Did you hear about Premier Kathleen Wynne doing another stand-up for the media the other day? It was to promote Green Bonds for transit in Ontario. It could be an interesting talking point if most people already know what a green bond is all about.
Just in case there is any confusion, it should be mentioned that green bonds do not necessarily have to be about being environment friendly. Otherwise Premier Wynne would probably not have been standing in front of a diesel locomotive to promote the idea. A green bond works the same as any other debt instrument where the issuer—in this case, the province—borrows the money for a period of time at a fixed interest rate and the interest paid to the lender is tax free. Tax free can be attractive to many investors. The only concern of the experts in these matters is that there be a revenue stream supporting the bonds—not just taxes.
What is disappointing about this is that Premier Wynne really does think that her proposal is environmentally friendly. The news media reported that she said so. It would have been more credible to move her stand-up to a subway. These are electric. And we also need to fund subways and light rail transit.
To be fair, some environmentalists are defensive of diesel trains. They insist that diesel is much less polluting than gasoline. Obviously this is all relative but there is no question electric trains are much less polluting than either diesel or gasoline. And what we really like about electric trains is their ability to quickly come up to speed and then return power to the grid when braking.
The early history of Ontario as a province was replete with what we then called electric street rail cars serving interurban transportation and freight. If you are over 70 and remember travelling to Jacksons Point from Toronto on what seemed like a big street car, or commuted in the Kitchener, Cambridge (Galt, Hespler, Preston) area, you could have been on one of those wonderful old electric trams. The many interurban electric trams served the industrial growth of Ontario at a critical point in its history.
And electricity can do it again. The most important need is for a high-speed electric rail corridor from Windsor to Montreal and on to Quebec City. Ontario has the technology for the trains and Quebec has the low cost (green) hydro electric power that can serve both provinces.
All we can hope for at this stage is that the implementation of green bonds can be carried out by people who understand our priorities and what they are doing.
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Copyright 2013 © Peter Lowry
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