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!

The EV transition in the eyes of the Beholden Part 3

Part 1 of the EV transition highlighted some of the costs associated with it and Part 2 of this series outlined some of the negative issues of EV and their batteries. In an effort to keep it readable at less than 1,500 words it was stated a Part 3 would be a requirement so here it is!

EV Fires

Should one do a simple Google search using the words “tesla car fire” and then hit the video button you will get dozens of videos of intense fires (presumably caused by the batteries) including some simply parked in a garage or stopped at an intersection. Some news story with videos where deaths have occurred note Tesla is being sued.  It surely makes one hesitant to consider their next vehicle should be an EV as it’s not just Tesla EV catching fire as another Google search discloses. As these happenings gain more publicity the push-back on the government decrees in the developed world, including here in Canada where the decree is; “all vehicle sales (cars and trucks) by 2035 will be electric” will surely grow!

Battery Storage Fires

An article by S&P Global on May 31, 2022 titled; “Battery blazes, breakdowns underscore ‘growing pains’ for energy storage” highlights the problems associated with battery storage and the fire occurrence in Southern Australia back in 2021 when it was claimed to be the largest battery storage unit in the world.  The article also outlines the latest problem with the 400 MW unit in California (Moss Landing Energy Storage) and now the largest unit in the world which recently experienced their second incident.  The article notes: “The breakdowns are among more than 50 known failures at medium- to large-scale battery storage projects in the U.S., Europe, Asia and Australia. Daily outage reports from the California ISO, which has more battery storage on its network than any other grid operator, point to additional frequent “plant troubles” curtailing capacity that the state is counting on to keep the lights on during critical periods of peak demand.” The article goes on to state: “Ranging from limited operational hiccups to catastrophic explosions, such incidents are likely to continue to accompany the proliferation of battery peakers, technology and safety experts said.” This certainly suggests the continued use of natural gas plants to back up the intermittent and unreliable nature of wind and solar generation will be with us for a few decades unless our politicians and the bureaucrats advising them are OK with frequent blackouts.

Transit EV Bus Fires

As the push to eliminate fossil fuel use for all the developed world continues the concept of electrifying all transit and transport vehicles gathers steam so, with lots of government support many transit authorities are working to convert their bus fleets.  As just one example the City of Ottawa under its $57.4 billion “Energy Evolution” transition plan, have a target aiming to have a zero-emission transit sector by 2030. One should presume the 944 transit buses currently in Ottawa will be converted to battery operated ones by that date. Ottawa isn’t the only city in Canada or around the world with these plans and many European cities are much farther ahead.  One example is Stuttgart (check out video) with two of EV transit buses and in the fall of 2021 one of them “is believed to have been the source of a massive fire that destroyed 25 buses in the city and also heavily damaged part of the depot they were parked in.” Once again there are dozens of videos and stories of EV bus fires from various locations around the world including one a few days ago in Connecticut which would make one somewhat reluctant to step on board for a trip or be content to allow your child to take an EV school bus.  Needless to say, investigations into these fires are going on wherever they occurred and many of the fleets have parked their EV buses until the investigations determine the cause of the fire(s) is complete and the cause known.

Child Labour mines for Cobalt in the Congo and Zambia

Cobalt is one of the principal ingredients in an EV lithium-ion battery and the Congo has the highest known cobalt reserves in the world representing close to 70% and another African country, Zambia has the 2nd highest known reserves.  Interestingly enough CNN back in May 2018 did some investigative work resulting in them posting a video titled “CNN FINDS CHILD LABOUR IN COBALT TRADE.” The video highlights the use of child labour to mine the cobalt and supply those EV battery manufacturers in China, the U.S.A, Europe and shortly, presumably Ontario. The latter have joined hands with PM Trudeau and the Province to provide grants for a new $1.5 billion plant to be built in Windsor with our tax dollars. Obviously, those tax dollars will be supporting the continued use of child labour in the Congo and in Zambia.

Supply Shortages Loom

Another major problem with the whole “energy transition” push is the probable upcoming shortages of key components required for the electrification of everything and one of those is copper.  As noted in an article in the Financial Post a couple of weeks ago, “Numerous metals and minerals have been hawked as “the next oil,” but according to veteran energy historian Daniel Yergin, only one metal represents the linchpin of the energy transition away from fossil fuels — copper.“ Yergin “sees a looming supply-demand gap in copper that risks “short-circuiting” the energy transition and stalling global ambitions to slash greenhouse gas emissions to “net zero” by 2050.” The article cites a report estimating copper supply would need to double from current production of 25 million metric tons to 50 million metric tons by 2035. The report concludes: “copper shortages could delay how long it takes to reach net-zero emissions; Yergin also acknowledged that various other critical minerals — lithium and cobalt, for example — could well have an impact on climate goals too.”

It sure looks as if the electrification of everything is a pipe dream that will continue to exhibit dire consequences on mankind except perhaps for the small but very rich segment of the population. The time has come to kill the wishes of the eco-warriors and those politicians who have consumed their Kool-Aid.

What’s Best at emissions control; Trees, Wind Farms or Solar Farms?

