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Ontario Global Adjustment Supreme Court Appeal spotlights a constitutional challenge to Ontario's electricity charge, pitting National Steel Car against the IESO over regulatory charge vs tax, procurement policy, and renewable energy feed-in tariff contracts.

Key Points

An SCC leave bid on whether Ontario's global adjustment is a valid regulatory charge or an unconstitutional tax.

✅ Appeals Court revived case for full record review

✅ Dispute centers on regulatory charge vs tax classification

✅ FIT renewables contracts and procurement policies at issue

The Ontario government wants the Supreme Court of Canada to weigh in on a constitutional challenge being brought against a large provincial electricity charge, a case the province claims raises issues of national importance.

Ontario’s attorney general and its Independent Electricity System Operator applied for permission to appeal to the Supreme Court in January, according to the court’s website.

The province is trying to appeal a Court of Appeal decision reinstating the challenge from November that said a legal challenge by Hamilton, Ont.-based National Steel Car Ltd. should be sent back to a lower-court for a full hearing.

Court reinstates constitutional challenge to Ontario's hefty ‘global adjustment’ electricity charge
National Steel Car appealing decision in legal challenge of Ontario electricity fee it calls an unconstitutional tax
Doug Ford’s cancellation of green energy deals costs Ontario taxpayers $231 million
National Steel Car launched its legal challenge in 2017, with the maker of steel rail cars claiming the province’s global adjustment electricity charge was a tax intended to fund certain post-financial-crisis policy goals. Since it is allegedly a tax, and one not imposed by the provincial legislature, the company’s argument is the global adjustment is unconstitutional, and also in breach of a provincial law requiring a referendum for new taxes.

The global adjustment mostly bridges the gap between the province’s hourly electricity price and the price guaranteed under contracts and regulated rates with power generators. It also helps cover the cost of building new electricity infrastructure and providing conservation programs, but the fee now makes up most of the commodity portion of a household power bill in the province.

Ontario argued the global adjustment is a valid regulatory charge, and moved to have National Steel Car’s challenge thrown out. An Ontario Superior Court judge agreed, and dismissed the challenge in 2018, saying it was “plain, obvious and beyond doubt” it could not succeed. However, an appeals court judge disagreed, writing in a decision last November that the “merits should not have been determined on a pleadings motion and without the development of a full record.”

In filings made to the Supreme Court, both the IESO and Ontario’s Ministry of the Attorney General argued their proposed appeals raise “issues of national and public importance,” such as whether incorporating environmental and social policy goals in procurement could turn attempts by a public body to recover costs into an unconstitutional tax.

Most applications for leave to appeal to the Supreme Court are dismissed, but the Ontario government claims the court’s guidance is required in this case, as it could lead to questions being raised about other fees or charges, such as money raised from fishing licences.

“A failure to dispose of this claim at the pleadings stage may well result in such uncertainty that public authorities across Canada decline to incorporate the kind of environmental and social policy goals objected to in this case into the decisions they make about how to spend funds raised from regulatory charges,” the filing from the attorney general states. “Alternatively, it may induce governments not to engage in cost recovery in connection with publicly supplied goods and services, which can otherwise be sound public policy.”

The government has so far had to pay National Steel Car $250,000 in legal costs “to avoid responding to the credible claim that the Global Adjustment is an unconstitutional tax,” said David Trafford of Morse Shannon LLP, one of National Steel Car’s lawyers.

“The application for leave to appeal is the next step in this effort to avoid having to respond to the case on the merits,” Trafford added in an email.

The application for leave to appeal is the next step in this effort to avoid having to respond to the case on the merits

David Trafford of Morse Shannon, one of National Steel Car’s lawyers
 
National Steel Car has particularly taken issue with the part of the global adjustment that funded contracts for renewable energy under a “feed-in tariff” program, or FIT, which the company called “the main culprit behind the dramatic price increases for electricity.”

The FIT program has been ended, but contracts awarded under it remain in place and form part of the global adjustment. Ontario’s auditor general estimated in 2015 that electricity consumers would pay $9.2 billion more for renewable energy under the government’s guaranteed-price program, a figure that later featured in a dispute between the auditor and the electricity regulator that drew political attention.

