The great Canadian boom in battery building flies right over Alberta and Saskatchewan.
Billions for battery plants and electric vehicle-making are going to Ontario, Quebec and British Columbia.
This is about political votes as much as electrical volts. Little electoral gain awaits Liberals and fellow-travelling NDP on the Prairies.
The cost of the mad rush to batteries is breathtaking. Ottawa acknowledges $37.7 billion in public spending just for three battery plants in Ontario and Quebec.
Even then, the Parliamentary Budget Office says the government can’t count straight. The real cost is $43.6 billion and that’s by no means final.
But projects keep coming. On Nov. 14 they announced a $1.05-billion battery plant for Maple Ridge B.C.
There’s no public money for the Prairies to actually make the batteries or the vehicles, but federal cash is pouring in to buy the finished goods.
Yes, Ottawa is deep into the business of both paying to produce a new product and paying to buy it. It’s economic engineering on a staggering scale.
The result could range from environmental triumph to a public sector mess that will echo long after Prime Minister Justin Trudeau is gone.
The City of Calgary will get the astonishing total of $325 million to buy 259 electric buses. That would replace only one-quarter of the city’s bus fleet of 1,028 vehicles.
On top of that, the city has borrowed $165 million from the Canada Infrastructure bank.
No electric buses will be on the road in Calgary for at least two years.
Edmonton is far ahead. But, as with the Oilers, the buses aren’t the glory ride everyone expected.
An Edmonton Journal story by Jackie Carmichael is cautionary for Canadian cities as well as Ottawa.
More than half of the city’s 60 electric buses are in the barn, stalled by lack of parts for repair and maintenance.
The American company that sold Edmonton the buses is in Chapter 11 bankruptcy protection. Edmonton is owed $1.3 million as well as parts. After spending $60 million on these buses, the city appears to be far down the list of creditors.
Edmonton spent $200,000 for blankets to keep the batteries warm. Winter cold has a big impact. The range of a bus on a full charge is only 117 kilometres, about enough for half a shift and just one-third the advertised distance.
“We do have a lot of trouble keeping those buses on the road,” a union official told the Journal.
Technical troubles are inevitable with change to a new industry. Nobody expected the Wright Brothers to produce an F-15 straight off.
But on the business side, Edmonton’s dilemma could be the first warning sign of what happens when companies join a government-funded gold rush.
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More than half of Edmonton’s $60-million electric bus fleet not roadworthy
Plan to electrify Calgary’s bus fleet gets $325M boost from feds
On top of that, the U.S. Inflation Reduction Act has triggered a huge wave of climate-related investment in the States. This puts the Liberals’ climate action plan in direct competition with the world’s largest economy.
From the desperate attempt to keep the NextStar battery plant in Windsor, it’s obvious that the only way to win is to outspend the Americans.
The initial deal was for $5 billion. When the South Korean backers of NextStar, notably LG, saw the American goodies on offer they threatened to back out.
The $5 billion became $15 billion, mostly in tax relief. Politicians in the region thought it was a wonderful idea.
Then the South Koreans said they must send in 1,500 skilled temporary workers for the start-up. Suddenly, cries erupted of unfairness to Canadian workers.
But the Liberals, if they read their own agreement, had to know this would happen.
The Harper Conservatives made the rule that allows it in 2015 when Leader Pierre Poilievre was employment minister.
So there is plenty of political embarrassment to go around here, but please try not to be alarmed. They will spend their way out of it.
Don Braid’s column appears regularly in the Herald