It is amusing to do a Google search with the simple words:  trees cut down to have solar farms, or trees cut down to have wind farms. The former generates over 26 million hits and the latter over 88 million.  Examining just a few dozen from either search alerts you to how convoluted and twisted the eco-warriors are about the either/or arguments in respect to; clearing trees or not clearing them to erect those IWT (industrial wind turbines) or lay down solar panels!

Leading to the searches was an article out of India titled:  “Felling of trees for solar power plants in Jodhpur raises hackles of locals, environmentalists”.  What catches the eye is the sentence: “While solar parks are being encouraged for providing clean energy, environmentalists and local communities in Rajasthan are concerned over their impact on the natural vegetation of the desert state.”  Wow, are people finally catching on?

A few of the Searches Catching the Eye on Solar Farms

A Korea Herald article from April 2019 noted “Since the government strongly pushed for solar power business in 2017, 4,407 hectares of forest have been damaged, 15 times the space of the Yeouido area of Seoul,”. It noted 2 million trees had been cut down to make way for solar panels and went on to state it was the opposition politicians of the Liberty Korea Party’s view that renewable energy shouldn’t be a replacement for nuclear energy.  Interestingly enough a recent announcement indicated Korea will expand its nuclear power in order to meet its climate targets.

Another article from May 2015 said Six Flags amusement park were seeking to clear-cut 90 acres for a solar farm in Central New Jersey to power their park but they received push-back from several environmental groups including the New Jersey Conservation Foundation. Those environmental groups even filed a lawsuit against Six Flags and the solar developer.  Amusingly the article went on to note; “The lawsuit was filed on the same day as a legislative panel in Trenton approved an aggressive ramping up of how much electricity in the state must come from renewable energy, a goal endorsed by most environmental groups.” The lawsuit was somewhat effective and wasn’t settled until 2018 and Six Flags was only allowed to clear-cut 40 acres so had to cover some of their parking lots with solar panels.

Yet another article from February 7, 2019 announced Georgetown University of Maryland was planning to get nearly half of its electricity power from solar power and went on to note:  “However, the university drew ire when it was announced that the solar farm it would construct in Nanjemoy, Maryland, would require clearing 210 acres of forested land on a peninsula near the Potomac River.  That raised the hackles of the environmentalists resulting in push-back. As a result; “Bonnie Bick, the political chair of the Southern Maryland Sierra Cluban organization famous for fighting for emission reduction with renewable energy – said, “I’m very much in favor of solar, but the solar needs to be properly sited. The question is not forest or solar, it’s where is the proper place to install solar?”  The push-back worked and Maryland blocked the project which resulted in the University instead contracting with existing solar farms in Maryland to purchase power from them under a PPA (power purchase agreement).

 A few of the Searches Catching the Eye on Wind Farms

One of the early finds in the Google search was one titled “A green paradox: Deforesting the Amazon for wind energy in the Global North” and curiosity piqued; it was viewed. The sub-heading was more enticing as it stated: “A shift to wind energy is leaving a trail of destruction in Ecuador, with a brutal impact on Indigenous communities and fragile ecosystems”. Reading the article, one discovers that the “trail of destruction” has been caused by the demand for balsa wood, a major component in the construction of wind turbine blades due to it being flexible and yet hard, while also being both light and resilient.  The article states: “The increased demand led to the deforestation of virgin balsa in the Amazon basin, in what came to be known as ‘balsa fever’. Balseros began to illegally deforest virgin balsa from the islands and banks of the Amazonian rivers in an effort to overcome the shortage of cultivated wood. This has had a terrible impact on the Indigenous peoples of the Ecuadorian Amazon,” The demand for balsa has come from both Europe and China.  The article claimed; “In 2019, Ecuador exported $219m worth of balsa wood, up 30% from the previous record in 2015. In the first 11 months of 2020, it exported $784m worth.”  It sure appears the push by eco-warriors and their political followers to reach “net-zero” is “leaving a trail of destruction” and the Indigenous communities on the Amazon basin by clear-cutting those balsa wood trees.

A series of articles about Scotland’s push to create wind power also disclosed how it resulted in clear-cutting 17,283 acres and wiping out 14,000,000 trees to save the planet.  The foregoing claim was also backed up by a citizen inquiry to the Scottish Forestry arm of the Government who provided a partial response which stated “The area of felled trees in hectares, from 2000 (the date when the first scheme was developed, is 6,994 hectares. Based on the average number of trees per hectare, of 2000, this gives an estimated total of 13.9M.” For privacy reasons Scottish Forestry would not disclose the clear-cut trees or acres affected on private property.  An attempt to determine how many IWT (industrial wind turbines) were located in Scotland only seemed available on Wikipedia which said as of June 2020 they were 8,366 MW (megawatts). If the average IWT was 2 MW it suggests a total of 4,183 IWT. In order to secure the bases of those turbines scattered throughout the Scottish countryside those bases would need about 500 tons of concrete to secure each of them. That results in over 2 million tons of cement scattered underground throughout Scotland’s countryside. We should all wonder how that will save the planet from “global warming”?  There has been lots of push-back from Scottish anti-wind groups for years but without much success until very recently when ministers actually refused planning permission for a 39 turbine wind farm in the Highlands’ Monadhliath mountains as it would have a “significant visual impact”.

Perhaps the Scottish politicians were enamored by the fact it was a Scottish engineer, James Blyth who first generated electricity via a wind turbine back in 1887 to power the lights in his cottage but we will probably never know why they bought into the concept?