National Steel Car said its global adjustment costs grew from $207,260 in 2008 to almost $3.4 million in 2016, reflecting how high electricity rates have pressured manufacturers, to almost $3.4 million in 2016. For 2018, there was approximately $11.2 billion in global adjustment collected, according to the IESO’s reporting.

A spokesperson for the IESO said it “is not in a position to comment” because the case is still before the courts.

Electricity prices have been an ongoing problem for both Ontario consumers and politicians, which the previous Liberal government tried to address in 2017 by, among other things, refinancing global-adjustment costs through the Fair Hydro Plan and other measures.

Since National Steel Car filed its lawsuits, though, the Liberals lost power in the province and were succeeded in 2018 by Premier Doug Ford and the Progressive Conservatives, who made changes to the previous government’s power policies, including legislation to lower electricity rates introduced early in their mandate.

The province has also pursued interprovincial power arrangements, including building on an electricity deal with Quebec as part of its broader energy strategy.

“The present government of Ontario does not agree with the former government’s electricity procurement program, which ceased awarding new contracts in 2016,” Ontario’s attorney general said in a filing. “However, Ontario submits that (the lower-court judge) was correct in holding that it does not give rise to a claim susceptible to being remedied by the courts.”

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Germany EV Subsidy Cut triggers budget-crisis fallout in the automotive industry, after a constitutional court ruling; EV incentives end, threatening electromobility adoption, manufacturer competitiveness, 2030 targets, and demand amid Chinese competition and weak global growth.

Key Points

A sudden end to Germany's EV incentives due to a budget shortfall after a court ruling, hurting automakers and adoption.

✅ Ends buyer rebates amid budget crisis ruling

✅ Risks 2030 EV targets and industry competitiveness

✅ Weak demand and China competition intensify

The German government has faced a backlash after abruptly ending an electric car subsidy scheme in a blow to the already struggling automotive industry.

The scheme is one of the casualties of a budget crisis caused by a shock constitutional court ruling in November that upended the government's spending plans.

The economy ministry said Saturday that Sunday would be the last day prospective buyers could apply for the scheme, which paid out thousands of euros per customer to partially cover the cost of buying an electric car today.

A spokesman for the ministry admitted it was an "unfortunate situation" for consumers who had been hoping to take advantage of the subsidy, but it had no choice "because there is no longer enough money available."

Analyst Ferdinand Dudenhoeffer from the Center for Automotive Research warned the decision could have dramatic consequences amid a Europe EV slump already pressuring demand.

"The competitiveness of [auto] manufacturers will now be severely damaged," Dudenhoeffer told the Rheinische Post newspaper.

The Handelsblatt business daily had already warned that scrapping the scheme risked jeopardizing Germany's plans to get 15 million electric cars on the road by 2030, even though the EU EV share grew during lockdowns earlier in the pandemic.

"This goal was already considered extremely unrealistic. Now it seems completely illusory," it wrote.

In the UK, analysts warn that electric cars could cost more if a post-Brexit deal is not reached, underscoring wider market uncertainties.

A total of around 10 billion euros ($1.1 billion) has been paid out since 2016 under the scheme for around 2.1 million electric vehicles, according to the economy ministry.

Germany's flagship automotive industry, including Volkswagen, has been struggling with the transition to electromobility due to a weak global economy and low levels of demand.

In addition, it is facing a serious challenge from homegrown rivals in China, one of its most important markets, as France moves to discourage Chinese EVs with new rules.

"The Chinese are massively expanding their car industry because they have customers. Our manufacturers no longer have any," Dudenhoeffer said, as France's incentive rules make the market tougher for Chinese brands.

Germany's highest court decided last month that the government had broken a constitutional debt rule when it transferred 60 billion euros earmarked for pandemic support to a climate fund.

The bombshell ruling blew a huge hole in spending plans and plunged Chancellor Olaf Scholz's three-way coalition into turmoil.

After adopting an emergency budget for 2023, Scholz and his junior coalition partners battled for weeks before finally finding an agreement for 2024.

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Nithi Mountain Wind Project delivers 200 MW of renewable wind power in British Columbia under a BC Hydro electricity purchase deal, producing 600 GWh yearly, led by Stellat'en First Nation and Innergex.

