Lion Electric, King of the EV Jungle Grants?

A recent article in the Financial Post titled: “Lion Electric posts profit as sales and subsidies pick up speed” was eye-catching simply for it’s inference on how it was worded, and suggesting “subsidies” played a role in it posting a profit. The article went on to quote their chief executive as follows; “We delivered the highest quarterly number of vehicles ever with 105 deliveries in Q2,” said Marc Bédard, Lion’s chief executive. The article went on to state: “The good fortune is set to continue, at least for the next little while. As of Aug. 4, the Quebec company’s order book was flush, with 2,357 vehicles valued at $575 million and 226 charging stations representing $3 million.”

Curiosity piqued, a look at how Lion Electric’s stock has performed on the TSE was a must and as it turned out the price over the past year fell from $18.47 CAD a share on August 9, 2021 to a close of $6.95 CAD on August 5, 2022 for a drop of $11.52 (-62.4%) a share over the past year.  Hmm, wonder why, as one would assume a company roaring to a profit would attract investors but that doesn’t seem to be the case for Lion Electric?  Maybe it’s not the king of the school bus and truck EV jungle?

Taxpayer subsidies

An article two weeks before the above article appeared in the FP and headlined “Lion Electric CEO predicts Ottawa’s new EV-truck subsidy will boost demand”.  The following quotes from the article might explain (partially) why Lion suddenly achieved profitability!  The article stated:“Stacking the Quebec subsidy of $144,000 on top of the federal grant would result in a total rebate of nearly $250,000 on the Lion6 model, putting it on par, price-wise, with a comparable diesel-powered truck.” And a further sentence said: “Similarly, stacking the Quebec rebate of $200,000 on the federal grant for the Lion8T would result in a total rebate of $350,000, making it just slightly more expensive than its non-electric competitors.”

An article two weeks before the above article appeared in the FP and headlined “Lion Electric CEO predicts Ottawa’s new EV-truck subsidy will boost demand”.  The following quotes from the article might explain (partially) why Lion suddenly achieved profitability!  The article stated:“Stacking the Quebec subsidy of $144,000 on top of the federal grant would result in a total rebate of nearly $250,000 on the Lion6 model, putting it on par, price-wise, with a comparable diesel-powered truck.” And a further sentence said: “Similarly, stacking the Quebec rebate of $200,000 on the federal grant for the Lion8T would result in a total rebate of $350,000, making it just slightly more expensive than its non-electric competitors.” 

Yet another article appearing in e-magazine Sustainable Bus in March 2022 was about how the Quebec government was investing $18 million into 120 school buses and stated “The subsidy for each bus is worth $150,000. The government’s plan is to electrify 65 per cent of its school buses by 2030.”  It also noted: “Quebec announced last year that the government will fund the majority of the $5 billion purchase of electric buses with $3.65 billion of the contract supplemented by the federal government”! If one goes back to examine the 2nd Quarter results for Lion you note the 105 deliveries consisted of 90 school buses and 15 trucks generating revenue of US $29.5 million  and if we use the $150K per school bus grant and $300K per truck grant the government subsidies amount to approximately CAD $15 million representing approximately 40% of gross revenue in the quarter. Without those subsidies the “operating loss” would have amounted to CAD $43 million!  With those kinds of subsidies, we shouldn’t be surprised Lion is receiving more orders.

Source of Grant Money

As noted above the grants to Lion are sourced principally from the Federal taxpayers with additional funds provided by Quebec taxpayers but in the latter case we should probably surmise it also is funded in large part via those same Federal taxpayers via the “equalization” payments the Federal government pass out.  As noted in the undated letter from Finance Minister Freeland sent to the Quebec Minister of Finance, Eric Girard, Quebec will be handed $13.666 billion or 62.35% of the total equalization payments to the five provinces who receive them, for the 2022-23 year.  Surely that kind of a handout goes a long way to allowing the Province of Quebec to be able to provide grants without tapping into their own tax revenues!

School Bus Orders

One of the largest orders received by Lion for those electric school buses came from First Student a company whose head office is in Cincinnati, Ohio with operations in the US and seven of Canada’s provinces.  Back on May 17, 2021 a press release they issued announced the “largest zero-emission school bus order of 260 buses”.  Assuming the Quebec government handed out the $150K per bus would suggest $39 million will go or has gone to Lion Electric for those buses. 

Another order for Lion’s buses came from Transdev Canadaa public private transport company limited with a Board of Directors and jointly owned by the Caisse des Depots Group (66%) and the Rethmann Group (34%) a German family owned company.  It should be noted CDPQ is the Quebec version of the Canada Pension Plan so they invest the contributions of all Quebec taxpayers to the plan. The order from Transdev Canada was made in early July for another 30 Lion electric school buses in addition to the 27 previously ordered and reputedly already in service.  So, at the $150K per school bus handed out by the province another $8.6 million will find its way into the Lion Electric bank account and future recipients of CDPQ pension payments should cross their fingers those school buses will be as efficient as those fossil fueled ones or Transdev might turn out as a negative investment.