Conclusion

It seems obvious that not only are wind and solar generation intermittent and unreliable but are also costly and detrimental to forestry and all the nature existing in the forests they decimate.  They have done absolutely nothing to alter the climate under the pretext of saving the planet from climate change.

One should surmise, trees; not solar panels or IWT, are much better at reducing emissions so, STOP the push to replace the world’s forest with those unreliable energy sources!

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.

 

 

 

                                                                                                                                  

Enbridge Inc Stymied by Ottawa Energy Evolution

As noted in the OEB’s (Ontario Energy Board) recent “Decision And Order” Enbridge Gas had applied to the OEB in March 2021 for approval to replace 19.8 kilometres of aging gas pipeline in Ottawa.  The pipeline is associated with the St. Laurent Pipeline which services approximately 165,000 Ottawa and Gatineau area customers. 

The OEB recently refused the replacement pipeline and basically told Enbridge to; “Plan for Lower Gas Demand” according to an article in The Energy Mix which noted: “The Ontario Energy Board sent minor shock waves through the province’s energy regulatory and municipal energy communities earlier this month with its refusal to approve the final phases of a $123.7-million pipeline replacement project in Ottawa proposed by Enbridge Gas.”  The article went on to note: “Several observers said this was the first time the OEB had refused a “leave to construct” application from a gas utility,”. 

The OEB, under Anthony Zlahtic,* the Presiding Commissioner, laid out the principal reasons for the decision and three of the five reasons were: City of Ottawa’s Energy Evolution Plan,”,Integrated Resource Planning Alternativesand “Downsizing the Pipeline due to Reduced Future Demand for Natural Gas.

Anthony Zlahic’s Background

Curiosity about Zlahic’s background led to examining his “Linkedin” file which lists his former jobs and co-incidentally claims he spent over 11 years working for Enbridge after which he worked for a subsidiary of EPCOR an electricity generation and distribution company owned by the City of Edmonton. EPCOR has subsidiary operations with one of those being Capital Power Corp of Toronto where Zlahic was employed and actively and successfully pursued wind power projects under the Ontario GEA (Green Energy Act).  He notes working with companies such as Pattern Renewable Energy as well as Samsung on industrial wind turbine projects for Capital Power and suggests he increased their “influence among key government agencies and companies directly and through the Association of Power producers of Ontario (APPrO) and Canadian Wind Energy Association (CanWEA)”. 

Based on Zlahic’s background and activities with both Enbridge Gas and his obvious belief in IWT (industrial wind turbines) as a reliable energy source one should wonder why the OEB appointed him and WHY he didn’t recuse himself (due to his background with Enbridge) from this hearing?

Also note, Zlahic ruled; Enbridge was responsible for all intervenor costs!

Ottawa’s Prejudicial Intervenor

One of the intervenor’s whom Enbridge is obliged to pay costs to is Pollution Probe** and they were represented by Michael Brophy both a director and team member of Pollution Probe.  Interestingly enough Brophy also was a former employee of Enbridge Gas.  One should wonder, did both Zlahic and Brophy part terms with Enbridge in a favourable way or do they hold some prejudices against them?

Another important fact associated with the ruling is in respect to the City of Ottawa’s Energy Evolution Plan which was actually written by Pollution Probe as an earlier article noted.  The foregoing was confirmed by another intervenor who advised that Michael Brophy told him he was a co-author of the 101 page “plan”. The “plan” suggests the costs to Ottawa for net-zero will be $57.4 billion and result in 3,218 MW of IWT capacity and 1,060 MW of solar capacity on rooftops by 2050!

Was the OEB outcome a result of self-flagellation by Enbridge?

It seems very ironic when examining the March 2021 annual statement of Pollution Probe and note their list of “Sponsors, Major Supporters and Partners” includes none other than Enbridge Inc.  

The Pollution Probe statement filed with the CRA indicates gross revenue of $1,839,737 for the year ended March 31, 2021 but only $113,516 or 6.1% was tax receipted by them so; is this an indication they are not much of a worthwhile “charity”?  

What is not surprising to see in their annual report are numerous government donors listed including: Environment and Climate Change Canada, Government of Canada, Natural Resources Canada, Transport Canada, Ministry of the Environment, Conservation and Parks (Province of Ontario) and TAF (Toronto Atmospheric Fund [Municipality of Metro Toronto]).

Interestingly enough Michael Brophy is also listed as a “Major Donor” meaning taxpayers are hit with a double whammy in that their taxes support the government grants which supply Brophy income from Pollution Probe and his donation(s) provides him with a personal tax receipt!

The tax dollars doled out to Pollution Probe according to a Federal Grant search is in the millions of dollars and is additional to the money handed out by them via Federal Contracts worth hundreds of thousands of our tax dollars!

More self-flagellation by Enbridge

Another exampleof Enbridge’s self-flagellation is related to the net-zero push and ESG (environment, social, governance) issues. A four-page letter sent to Larry Fink, the CEO of BlackRock back in March 2022 clearly demonstrates the foregoing.  The President and CEO of Enbridge, Al Monaco goes into detail on how the company is changing. In in Monaco tells Fink how they have invested in wind farms and solar facilities and enshrined ESG related initiatives, etc. into their business model. An example from the letter related to ESG states: “By 2025 we’re aiming for a workforce that will include 28% racial and ethnic group representation, 40% women, 6% persons with disabilities, and 3.5% Indigenous peoples.”

