Global Coal consumption rises but Canada won’t export either Coal or LNG

Well, there it was in black and white with UN Secretary-General Guterres calling for “no new coal” but also for eliminating its use in rich countries by 2030 and poor countries by 2040. He urged carbon-free electricity generation in the developed world by 2035, meaning no gas-fired power plants, either.“ The foregoing was from a CBC article of March 20, 2023, when Guterres was screaming about ensuring we kept the global temperature increase below that magical 1.5 C limit!

Later in 2023 at the opening launch of the UNIPCC (United Networks Intention for Poverty Creation Conclusions NB:) Convention, Guterres stated: “Inch-by-inch progress will not do.  It is time for a climate ambition supernova in every country, city and sector.“

So, we should wonder, how is that “no new coal” push working out, particularly after NATO’s action on Russia occurring shortly after Russia launched it’s attach on the Ukraine on February 24, 2022?

NATO’s action on Russia

An excellent Joe Blogs You Tube video came my way  and while somewhat lengthy it was filled with facts and charts related to the effects of NATO’s declaration in respect to Russia’s fossil-fuel exports after their invasion of the Ukraine. The various charts in the video highlights how coal consumption has tracked.

The following chart indicated that coal consumption dropped somewhat back in 2019 due to the Covid impact but since then has increased to record levels.

Another chart highlights how global coal-fired electricity generation hit a new high in 2023 in spite of  Guterres scream about “no new coal”!

To put the above in context note that Canada total electricity generation in 2023 was 613 TWh (7.3%) and coal generation represented less than 5% or about 30 TWh of the 613 TWh.

Now, should one wonder which countries mine coal the following chart contains those with the highest production levels.

The below chart indicates where Russia’s coal exports are destined for and it is easy  to note that China has replaced the EU as the major purchaser since the invasion of the Ukraine .

As a matter of further interest China consumes 4.3 billion tonnes of coal annually which is more then the other nine (9) countries gobally of the top ten (10) coal consumers.

Video Summary:

The summary of the video indicates the US and other developed counties have declared sactions against the two largest Russian coal export companies.  As a result both China and India have started to reduce their purhases at the start of 2024 as there is concern they could both face secondary sanctions from the countries who are their largest export markets.

Quite the squeeze on Russian and both China and India are now busy trying to secure coal from other countries to replace Russian coal but we should presume Canada won’t be among them!

Other Coal News:

Canada: Canada’s thermal coal exports in 2023 were up seven per cent to 19.5 million tons despite the Liberals promise three years ago to end all exports by 2030. About half of those exports were mined in the US but because most US west coast ports won’t allow thermal coal exports they are shipped to Vancouver and Prince Rupert terminals by rail for export. Needless to say, eco-warriors such as Ecojustice are upset but “Environment Minister Steven Guilbeault said last month he expects to announce a plan to phase out coal exports later this year.“

India: India has plans to expand its steel production and that will result in them becoming “the largest seaborne coking coal buyer, a trend driven by the country’s growing steel capacity and consumption. India aims to raise its steel capacity to 300 million mt per year by 2030, up 71% from 2023.“ Interestingly their largest supplier is Australia but they are looking to other markets such as the USA and Russia to provide future supplies.

Vietnam: Vietnam depends on coal fired electricity and has experienced power outages caused by heat waves so it’s principal coal miner has boosted sales at the same time as the country will increase its imports.  “Coal-fired power plants account for 37.5 per cent of Vietnam’s total installed power generation” and during heatwave generation has reached 67%.

Coal News Summary:

The above highlights demand in only a few countries but as is obvious many Asian countries are increaing their coal generation of electricity as well as steel production so Canada’s proposed ceasing of our exports will have no affect on reducing global GHG except to reduce Canadian jobs associated with coal mining as well as the ports where they are exported!  

Canada’s Natural Gas and Liquid Natural Gas (LNG)

Canada is ranked fifth in the world in respect to natural gas production and reserves and most of what we produce is exported to the US.  In 2023 our natural gas exports generated $13.10 billion and our imports of it (mainly to the Atlantic provinces) cost $3.18 billion meaning it contributed almost $10 billion to our international trade balance while generating good jobs and warming millions of Canadian households during our cold winters. What Canada does little of with natural gas is to liquifiy it as LNG for shipments outside of pipelines but we certainly have had an opportunity to do so. Here are three examples!

