Strange Things that Caught My Eye Over the Recent Week

Should you, as I do, consider recent events to be off the scale of normal, it is worth pondering the cause!  Is it related to the Covid-19 pandemic, climate change, the “woke” generation, government bureaucrats or those in political power or perhaps a combination of some or all of them?  Some recent examples:

Planting Trees in Brampton as Part of Two Billion Trees                                                                             

I’m sure most will recall just before the last Federal election in 2019 our PM Trudeau met with Greta Thunberg and promised her we would plant 2 billion trees.  Well, it appears the process, under the Minister of Natural Resources, Seamus O’Regan has finally started according to a press release on August 4, 2021 which contained the following:

Today, Maninder Sidhu, Parliamentary Secretary to the Minister of International Development and Member of Parliament for Brampton East, on behalf of the Honourable Seamus O’Regan Jr., Minister of Natural Resources, announced $1,280,000 to the City of Brampton in support of the Government of Canada’s plan to plant two billion trees over 10 years. This project will see 8,000 trees planted across the region this year and contribute to the rehabilitation of the city’s urban tree canopy.”

Quick math on the cost per tree being planted comes to $160.00 each meaning if Minister O’Regan Jr. continues at this level the total cost to Canada’s taxpayers will be $320 billion for the 2 billion trees. Those 8,000 trees will, eventually, absorb about 174 tons of CO2 meaning the cost per ton of emissions removal is about $7,400. Pretty sure O’Regan could have purchased “carbon offsets” for a few dollars each from former Governor of the Bank of Canada, Mark Carney and saved the taxpayers money!

CONFIDENCE IN CHARITY LEADERS HAS FALLEN SHARPLY OVER THE LAST TWO DECADES – WHAT DOES THAT MEAN FOR THE SECTOR?

In late June Charity Village released a report that tracked “four research streams that asked about perceptions of charity leaders over time, representing 27 distinct surveys.” The surveys cited go back as far as 2000.  One of the comments in their report stated: “In 2000, 27% of Canadians reported a lot of trust or confidence in charity leaders, but in the Environics Institute’s research, only 8% reported having a lot of confidence in 2020,”. Another finding was, “between 2009 and 2020, confidence in charity leaders dropped by 22 percentage points, compared to only eight percentage points for business leaders, six for union leaders, and three for government leaders.” The preceding findings may (in my mind) be a reflection of the growth in eco-charities who provide no real charitable benefits to those in need and are well funded by domestic and foreign charitable foundations. The former includes many of Canada’s colleges and universities with departments focused on “climate change”! Needless to say, the drop in confidence has resulted in fewer Canadian tax filers donating: “In 2000, 25.5% of Canadian tax filers reported charitable donations, but by 2018 it was only 19.4%.” 

Toyota CEO Agrees With Elon Musk: We Don’t Have Enough Electricity to Electrify All the Cars

Toyota’s CEO at the company’s year-end press conference in mid-December 2020 said; “The current business model of the car industry is going to collapse. The more EVs we build, the worse carbon dioxide gets…When politicians are out there saying, ‘Let’s get rid of all cars using gasoline; do they understand this?” 

Interestingly enough, Elon Musk, the founder of Tesla just a couple of weeks earlier noted “Increasing the availability of sustainable energy is a major challenge as cars move from combustion engines to battery-driven electric motors, a shift which will take two decades, Musk said in a talk hosted by Berlin-based publisher Axel Springer.”  Musk also said; “electricity consumption will double if the world’s car fleets are electrified, increasing the need to expand nuclear, solar, geothermal and wind energy generating sources.” In respect to “wind energy” it is interesting to note the Global Wind Energy Council in an article claimed, at the end of 2020 there were “743 GW of wind power capacity worldwide”.  To put that in perspective the Federal Government’s “Canadian Centre for Energy Information” tells us at the end of 2017 Canada’s total electricity capacity was 145,214 MW which is only 145.2 GW! 

