Economy
Big Tech’s AI Dreams And Dems’ Electrification Push Are Keeping More Coal Online For Longer
From the Daily Caller News Foundation
By Nick Pope
Power-hungry data centers and Democrats’ broad electrification agenda are teaming up to keep more coal-fired capacity online for longer than initially projected, according to The Wall Street Journal.
Tech companies’ data centers, policies pushing adoption of products like electric vehicles (EVs) and heat pumps and manufacturing activity are quickly driving up electricity demand projections, forcing some utility companies to keep coal-fired power plants operational for longer than anticipated, according to the WSJ. In 2023, S&P Global Commodity Insights projected that the U.S. would retire about 133,000 megawatts of remaining coal capacity by 2035, but the organization’s 2024 outlook now anticipates that roughly 105,000 megawatts of coal-fired generation will be retired by that year.
“Utilities around the country are kind of going into panic mode” because they are finding themselves unprepared for surging power demand, Michelle Solomon, a senior policy analyst at Energy Innovation, told the WSJ. Nearly every regional power market in the U.S. increased their projections for five-year annualized electricity demand growth between 2022 and 2023, with the rate doubling in some instances.
Coal-fired power plants are also benefiting from the fact that green energy generation is not coming online fast enough to replace retiring fossil fuel capacity, according to the WSJ. Coal is a dirtier fuel source than alternatives like natural gas, but the artificial intelligence (AI) boom and Democrats’ push for electrification — an effort intended to counter climate change —are prolonging its use.
“The existing fleet [of fossil-fuel generators] needs to stick around longer and run harder,” Patrick Finn, an analyst at the energy-focused consultancy Wood Mackenzie, told the WSJ. This dynamic will likely be a headwind for cutting emissions, which has been a top domestic and international priority for the Biden administration.
The Biden administration has pursued policies that will drive up long-term electricity demand while making it more difficult to build reliable, cheap fossil fuel-fired capacity.
On the demand side, the administration has pushed policies that will substantially increase the number of EVs on the road and issued regulations that often favor electric appliances, in addition to incentivizing power-intensive manufacturing while the AI boom takes shape. In terms of supply, the Biden Environmental Protection Agency (EPA) has moved to reshape the American power grid by effectively mandating the installation of costly carbon capture and sequestration (CCS) technology for coal plants, requiring that these plants control 90% of their emissions by 2032 if they are to operate past 2039, according to the Center for Strategic and International Studies.
Economy
Ottawa’s new ‘climate disclosures’ another investment killer
From the Fraser Institute
By Matthew Lau
The Trudeau government has demonstrated consistently that its policies—including higher capital gains taxes and a hostile regulatory environment—are entirely at odds with what investors want to see. Corporate head offices are fleeing Canada and business investment has declined significantly since the Trudeau Liberals came to power.
According to the Trudeau government’s emissions reduction plan, “putting a price on pollution is widely recognized as the most efficient means to reduce greenhouse gas emissions.” Fair enough, but a reasonable person might wonder why the same politicians who insist a price mechanism (i.e. carbon tax) is the most efficient policy recently announced relatively inefficient measures such “sustainable investment guidelines” and “mandatory climate disclosures” for large private companies.
The government claims that imposing mandatory climate disclosures will “attract more private capital into Canada’s largest corporations and ensure Canadian businesses can continue to effectively compete as the world races towards net-zero.” That is nonsense. How would politicians Ottawa know better than business owners about how their businesses should attract capital? If making climate disclosures were a good way to help businesses attract capital, the businesses that want to attract capital would make such disclosures voluntarily. There would be no need for a government mandate.
The government has not yet launched the regulatory process for the climate disclosures, so we don’t know exactly how onerous it will be, but one thing is for sure—the disclosures will be expensive and unnecessary, imposing useless costs onto businesses and investors without any measurable benefit, further discouraging investment in Canada. Again, if the disclosures were useful and worthwhile to investors, businesses seeking to attract investment would make them voluntarily.
Even the government’s own announcement casts doubt that increasing business investment is the likely outcome of mandatory climate disclosures. While the government says it’s “sending a clear signal to corporate boards and shareholders, at home and around the world, that Canada is their trusted partner for putting private capital to work in the race to net-zero,” most investors are not looking to put private capital to work to combat climate change. Most investors want to put their capital to work to earn a good financial return, after adjusting for the risk of the investment.