First Germany asked for LNG during a visit to Canada in August 2022 but our PM, “Trudeau said there isn’t a clear business case yet for building a liquefied natural gas (LNG) export terminal in Saint John or elsewhere.“

The second request for LNG came from Japan but again “Japan has “high expectations” for getting natural gas from Canada, but Prime Minister Justin Trudeau made no new commitments to increase exports during meetings with Japanese Prime Minister Fumio Kishida on Thursday. “

Then Greece came looking for LNG but; “For the third time in 18 months, a foreign head of government has made a rare visit to Canada with the stated intention of buying billions of dollars in natural gas. And for the third consecutive time, the official answer from the Trudeau government appears to be “no.”This time around the visitor was Greece Prime Minister Kyriakos Mitsotakis, who was the first Greek leader to come to Canada in more than 40 years.“

Conclusion

The following chart from the Global LNG outlook for 2024-2028 provides the list of countries globally with LNG exports for 2023!

It is obvious that Canada, with our fifth place in both natural gas reserves and generation, could economically benefit substantially if our Prime Minister wasn’t so taken with his push to destroy the benefits fossil fuels bring to our country. I personally have a firm belief we could easily become one of the top five LNG exporters if we eventually elect a governing party who is not out to destroy our beloved country!

NB:  Authors definition!

Ontarians Should Hold Back on Buying EV for a While

As noted in a recent article the Ontario Minister of Energy, Todd Smith announced the possibility of a discount for charging your EV (electric vehicle) but he better hold off for quite a while.

Yesterday, May 5^th was a clear demonstration why he should hold off as 59.4% of Ontario’s nuclear capacity is either down for full refurbishment or VBO (vacuum building outage). What that means is Ontario’s current grid connected capacity is without 7,810 MW of that reliable nuclear power that when grid connected, operates 24 hours daily.

Should Ontarians suddenly endorse EV in a big way and need to charge them on a regular basis it could bring about a demand that the grid will be unable to handle, and we may then experience rolling blackouts. We ratepayers should be thankful most Ontarians have not been sold on the reputed wonders of EV to reduce our CO 2 emissions!

Yesterday, Ontario’s hydro capacity (7,375 MW) which, unlike nuclear can ramp up and down, actually generated more power than nuclear for 8 hours of the day. As frequently occurs during our spring and fall days demand was quite low and only reached 15,185 MW at hour 20 (hour ending at 8 PM) and for most of the day was well under 14K MW and as low as 11,158 MW during our nighttime!

Thankfully Ontario has 8,711 MW of natural gas capacity which like hydro also can ramp up or down as needed so it generated power during the higher demand hours!

We also have 4,936 MW of IWT capacity, and 436 MW of solar capacity connected to our grid, but it cannot be ramped up when needed if there is no wind blowing or the sun isn’t shining but we are obliged to accept all of IWT’s generation when the wind is blowing!

As a result of the low demand yesterday but, fortunately a low wind day, those IWT only generated 28,146 MWh or 23.9% of their capacity however it wasn’t needed! Despite the foregoing the “first-to-the-grid” rights of their contracts required IESO to either accept them or have them curtailed. Curtailing wind only saves us ratepayers $15/MWh so IESO will sell off the surplus power to our neighbours should the average market price exceed that $15/MW which it did yesterday averaging $24.73/MWh! 

While IESO actually reported net-exports totaled 37,104 MW we should assume all of that IWT generation wasn’t needed but it cost us $135/MWh, so Ontario ratepayers picked up the cost which was $4.8 million but IESO only earned $800 thousand from its sale meaning the remaining $4 million became a cost to us Ontario ratepayers and taxpayers.

Conclusion

Let’s keep our fingers crossed that those nuclear plants will return before the high demand days arrive on our hot summer days and well before EV adoption increases!   

Who Dug the Hole Canada is now in, Trudeau or Butts of was it Both of Them

The pro-Hamas camp now ensconced at McGill University in Montreal brought back memories!