We should all find it dismaying that one of Canada’s most successful companies is basically kowtowing to BlackRock and in effect, the WEF (World Economic Forum) instead of fighting back knowing the world cannot survive with the wind and solar intermittent and unreliable energy pushed by the WEF and the numerous eco-warriors like Pollution Probe.

Appeal of the Masses

For the will of the people Mr. Monaco please stand up for the enormous benefits of fossil fuels and how they have lifted billions of people around the globe out of poverty and saved so many lives!

*The 2021 Ontario Sunshine list indicates Anthony Zlahtic’s annual salary was $169,349.82!

**One of the original founders of the Strathmere Group which this writer has written a series of articles about was Pollution Probe.

Hmm, One should wonder, do all the various taxes on fuels have anything to do with Canada’s current 6.8% inflation rate?

A Jack Mintz article in the Financial Post about the various “fuel taxes” inspired some research on how much taxes Canadians are burdened with in respect to the fuels consumed to bring goods to the stores, get us to work, manufacture products, used in agriculture and for food processing, etc.etc.

Most individuals are probably unaware how many variable taxes are applied by both the Federal and Provincial governments and how the layered effect creates a tax-on-tax situation we taxpayers absorb regardless of whether we bike to work or walk to the grocery store for our daily or weekly needs.

A short list includes: the “excise tax” (averaged at 10.5 cents/litre), the “carbon tax”* (currently at 11 cents/litre) and either the HST (harmonized sales tax) or the PST (provincial sales tax) plus the GST (federal general sales tax). The latter ie: “sales taxes” are applied to the final price after all the prior taxes are included on your purchase so, apply taxes-on-taxes, for both the excise and carbon tax. Please note I used 13 cents/litre as the average, with Alberta being the one exception as they have no sales tax.

The Feds and Provinces love high Gasoline and Diesel Prices

For some time I’ve wondered why no one has looked at the big picture with gas and diesel prices more than double what they were. Running the numbers based on what Statistics Canada reported we used for gasoline and diesel consumption for road vehicles and what diesel fuel is consumed for our railway industry for 2020 was targeted!  Interestingly the only government who offered a break by reducing taxes while prices increased was Alberta, where the current Provincial leader Jason Kenny agreed to eliminate their portion of the excise tax. Alberta is also the only province without a sales tax. The Ontario Ford led government has promised to cut sales taxes by 5.7cents/litre if elected starting July 1st, 2022 but we don’t know yet if that will actually happen.

I did a quick calculation on the fuel tax costs using an average of annual gasoline and diesel fuel sales from the Federal Government’s website(s) to determine how much more we pay annually now, versus prior to the doubling of pump prices!

Gasoline

For gasoline sales I used an average of 44 billion litres annually (6.4 billion litres consumed in Alberta was deducted from sales tax revenue calculations) as the years prior to the Covid-19 pandemic averaged above that consumption level. Alberta doesn’t have a provincial sales tax but the other taxes apply as they are federal not provincial.

For gasoline priced at $1/litre total costs including all taxes the total annual bill comes to $53.178 billion. That includes taxes of $15.578 billion with the latter broken down as $11.660 billion in Federal taxes and $3.918 billion in provincial taxes.

For gasoline priced at $2/litre the total costs including all taxes amounts to $95.666 billion with taxes of $20.466 billion and the latter broken down to $13.220 billion in Federal taxes and $7.246 billion in provincial taxes.

Diesel

For diesel sales from Statistic Canada the average used was 17.5 billion litres annually for “road motor vehicles” (3.6 billion litres consumed in Alberta was deducted from sales tax revenue calculations) plus an additional 2.1 billion litres of diesel used for the railway industry as per Statistic Canada.

For diesel priced at $1/litre the total costs including all taxes amounts to $28.330 billion including taxes of $5.790 billion with the latter split into $4.280 billion in Federal taxes and $1.510 billion in provincial taxes.

For diesel priced at $2/litre the total costs including all taxes amounts to $50.484 billion including taxes of $8.344 billion with $5.264 for the Federal coffers and $3.080 for the provincial tax kitty.

So, if we combine taxes for the $1/litre costs of both gasoline and diesel we can see total costs of $21.568 billion and at $2/litre combined federal and provincial taxes grows to $28.810 billion and is a year-over-year increase of $8.344 billion or 40.7%.

The $8.344 billion extracted from the taxpayers pockets by the Federal and Provincial governments clearly has had a negative effect on every Canadian household as it extracted our after-tax dollars and raised the cost of everything we consume. Those costs include simple things such as delivery costs added to the price of food to feed families and no doubt helped drive more households into energy poverty.

Oh, and less we forget, we also pay sales taxes (Federal and Provincial) for other necessities of life like electricity to keep the lights on and energy to heat our homes and keep us from freezing in Canada’s cold winters.

One should note the Bank of Canada has not noticed this inflation issue but bragged a few months ago about how they had “reduced electricity use in our head office by 50 percent—the equivalent of removing over 1,300 homes from the electricity grid.” One assumes they used our tax dollars to achieve the above reduction while ignoring inflation caused from increased taxes affecting each and every Canadian household.  