Key Points

A 200 MW wind farm in British Columbia producing 600 GWh yearly, co-owned by Stellat'en First Nation and Innergex.

✅ 30-year BC Hydro take-or-pay PPA, CPI-indexed

✅ 200 MW capacity, ~600 GWh per year for ~60,000 homes

✅ 51% Stellat'en First Nation; operations targeted for 2030

In December 2024, a significant development unfolded in British Columbia's renewable energy sector, where the clean-energy regulatory process continues to evolve, as Stellat'en First Nation and Innergex Renewable Energy Inc. announced the signing of a 30-year electricity purchase agreement with BC Hydro. This agreement pertains to the Nithi Mountain Wind Project, a 200 MW initiative poised to enhance the province's clean energy capacity.

Project Overview

The Nithi Mountain Wind Project is a collaborative venture between Stellat'en First Nation, which holds a 51% stake, and Innergex Renewable Energy Inc., which holds a 49% stake. Located in the Bulkley-Nechako region of British Columbia, the project is expected to generate approximately 600 GWh of renewable electricity annually, comparable to other large-scale projects like the 280 MW wind farm in Alberta now online, sufficient to power around 60,000 homes. The wind farm is scheduled to commence commercial operations in 2030.

Economic and Community Impact

This partnership is anticipated to create approximately 150 job opportunities during the development, construction, and operational phases, thereby supporting local economic growth and workforce development, and aligns with recent federal green electricity procurement efforts that signal broader market support. The long-term electricity purchase agreement with BC Hydro is structured as a 30-year take-or-pay contract, indexed to a predefined percentage of the Consumer Price Index (CPI), ensuring financial stability and protection against inflation.

Environmental and Cultural Considerations

The Nithi Mountain Wind Project is being developed in close collaboration with First Nations in the area, guided by collaborative land-use planning. The project integrates cultural preservation, environmental stewardship, and economic empowerment for Indigenous communities in the Bulkley-Nechako region, while other solutions such as tidal energy for remote communities are also advancing across Canada. The project is committed to minimizing environmental impact by avoiding sensitive cultural and ecological resources and integrating sustainability at every stage, with remediation practices to restore the land, preserve cultural values, and enhance biodiversity and wildlife habitats if decommissioned.

Broader Implications

This agreement underscores a growing trend of collaboration between Indigenous communities, exemplified by the Ermineskin First Nation project emerging nationwide, and renewable energy developers in Canada. Such partnerships are instrumental in advancing sustainable energy projects that respect Indigenous rights and contribute to the nation's clean energy objectives, as renewable power developers find that diversified energy sources strengthen project outcomes. The Nithi Mountain Wind Project exemplifies how integrating traditional knowledge with modern renewable energy technologies can lead to mutually beneficial outcomes for both Indigenous communities and the broader society.

In summary, the Nithi Mountain Wind Project represents a significant step forward in British Columbia's renewable energy landscape, highlighting the importance of collaboration between Indigenous communities and renewable energy developers. The project promises substantial economic, environmental, and cultural benefits, setting a precedent for future partnerships in the clean energy sector, as large-scale storage acquisitions like Centrica's battery project illustrate complementary pathways to unlock wind potential.

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Germany Nuclear Power Extension debated as Olaf Scholz weighs energy crisis, gas shortages from Russia, slow grid expansion in Bavaria, and renewables delays; stress test results may guide policy alongside coal plant reactivations.

Key Points

A proposal to delay Germany's nuclear phaseout to stabilize power supply amid gas cuts and slow grid upgrades.

✅ Driven by Russia gas cuts and Nord Stream 1 curtailment

✅ Targets Bavaria grid bottlenecks; renewables deployment delays

✅ Decision awaits grid stress test; coalition parties remain split

The German chancellor on Wednesday said it might make sense to extend the lifetime of Germany's three remaining nuclear power plants.

Germany famously decided to stop using atomic energy in 2011, and the last remaining plants were set to close at the end of this year.

However, an increasing number of politicians have been arguing for the postponement of the closures amid energy concerns arising from Russia's invasion of Ukraine. The issue divides members of Scholz's ruling traffic-light coalition.

What did the chancellor say?
Visiting a factory in western Germany, where a vital gas turbine is being stored, Chancellor Olaf Scholz was responding to a question about extending the lifetime of the power stations.