Those memories were related to how our Prime Minister, Justin Trudeau and his buddy, Gerald Butts became strong friends when they both attended McGill U. as the following picture suggests.

Damage to Ontario

Those of us living in Ontario are paying the price for the time spent by Butts influencing Dalton McGuinty during the days when he was Premier and Butts was his “principal secretary” and “policy guru” as noted in an article in the CBC from December 7, 2016.  

The author of the CBC article points out how Butts took credit for the Green Energy Act’s creation which according to his biography on the WWF (World Wildlife Fund) pointed to that claim along with many others. The article went on to note how the GEA “cost Ontario consumers an extra $37 billion between 2006 and 2014, according to an auditor general, and is expected to cost another $133 billion from 2015 to 2032.“ The foregoing represents an average cost of over $6.5 billion annually until those contracts expire and close to what Ontario taxpayers are now absorbing in order to keep electricity rates from increasing even more.

Damage to Canada

As we know, Butts went on to become the “principal secretary” to Prime Minister Trudeau and was successful in “promising to enact carbon pricing regimes (read: tax) on all provinces by 2018 and phasing out coal by 2030“.  

As time progressed for Butts as Trudeau’s principal secretary, he ultimately was forced to resign his position; “amid allegations that senior members of the PMO pressured former justice minister Jody Wilson-Raybould to help Quebec-based multinational engineering firm SNC-Lavalin avoid criminal prosecution on bribery and fraud charges in relation to contracts in Libya“ as noted in another CBC article from February 18, 2019.

Despite his resignation Butts can once again claim success as the Trudeau led government imposed the “carbon tax” which continues to rise every year until it reaches $170/tonne and is causing energy poverty in every province where it has been enacted!

That “carbon pricing” regime came to pass as there are economists such as Chis Ragan and others who believe taxing something will cause its demise! I authored three articles that tried to outline exactly what the “Ecofiscal Commission” was and the individuals involved in justifying their recommendations. 

One can liken it to how they believe taxing alcohol and smoking reduced their consumption due to their associated health issues so presumably they believed reducing CO 2 emissions will be beneficial by taxing our energy needs when produced from fossil fuels! 

They failed to look at the negative affects of eliminating the ability of those fossil fuels to provide the electricity and heat to keep us warm during our winters, cool in the summer or via their other many contributions such as keeping us healthy with medical supplies and with fertilizers for our farmers to grow food!

Eurasia Group

After Butts resigned as the principal secretary to Prime Minister Trudeau, he wound up at Eurasia Group where he now resides as their Vice Chairman and his biography brags extensively about his abilities!  Just one example:  “As the principal secretary to Canadian Prime Minister Justin Trudeau from 2015–2019, Gerald was responsible for providing executive direction on the development, implementation, and communication of the government’s agenda. This work included overseeing economic policy, the negotiation of the Paris climate accord, and the creation of Canada’s first national climate change plan—which included an economy-wide price on carbon.“  Beyond the foregoing it is worth noting that Eurasia Group has successfully obtained over $1 million of Government contracts!

Conclusion

The unelected “principal secretary” to both Ontario Premier, Dalton McGuinty and Prime Minister, Justin Trudeau will cost Ontario taxpayers and ratepayers $170 billion dollars but that pales beside the costs to all Canadian taxpayers and ratepayers under the claimed achievements he cites while the principal secretary to Prime Minister Justin Trudeau! 

How can this ever happen in what we claim is a democracy!

Spring Weather brings Unneeded Wind Generation in Ontario while Solar Generation in California does the Same Costing Ratepayers a Bundle

Ontario

The recent two days in Ontario brought Spring showers and lots of IWT (industrial wind turbine) generation as the wind was blowing throughout the province. Based on IESO data it also resulted in them apparently curtailing some of its unneeded generation.

On April 22^nd IESO forecast those IWT would generate 46,220 MW (39% of capacity) but curtailed 4,464 MW. Then on April 23^rd IESO forecast they would generate 91,540 MW (77.8% of capacity) but again curtailed 10,288 MW.  Those “first-to-the-grid” contacts resulted in the owners of the IWT receiving $135/MWh for accepted generation and $120/MWh for what was curtailed!