The Bank of Canada will have caused “energy poverty” in many more than the 1,300 homes their “reduced electricity use” reputedly saved by ignoring how tax policies of the Federal and Provincial governments are negatively affecting Canadian families and businesses!

NB: For the sales taxes (federal [5 cents/litre] and provincial [8 cent/litre]) the average used was 13%  combined and 10.5 cents/litre for the excise tax for gasoline and 4 cents/litre for diesel and for both a carbon tax (as at April 1, 2022) of 11 cents/litre.

*Scheduled to increase from $50/ton to $170/ton by 2030

Net-Zero Looking like a No-Go by 2050 PART 1

The past several days has made it look like there isn’t “a hope in heaven or hell” to meet the commitments to reach net-zero by 2050. The promises made at COP-26 will be not be met, unless mankind is back living in caves by that date!  The following highlights several happenings impacting the impossible dreams of our elected leaders. Here are a just few that will also make eco-warriors upset!

Creaky U.S. power grid threaten progress on renewables, EVs

The captioned was labelled as a Reuters Special Report posted several days ago suggesting grid failures are becoming a big problem in the U.S. and caused by “climate change” bringing nasty things like; wildfires in California, hurricanes in the Gulf Coast, Midwest heat waves and a Texas deep freeze.  The author goes so far as to claim; “the seven regional gid operators in the United States are underestimating the growing threat of severe weather caused by climate change” claiming he checked data going back to the 1970s! Had he bothered to go back a little further he may have found heat waves, hurricanes, wildfires and deep freezes are not a new phenomenon that has only occurred during the past 50 years.  He did rightly note the “inherent unreliability” of wind and solar “exacerbates the network challenges” and requires grid expansion to get their generation to where they are needed!  The article goes on to cite the increasing demand for electricity that will be caused by all those EV (electric vehicles) charging their batteries but that means a huge increase in spending on the grid!  He cites John Kerry, U.S. Special Envoy who stated: “We can send a rover to Mars, but we can’t send an electron to California from New York.” My guess is if Kerry had investigated, he would find out New York has no spare electrons to send anywhere and moving that “electron” across the county would cost more than sending that rover to Mars!

A summer of Blackouts

Another recent article related to the U.S. in the City Journal (CJ) co-authored by the editor and a “Fellow” at the Manhattan Institute took a different tact. The article noted “rolling blackouts” will be caused by; “the closure of some coal and nuclear plants, and the unreliability of renewables like wind and solar”.  The article further states “the unreliability of renewables like wind and solar” reduced energy surpluses. The article goes on stating; “That’s left some places with little margin for error during peak usage times in mid-summer—potentially prompting the kind of blackouts California saw last year. The warnings have spurred calls to slow down climate-change-driven efforts to retire nuclear and fossil-fuel generating plants.“ The authors of this article make a more logical argument than the Reuters article as it cites immediate problems presumably inferring building transmission systems to carry an electron from NY to California is not the answer noting: “the Midcontinent Independent System Operator (MISO), which coordinates and oversees the power grid for 15 midwestern and southern states serving more than 40 million people, has noted that the closing of plants representing significant sources of energy had accelerated a shortfall in power reserves, potentially with dire consequences.”  The article goes on to note upcoming problems in several of those midwestern states including Illinois, New Mexico, Utah and Colorado, all of whom, forecast power shortfalls and corresponding blackouts during peak demand hours principally due to plant closures and intermittent unreliable wind and solar.  The article also mentions the drought in California which will reduce hydro generation and suggest that, in itself, may well cause blackouts similar to those experienced last year.

Bundesbank warns Russian gas embargo would cost Germany 5 per cent in lost output

The Russian Ukraine war has exacerbated the global efforts to meet those COP-26 targets as the European Union has moved to stop purchasing Russian oil, natural gas and coal. Germany could see one of the largest impacts as they had become overly dependent on the supply of those fuels from Russia. Recently Bundesbank (Germany’s central bank) warned the embargo could knock 5% (US$195 billion) off of Germany’s GDP effectively creating a recession.  At the same time Germany has reactivated many of their old coal plants to ensure electricity supply certainty.  The latter will not ensure they avoid the falling GDP forecast from Bundesbank nor will it help Germany and the EU reach their “net-zero” emission targets as they will be replacing gas fired plants with coal which is much more emissions intensive. It should also be remembered by all, that Germany had not only closed their coal fired electricity plants but had also phased out their nuclear plants in favour of intermittent and unreliable wind and solar generation.

Kwarteng to classify natural gas as ‘green’ investment to support North Sea

Kwasi Kwarteng is the UK’s Business Secretary under Prime Minister Boris Johnson. One month ago he was quoted stating: “Net zero is the solution to the global gas crisis, not the cause. Expensive gas is the problem – cheap, clean, homegrown energy is the solution,”! The quote was from a speech he delivered at the Harvard Kennedy School.  Kwarteng is now planning on classifying “natural gas” as green and drilling for it in the North Sea as “environmentally sustainable”.  Pretty sure the “eco-warriors” around the world must be very upset about declaring “natural gas” as green and drilling for more is “environmentally sustainable”!

