Deal with Magna International and Magna E-Car builds more momentum for Ontario EV strategy

The Ontario government announced today it is working with Magna International and its majority-owned Magna E-Car division to assist in the development of a concept electric car, parts for hybrid and plug-in vehicles, components made of lightweight and bio-based materials, and an alternative energy project, details of which were not disclosed. The announcement is expected to lead to the creation of 738 new jobs and the protection of more than 1,300 jobs at Magna facilities in Aurora, Brampton, Concord and St. Thomas.

The government release didn’t mention dollars, but reports earlier in the day suggested that the government would be contributing $48 million toward what will be a $432 million R&D investment. This comes after a number of earlier EV-focused announcements, including Toyota’s disclosure last month that it will build its RAV4 electric vehicle at its plant in Woodstock, Ontario, and the government’s announcement a week later that it is creating an $80 million fund to help spur development and deployment of EV charging infrastructure in the province. Oh, and there was also the $2 million investment in Dana Holding Corp. toward building battery cooling systems for hybrid and plug-in vehicles.

A lot has happened in less than a month. Things are starting to come together… cautiously optimistic.


Tsk, tsk: Globe and Mail runs another misleading Wente column on green energy, electric vehicles

Okay, we all know Globe and Mail columnist Margaret Wente hates green energy, electric vehicles or any non-market efforts, really, to wean ourselves from fossil fuels. We know, even though she never discloses it (but should), that she’s on the board of directors of Energy Probe, a Canadian libertarian think tank that aggressively spreads its belief that climate change is a hoax and green energy such as wind and solar is a waste of time and resources. We also know that Wente likes to be a contrarian because it pumps up her profile. So I wasn’t so shocked when I read yet another column from her bashing the McGuinty government’s green energy policies, and in doing so, cherry picking the facts (or simply spinning them) to mislead her readers. What gets me, however, is how the editors at the Globe and Mail would let it into the paper, as is, and with the headline it was given.

BTW: Here’s my response to her last major assault on green energy back in April 2010.

Here’s my response to Wente’s most recent anti-green column, starting with the Globe’s headline: “Message to McGuinty: Most green-job schemes have been miserable failures.”

I can’t believe the headline writer and overseeing editor would allow the word “most” to make it into that headline. Wente doesn’t back up the “most” claim with any statistics, let alone credible ones. And the few examples she cites are small, based on someone else’s reporting (such as one problematic report in the New York Times) and/or come without any context.

Now, here’s Wente’s opening two paragraphs:

Dalton McGuinty has hit the campaign trail, and he’s paving it green. Earlier this month he announced that Ontario will pump $80-million into building charging stations for electric cars. “They are peppy, they are quiet, and the thing that I like best as a father, and ultimately a grandfather, I would hope, is that they’re clean,” he said. By 2020, he hopes, one out of 20 cars in Ontario will be electrically powered.

Meantime, Costco, the giant retailer, has pulled the plug on its electric car-charging stations, which it had installed in its California parking lots. The reason is that nobody uses them. Even China – which promised it would leapfrog the world in electric-car development – is backing off.

First, Costco is removing chargers that were installed back when GM introduced its EV1 electric vehicle to the market in the 1990s, before the cars were crushed and shredded. Costco says the chargers aren’t used, but that’s largely because electric vehicles only began hitting the market this year and the chargers that are in place are outdated (i.e. based on old standards) or simply stopped working, as you’ll read further down in this Daily Mail story.  Second, Costco is just one company seemingly going against the grain at a time when dozens of others, including Best Buy, IKEA, Walgreens and Lowe’s, are adding them. Personally, I don’t think retail stores are ideal places for EV charging systems, but the fact that so many big brand operations are beginning to test them and deploy them is a good sign. For Wente to cite the Costco decision as proof that EV charging systems, and thus electric vehicles, are being abandoned is quite the stretch. Also completely wrong is her unsupported comment that the Chinese are “backing off.” How she came to this conclusion is beyond me, but perhaps she didn’t read China’s 12th five-year plan. By 2015 China plans to have 4,000 charging stations and growth is expected to increase rapidly from there with plans to invest nearly $5 billion in charging infrastructure by 2020, at which point the country will have at least 10,000 public state-run charging locations, not including the tens, possibly hundreds of thousands of private home and business charging stations that are expected to emerge. That doesn’t sound like backing off.