Over the same two days IESO data disclosed Ontario’s net-exports to our neighbours in Quebec, Michigan and New York were 90,293 MW or 73.4% of what they accepted into the grid from IWT generation strongly suggesting it wasn’t needed.  IESO sold that power at an average price of $16.83/MWh on the 22^nd and $18.83/MWh on the 24^th so we ratepayers wound up paying $512.21/MWh or 51.2 cents/kWh for the 32,735 MW that was apparently required in Ontario to keep the grid supplied with what was in demand.  The total costs of the IWT generation coupled with the curtailment costs were $18,378,020 and we were paid $1,611,881 for the 90,293 MW they sold over the intertie lines resulting in the foregoing cost of $512.21/MWh for the 32,735 MW used in the Ontario grid and a net cost to ratepayers and taxpayers of $16,767,139!

The owners of the IWT were surely rubbing their hands in glee while Ontario taxpayers were forced to pick up $7.3 billion in costs associated with “Cost-Relief Programs” caused by the intermittent and unreliable supply of electricity from principally those IWT and to a lesser degree solar generation sources!

California

In California a recent article noted “In 2024, residential PV (Photovoltaic) will shift nearly $4 billion onto others’ bills, more than double the 2020 amount.“

What the foregoing statement implies is the plentiful solar panels sitting on residential roofs in California contribute much less towards the “fixed costs” which are detailed as:  “vegetation management, grid hardening, distribution line undergrounding, EV charging stations, subsidies for low income customers, energy efficiency programs, and the poles and wires that we all rely on whether we are taking electricity off the grid or putting it onto the grid from our rooftop PV systems.“ The effect is a layering of those costs onto all the other ratepayers without rooftop solar. 

To put the foregoing into perspective the article goes on to state: “In 2014, the homes served by these three IOUs (Investor-owned utilities) got less than 2% of their electricity off their roofs. Today they get about 20%. As fewer kWhs are sold from the grid, retail rates must rise even more in order to recover the fixed costs of the system.“ The story goes on to note California’s electricity rates are more than double the national average in the U.S.

The following chart from the article shows the steep climb in rooftop solar in the state:

Another article related to California basically aligns with Ontario’s IWT issues due to lower demand during the Spring noting: “Solar energy waste is most prevalent in the spring when there is less need for heating and cooling. Use is high in the morning and evening but drastically reduces during the day. Therefore, the National Renewable Energy Laboratory found that with a high demand of solar power on an electricity grid, the netload of renewable energy takes on a “U” shape. However, even when demand is low, solar panels continue to absorb energy that goes to waste. In 2022, the state wasted 2.4 million megawatt-hours of electricity, and 95% of that was solar. Throwing away free power raises electricity prices.“

Conclusion

The foregoing actually presents proof that politicians in both California and Ontario who pushed the renewable energy agenda have been responsible for driving up what we all consider a basic necessity of life.  They failed to see the future implications of the transition to “renewable energy” in an effort to reputedly save the world from “climate change”!

The time has come for politicians to appreciate their inability to predict the future and stick to managing our bureaucracies in a way that will ensure “energy security” without inflation driven concepts sold to them by the eco-warriors!

The Federal Carbon Charge Appears to be the Implementation of the “Circular Economy”

Should one scroll down to page 366 in the recently released Federal Budget under the highlighted “Total tax revenues” it announces as one source for the 2024-2025 year, they anticipate collecting $14.9 billion! They clearly state where that revenue is generated from and destined for in the future:  “Pollution pricing proceeds to be returned to Canadians“!

It represents only 3.3% of the forecasted tax revenues yet it is still significant in that it is approximately $530.00 for each and every taxpayer but only about 50% of what they are granting to VW and Stellantis to manufacture EV!

So we 28 million taxpayers should wonder: Where are those recycled tax dollars coming from?

The Federal Carbon Charge

As it turns out it will be us taxpayers (residential and industrial) who are providing those “Pollution pricing proceeds” that supposedly will be returned to us, or will they? 

Examining the Federal Government’s documents on the “Circular Economy” as  it appears to apply, is summed up by them as follows:

“The federal carbon pollution pricing system has two parts: a regulatory charge on fossil fuels such as gasoline and natural gas, known as the fuel charge, and a performance‑based system for industries, known as the Output-Based Pricing System (OBPS). The federal system can apply in whole or in part in a jurisdiction.