As industrial wind turbine’s (IWT) life span is around 20 years we should expect about 50% of those in operation globally will reach their end-of-life in the next 10 years and the rest by the time Musk forecasts capacity must double.   Approximately the same life-span applies to solar panel and batteries for storage. Those politicians and Musk should also understand the USA in 2020 generated 60.3% of it’s electricity consumption from fossil fuels!  I would therefore suggest the “politicians” cited by Toyota’s CEO along with Musk himself have no understanding of what EV will do to the electricity system globally and why both are way off base and have no bearing on getting us to “net-zero” emissions by 2050!

Hydro One submits five-year Investment Plan to the Ontario Energy Board to energize life for communities

Just a few days ago Hydro One issued a press release announcing they had submitted a 5 year plan to the OEB (Ontario Energy Board) seeking approval to spend $17 billion over that time to reputedly: “reduce the impacts of power outages for its distribution customers by approximately 25 per centand “enable economic growth and prepare for the impacts of climate change.” The proposed capital expenditures are about double what they have been over the past several years (eg: 2019 was $1.667 billion and 2020 was $1.878 billion).  The press release claims “If approved, the five-year Investment Plan will have bill impacts below the expected rate of inflation, with the monthly bill for a typical year-round residential customer increasing by an average of $1.68 each year from 2023 to 2027.” Reviewing the OEB’s Yearbook of Distributors to get a sense of how those “power outages” compare due to “defective equipment” the 2015 report states the hours interrupted due to “defective equipment” were over 4.6 million hours and in 2019 (2020 report is not yet published) they had dropped to just under 4.4 million hours.  Since 2015 Hydro One’s residential customer base also increased by 60,000 so hours per customer have dropped.

As a former banker I don’t believe the approximately $2 million the 1,2 million residential customers will cough up at the suggested $1.68 annual increase will be sufficient to pay the interest on the $1.9 billion of new debt (the foregoing additional debt assumes Hydro One will maintain is debt to equity ratio at 2020 year-end levels) they will incur annually.  By 2027 it will be a pipe dream!

Let us all hope the OEB does its job for the benefit of Hydro One’s customer base of which I am one.

Let’s thank our lucky stars Hydro One was not allowed to buy Avista

While on the subject of Hydro One it should remind all that back a few years ago they were intent on purchasing Avista Corporation via an all-cash purchase at $53 (US) per share.  The total cost for the all-cash offer was estimated at Cdn$6.7 billion.  The closing price on Avista’s stock on Friday July 7, 2021 and over three years after the purchase offer was $42.67 (US).  At the time the purchase offer was made Glen Thibeault was the Ontario Minister of Energy and was keen on the takeover saying: “One of the benefits of broadening the ownership of Hydro One was to unlock the potential for precisely this sort of transaction,”.  Thibeault went on to say; “As the single largest shareholder in Hydro One, the Ontario government would benefit from the company’s receipt of additional regulated returns expected to begin in 2019. Those benefits will be above and beyond the proceeds already attributed to the Ontario Trillium Trust as a result of the IPO and subsequent secondary offerings.”

Needless to say, those of us who felt Hydro One should focus on Ontario’s ratepayers were delighted US regulators in the states where Avista operated refused the takeover. Hydro One had planned to borrow $3.4 billion and issue another $1.4 billion of debentures convertible into Hydro One shares which would have, in all probability, detrimentally impacted all of their existing Ontario ratepayers.

Conclusion

Unfortunately, it appears those we elect as our representative politicians often are more influenced by those lobbying them continually such as the “climate change” advocates or they bow to the bureaucrats who are the beneficiaries of our tax dollars for their pay. Combine the foregoing with the “woke” generation screaming and their mainstream media support along with the push for globalization and we should unfortunately recognize what is continuing to happen appears to be the “new normal”!  