It seems obvious that Lion Electric has twigged the politicians into being convinced electrifying everything is the way to go and will create jobs and benefits to the Quebec economy (possibly via Quebec Hydro for charging those buses)?  As a result Quebec politicians have somehow decided they need to hand out taxpayer funded grants to save the world from “climate change” while picking what they consider new technology and the companies that will benefit!  As an observer over several decades, I am skeptical politicians have ever been able to pick winners but have often picked losers’!

My vote for “King of the EV Grants” goes to Lion Electric!

OCAF is bringing Holger Dalkman from Germany to speak to City of Ottawa Officials and Others

The excitement in Ottawa often keeps locals up at night but we should be pretty sure an upcoming event hosted by OCAF (Ottawa Climate Action Fund) will be nothing like a “truck convoy” with honking horns. Despite it’s more quiet nature it should cause excitement for other reasons! Let’s see why?

OCAF is Hosting an Event

OCAF was founded with $21.7 million of our tax dollars and endorsed by now retired MP, Catherine McKenna and MP Seamus O’Regan at their opening ceremony on May 14, 2021. The ceremony itself was hosted by none other than Diana Fox Carney (wife of Mark Carney), an acclaimed eco-warrior.

Just before OCAF was founded the City of Ottawa’s council (presumably smitten by the ruling Liberal Party) passed a plan (Energy Evolution) to reach “net-zero” emissions by 2050. The plan encompasses erecting 700 industrial wind turbines with a capacity of 3,218 MW and 1,060 MW of rooftop solar. The “plan” appears to have been generated by none other than Pollution Probe rather than the bureaucrats within the municipality.  That in itself seems very strange!

It appears the latest planned event by OCAF is aimed at Ottawa’s transportation and transit sector and they are bringing in a speaker from Germany to deliver the message outlined in the event title which is: Avoid, Shift, Improve: How can international best practices accelerate low-carbon, resilient transportation in Ottawa?

The invited guest speaker is Holger Dalkman whose LinkedIn profile claims he is the “CEO and Founder of Sustain 2030” (an extensive search of “Sustain 2030” on Google turned up nothing) and holds a Masters degree in geography! In searching his name, it appears he has had numerous appearances including with the WEF (World Economic Forum) the UN and many other organizations pushing the “climate-change” agenda. His forte according to his profile is “twenty years of experience working in the field of mobility, cities, sustainability and climate change”. 

It appears his presentation will be related to the transit and transportation system in the City of Ottawa. Perhaps he will recommend banning all trucks unless they are electric powered ones (sans horns).  He may also express delight that OC Transpo is on the path to converting all their buses to battery-powered ones but the foregoing is simply speculation on my part!

If an Ottawa citizen steps back and looks at how well Germany has done with its push to reduce “climate change” and push for “net-zero” emissions they might have second thoughts about Dalkman’s speech and recommendations.

Germany has one of the highest costs of electricity in the world as well as an extremely high cost for home heating.  A March 16, 2022 article stated “A new 5,000 kWh annual supply contract costs an average of 2,098 euros, or 42 cents/kWh, 23% more than in December”. To contrast that with Ontario the average annual household consumption is 9,000 kWh and the average price is about 15 cents/kWh.  It is also worth noting the “42 cents/kWh” is U.S. currency so the Canadian equivalent is about 56 cents/kWh! Germany’s households (half are heated with naturals gas) are also paying dearly for natural gas as it has been affected by the Russia/Ukraine war and are now facing annual heating costs of well over U.S. $4,000/annually.

One should presume many millions of households in Germany are currently experiencing energy poverty*.

The first question asked of Dalkman during the Q. and A. session after his presentation should be; how many of the 41 million German households are currently experiencing “energy poverty” and what has caused it? 

No doubt he will get all choked up as he ponders how to answer that question while continuing to push the “net-zero” target!

*The common denominator for “energy poverty” is 10% or more of household income goes to pay for those two staples of heat and electricity.

 

 

 

                                                                                                                                  

Net-Zero Looking like a No-Go by 2050 Part 2

Part 1 examined several events related to the global “climate change” push and the damage being caused to livelihoods in the U.S., Europe and Canada.  The news was bleak but a couple of the articles signaled the fallout may be having an effect on how politicians may react to more bad news and that voters may rebel. 

Part 2 will look at other global events that will surely cause more handwringing amongst those politicians!

The transition to green energy and the missing warming

Lets’ start with a recent report from a German Scientist, Fritz Vahrenholt, who describes himself as “a scientific reviewer of the IPCC report (The renewable energy section, not the section on climate science), and says that it was his first view of the report that caused him to become skeptical of climate change.”