Canada also designed its system to be revenue neutral: where the federal system is applied, all direct proceeds from the federal fuel charge and federal OBPS are returned to the province or territory where they were collected.“

Examining the Federal Carbon Charge (FCC) for Natural Gas

The government has decreed they are leveling a charge on natural gas, so it is worthwhile to note that according to the CGA (Canadian Gas Association) what Canada’s GHG emissions are from natural gas. The CGA states: “In 2020 the transmission, distribution and storage of natural gas produced around 10 Mt CO₂eq emissions (Canada’s total GHG emissions were 672 Mt CO₂eq) ie: 1.4% of emissions came from natural gas! We should wonder how those emissions if eliminated would be even noticeable as Canada’s total emissions on a global scale are only 1.5%.

The CGA also provide individual statistics and note in “2021 the average residential natural gas customer used 2,385 cubic metres¹ of natural gas. Annual residential gas use varies across Canada from 1,900 to 3,100 cubic metres per year, depending on the climate in the region.”

The FCC as of April 1^st, 2024, increased to 15.3 cents per cubic metre so if the average consumption remains the same in the current year the natural gas bill to heat your household will include $364 of those FCC costs!

The CGA report the total number of households who heat their homes with natural gas in Canada was over 6.8 million in the 2021-2022 season. What the CGA basically state is; all households with natural gas to heat their homes annually consume 16,218 million cubic metres of that fossil fuel source. The Federal government on the other hand suggest natural gas can be replaced with either expensive heat pumps using electricity from a fossil free grid at less cost or fuel your electric furnace from those same electricity grids!

If one does the simple math by multiplying 15.3 cents per cubic metre of natural gas consumed by those 6.8 million households the revenue from that charge represents $2.47 billion or 16.6% of the $14.9 billion they estimate as tax revenue associated with the “Pollution pricing proceeds to be returned to Canadians”!

Industrial Gas Costs

The Federal Fuel Charge Rates also apply to natural gas used for industrial purposes and if combined with hydrogen it is considered “non-marketable natural gas”! The FCC has been set at an even higher rate of 20.6 cents per cubic metre for it, in the 2024-2025 year but no consumption disclosures are available for the latter. 

Looking at the StatsCAN data from June 2023 it notes; “In December 2022, natural gas deliveries to industrial consumers in Canada totalled about 8.3 billion cubic metres, with over 70% going to Alberta. The industrial sector in Alberta—the single largest consumer of natural gas in the country—received a record 5.8 billion cubic metres in December, the majority of which was used as fuel by the energy producing sector.“

As neither StatsCan nor the CER disclose what the total “non-marketable natural gas” was we will use the above noted 15.3 cents per cubic metre to calculate the foregoing. It suggests those 8.3 billion cubic metres would have generated revenue of $127 million for the month of December 2022 and perhaps as much as $1.5 billion for the full year 2024-2025 at those rates if those volumes are constant! The $1.5 billion would represent 10.1% of the forecasted $14.9 billion to the “Pollution pricing proceeds to be returned to Canadians”. Now try to imagine how that $1.5 billion in FCC costs would impact what those “industries” (including farmers, etc.) are producing by driving up their costs.

The foregoing suggests the combined FCC (Federal Carbon Costs) associated with Canada’s generation and consumption of natural gas would collectively represent about 26.7% or $3.975 billion of the $14.9 billion contained in the budget. This works out to around $141.00 per taxpayer so we should assume the shortfall in the budget projections will all come from the FCC applied to the use of other fossil fuels such as gasoline, diesel, propane, etc. fuels!

The price per metric ton of emissions from the natural gas sector for 2024-2025 looks to average around $39.75 per ton but its impact will drive up the price of everything associated with it and have only a very minor (immeasurable) impact on reducing Canada’s emissions!

We are shooting ourselves in the foot while China opens two coal plants a week!

Maybe PM Trudeau and NDP Leader Singh should get busy and plant some of those two billion trees he promised Greta Thunberg to absorb those GHG and save us Canadian households from this cost-of-living increase and avoid the “circular economy” designed by the WEF!