Ford gov’t drops ball on undoing Liberals green regs

I was invited on the Marc Patrone Show on Sauga 960 AM this morning to chat about my latest post and you can listen to it on the Podcast at Sauga 960 AM. The start time is 28.40 and ends just after minute 40 of the podcast. 

link is:  https://sauga960am.ca/podcasts/

It is also posted on Newstalk Canada as: Ford gov’t drops ball on undoing Liberals green regs and if your are a member you can find it here:

Radical environmental cabal plots ‘green new deal’ for Canada

Once again Marc Patrone had me on as a guest on his Morning Show and the discussions were about the Strathmere Group members and their tremendous influence on the Justin Trudeau led government.

You can listen here to the Podcast at Sauga 960 AM for September 14, 2020 starting at 50.50 through to 01.04.02:

OR

here on NEWSTALK CANADA

Same suspects in Ontario green energy boondoggle now with Trudeau

Marc Patrone of Sauga 960 AM had me on his show to discuss what we may see when Trudeau delivers his Throne Speech before the end of the month. You can listen to the podcast starting  at 48:55 on September 8th and finishing at 1:01:26. Find it here under Marc’s show.

OR

Find it here at NEWSTALK CANADA

Marc Patrone Show: Will Trudeau/Butts radical environmental agenda derail over scandal?

Should you want to listen to the podcast of me on the Marc Patrone Show on NEWSTALK SAUGA 960 AM this morning (July 23, 2020) you can find in either on the podcast starting at 30.40 here:

Podcasts

or on the NEWSTALK CANADA website here:

Parker Gallant: Will Trudeau/Butts radical environmental agenda derail over scandal?

 

April 2020 Showered Ontario Ratepayers with More Costs than 2019

The IESO has recently released data consumption and costs for April 2020.  Needless to say, it brings ratepayers a continuation of bad news propagated by the previous Liberal government and their affection with renewable energy.

In line with the Covid-19 lock-down IESO reported grid connected Class A and Class B consumption fell this April from 10.683 TWh (terawatt hours) in 2019 to 9.781 TWh; an 8.4% drop.  The drop for Class A ratepayers (large industrial companies) was significant falling from 3.301 TWh in 2019 to 2.764 TWh in 2020 for a 16.3% drop (.537 TWh) whereas Class B (small/medium sized companies and residential) consumption fell from 7.382 TWh in 2019 to 7.017 TWh (.365 TWh), down 4.9%.

Despite the cumulative 8.4% drop in Ontario demand of .902 TWh however, the cost of consumption per MWh (megawatt hour) for both Class A and Class B ratepayers increased with the principal cause being a drop in the HOEP (Hourly Ontario Electricity Price) or “market price” and an increase in the GA or Global Adjustment.  Those events coincided with an increase in surplus generation exported to our neighbours at the HOEP price average of $5.78/MWh. Our “net exports” increased 662,000 MWh from 1,427,000 MWh to 2,089,000 MWh and the additional exports cost Ontario ratepayers about $75 million.  In April 2019 we exported 13,4% of what we consumed and in April 2020 it jumped to 21.4%.

Anyone involved in planning, no matter the industry, would suggest; IESO has done a horrible job of it! IESO presumably could however, turn around and suggest it was because of political interference by the McGuinty/Wynne governments their planning was obscured .

To a certain extent, many would be inclined to agree with the forgoing, as one particular type of generation played a major role in creating the expensive mess in Ontario’s electricity sector. It was mandated by the governing Liberals during their 15 years in power!  The particular generation causing most of the fiscal pain (in addition to solar) is of course industrial wind turbines (IWT) which are both unreliable and intermittent.  In both April 2019 and April 2020 wind generation drove up our costs of power and regardless of whether it’s accepted or curtailed, we are still obliged to pay for it.