This latest announcement should come as no surprise. The Trudeau government has demonstrated consistently that its policies—including higher capital gains taxes and a hostile regulatory environment—are entirely at odds with what investors want to see. Corporate head offices are fleeing Canada and business investment has declined significantly since the Trudeau Liberals came to power. Capital per worker in Canada is declining due to weak business investment since 2015, and new capital per-Canadian worker in 2024 is barely half of what it is in the United States.
It’s also fair to ask, in the face of these onerous polices—where are the environmental benefits? The government says its climate disclosures are needed for Canada to progress to net-zero emissions and “uphold the Paris climate target of limiting global warming to 1.5°C above pre-industrial levels,” but its net-zero targets are neither feasible nor realistic and the economics literature does not support the 1.5 degrees target.
Finally, when announcing the new climate disclosures, Trudeau Environment Minister Steven Guilbeault said they are an important stepping stone to a cleaner economy, which is a “major economic opportunity.” Yet even the Canada Energy Regulator (a federal agency) projects net-zero policies would reduce real GDP per capita, increase inflation of consumer prices and reduce residential space (in other words, reduce living standards).
A major economic opportunity that will increase business investment? Surely not—mandatory climate disclosures will only further reduce our standard of living and impose useless costs onto business and investors, with the sure effect of reducing investment.
Author:
Business
Premiers fight to lower gas taxes as Trudeau hikes pump costs
From the Canadian Taxpayers Federation
By Jay Goldberg
Thirty-nine hundred dollars – that’s how much the typical two-car Ontario family is spending on gas taxes at the pump this year.
You read that right. That’s not the overall fuel bill. That’s just taxes.
Prime Minister Justin Trudeau keeps increasing your gas bill, while Premier Doug Ford is lowering it.
Ford’s latest gas tax cut extension is music to taxpayers’ ears. Ford’s 6.4 cent per litre gas tax cut, temporarily introduced in July 2022, is here to stay until at least next June.
Because of the cut, a two-car family has saved more than $1,000 so far. And that’s welcome news for Ontario taxpayers, because Trudeau is planning yet another carbon tax hike next April.
Trudeau has raised the overall tax burden at the pumps every April for the past five years. Next spring, he plans to raise gas taxes by another three cents per litre, bringing the overall gas tax burden for Ontarians to almost 60 cents per litre.
While Trudeau keeps hiking costs for taxpayers at the pumps, premiers of all stripes have been stepping up to the plate to blunt the impact of his punitive carbon tax.
Obviously, Ford has stepped up to the plate and has lowered gas taxes. But he’s not alone.
In Manitoba, NDP Premier Wab Kinew fully suspended the province’s 14 cent per litre gas tax for a year. And in Newfoundland, Liberal Premier Andrew Furey cut the gas tax by 8.05 cents per litre for nearly two-and-a-half years.
It’s a tale of two approaches: the Trudeau government keeps making life more expensive at the pumps, while premiers of all stripes are fighting to get costs down.
Families still have to get to work, get the kids to school and make it to hockey practice. And they can’t afford increasingly high gas taxes. Common sense premiers seem to get it, while Ottawa has its head in the clouds.
When Ford announced his gas tax cut extension, he took aim at the Liberal carbon tax mandated by the Trudeau government in Ottawa.
Ford noted the carbon tax is set to rise to 20.9 cents per litre next April, “bumping up the cost of everything once again and it’s absolutely ridiculous.”
“Our government will always fight against it,” Ford said.
But there’s some good news for taxpayers: reprieve may be on the horizon.
Federal Conservative leader Pierre Poilievre’s promises to axe the carbon tax as soon as he takes office.
With a federal election scheduled for next fall, the federal carbon tax’s days may very well be numbered.
Scrapping the carbon tax would make a huge difference in the lives of everyday Canadians.
Right now, the carbon tax costs 17.6 cents per litre. For a family filling up two cars once a week, that’s nearly $24 a week in carbon taxes at the pump.
Scrapping the carbon tax could save families more than $1,200 a year at the pumps. Plus, there would be savings on the cost of home heating, food, and virtually everything else.
While the Trudeau government likes to argue that the carbon tax rebates make up for all these additional costs, the Parliamentary Budget Officer says it’s not so.
The PBO has shown that the typical Ontario family will lose nearly $400 this year due to the carbon tax, even after the rebates.
That’s why premiers like Ford, Kinew and Furey have stepped up to the plate.
Canadians pay far too much at the pumps in taxes. While Trudeau hikes the carbon tax year after year, provincial leaders like Ford are keeping costs down and delivering meaningful relief for struggling families.
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