Taxes on Your Natural Gas Bill as of April 1, 2024, are 36% and will Double Over the Next Four Years

The 3.8 million households in Ontario using natural gas as a home heating source have all, presumably, recently received their March 2024 bills from Enbridge and examining them demonstrates how it is becoming harder for those living on low or fixed incomes to heat their homes. 

As of April 1^st those households, suffering from rising costs, are obliged to pay even more to heat their homes!  When they get their next bill, it will be higher if they consume the same amount of gas, but it will have nothing to do with an increase in the cost of the natural gas itself.

Layering Taxes

Reviewing the bill we received, disclosed the cost of the gas was 12.3695 cents/m³ while the carbon tax levied was 12.9 cents/m³! To top things off the HST (harmonized sales tax) added another 7.2 cents/m³!

On a combined basis the carbon tax plus the HST was 20.1 cents/m³! The foregoing suggests trying to stay warm in our cold winters should not be tolerated and therefore our Federal and Provincial governments seem intent on classifying it as a “sin tax”!

Looking at specific details of the bill discloses the “carbon tax” referenced as “The Federal Carbon Charge” (FCC) is mixed in with the natural gas costs, delivery costs, transportation costs, etc. The HST which is 13% in Ontario is levied below the line after all the other above costs including the “carbon tax”, aka the FCC! The “below the line” HST therefore applies to the Federal “carbon tax” meaning it is a “tax on a tax”!

The foregoing made me curious about the “sin tax” and a quick calculation discerned my bill would have been over 32% lower without those two taxes.

The carbon tax increased to 15.3 cents/m³ as of April 1, 2024, adding 18.6% to the natural gas “carbon tax” and then applying the HST brings the total costs of our duplicate bill with those “sin taxes” to over 36% of the total costs of the bill!

More Costs on the Way

Four years from April 1^st, 2024, the carbon tax will have doubled meaning; when combined with the HST in Ontario, taxes will have reached 72% of the bill to heat natural gas fired homes in the province should all other costs on the bill remain where they are today.

Conclusion: Increased Energy Poverty on the Horizon

Back in 2019 it was estimated 1,138.000 Ontario households were experiencing energy poverty based on a 2016 census but there were no specifics as to whether that was due to high costs of electricity or natural gas as well as other heating sources such as furnace oil or propane. The 2019 study defined energy poverty as follows:  “Energy poverty is qualitatively defined as the experience of households and communities that struggle with meeting their home energy needs. Home energy needs typically include electricity and home heating fuels.“ The study went on to state “energy poverty” kicked in when spending reached 6% of after-tax income. The 2016 census indicated at that time there were 5,169,000 households in the province which means about 22% of them were experiencing “energy poverty”! 

Statistics for 2021 indicate total households in Ontario had grown to 5,491,000 so we should expect those living in “energy poverty” have increased; due to both the number of households and the increased costs of energy which now includes the “carbon tax” along with the HST being applied on the latter. 

With the “carbon tax” continuing its climb and the “transition” of the electricity sector gaining traction it is obvious we will undoubtedly see the 22% experiencing “energy poverty” in 2016 climb to levels well over that in the next four years. 

Conclusion:

They told us the “Energy Transition” was happening!  They just didn’t tell us they meant its purpose was to transition us into poverty!

PS: The application of the FCC is occurring in most provincial jurisdictions meaning “energy poverty” increases will be nationwide!

Springing into Spring brings IWT Costs

Having a look at IESO data in the Spring often brings distressing news and it’s always about the wind blowing and raising electricity costs while those IWT kill the birds and bats, harm aquifers and create that damn infrasound.

Well along came March 26^th, 27^th and 28^th and those spring breezes arrived and Ontario’s 4,900 MW of IWT (industrial wind turbines) were spinning and respectively generated 96,911 MWh on the 26^th, (82% of capacity) 65,896 MWh on the 27^th (56% of capacity) and finally 43,714 MWh on the 28^th (37.2% pf capacity).