He said the nuclear power plants in question were only relevant for a small proportion of electricity production. "Nevertheless, that can make sense," he said.

The German government has previously said that renewable energy alternatives are the key to solving the country's energy problems.

However, Scholz said this was not happening quickly enough in some parts of Germany, such as Bavaria.

"The expansion of power line capacities, of the transmission grid in the south, has not progressed as quickly as was planned," the chancellor said.

"We will act for the whole of Germany, we will support all regions of Germany in the best possible way so that the energy supply for all citizens and all companies can be guaranteed as best as possible."

The phaseout has been planned for a long time. Germany's Social Democrat government, under Merkel's predecessor Gerhard Schröder, had announced that Germany would stop using nuclear power by 2022 as planned.

Schröder's successor Angela Merkel — herself a former physicist — had initially sought to extend to life of existing nuclear plants to as late as 2037. She viewed nuclear power as a bridging technology to sustain the country until new alternatives could be found.

However, Merkel decided to ditch atomic energy in 2011, after the Fukushima nuclear disaster in Japan, setting Germany on a path to become the first major economy to phase out coal and nuclear in tandem.

Nuclear power accounted for 13.3% of German electricity supply in 2021. This was generated by six power plants, of which three were switched off at the end of 2021. The remaining three — Emsland, Isar and Neckarwestheim — were due to shut down at the end of 2022. 

Germany's energy mix 1st half of 2022
The need to fill an energy gap has emerged after Russia dramatically reduced gas deliveries to Germany through the Nord Stream 1 pipeline, though nuclear power would do little to solve the gas issue according to some officials. Officials in Berlin say the Kremlin is seeking to punish the country — which is heavily reliant on Moscow's gas — for its support of Ukraine and sanctions on Russia.

Germany has already said it will temporarily fire up mothballed coal and oil power plants in a bid to solve the looming power crisis.

Social Democrat Scholz and Germany's energy minister, Robert Habeck, from the Green Party, a junior partner in the three-way coalition government, had previously ruled out any postponement of the nuclear phasout, despite debate over a possible resurgence of nuclear energy among some lawmakers. The third member of Scholz's coalition, the neoliberal Free Democrats, has voiced support for the extension, as has the opposition conservative CDU-CSU bloc.

Berlin has said it will await the outcome of a new "stress test" of Germany's electric grid before deciding on the phaseout.

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Canada Electric Vehicle Adoption is accelerating as EV range doubles, fast-charging networks expand along the Trans-Canada Highway, and drivers shift from internal combustion to clean transportation to cut emissions and support climate goals.

Key Points

Canada Electric Vehicle Adoption reflects rising EV uptake, longer range, and expanding fast-charging infrastructure.

✅ Average EV range in Canada has nearly doubled in six years.

✅ Fast chargers expanding along Trans-Canada and major corridors.

✅ Gasoline and diesel demand projected to fall sharply by 2040.

As green technology for vehicles continues to grow in popularity, with a recent EV event in Regina drawing strong interest, attendance at a seminar in southern Alberta Wednesday showed plenty people want to switch to electric.

FreeU, a series of informal education sessions about electric power and climate change, including electricity vs hydrogen considerations, helped participants to learn more about the world-changing technology.

Also included at the talks was a special electric vehicle meet up, where people interested in the technology could learn about it, first hand, from drivers who've already gone gasless despite EV shortages and wait times in many regions.

"That's kind of a warning or a caution or whatever you want to call it. You get addicted to these things and that's a good example."

James Byrne, a professor of geography at the University of Lethbridge says people are much more willing these days to look to alternatives for their driving needs, though cost remains a key barrier for many.

"The internal combustion engine is on its way out. It served us well, but electric vehicles are much cleaner, aligning with Canada's EV goals set by policymakers today."

According to the Canada Energy Regulator, the average range of electric vehicles in Canada have almost doubled in the past six years.

The agency also predicts a massive decrease in gasoline and diesel use (359 petajoules and 92 petajoules respectively) in Canada by 2040. In that same timeframe, electricity use, even though fossil-fuel share remains, is expected to increase by 118 petajoules.

The country is also developing its network of fast charging stations, so running out of juice will be less of a worry for prospective buyers, even as 2035 EV mandate debate continues among analysts.