Indeed, research firm Pike Research projected last week that there will be 7.7 million charging stations for EVs located in homes, workplaces and public spaces worldwide by 2017, with about 1.5 million of them located in the United States. So much for backing off. I’ll admit that’s an ambitious prediction, but the trend is clear — yet Wente cites a decision by Costco to remove obsolete charging systems as proof that the market for EVs and their associated charging infrastructure is fading.

The rest of the world has begun to discover that the green dream is a mirage. Across the U.S., federal, state and city governments have poured zillions into green schemes. Most have been miserable failures.

The city of Seattle, for example, got $20-million from the U.S. Department of Energy to retrofit houses and make them more energy efficient. The money was supposed to create 2,000 jobs and retrofit at least 2,000 homes. But by this month, only three homes had been retrofitted and only 14 jobs created. Even the greens admit the program is a total flop.

There’s that “most” word again, as in “most have been miserable failures.” She’s referring both generally to green energy initiatives spearheaded by government and specifically to a small $20-million household retrofit program in Seattle that didn’t deliver promised results. Forget that maybe, just maybe this specific program was mismanaged. So what? I mean, programs — private or public — get mismanaged and don’t produce results all the time. Hey, the market even screws up, too. You know, like how mismanagement by U.S. and European banks led to a worldwide financial crisis? No mention of that, of course. Also no mention of how successful the Canadian federal government’s EcoEnergy home retrofit program was before it was cancelled in 2010. In all, Ottawa committed $750 million to a program that encouraged Canadians to spend $4 billion of their own money. In doing so, those Canadians will save an average of $340 million a year every year on their energy bills — all of it money that will be reinvested in the Canadian economy each year. Also, the $4 billion spent by homeowners generated $250 million in GST revenue for the government. All of this also created thousands of jobs, contributing even more tax revenue to Ottawa. How can that be categorized as a miserable failure? It can’t, which is why Wente didn’t mention it — it didn’t fit with her message or her goal, which is to poke holes in the McGuinty government’s green energy and electric vehicle strategy and give momentum to the opposition PC party as a provincial election approaches.

In Massachusetts, the state government poured $58-million into a company called Evergreen Solar Inc. But Evergreen couldn’t compete with cheaper solar panels made in China. In March it closed its factory and laid off 800 people, and this month it declared bankruptcy. In Salinas, Calif., a company called Green Vehicles received a couple of million dollars in government grants to develop an electric car for freeways. It too went under. The mayor says the city will think twice before investing in other startups, regardless of how many jobs they’re supposed to create.

Yes, yes, companies go bankrupt, struggle, lay off people, often because they can’t compete with China or are simply poorly run. These companies are everywhere — biotech, information technology, Internet, automotive, etc., and more so with the U.S. economy continuing to struggle. So Wente cites a company that got lots of U.S. government money but simply couldn’t hit the home run it expected. Is that our standard now? That every bit of public investment MUST result in success? If that’s the case, hell — better shut off the tap that flows to the automotive, forestry and oil and gas sectors, eh? Here’s the thing: the U.S. is actually doing okay competing against the Chinese in solar. It’s exporting more solar product than it’s importing, contrary to popular belief.

Green projects, it turns out, don’t create many jobs, and those jobs are costly. Barack Obama recently visited a plant in Michigan to tout its investment in new battery technology. The plant got grants of $300-million, and expects to create 150 new jobs. That works out to $2-million a job. Then there’s SolFocus, a company in San Jose, Calif., that produces solar panels. The mayor called it an “enormously important” development for the city’s economy,” The New York Times reported. But the company assembles its solar panels in China, and its new headquarters employs just 90 people.