It’s worth noting, in the past, IESO’s “Annual Planning Outlook” would forecast those IWT would generate 29/31% of their capacity annually but they would be specific when looking at the summer and winter (Ontario’s two peak demand periods) and would only rate IWT at 15% for the summer and 30% for the winter!  IESO’s recently released Annual Planning Outlook no longer does the foregoing and instead it forecasts they will generate .8 GW (gigawatts) in the summer and 1.5 GW in the winter which equates to 16% in the summer and 30% in the winter.

Over the three Spring days noted above, those IWT generated 58.4% of their capacity producing 206,296 MWh without any apparent curtailment!

The question then becomes did we need all that generation or were we exporting it to our neighbours at low prices?  As it turns out Peak demand is low most of the time in the Spring and Fall seasons and the above three days were no exception with the highest peak reaching only 17,457 MW at Hour 19 on March 27^th so yes, we were exporting a lot of that power to Quebec, Michigan and New York!  As it turns out net export sales totaled 100,814 MWh or 48.9% of what they generated!

Over the three days the wholesale HOEP price averaged over $30/MWh coming in respectively at $30.27, $35.35, and $31.01 so IESO recouped a total of $3,145,380 for all of those net-exports.

Now if we agree, excess IWT generation represented ALL of the net-exports or caused other baseload generation (nuclear and hydro) to be exported we can rightly discern their unreliable and intermittent nature should be allocated to what the remaining 105,482 MWh of their generation actually cost us Ontario ratepayers/taxpayers. The 206,296 MWh those IWT generated received $135/MWh which cost us a total of $27,850,000* and granting them all of the revenue from the sale of the 100,815 MWh over those three days at the above sale prices means we earned $3,145.000*. If we then deduct the latter from the full cost of the IWT generation, it means for the 105,482 MWh we Ontarians consumed it cost us $234.20/MWh or 23.4 cents/kWh!

The foregoing is what we Ontario ratepayers have become accustomed to as a result of the GEA (Green Energy Act) and the contracts signed under it. The Ford led Government cancelled the GEA when they gained power but there is something disturbing about their buy-in to “Electrification” as it has seemingly got to the point where IESO suggest we need vast amounts of power to achieve the “political” goals.

One example of those future goals and needs from the “Annual Planning Outlook” is the following sentence referencing our needs from 2029 to 2034: “These needs are expected to be met by new or repowered, non-emitting energy-producing resources (that include but are not exclusive to wind and solar) acquired through future long-term RFPs, as well as the reacquisition of existing facilities through medium-term procurements in accordance with the Resource Adequacy Framework.”

Conclusion

From all appearances the Ford led Ontario Government seems intent on satisfying the wishes of PM Justin Trudeau and his “climate czar” Steven Guilbeault, to drive us all into energy poverty instead of pushing back!

*Rounded to the nearest $1000.

A Deep Look at Your Ontario Hydro One Bill and How it Actually Costs 32.5 Cents per Kilowatt Hour

Having just received our Hydro One bill for the period February 3/2024 to March 5/2024 rather than simply paying it and forgetting it until the next bill arrives, I spent a little time examining it. The two pages of the bill contain a fair amount of detail beyond just the electricity being billed and the cost of that power!

On the first page of the bill our consumption was shown as 1,011 kWh and the “What do I owe?” section indicated $179.69 so doing the quick math indicated the costs were 17.8 cents/kWh!

The $179.69 was detailed on page 2 and listed the specifics for Electricity ($112.99 or 11.2 cents/kWh), Delivery, ($71.95 or 7.1 cents kWh), Regulatory Charges ($6.83 or 0.6 cents/kWh), HST ($24.93 or 2.5 cents/kWh) and a deduction for the Ontario Electricity Rebate. The latter was a credit for $37.01 (3.3 cents/kWh) bringing the bill to $179.69. Without that “credit” the cost per kilowatt-hour would have been 21.1 cents per/kWh!

Flipping back to page one there is a rectangular space that is headed: “What do I need to know?” and within it on my bill it said the following: “Total Ontario support: $148.84. To learn more about the province’s electricity support programs visit Ontario.ca/yourelectricitybill.”

If one does the simple task of adding the $148.84 of “Ontario support” to the bill total of $179.69 it comes to $328.53 and then dividing that by the 1,011 kWh consumed the cost per kWh jumps to 32.5 cents/kWh.