The review of his report notes the climb of “CO2 emissions” and their increased air concentration over the past 30 years and the warming over that timeframe.  It then points out that the AMO (Atlantic Multidecadal Oscillation) has increased since 1980 but is now weakening suggesting a cooling stage of 20-40 years will occur and added to a weakening solar radiation concludes; “further significant warming beyond 1.5 degrees is unlikely in the next 30 years.”  The review also notes a “halted decline in Artic Sea ice” as noted by “European Copernicus program in March”.  This leads to the conclusion; this is good news and suggests: “Wouldn’t it be time for climate researchers to bring these trends to the attention of politicians and the public? After all, politicians are currently readjusting the priorities of energy supply. While until last year’s price explosion and the aftermath of the Ukraine war it was apparently taken for granted that climate impacts would be the sole determining factor for energy policy, we are all now being made aware of the importance of security of supply and price trends.”  We can only hope the foregoing news is actually brought to the attention of the politicians and they listen rather than always accepting the dire forecasts of the eco-warriors.

Canada’s oil and gas workers don’t need a forced ‘just transition

The captioned headline and the article from May 10th in the Niagara Independent should be a “must read” by every Canadian politician.  The article enunciates the importance of Canada’s oil and gas sector and how the demand for oil and gas not only creates jobs for hundreds of thousands of workers but also generates billions of tax dollars that pay for “roads, schools and hospitals”.  It goes on to note “Global demand for both oil and natural gas is firmly back near pre-pandemic levels and rising, according to the U.S. Energy Information Administration” and questions the need for the “Just Transition” pushed by the current Trudeau led government!  The article points out “Canada can be the world’s oil and gas supplier of choice, providing customers reliable, responsible energy that is committed to emissions reduction and environmental excellence.”  The article points out world energy consumption will grow and Canada should be ready to step up to provide it.

It is so far not apparent the current government will back off their “Just Transition” concept but they should note the UK plans to classify “natural gas” as green and drilling for it is “environmentally sustainable” as noted in a post in Part 1 of this series.

India going gangbusters on coal — tosses green rules, & wants to reopen 100 old mines

It is becoming more apparent that while countries like Canada are led by politicians who have subscribed to the UNIPCC’s push to eliminate fossil fuels there are still some politicians around the world who are more concerned with their citizen’s well-being!  This is evident with India who did not step up at COP-26 to demands they should reduce their dependence on fossil fuels and didn’t accede to the wishes of people like Mark Carney. A recent article noted “India needs a billion tons of coal a year, and digs up about 770 million tons. Suddenly the plan is to increase that to 1.2 billion tons “in the next two years” and if that means opening 100 old mines and throwing away the green tape, so be it.” India depends on fossil fuels for 70% of their power generation and recently experienced increased demand due to the end of Covid restrictions and hot temperatures causing power demand to rise resulting in power outages. Increasing coal mining will allow them to reboot those coal plants that have experienced a shortage of fuel.

It is good to see some politicians around the world feel their citizens deserve reliable power and are not caught up in what the unelected Mark Carney’s or Bloomberg’s of the world tell them to do.       

US to Ease Sanctions on Venezuela, Enabling Cargoes to Europe  

As a Canadian it seemed very strange that the U.S. Government under President Biden recently decided to ease sanctions on Venezuela allowing them to ship oil to Europe and perhaps even the USA based on an article in the Financial Post last week.  Is this the same President who cancelled the Keystone pipeline during his first day in office that would have carried Canadian crude oil to the US?  The article suggests Venezuela oil may even be allowed to go to the US; “While Chevron currently isn’t allowed to drill for or export oil from Venezuela, the resumption of talks with state-owned PDVSA paves the way for the San Ramon, California-based company to obtain a new license allowing it to resume operations. It also signals that Venezuelan oil may be coming to the U.S., one person said.”

We should assume our Prime Minister, Justin Trudeau didn’t jump on that news and call Biden to get him to reverse his decision to allow the Keystone pipeline. Trudeau and his minions like the Minister of Environment and Climate Change, Steven Guilbeault, are determined to stop all Canadian fossil fuel from being extracted and sold around the globe.

Huge fire erupts at bus garage with vehicles alight and reports of an ‘explosion’

A bus garage hosting TfL (Transport for London) electric double decker buses erupted in flames yesterday and included an explosion which can be seen on a video.  The cause of the fire is under investigation but as a result TfL has removed 108 electric London buses from service due to the concern it could be an issue with the battery.  There have been similar incidences elsewhere with another one having recently occurred in Paris, France near the end of April and their transit authority suspended the use of 149 electric buses. Apparently this was the second one occurring as another electric bus had caught fire earlier in April. 