During his 2008 campaign, Mr. Obama promised to create five million green jobs over the next decade. But as The New York Times reported last week, “federal and state efforts to stimulate creation of green jobs have largely failed.”

At this point Wente hasn’t established that green projects don’t create jobs, but she goes ahead and makes this statement anyway, giving only a tiny snapshop of job creation by mentioning two more ventures — one an electric vehicle battery maker and the other a maker of solar panels. She talks about how one government investment in a battery maker worked out to $2-million a job, though she doesn’t talk about future job growth at that company that was seeded by this government money — she only talks about the situation as it stands today so early in the birth of this new market. And this is where Wente goes off tracks, referring to a recent New York Times report that was clearly the inspiration for her column in the first place. That is, she waited for a juicy story in a more left-leaning U.S. newspaper like the Times and used it as a way to legitimize her own biases on the green energy topic. After all, it’s juicy to quote the Times saying “federal and state efforts to stimulate creation of green jobs have largely failed.”

But the Times article was also a failure of journalism. As Joe Romm points out at Climate Progress, isn’t it kind of strange to declare a program a failure about two or three years into a 10-year mandate? As Romm writes, “Imagine if, in 1963, two years after JFK’s famous speech to Congress, the New York Times had run a story, ‘Space program fails to live up to promise.'” Let’s keep in mind as well that the space program wouldn’t have gone far either if, during that time, a U.S. Congress filled with anti-science, anti-government Tea Partiers prevented the flow of money into Kennedy’s vision. Obama’s goal is achievable but not when such programs are consistently under attack by state and federal legislators who have only one objective: to defeat and humiliate the U.S. president. This is Wente’s objective with respect to McGuinty, who is also facing resistance but has actually delivered so much more: 20,000-plus green jobs, and counting. Is that a failure? Wente mentions that job count, but she doesn’t directly call it a failure, preferring instead to breeze over results in Ontario and focus on negative outcomes in the U.S. market.

Maybe he should take a look at Spain, which also set out to become the solar-power capital of the world. Everything went fine, so long as the subsidies kept flowing. But when the world economy went south, the Spanish government couldn’t afford them any more and pulled the plug. Bye, bye solar, and bye, bye jobs. By one reckoning, Spain spent half a million euros for each green job it created.

The moral of the story is as clear as a row of giant wind turbines on the horizon. Governments that invest in risky, expensive and unproven technologies will probably lose big. The only way they are able to lure private investment is with generous subsidies and long-term contracts. And even then, the failure rate is high. Ontario has already attracted its share of “suitcase” companies that are here so long as the money flows, and not a moment longer. And when they go belly-up, guess who’s stuck with the bills?

It’s predictable that Wente again trots out the Spanish example, which she also used in her wind-bashing column a year earlier. It’s the only example she can really offer up, largely because Spain’s solar market did in fact go through troubles and it is one cautionary tale that’s worth learning from. However, Spain is not representative of the market and its health. Wente neglects to mention countries that are thriving, how quickly solar costs are falling, how worldwide investment in solar continues to grow at a healthy pace, and how Ontario solar manufacturers are saying they can deal with a 30 per cent reduction in the feed-in-tariff rate as part of a plan to eventually eliminate incentives. No question Ontario could have done a better job executing its green-energy programs, and while there may be the occasional dud along the way, what this province is doing is investing in a future that Wente apparently can’t see or appreciate, or maybe doesn’t want.

By the way, to call solar and wind and electric vehicles “unproven” technology is, well, wrong. This stuff works, and it works well. It’s no less proven than the iPhone or BlackBerry Wente carries on her hip. Is it risky? Yes, because the deck is stacked against it and folks like Wente don’t make it any easier. But risk is also a matter of perception. I mean, drilling deep in the Gulf of Mexico or North Sea is risky, and so is investing in the oil sands, and so is sending people deep underground to mine for coal.

Anyway, none of this is going to change Wente’s mind. But I do expect better journalism from her, at least on this issue. And I do expect the editors of the Globe and Mail to challenge unsubstantiated claims, even if they come from columnists.

