside the foregoing we here in Canada should wonder if the BESS units in operation here are powered with CATL batteries and if so, will they too be decommissioned? The reason that question should be raised is because Canada is a member of NATO along with 30 other countries and the US has tremendous power over the members.
Conclusive or NotConclusive:
Should we feel confident our Minister of Defence, Bill Blair, will seize this opportunity to ensure we Canadians will not be affected by threats to our power grid by investigating what batteries are in our BESS units or is that just a wishful dream?
I leave the above question’s answer to the readers of this article!
PS:From a contact who knows his way around the interconnections between Canada and the USA!
“Perhaps more significant than NATO giving the US leverage over Canadian use of Chinese BESS is NERC — the North American Electric Reliability Corporation. NERC sets the technical and security standards for all electricity systems in North America and failure to comply with NERC requirements will result in disallowance of interconnected operation. In the US this is federal law, in Canada it is embedded in provincial law by all provinces. As something like 10% of Canadian electricity sales are exports to the US, and the biggest exporters are all provincial crown agencies of one sort or another (eg Quebec, Manitoba, BC) Canada will quickly fall in line with whatever the US decides. NERC is actually an independent company that was established by Canadian and US utilities as a cooperative. Following its rules was voluntary until the 2003 NE blackout when US passed rules making compliance with rules set by FERC mandatory. NERC persuaded FERC to delegate everything to it which it did. Canadian utilities had already accepted FERC requirements related to industry restructuring to allow competition so making the existing interconnection rules mandatory was not only simple but quite welcome in Canada. Cybersecurity measures – which frequently involve attacks on grid facilities from Russia and China – are already coordinated across the border by NERC.“
Yesterday, February 9th, 2024, those IWT spread throughout Ontario were impressive generating 94,605 MWh or about what 3.1 million average households would consume in a day suggesting they are the panacea to stop climate change! Mere days before on February 3rd and the first seven hours on February 4th they generated only 2,673 MWh which was 1.8% of their capacity in those 31 hours.
As the expression goes; they continually demonstrate their “traditional yo yo” tendencies as the following screenshot from IESO February 5th to the 10th demonstrates. They are the “green” in the chart which basically shows their intermittent and unreliable nature whereas the dark blue is natural gas which has the ability to ramp up and down as demand changes and to keep our grid from failing and causing blackouts.
So, the question one should ask, was the power delivered by those IWT on the 9th of February needed here in the province?
As it turns out 65.8% of the IWT generation or 62,259 MW were not really needed as IESO’s intertie data (net-exports) shows it went to our neighbours in Quebec, New York and Michigan and the average sale price over the 24 hours was $19.42/MWh and well below what we Ontario ratepayers/taxpayers paid for it. If we assume it was all surplus IWT generation those net-exports, we paid those contracted parties $135/MWh for; suggests the total cost of what was sold to our neighbours came to $8,404,965 but the price we were paid by our neighbours was an average of only that $19.42/MWh. Using the latter average price received over the 24 hours means we earned only $1,227,774!
The net result is we Ontario ratepayers/taxpayers have to eat the loss of $7,177,218 for just that one day’s IWT generation. The foregoing is not the exception particularly when Ontario’s peak demand is relatively low as it was yesterday reaching only 17,057 MW at hour 19.
For the foregoing reasons, we should wonder why the Ontario Minister of Energy is instructing IESO to extend the IWT contracts when their 20-year terms are up as they do nothing but increase our electricity costs. Those costs will be exacerbated by the addition of BESS (battery energy storage systems) as the latter will simply add another costly layer in an attempt to keep our grid reliable!
Parker Gallant Energy Perspectives 