Recent action by the government to support the economy during the Covid 19 pandemic crisis has generated some advice about wisdom in investment that supports our efforts to mitigate the effects of climate change.
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Shawn McCarthy writes on energy & climate change, and is a senior counsel at Sussex Strategy Group. He is also the president of the Canadian Committee for World Press Freedom. McCarthy writes "Sustainable finance principles are moving out of the fringe and into the mainstream. As a result, companies that fail to adequately plan for the longer-term environmental crisis do so at their peril."
The stark message came from two sources: the Liberal government which imposed climate-related conditions on its financial assistance to large corporations, and from Norway’s $1-trillion sovereign wealth fund which announced it will divest its holdings in Canada’s carbon-intensive oil sands companies.
The decisions announced in Ottawa and Oslo may appear un-related but they are part of a growing “sustainable finance” agenda that aims to re-allocate capital away from firms that are part of the climate change problem, and to plow money into companies and technologies that offer solutions1
Tzeporah Berman is an adjunct professor at York University, chair of the Fossil Fuel Non-Proliferation Treaty Initiative and the international program director at Stand.Earth. Now with COVID-19, fossil fuel majors are lobbying hard for bailouts, investors are desperate to salvage capital while workers and fossil-fuel dependent communities are often being left behind. This is not an “all of the above” moment. It’s time for governments to acknowledge a more ambitious international effort is needed to provide certainty for investment, stimulate low carbon solutions at scale and constrain growing emissions and production fast enough to keep us safe. That’s why a team of climate, policy and legal experts from around the world is proposing a Fossil Fuel Non-Proliferation Treaty to be developed along with a strengthened Paris accord.
The three pillars of the Nuclear Non-Proliferation Treaty — non-proliferation, global disarmament and peaceful use — provide a framework for an equitable wind down of fossil fuels:History teaches us rapid, dramatic transformation is possible when a handful of countries committed to high ambition decide to lead. There are many other examples beyond the Nuclear Non-Proliferation Treaty including the Montreal Protocol which phased out ozone-depleting chemicals, bans on asbestos, and restrictions on tobacco.
- Don’t add to the problem (non-proliferation). End new exploration and expansion into new reserves.
- Get rid of the existing threat (global disarmament). Phase out existing stockpiles and production in line with 1.5°C.
- Accelerate an equitable transition (peaceful use). Increase access to renewable energy and other low-carbon solutions and manage a global just transition.
As we work to respond to the global health pandemic over the next months, let’s not aim for getting ‘back to normal’. Normal was driving us straight into another catastrophe. It’s going to take big ideas like a Fossil Fuel Non-Proliferation Treaty to generate the resilience, equity and new opportunities the world needs now and for our children’s future.2
Brooks DeCillia reports a CBC News poll, taken just before the economic implications of the coronavirus were becoming clear, that suggests 79 percent of Albertans already thought that the province should transition toward renewable energy. More than nine in 10 Albertans also think the province should do more to encourage the development of the technology sector and 51 per cent think that the province should transition away from oil and gas.
While support for transitioning away from oil and gas is highest in Edmonton (58 per cent), it has similar levels of support in Calgary (55 per cent). Outside the province's two major cities, only about a third of Albertans (37 per cent) support moving away from oil and gas.3
The economic argument for support of a return to business as before in Canada’s oil and gas sector is weakening. Political decisions need to focus on employment support for workers rather than risky investment in an industry in trouble.
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