So, one should wonder what does that “Ontario support” cover? If you investigate Hydro One’s website, you should run across this chart describing what that support is!

The Ontario Electricity Support Program (OESP) was increased last fall from 11.7% to 19.3% to provide households with a reduction in their electricity bills and the estimated $10.3 billion cost of the program will be allocated to taxpayers. If you analyze your bill by adding the OESP back to the total and deduct the HST and multiply by 19.3% you will get the amount of the OESP that appears on your bill.

The taxpayer largesse passed out under the various “Ontario Support Bill Message” should make one wonder how many Ontario households are suffering from “energy poverty” defined as 6% of net income (after tax) and as it turns out 20.7% of the 5,491 million Ontario households are!  That 20.7% represents 1,128,065 Ontario households according to a report from energyrates.ca. Some presumably benefit from not only the OESP but also the other two or three programs on the “What do I need to know?” Bill Message” from Hydro One!

Bearing the $10.3 billion for the OESP only in mind we customers of Hydro One should wonder how much of that is going to support their revenue base along with the other support programs paid for by the taxpayers?   Hydro One with almost 1.5 million customers, and presumably many living in rural and remote communities we should suspect it’s hundreds of millions or perhaps even a billion or two dollars of taxpayer support even though Hydro One notes the dividends paid to the Provincial Government were $330 million in 2023! We should be pretty sure the $330 million would have made a relatively small impact on the taxpayer money they received as a result of those various programs.

Hydro One’s 2023 Year-end financials don’t disclose how much they benefit from the OESP or the other programs, but it does disclose their gross revenue was $7,844 million and their net income after taxes was $1,080 million which is a very nice 13.3% ROR (return on revenue) and a healthy 9.5% ROC (return on capital).

Conclusion

It seems obvious the bulk of the Ontario PC promises made when Doug Ford was leading the party in the 2018 election are still “pie in the sky” dreams except for scrapping the GEA, firing the CEO of Hydro One and cancelling a few wind and solar contracts!

To recall what Ford said back then and what he would do about the electricity sector, here is the list of promises made:

Clean up the Hydro Mess and fire the board of Hydro One and its $6-million-dollar CEO. Our first act will be to end the Liberal practice of making millionaires from your hydro bills!

Stop sweetheart deals by scrapping the Green Energy Act.

Cut hydro rates by 12% for families, farmers, and small businesses by:

Returning Hydro One dividend payments to families.

Stopping the Liberal practice of burying the price tag for conservation programs in your hydro bills and instead pay for these programs out of general government revenue.

Cancel energy contracts that are in the pre-construction phase and re-negotiate other energy contracts.

Declare a moratorium on new energy contracts

I will leave it up to the reader, who is presumably both a ratepayer and a taxpayer to rate the Ford led Government’s success, but it appears obvious that while electricity rate increases have been somewhat restrained NB: it is only because taxpayers are now saddled with the $10.3 billion cost for just the Ontario Electricity Support Program and a lot more for the others now in place.

NB: Looking back at my Hydro One bill for January 2018 just a few months before the election in Ontario I was able to calculate the cost per kWh of that bill at that time was 14.8 cents/kWh. That suggests rates have increased by 3 cents per kWh or 20.2% which is slightly over 3% on average, annually!

We’re getting zapped by Guilbeault’s radical, no-fuel, electrified future: Full Comment podcast

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:

https://nationalpost.com/opinion/were-getting-zapped-by-guilbeaults-radical-no-fuel-electrified-future

EV con job perpetrated by Politicians will cost us dearly!

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!

How those Regulatory Credits are Defined:

It became readily apparent recently that the US Energy Department stands by its rules for ICE but has a different set of rules for EV as the Wall Street Journal disclosed in an article on January 24^th, 2024.  The article was titled:  “The Secret Is Out” Wall Street Journal Breaks Massive Government EV Cheating Scandal (greenbuildingelements.com)”.  It also popped up on a YouTube Video at the following link: BREAKING: Government Cheating Scandal Unveils EV’s as a Massive Scam! (youtube.com)!  From the article linked above:

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 when testing 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 5^th, 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!