Not to worry about the above though, as right here in Ontario the OCAA (Ontario Clean Air Alliance) got a much different message recently.  The OCAA paid close attention to a recent debate amongst the leaders of four (New Blue Ontario Party and the Ontario Party were excluded) of the Provincial Parties invited to debate and the OCAA were delighted when they heard Doug Ford declare he “will not be happy until Ontario achieves a 100%  zero-carbon electricity grid”!  We should be pretty sure the Liberals, NDP and Green Party Leaders are fully on-board with Ford’s “happy” target!

What the foregoing suggests is that it doesn’t matter which side of the ocean you live on; politicians haven’t got a clue as to what the truth is!  Their preferences are driven by what they perceive voters’ favour and apparently, they haven’t a clue if “climate change” aka “global warming” is fact or fiction or what mankind’s influence on the climate actually is.

Stay tuned for Part 2 in this series!

Allianz Insurance Suffers a Catastrophic Loss Probably Caused by Electric Vehicles!   Isn’t that Ironic?

An article in the British newspaper, “EXPRESS” in the May 11th edition shouted out: “The heightened appeal for electric cars may be causing a wave of cargo ship fires because they are not designed to carry lithium batteries safely. The new report, from Allianz Global Corporate and Specialty, said that bigger vessels carrying as many as 8,000 vehicles at a time concentrate the risk.”

The above commentary came about due to the potential insurance losses suffered from the sinking of the Felicity Ace in the Atlantic Ocean which happened to be carrying 4,000 Volkswagen vehicles including; Porsches and luxury Bentley vehicles and many were electric vehicles. An article on February 22, 2022 noted “a spokesperson for the salvage crew working on the burning cargo ship, who confirmed that “part of the fire is the batteries [in electric vehicles on board] that are still burning.” The paper said that according to Portuguese navy officials and salvage workers who have seen a cargo manifest, “it is clear that many of the cars on board are electric vehicles.” The fire, which started on Wednesday, has continued to burn into the weekend.

Allianz with their head office in Germany is recognized as # 1. of the top 10 global insurers ranked by 2019 non-banking assets and presumably took a significant hit as the value of the cargo on the Felicity Ace, now sunk, has been estimated at over $500 million.

Interestingly enough; if the loss of the ship and its cargo are eventually blamed on EV batteries, one should wonder; will Allianz drop their membership in the UN Net-Zero Insurance Alliance

The history of Allianz and perhaps their belief in “Energiewende”under Angela Merkel, former Chancellor of Germany, seemed to convince the German population of the ability to denounce the use of fossil fuels and nuclear energy and instead depend on renewable energy for their needs.  Evidentially that included transformation of the transportation sector and Allianz jumped on board.  They aggressively have promoted EV for over a decade as a simple search on their website determines.  As an example, in 2011 Allianz was a co-sponsor of an EV race consisting of two, three and four-wheelers! Their related press release stated: “We believe in the future of electric-powered cars, which will allow us to be mobile in a sustainable, emission-free and low-noise fashion.”  Anyone living near wind turbines (also supported by Allianz to achieve “net-zero”) to recharge those EV might not be happy to note how Allianz ignored noise emissions from wind turbines and their reputed “clean generation”! 

As it turned out Energiewende has turned out to be a very negative issue for Germany particularly with the ongoing Ukraine/Russian war impacting Germany’s need for natural gas resulting in them firing up many of their mothballed coal plants.  Net-Zero is starting to look like a nightmare not a dream!

So, one must wonder how Allianz’s worldwide offices and their executives are taking all this negative news affecting their support and push for “net-zero” and having to deal with an insurance claim that may well top $500 million appearing to have been caused by EV?

Net-Zero is starting to look like a nightmare not a dream now and as Alanis Morissette’s song title enunciated; “Isn’t that ironic”!

Four Years Later and I Repeat: “If I were Ontario’s new Minister of Energy …”

Back on May 30, 2018 an article I penned, just prior to the last provincial election, listed ways in which the incoming ruling party could reduce electricity costs by $2 billion annually.  Electricity costs had more than doubled in Ontario under the reign of the McGuinty/Wynne led Liberals due to their enactment of the GEA (Green Energy Act) when George Smitherman was the Minister of Energy.

Ontario’s voters were expected to respond when casting their vote in early June 2018 and they did!  The ruling OLP (Ontario Liberal Party) were decimated turning them into what many referred to as the “mini-van party”.

My prior advocacy work had focused on the “electricity sector” and the cost of wind and solar generation. My efforts included frequent dialogue with the Conservative appointed “energy critics” so, at that time, I and many Ontario ratepayers in rural and urban communities had hopes the Doug Ford led Ontario Conservative Party would deal with the mess the Liberals had created. Potentially the savings would have amounted to around $8 billion over the past four years.

The Ford led government based on a recent report from the Ontario Financial Accountability Office seems to have simply transferred $6.9 billion in electricity costs for the 2021-2022 year and $118 billion to taxpayers over 20 years, even though taxpayers are also ratepayers!  In quickly reviewing recently released platforms for the OLP, the NDP and the recent OPCP budget it sure appears they all have plans aimed at “global warming” and want to spend billions continuing the push to jump on board with “The Great Reset” advocated by the WEF and our Prime Minister, Justin Trudeau.

The only dissenting voice amongst the political parties seems to be the newly formed “New Blue Party” whose “BLUEPRINT” states they will take “down wind turbines to reduce electricity costs”!