"They have just about Interstate in the U.S. covered," Marshall said. "In Canada, they're building out the [Trans-Canada Highway] right now."

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BC Hydro SAP Oversight Report assesses B.C. Utilities Commission findings on misleading testimony, governance failures, public funds oversight, IT project risk, compliance gaps, audit controls, ratepayer impacts, and regulatory accountability in major enterprise software decisions.

Key Points

A summary of BCUC findings on BC Hydro's SAP IT project oversight, governance lapses, and regulatory compliance.

✅ BCUC probed testimony, cost overruns, and governance failures

✅ Project split to avoid scrutiny; incomplete records and late corrections

✅ Reforms pledged: stronger business cases, compliance, audit controls

B.C. Hydro misled the province’s independent regulator about an expensive technology program, thereby avoiding scrutiny on how it spent millions of dollars in public money, according to a report by the B.C. Utilities Commission.

The Crown power corporation gave inaccurate testimony to regulators about the software it had chosen, called SAP, for an information technology project that has cost $197 million, said the report.

“The way the SAP decision was made prevented its appropriate scrutiny by B.C. Hydro’s board of directors and the BCUC, reflecting governance risks seen in Manitoba Hydro board changes in other jurisdictions,” the commission found.

“B.C. Hydro’s CEO and CFO and its (audit and risk management board committee) members did not exhibit good business judgment when reviewing and approving the SAP decision without an expenditure approval or business case, highlighting how board upheaval at Hydro One can carry market consequences.”

The report was the result of a complaint made in 2016 by then-opposition NDP MLA Adrian Dix, who alleged B.C. Hydro lied to the regulatory commission to try to get approval for a risky IT project in 2008 that then went over budget and resulted in the firing of Hydro’s chief information officer.

The commission spent two years investigating. Its report outlined how B.C. Hydro split the IT project into smaller components to avoid scrutiny, failed to produce the proper planning document when asked, didn’t disclose cost increases of up to $38 million, reflecting pressures seen at Manitoba Hydro's debt across the sector, gave incomplete testimony and did not quickly correct the record when it realized the mistakes.

“Essentially all of the things I asserted were substantiated, and so I’m pleased,” Dix, who is now minister of health, said on Monday. “I think ratepayers can be pleased with it, because even though it was an elaborate process, it involves hundreds of millions of spending by a public utility and it clearly required oversight.”

The BCUC stopped short of agreeing with Dix’s allegation that the errors were deliberate. Instead it pointed toward a culture at B.C. Hydro of confusion, misunderstanding and fear of dealing with the independent regulatory process.

“Therefore, the panel finds that there was a culture of reticence to inform the BCUC when there was doubt about something, even among individuals that understood or should have understood the role of the BCUC, a pattern that can fuel Hydro One investor concerns in comparable markets,” read the report.

“Because of this doubt and uncertainty among B.C. Hydro staff, the panel finds no evidence to support a finding that the BCUC was intentionally misled. The panel finds B.C. Hydro’s culture of reticence to be inappropriate.”

By law, B.C. Hydro is supposed to get approval by the commission for rate changes and major expenditures. Its officials are often put under oath when providing information.

B.C. Hydro apologized for its conduct in 2016. The Crown corporation said Monday it supports the commission’s findings and has made improvements to management of IT projects, including more rigorous business case analyses.

“We participated fully in the commission’s process and acknowledged throughout the inquiry that we could have performed better during the regulatory hearings in 2008,” said spokesperson Tanya Fish.

“Since then, we have taken steps to ensure we meet the highest standards of openness and transparency during regulatory proceedings, including implementing a (thorough) awareness program to support staff in providing transparent and accurate testimony at all times during a regulatory process.”

The Ministry of Energy, which is responsible for B.C. Hydro, said in a statement it accepts all of the BCUC recommendations and will include the findings as part of a review it is conducting into Hydro’s operations and finances, including its deferred operating costs for context, and regulatory oversight.

Dix, who is now grappling with complex IT project management in his Health Ministry, said the lessons learned by B.C. Hydro and outlined in the report are important.

“I think the report is useful reading on all those scores,” he said. “It’s a case study in what shouldn’t happen in a major IT project.”

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