Monday, March 19, 2012

The real and painful effects of Climate Change on Ontario Part 2

In my last posting I discussed the erroneous prediction made by a consensus of weather forecasters from across North America for the winter of 2011 - 12.

Suppose you were a retailer in Ontario this past winter and you actually took seriously the prediction that the winter was going to be brutal, cold, and snowy. You acted on that prediction and pre-ordered extra snow blowers, shovels, snow-boots and other wintry paraphernalia. The erroneous predictions were based on computer models used by forecasters. Now your decision has left your business with a surfeit of winter stock and a cash flow problem. Too much cash is tied up in too much stock, and not enough cash is on hand to restock for the new season.

That very situation may have played out for retailers recently. Should they liquidate the excess stock at fire-sale prices and accept losses, or hold it until next winter while borrowing money for the new season? What to do?

This problem of course is mostly confined to the retailers, wholesalers and their employees. It is a risk of doing business. The general public may be advantaged by the potential fire-sale prices, but presumably they will not be affected by the problem because those businesses operate mostly in a free and voluntary market.

Unfortunately that is not the case with regard to the production of electricity in Ontario. The government of Ontario operates Ontario Power Generation (OPG) as a near monopoly for the production of electricity in Ontario.

When the McGuinty Liberals became the government in 2003, they completely accepted the United Nations IPCC forecasts for future catastrophic global warming (AGW) due to "excessive" carbon dioxide gas (CO2) emissions from fossil fuels. These forecasts were determined by a consensus of researchers using long range computer models and data that was collected.

Despite our normally cold winters and comparatively meagre population, Premier McGuinty's government ordered the shut down of most of the coal burning power generation stations in the Ontario. The purpose was to replace these low cost electricity producers with alternative high cost wind, and solar generators that do not produce CO2 (that was key). The McGuinty Liberals even offered inducements (FIT and MicroFIT) to landowners to construct these generators on their properties across the province. It worked, OPG now produces less and less electricity though the price of production continues to increase because of the high cost producers. Check out this recent column which details what is happening.

So, much like my hypothetical retail story above, and based on long range climate predictions that may or may not be correct,  the McGuinty Liberals have made a decision that affects all Ontario consumers now, and into the foreseeable future. It wouldn't be so bad if we had the choice today of opting out, but that's not the way things work in Ontario. Unless you are self-sufficient in electricity production, you are paying more and more because of McGuinty's actions and that trend will continue.

Interestingly the IPCC's predictions of five years ago can now be compared to reality. That is what the graph below shows.

The graph is taken from here. The graph's author contends that while the climate is currently warming slightly, there are other cycles unrelated to CO2 that cause variability. The blue area denotes the range of the variable cycles, the red and blue line denotes actual data, and the green area shows the IPCC 2007 projections for temperature. The yellow line shows the author's projections based on his theory (which is more in agreement with the real data).
It's a bit more complicated than that, but that is the gist of the graph. There is now a divergence between the real data and the IPCC projection that may increase with time. If it does, it just confirms my case that the McGuinty Liberals have acted prematurely and rashly. Ontario will suffer real economic pain from global warming, whether AGW is real or not. And because there is no free market in electricity production, we have all been coerced into this situation.

You might be asking how can I be certain that the McGuinty Liberals are assuming that CO2 is the cause of climate change? Watch this short video:    
Is there any doubt now? The Environmental Commissioner of Ontario, the Provinces' INDEPENDENT watchdog for environmental issues, has no doubt! Did he sound independent? Can you imagine a more bullshit job than this in government?

If you want more information about how your Ontario government is wasting tax revenues and borrowed money go here.    

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