How to create (and destroy) a solar PV export industry, Ontario-style

Been away on vacation and largely unplugged, so apologies for the content dead zone for the past week. Just to get things started again, here is my Clean Break column from last week’s Toronto Star. It takes a look at both the real potential of creating a solar PV export market in Ontario and the many reasons it will now be an uphill struggle. See below:


Tyler Hamilton

Here’s a question I get asked all the time: Can solar modules made in Ontario compete in a global marketplace?

Many have their doubts, and those doubts are grounded in reality. The solar photovoltaic modules coming off Ontario assembly lines today are probably not going to find many customers in Europe or the United States.

The key word being “today.”

But give it two or three years. That’s the answer I get from manufacturers that have set up shop in this province, lured by a generous renewable energy purchase program that pays top dollar for electricity produced from solar panels.

We can get our costs down, they say — just give us the breathing room to do it.

That was the whole point of the province’s feed-in tariff (FIT) program. It was designed to provide above-market incentives for the first few years, after which rates would fall, owing to declining technology costs and manufacturing efficiencies that come from volume production.

Knowing the party won’t last, many Ontario manufacturers would ostensibly work to drive down their costs to where they could sell product in the United States and Europe at a globally competitive price-point.

All of that, however, was based on some assumptions. First, most manufacturers assumed a certain demand. Second, they assumed the Ontario grid could accommodate that demand. And third, they expected the program would survive long enough to follow through on their business plans.

The demand part happened. Ontario’s FIT program has resulted in contract offers for more than 1,300 megawatts of solar, exceeding most market forecasts. For example, Spanish solar-module manufacturer Siliken established a plant in Windsor based on the expectation that there would be a need for 400 megawatts of solar panels annually in Ontario.

But things fall apart after that. The program has been in effect for nearly two years, and so far only 10 megawatts worth of large projects have been built and injecting electrons into the grid, according to the latest figures from the Ontario Power Authority.

This may be a bit confusing. The province boasts the largest solar PV facility in the world in Sarnia, rated at 80 megawatts. How could we have built only 10 megawatts?

It turns out most of the solar development in Ontario over the past two years is the result of an earlier initiative, one that didn’t have domestic content rules. In other words, no manufacturers had to lay roots in Ontario to tap into market demand. That’s why panels for the Sarnia project came from U.S.-based First Solar and were made in Michigan.

The newer FIT program does require some domestic content, which is why we now have 18 solar manufacturers in Ontario. To their frustration, they see big demand for their product but their customers can’t get approval to connect their projects to the grid. No connection means no purchase order.

Manufacturers, for good reason, blame Hydro One for dragging its feet. In the meantime, assembly lines have been shut down and employees have been laid off until projects start flowing. Not the kind of environment in which product costs can be reduced and efficiencies gained.

“We came here thinking we could use the local market to support us while we brought our factories up and wrung efficiencies out of systems, getting us closer to competing against our brothers and sisters in China,” says Milfred Hammerbacher, president of Canadian Solar Solutions, whose parent company operates primarily out of China.

“We thought it would be achievable. But we needed two years to get to that level, and right now we’re just not getting that cushion. In a start-up operation where you have two or three of your lines not being used, there’s no way you can come close to being competitive (globally).”

Canadian Solar is committed to getting through this rough patch, as is Siliken. Many, however, are thinking seriously about packing up their bags and moving back home to their corporate parents.

It doesn’t help that Ontario Progressive Conservative Leader Tim Hudak wants to cancel the program if elected, pulling the rug from under a promising industry that’s already off balance. Thousands of jobs are at risk, as well as an export sector that — despite the spears we keep throwing at it — still has the potential to thrive if we’d let it.

“We set up in Windsor with the intention to serve the northeast of the U.S.,” says Paco Caudet, Siliken’s general manager in Canada. He just sold his flat in Spain. “I plan to stay here.”

It’s a courageous attitude. Still, why do we make it so easy for them to come, then turn around and make it so difficult for them to stay?