Scott Luft tracks IESO data for wind and reviewing his spreadsheet for April 2019 indicates wind collectively (grid accepted, transmission accepted and curtailed) was about 1.453 TWh or 97% of our gross exports and in April 2020 wind (collectively) was 1.447 TWh and approximately 67.6% of our gross exports.

What the foregoing clearly shows is those bird and bat killing IWT were not needed and have damaged Ontario’s ability to both attract and retain our manufacturing base due to our expensive electricity prices.

IWT have been a detriment, not a benefit, to the province, including any notion they played a role in helping to close the coal plants!

As soon as this pandemic subsides the Ford government needs to focus their efforts on sorting out the electricity file to weed out expensive and wasteful renewable energy.

Interview on SAUGA 960AM Radio

I have been interviewed by veteran journalist and CRTC former Commissioner, Marc Patrone, the host of the Marc Patrone Show, from 9 AM to 11 AM weekdays on SAUGA 960 AM.  The interview; “Exposing the Green Scam” will be on his show tomorrow morning but I’m not sure when during those two hours.  I have tried to provide some history as well as some specifics on how we wound up with our very high cost electricity in Ontario.

I believe it will be also be available on the 960 AM podcast of his show later that day and also available on: NewstalkCanada.

Web link for SAUGA 960 AM is:

https://sauga960am.ca/timetable/event/the-marc-patrone-show/

The link for NewstalkCanada is:

http://newstalkcanada.wpengine.com/

Have a listen and take a break from the overly depressing Covid-19 news.

OPG’s Record Results for 2019

The Ontario Power Generation (OPG) announced their financial results March 12, 2020 for the year ended December 31, 2019 and the media appears to have been so focused on Covid-19 to even notice.  At first glance the $1,126 million of after-tax income reported appears to be less than 2018’s $1,195 million but the latter includes after-tax income of $205 million associated with the sale of the Lakeview Generating Station and unrelated to earnings from power generation.

Power generation was 77.8 TWh (terawatt hours) in 2019 versus 74 TWh in 2018 and gross revenue climbed by $485 million from $5,537 million to $6,022 million.  Payments, in lieu of taxes, were $190 million versus $141 million in 2019. All-in, the province will be able to include $1,316 million as revenue.  That, as Scott Luft points out, is a long way from covering the $5.5 billion in costs for the “Ontario Electricity Rebate”* (OER) for the upcoming March 31st year-end budget.

Noted in the financial report is the following: “The Enterprise Total Generating Cost (TGC) per megawatt hour (MWh) was $50.82 for 2019, compared to $53.24 for 2018.”  While it appears the claim in this statement is the cost of generating a MWh decreased on a year over year basis, OPG do not define what is included in the “TGC” calculation.  One should suspect a number of substantial costs, paid by ratepayers, are not included in the TGC!

This writer’s preference is to calculate the actual costs per MWh by simply dividing gross revenue by actual generation.  If one does that calculation for 2019 for OPG; the per MWh cost is simply $6,022 million (total revenue) divided by 77.8 TWh (generation reported).  Resulting from this calculation; the cost per MWh for 2019 was $77.40/MWh or 7.74 cents/kWh (kilowatt hour).  Ratepayers in the province would be happy if that was the average of TOU (time-of-use) rates, but ratepayers know, other factors played a role in increasing costs.  Wind and solar generation have driven prices up over the past 10 years by over 100% due to above market, contracted prices and the inability of wind and solar to generate power when it is actually needed causing us to export surplus generation for pennies on the dollar to our neighbours.

Looking back in OPG’s past is interesting.  If one reviews their financial statements for 2009 (the year the GEA was passed) the same calculation as noted above indicates a per MWh cost of $60.97 (6.1 cent/kWh). That means we have seen an increase of $16.43 per MWh or 26.9% over the 10 years!   Ontario’s inflation rate over those same 10 years was 17.97% so the cost of OPG’s generation over that time-frame was slightly above Ontario’s inflation rate.