Following are the recommendations put forward in the article four years ago and I will leave it to the reader to pontificate as to whether or not, any of them were acted on!

“Green Energy Act

Immediately start work on cancelling the Green Energy Act

Conservation

Knowing Ontario has a large surplus of generation we export for 10/15 per cent of its cost I would immediately cancel planned conservation spending. This would save ratepayers over $433 million annually

Wind and solar contracts

I would immediately cancel any contracts that are outstanding but haven’t been started but may be in the process of a challenge via either the ERT (environmental review tribunal) or the court system. This would save ratepayers an estimated $200 million annually

Wind turbine noise and environmental non-compliance

Work with the MOECC Minister to insure they effect compliance by industrial wind developers both for exceeding noise level standards and operations during bird and bat migration periods.  Failure to comply would elicit large fines. This would save ratepayers an estimated $200/400 million annually

Change the “baseload” designation of generation for wind and solar developments

Both wind and solar generation is unreliable and intermittent, dependent on weather, and as such should not be granted “first to the grid rights”.  They are backed up by gas or hydro generation with both paid, for either spilling water or idling when the wind blows or the sun shines.  The cost is phenomenal.  As an example, wind turbines annually generate at approximately 30 per cent of rated capacity but 65 per cent of the time its generation is at the wrong time and not needed. The estimated annual ratepayer savings if wind generation was replaced by hydro would be $400 million and if replaced by gas in excess of $600 million

Charge a fee (tax) for out of phase/need generation for wind and solar

Should the foregoing “baseload” re-designation be impossible based on legal issues I would direct the IESO to institute a fee that would apply to wind and solar generation delivered during mid-peak and off-peak times.  A higher fee would also apply when wind is curtailed and would suggest a fee of $10/per MWh delivered during off-peak and mid-peak hours and a $20/per MWh for curtailed generation. The estimated annual revenue generated would be a minimum of $150 million

Increase LEAP contributions from LDC’s to 1 per cent of distribution revenues

The OEB would be instructed to institute an increase in the LDC (local distribution companies) LEAP (low-income assistance program) from 0.12 per cent to 1 per cent and reduce the allowed ROI (return on investment) by the difference. This would deliver an estimated $60/80 million annually reducing the revenue requirement for the OESP (Ontario electricity support program) currently funded by taxpayers

Close unutilized OPG generation plants

OPG currently has two power plants that are only very, very, occasionally called on to generate electricity yet ratepayers pick up the costs for OMA (operations, maintenance and administration). One of these is the Thunder Bay, former coal plant, converted to high-end biomass with a capacity of 165 MW which would produce power at a reported cost of $1.50/kWh (Auditor General’s report) and the other unused plant is the Lennox oil/gas plant in Napanee/Bath with a capacity of 2,200 MW that is never used. The estimated annual savings from the closing of these two plants would be in the $200 million range.

Rejig time-of-use (TOU) pricing to allow opt-in or opt-out

TOU pricing is focused on flattening demand by reducing usage during “peak hours” without any consideration of households or businesses.  Allow households and small businesses a choice to either agree to TOU pricing or the average price (currently 8.21 cents/kWh after the 17% Fair Hydro Act reduction) over a week.  This would benefit households with shift workers, seniors, people with disabilities utilizing equipment drawing power and small businesses and would likely increase demand and reduce surplus exports thereby reducing our costs associated with those exports. The estimated annual savings could easily be in the range of $200/400 million annually

Other initiatives

Niagara water rights

I would conduct an investigation into why our Niagara Beck plants have not increased generation since the $1.5 Billion spent on “Big Becky” (150 MW capacity) which was touted to produce enough additional power to provide electricity to 160,000 homes or over 1.4 million MWh.  Are we constrained by water rights with the US or is it a lack of transmission capabilities to get the power to where demand resides?

MPAC’s wind turbine assessments

One of the previous Ministers of Finance instructed MPAC (Municipal Property Assessment Corp,) to assess industrial wind turbines (IWT) at a maximum of $40,000 per MW of capacity despite their value of $1.5/2 million each.   I would request whomever is appointed by the new Premier to the Finance Ministry portfolio to recall those instructions and allow MPAC to reassess IWT at their current values over the terms of their contracts.  This would immediately benefit municipalities (via higher realty taxes) that originally had no ability to accept or reject IWT.

If one does a quick addition of the foregoing one will see the benefit to the ratepayers of the province would amount to in excess of $2 billion dollars which co-incidentally is approximately even more than the previous government provided via the Fair Hydro Act.

Hmm, perhaps we didn’t need to push those costs off to the future for our children and grandchildren to pay!

Now that I have formulated a plan to reduce electricity costs by over $2 billion per annum I can relax, confident that I can indeed handle the portfolio handed to me by the new Premier of the province.”