We have heard from the elites of the world as well as our politicians that we should stop consuming fossil fuels and use public transit but hopefully this isn’t what they had in mind but based on the travelling habits of our PM, Trudeau perhaps it is as he never takes public transit?

Conclusion

The developed world’s politicians seem to have embraced the dire and criticized reports from the UNIPCC along with the hues and cries from the many unqualified ENGO (environmental non-government organizations).  Couple that with the further embrace of those IPCC reports by the main stream media and it sure appears “actual science” is ignored! 

Perhaps some of these recent events will light up the minds of the reporter’s aka journalists and the general public will get the truth instead of the “disinformation” we are being fed!

The Ford Government Brings us More Promises and More Tax Dollars Down the Drain

It’s become hard to understand exactly why the Ford led OCP (Ontario Conservative Party) seems set on imitating the Trudeau government who are hell-bent on destroying Canada’s fossil fuel sector but, many recent and past announcements and actions by the OCP suggest they are two peas in a pod!

As one example Minister of Energy Todd Smith issued a press release about the taxpayer subsidized ONroute Electric Vehicle Charging Stations recently and the release noted there were 72,655 EV currently registered in the province and “by 2030 one out of 3 vehicles sold will be electric”.  That would represent sales of around 170,000 EV! Presently the currently registered EV represent 0.85% of all vehicles weighing less than 4,500 kilograms in Ontario (2019 stats) and most if not all, received provincial and/or federal tax grants.  One should wonder will this Ford government’s sudden love affair with EV trigger a return of the provincial grant that the Ford government killed when first elected?

Another announcement by Minister Smith in the Belleville Intelligencer had the following quote in an article about his plan to lower electricity rates during the night: “Our government has reversed the trend of skyrocketing electricity prices and given families and businesses more control when it comes to their energy bills,”.  The article failed to note the recent Financial Accountability Office of Ontario (FAO) report indicated taxpayers would be picking up $6.9 billion of costs in the current fiscal year associated with his claim. What the foregoing infers is, “the trend”, seems to be; lets increase the provincial debt to burden future taxpayers.

Cheaper Nighttime Rates May Produce Blackouts

The article in the Intelligencer was headlined: “Energy Minister Todd Smith eyes ‘ultra-low overnight electricity plan“, and suggested it was to “benefit shift workers and support EV adoption”. Minister Smith has directed the OEB (Ontario Energy Board) to review the concept of implementing the reduction, “for residents who charge their electric vehicles overnight”! This looks to be simply another burden on future taxpayers with little benefit to those “shift workers” who, if they drive EV, will have to charge them during the day when rates are at peak levels. It will also result in higher rates during “peak demand” times of each day and a further burden on future taxpayers.

The issue of cheaper rates during the night may also benefit municipalities who have jumped on the “net-zero” concept and have told the province to shut down our gas plants that serve to back up the unreliable and intermittent wind and solar generation.  One wonders if Minister Smith is familiar with the fact that several municipalities such as Ottawa are aiming to convert their transit buses and other municipal vehicles to battery fueled vehicles. Ottawa alone intends to purchase 450 E-buses by 2030 and have a full E-bus fleet by 2036.  One should assume those buses will be charged principally at night and if so, what impact will it have on demand if all 32 municipalities who have told the province to shut down the gas plants convert their fleets?  Obviously, they will also demand they can charge those buses, etc. with those lower nighttime rates too! The City of Ottawa will borrow $400 million from the taxpayer owned “Infrastructure Bank” (a Trudeau led government creation) to assist in the purchase of those buses which further burdens all of Canada’s taxpayers!

Those buses charging at night also may have other issues as some cities who have moved to E-bus fleets have had bad experiences due to sudden fires. Germany has had several flareups in different cities. Recent events where fires broke out are of concern; meaning E-buses will require more stringent regulations such as separate garage stalls further raising conversion costs. Insurance companies have not yet dealt with those issues but will undoubtedly raise their premiums as a result of those events.   

In his push to support EV to reduce emissions Minister Smith ignores the fact the Pickering Nuclear generating station that supplies Ontario with 2,500 MWh every hour of the day will be shut down in 2025!  So far, the ministry has not identified what will replace that emission free power.

The absence of generation to meet demand in the future can be visualized by the following chart Scott Luft recently posted on his twitter page showing demand increasing substantially in the future! 

The plans and targets the current Ontario government has to reputedly reverse “the trend of skyrocketing electricity prices” seem destined to continue throwing our tax dollars down the drain.  A recent report by the Fraser Institute forecasts Ontario’s net debt will reach $503.3 billion or about $130K per household by 2023-24!

The time has come for this government to take action and stop spending money that serves to increase the possibility of a future debt crisis!

PS: Stay tuned for the next plan by the Ministry of Energy to drive up our Cost of Living.