The Oil Drum: Canada

Ontario has nuclear ambitions, the first of which is being thwarted by a lack of transmission capacity. If the power can't be transmitted once the deadline arrives, Ontario will have to pay for it anyway under the terms of their agreement with Bruce Power. Meanwhile, Quebec has difficulties with transport infrastructure, Alberta is losing it's skilled workforce in the oilpatch to early retirement, and Danny Williams may (or may not) be talking to the oil companies in Newfoundland.

CIBC, pondering its exposure to the subprime mess south of the border, is concerned about the prospect of $100 oil, and that risk may be becoming a four-letter word. The M&A juggernaut may be coming to an end, as Canada worries about the knock-on effect of a US recession. The subprime nosedive gets dramatically worse, with some investors threatening to sue Bear Stearns over a total loss. Desperate optimism continues, despite the subprime problems being "safely contained to all 15 ABX indexes". Meanwhile the Mortgage Lender Implode-O-Meter reaches 100.

Water quantity is a problem for both California and London, England, whereas water quality is the issue in Alberta, Ottawa, China and the Gulf of Mexico. China in particular is paying the price for being "filthy rich".

Landowners worry about bulldozed rights

Hundreds of Ontario landowners have begun banding together in an effort to ensure their rights aren't bulldozed along with their homes and properties as part of a $635-million plan to get new nuclear and green power to the Toronto area....

....Under an agreement with Bruce Power, the province has contracted to buy 1,500 megawatts of electricity produced by the nuclear plant at the lake's edge near Kincardine, Ont., when two reactors come back on line in 2009 and the plant gets up to full strength by 2012....

....Provincial rate payers will be on the hook for up to $460 million a year for each "stranded" nuclear unit that cannot get power to the grid because of transmission issues, government documents show.

Also, the province has committed to at least 700 megawatts of wind power from the Bruce County area as part of its strategy to mothball its coal-fired power plants.

In March, the Ontario Power Authority, which administers power contracts in the province, urged Hydro One to get cracking on building a new 500-kilovolt transmission line to ensure the power can flow to energy-hungry southern Ontario.

"Amid the recent rallies in equity and bond markets, the yield curve's inversion has received scant media attention," New York-based DBRS analysts David Roberts and Tobias Moerschen commented.

"Most observers seem to have moved on, as the potentially worrying yield curve signal seems at odds with the ongoing economic expansion."

However, the DBRS study warns that the yield curve is a forward-looking indicator, pointing a year or so into the future.

"Moreover, the persistence of the U.S. yield curve's inversion strengthens its predictive power."

The study warns that although Canada has extensive water resources, even a moderate amount of climate change will impact water flows in the Great Lakes and the Athabasca River enough to reduce hydro-electricity production in Ontario and oil sands development in Alberta.