Tyler Hamilton, author of Mad Like Tesla, writes weekly about green energy and clean technologies. Contact him at

Rogers Communications tip-toes into home energy management market through new “smart home” monitoring service

I mentioned this was coming, but Rogers Communications has made it official: it has now started offering a smart home monitoring service to its customers in Ontario, and as part of this service it can give users the ability to (remotely) control in-house lighting, heating/cooling settings, and certain appliances as part of a broader home automation package, which wisely puts the emphasis on home security — something homeowners are more likely to pay for. As expected, the platform behind this service offering is iControl, which Rogers invested in back in June.

Here’s how Rogers describes it: “At the heart of the system is an ultra-rugged, easy-to-use touchpad that consumers use to arm/disarm and manage their system. Available in wall-mount or table-top, the touchpad provides quick 1-touch access to home security functions, home automation apps for lighting, cameras and thermostats as well as multimedia apps for photos, traffic, weather and sports. When an alarm occurs, the touchpad instantly connects with the Rogers central monitoring station simultaneously over both Rogers cable and wireless networks. The touchpad constantly communicates with its highly encrypted smart sensors throughout the home, checking their status, signal strength, battery level and even room temperature.”

The customer can control the systems through a wireless device, such as an iPhone, and alternatively, the customer can get alerts on his/her wireless device via text message or e-mail.

Sounds quite comprehensive, and certainly using this kind of platform makes it easier for Rogers to add new sensors and services to the mix as its customer base becomes more comfortable with the system. Now, the issue of cost. This doesn’t come cheap. You can get the starter kit for $149 if you sign up for a three-year term, which isn’t a bad deal given that most people usually stick with the security services they choose. (If you don’t sign a multi-year deal, the kit will cost $749).  Monthly plans start at $39.99 for basic service, and sensors can be added on an a-la-carte basis or as part of “value packs” that can be purchased at a discount. You also can’t install the system yourself, so there’s also a one-time installation fee of $99.

Then again, if home security is the focus and the rest is gravy, then maybe consumers won’t balk at the cost. Whatever the outcome, I’m glad Rogers is testing the waters with this because I truly believe this is the only way energy management technologies will be widely introduced into the residential market. Here’s a Rogers video explaining the service here (notice the big emphasis on security).

Shrinking “bioproducts” sector a worrisome trend in Canada, but Ontario is holding its own

My Clean Break column this week reports on a new study out of the Richard Ivey School of Business, which takes a look at the state of the bioproducts industry in Canada. The researchers behind the report analyzed Statistics Canada data between 2003 and 2009 and what they found was a disturbing negative trend — the industry is shrinking, not growing, at a time when bioproducts are desperately needed as part of a strategy to reduce our dependence on fossil fuels; also at a time when the United States and other regions are showing a strong commitment to bioproducts and are enjoying the associated growth.

What’s going on? Well, for one the bulk of bioproducts made in Canada are first-generation biofuels, such as corn ethanol, or other forms of bioenergy. We don’t give enough support to biochemistry research and product development, or higher value non-fuel markets such as alternative plastics, which in my view are much more exportable down the road. We are throwing money at corn ethanol and not doing enough to support and help commercialize next-generation biofuels produced from algae or cellulosic conversion technologies.

I’m pasting my column below, though before you read there are some caveats here. The data analyzed doesn’t cover the past two years, so there may be some positive signs not accounted for in this report. Also, Ontario appears to be doing much better than the rest of Canada, though this is not to suggest there’s enough being done in Ontario. Anyway, I think this report is an important wake-up call for Canada. Sure, we’re blessed with forestry and agricultural resources, but are we satisfied just growing and selling commodities? Are we going to continue down the path of selling our raw natural resources to other countries, only to purchase it all back in the form of higher-value products? Once again, Canada lacks a vision and has no real plan to lead the world on bioproduct development, even though it has the capacity to do so. Click below to read the full column: Continue reading Shrinking “bioproducts” sector a worrisome trend in Canada, but Ontario is holding its own