While we can commend OPG for keeping their costs of generation at reasonable levels it is unclear why they suddenly went south of the border to acquire a string of hydro electric generating stations at a cost of C$1.12 billion. The acquisition of Cube Hydro (merged with Eagle Creek Renewable Energy) adds 627 MW of (mainly) hydro electric capacity but does absolutely nothing (on its surface) to benefit Ontario ratepayers.  As a provincial crown corporation their focus should be to ensure the delivery of cheap reliable power to Ontario ratepayers!

We ratepayers will need to keep our eyes fixed on OPG to ensure they don’t loose sight of their mission which is noted on their website as “ Ontario Power Generation’s mission is to provide low-cost power in a safe, clean, reliable and sustainable manner for the benefit of our customers and shareholder.”

*The OER replaced the Wynne led governments “Fair Hydro Plan” subsidizing rates for residential customers.

CanWEA and their many tipping points

Just a few days ago Robert Hornung, President of the Canadian Wind Energy Association, authored a post on the CanWEA website with the headline; “Ontario heading for a troubling investor-confidence tipping point.”  Hornung was alluding to the recent notice of cancellation of the Nation Rise industrial wind turbine project that had been under construction in North Stormont. The project had been ushered through the final approval process by the Wynne led government just days before the writ was dropped for the last provincial election. It was cancelled because it would cause serious and irreversible harm to the little brown bat (a species at risk).

What Mr. Hornung doesn’t seem to grasp was the “tipping point” for voters in the province was illustrated in the last provincial election when the ruling Ontario Liberal Party were tossed out, in large part, due to electricity costs more than doubling.  The rise in the cost of electricity, since the Green Energy Act was passed in 2009, was principally caused by above market wind and solar contracts handed out to mainly foreign companies.

An illustration of the above can be found by looking at just the December 2019 grid accepted and curtailed wind to see what it added to our electricity costs.  My friend Scott Luft uses IESO data to calculate grid accepted (TX) wind and estimates the distribution delivered (DX) as well as curtailed generation.  Along with that he records the market trading price or HOEP (Hourly Ontario Energy Price) when the wind is delivered.

For December 2019 TX and DX accepted wind was 1,504.3 GWh (gigawatt hours) and curtailed wind was 254.5 GWh.   At the price of accepted wind at $135/MWh and curtailed wind at $120/MWh, December’s wind contacts cost ratepayers about $233.5 million or 15.5 cents/kWh.

The likelihood of our exports for the month being higher than the accepted 1.5 TWh of wind is something, I would bet on, so we really didn’t need it.  What the market valued it at was (per Scott’s data) only 1.5 cents/kWh.  In other words, for every kilowatt hour of wind delivered it cost us 14 cents.  Now we should all see that as a “tipping point” and cancel even more contracts but that might prove upsetting to Mr. Hornung!

IESO just released their Annual Planning Outlook and it indicates: “There are enough existing and available resources to meet our needs for the next decade.”  The Outlook also links to a “Resource Adequacy” report that provides the seasonal effective capacity of all generation sources. Wind is rated at only 11% in the summer and 31% in the winter.  Typically, Ontario demand peaks in the summer so it is obvious IESO regard wind’s contribution during that high demand season as almost of no value. Even in winter peaks the 31% IESO suggests is their “effective capacity” is much less than wind generally provides during that season.  The reasoning behind the latter is its habit of generating power when it isn’t needed—in the middle of the night!  Mr. Hornung himself admitted the foregoing at their annual conference in Calgary when it was announced CanWEA will merge with CanSIA in an effort to somehow create synergy.

Hornung’s admission at their annual conference was no surprise to many but may have been one of the tipping points that may hopefully lead to more cancellations.  Those cancellations would save species at risk, reduce possible damage to aquifers, reduce health problems caused by the audible and inaudible noises emitted and save Ontario ratepayers hundreds of millions of dollars annually.

As far as Ontario ratepayers are concerned that would be a great “tipping point’!