Crazy stuff from Polls, Surveys and Politicians

Youthful “Climate Anxiety’

An article from April 26, 2022 on CTV news reported on a CAMH (Centre for Addiction and Mental Health) survey on Ontario youth and labelled it “depressing”! The survey was about how the “Covid-19 pandemic” coupled with “eco-anxiety” had affected youth and the author of the article (Abby Neufeld) got the views expressed from a 17-year-old.  Leaving aside the section on the pandemic’s affect the shocking thing was how he responded to the question about climate-anxiety stating: “The first time it ever really hit home for me was in Grade 2 – we watched this informative video explaining the earth was sick,” he recalled, adding that he remembers feeling a sense of helplessness, unable to process what could be done.” One should assume when he was in grade two (2), he would have been seven (7) years old! As a parent one should ask why the local school board is allowing teachers to show videos that will obviously create anxieties in that age group? The CAMH survey indicated 24% of youth were “worried” about “climate change” and 50% were “depressed about the future”!

US Gallup Poll

As a counter to the CAMH survey a recent US Gallup Poll asked the question “What do you think is the most important problem facing the country today?” and 35% picked “Economic Problems” as their top concern.  A miserly 2% picked “Environment/Pollution/Climate change” as the “most important problem” facing the country! Perhaps the US education system doesn’t allow the showing of those scary “climate change” videos to seven (7) year old’s in Grade two (2)?

Ontarians Rank “Tackling Climate Change” Seventh

Global News recently commissioned IPSOS to poll Ontarians to determine their top three priorities before the budget was to be presented in Parliament on April 28, 2022. Interestingly, “Tackling Climate Change” ranked seventh just ahead of “Lower Energy Costs” but behind four other economic issues including; “Lower Taxes”, “help with day-to-day needs (like groceries and gas)”, “help to make housing more affordable” and “Economy and Jobs”.   With all those economic issues front and center one should wonder; why are our politicians continually supporting the elimination of fossil fuels and targeting that COP-26 “net-zero” pie in the sky target? It now appears the Covid-19 pandemic coupled with Russia’s invasion of the Ukraine have enlightened voters to real issues affecting their daily lives as they relegate the eco-warrior cries about “climate change” well down their list of concerns!

43% of Britons will struggle to pay their energy bills

An April 25, 2022, article in the Financial Post provided the results of an Opinions and Lifestyle Survey from the Office for National Statistics in the UK indicating energy poverty has affected many households.  The findings, collected from March 16th to March 22nd stated 43% of the UK’s household’s will struggle to pay their energy bills and 23% said it was difficult to pay their usual household bills.  The latter was up from 17% in November 2021. The increase obviously is in respect to the hit UK consumers have taken as electricity and natural gas prices have pushed up inflation to a 30 year high similar to what our inflation rates have climbed here in Canada.

An overwhelming majority of Quebecers, and all Canadians, want to supply Europe with energy

The media release of April 26, 2022 from the Montreal Economic Institute on April 26, 2022 noted they had engaged Ipsos to conduct a poll to determine how Canadians felt about exporting “our vast energy resources to European countries” to replace the Russian supply. Approximately 72% were in support and only 17% were opposed and that polling didn’t differentiate much with 65% of Quebecers also supportive. Another surprising result of the poll was the following from the media release: “While the provincial government has just adopted a bill aiming to put an end to all hydrocarbon development projects in Quebec, 59% of the population of the province is in favour of developing Quebec’s oil and gas potential in order to export the resources to Europe. Moreover, 53% of Quebecers want to revive the GNL Québec project in order to export liquefied natural gas to Europe, while only 29% are opposed.” 

The foregoing flies in the face of both the ruling Federal and Quebec politicians who continue to push for the complete elimination of fossil fuels. It appears however, the politicians plan to ignore what those who elected them, see as “sane policies” to actually protect the Canadian economy and our well-being!

New Federal Regulation makes new homes costlier

Finance Minister Chrystia Freeland’s budget launched April 7, 2022 promised to spend billions of tax dollars (north of $70 billion) aimed at making new homes affordable. Considering the budgeted spending one wonders WHY the same government just five (5) days before the budget was presented would propose a regulation making new homes costlier?

The primary objective of the new regulation(s) is to; “Reduce energy consumption and resulting GHG emissions associated with products used in homes, contribute to Canada’s commitment to reach net-zero emissions by 2050, reduce the load on the electricity system, and help Canadians save money on their energy bills.” The foregoing will reputedly reduce emissions by 1.2 megatons or 0.17% of Canada’s 2020 emissions and it applies to all appliances utilizing electricity in the house including; your furnace, air conditioner, etc. along with all other major appliances. We should be confident China or India will have no trouble increasing their emissions by that much in less than a week.

Shortly after the budget was presented the New York Post had an article that should prove shocking to all Canadians as it stated: “As of February, the Canadian Real Estate Association reported that the average price of a Canadian home stood at 816,720 Canadian dollars, or $646,809 — over nine times the average household income. In contrast, the US has seen slightly lower price increases, with home prices rising 27% over the same period, Fortune previously reported. In America, the median home price last month stood at $375,000, an all-time high and a 15% rise from a year prior.” That suggests the cost of the average home in Canada is almost double the cost in the US and is truly shocking.

One should wonder why the current government continues their agenda and appears intent on driving up our cost of living via inflationary regulations such as this?  Is it because the Trudeau led government is sold on the WEF’s (World Economic Forum) concept that we Canadians “will own nothing but be happy”?  We need to push back for the sake of all Canadians and our children.

Let’s have a Canada wide poll

Perhaps the time has come for a poll or survey that allows all Canadians to show our politicians what the U.S. Gallup Poll is telling the U.S. elected leaders!