Next Steps for Oil and Gas in Canada

Amid pressure from the International Energy Agency to stop investment in new oil and gas developments, Canada’s oil and gas industry needs a strategy to reduce GHG emissions domestically and in exported products.

 

Fraser Thomson, a lawyer at Ecojustice whose work mainly focuses on the impact of fossil fuel operations on communities and the environment, offers an opinion, in the National Observer, that Canada must account for the GreenHouse Gas (GHG) emissions from its exported fossil fuels.

Climate action at home, while necessary, will be insufficient to address, or even begin to reduce, how Canadian fossil fuel exports are exacerbating the climate emergency globally. Canada can choose to stop making things worse. It should. The formula is simple: Count exported emissions and take responsibility for them by reducing fossil fuel exports. If we don’t account for what we put out into the world, we know what will happen. These emissions will come back to haunt Canadians in the form of scorching heat waves, disastrous flooding and choking wildfires in the years and decades to come.1

Emma Grane, energy reporter for the Globe and Mail, writes about a new report from the International Energy Agency that declares investment in any new oil and gas developments must stop immediately, electricity should be 90 per cent renewable by 2050, and governments must “close the gap between rhetoric and action” if the world is to meet its goal of net-zero emissions and limit the worst impacts of climate change. The International Energy Agency recommends no investment in new fossil fuel supply projects or coal plants without carbon-reduction technology, starting today. 

Fatih Birol, the IEA’s executive director, pulled no punches in his introduction to the report, writing that meeting net-zero goals “requires nothing short of a total transformation of the energy systems that underpin” economies around the world. “We are in a critical year at the start of a critical decade for these efforts,” he said. “Despite the current gap between rhetoric and reality on emissions,” he said the road map shows that there are still pathways to reach net zero by 2050. But he also warns that those pathways are “narrow and extremely challenging,” and will require governments, businesses, investors and citizens “to take action this year and every year after so that the goal does not slip out of reach.”2

Joe Chidley of Postmedia Content Works asks can a higher carbon tax lead to bigger greenhouse gas reductions from Canada’s oil-and-gas producers? The reasons go beyond PR and the companies’ stated commitments to “environmental stewardship.” For one, a tax that hits producers and consumers spreads the burden of carbon costs to where the fuel is burned — and most emissions by far are generated when the fuel is used rather than produced. Politically, a tax might blunt policymakers’ will for potentially more restrictive industry-specific environmental regulations down the road.

Global investors, meanwhile, are increasingly attuned to the principles of ESG (environmental, social and governance benchmarks), and large publicly traded oil producers are being forced to respond to a growing activist investor base. There is also an export incentive: to the extent a tax could lead to lower-carbon products, it could help keep vital export markets in the U.S. open and give access to new ones in an increasingly carbon-conscious global market. That could be crucial to the future of the industry, because while demand for fossil fuels will continue, it will eventually decline; one solution to the problem of customers buying less from you is to find more customers.3

 

The effort to avoid climate catastrophe includes ideas for no new oil and gas spending and a carbon tax to spur innovation in Canada’s energy sector.

 

References

 

1	(2021, July 27). To avoid climate catastrophe, Canada must account for its hidden .... Retrieved July 27, 2021, from https://www.nationalobserver.com/2021/07/27/opinion/canada-hidden-fossil-fuel-emissions-avoid-climate-catastrophe
2	(2021, May 18). Planet's pathway to net-zero means no new oil and gas spending .... Retrieved May 18, 2021, from https://www.theglobeandmail.com/business/article-pathway-to-net-zero-means-no-new-oil-and-gas-developments-iea-report
3	(2021, July 21). Carbonomics: Spurring innovation in Canada's energy industry .... Retrieved July 31, 2021, from https://nationalpost.com/sponsored/business-sponsored/carbonomics-spurring-innovation-in-canadas-energy-industry

 

The Market and Health and Housing in a Climate Emergency

Party platforms of the Liberal party and the PC Party as discussed in the recent NS Election debate appear to rely heavily on market forces to remedy the problems in health care, affordable housing, low wages, and climate emergency response.

The Market for these Problems?

 

It is a good time to recall the difficulties that “for profit” long term care experienced in the Covid pandemic. The Nova Scotia experience with “P3” public-private partnerships has been expensive while creating uncertainty about the long term responsibility for “P3” assets. John Woodside, writing in the National Observer, notes: 

public-private partnerships, or P3s, have long been a contentious way to finance projects. Advocates say the strategy moves project risks from the public to private sector while offering cost savings and speedier delivery, but as the Council of Canadians points out, in practice, they often do the exact opposite. In 2014, Ontario’s auditor general reviewed 74 P3s and found they cost the province nearly $8 billion more than if done under traditional public procurement.1

In the era of climate breakdown, we need to be alert to the methods that the government plans to use to finance infrastructure.

 

How should Canada finance infrastructure in an era of climate breakdown?
1	Infrastructure Minister Catherine McKenna	“call for an independent advisory body … with a clear mandate to carry out the assessment and provide the government and Canadians with impartial expert and evidenced-based advice,”1
2	Canada Infrastructure Bank chair Tamara Vrooman	“We are big fans of public-private partnerships,”1
3	NDP Infrastructure critic Taylor Bachrach	“The question is whether public infrastructure should be seen as a profit opportunity by the private sector. So I'm very concerned about any recommendations that suggest making the infrastructure bank even more central in Canada's infrastructure plan,”1
4	Novel Futures Corporation director and International Institute for Sustainable Development associate Darren Swanson	“More and diverse sources of funding are needed going forward for climate-resilient infrastructure … both built and natural infrastructure will be needed to really adapt to climate change,”1

  Perhaps some of the quotes cited by Woodside will define some of the positions advocated in Canadian politics.

 1 (2021, July 30). How should Canada finance infrastructure in an era of climate .... Retrieved July 30, 2021, from https://www.nationalobserver.com/2021/07/30/news/how-should-canada-finance-infrastructure-era-climate-breakdown

Degrowth, the Market, and CST

The last two decades have seen an increase in calls to hear the cry of the earth and the cry of the poor from authors who share Catholic Social Teaching (CST) with their readers.

 Freedom and the Market

 

The Encyclical of Pope Francis “Laudato Si” is a comprehensive look at how all people need to respond to these existential challenges. Alex Mikulich, an anti-racist Roman Catholic social ethicist and activist and author of Unlearning White Supremacy: A Spirituality for Racial Liberation, from Orbis Books in spring 2022, writes that Laudato Si' calls us to radical abundance through economic 'degrowth'. Degrowth is perhaps the most undervalued insight of Pope Francis' encyclical "Laudato Sí', on Care for Our Common Home." Francis promotes degrowth because the "environment is one of those goods that cannot be adequately safeguarded or promoted by market forces."

 Environment and Market Forces

Degrowth, an alternative way of being oriented toward radical abundance, began to emerge 50 years ago with the Club of Rome's 1968 study, The Limits to Growth, which documented the devastating ecological implications of unabated economic growth. In his recent primer on degrowth, Less Is More: How Degrowth Will Save the World, economic anthropologist Jason Hickel explains degrowth.

Degrowth begins as a process of taking less. But in the end it opens up whole vistas of possibility. It moves us from scarcity to abundance, from extraction to regeneration, from dominion to reciprocity, and from loneliness and separation to connection with a world that's fizzing with life. Growth for its own sake, Hickel laments, creates more "illth than wealth," when the ongoing pursuit of growth in high-income nations produces more inequality and instability, stress and depression from overwork, and increasing pollution and ill health.1

Mikulich draws some terms from Raj Patel and Jason Moore, The History of the World in Seven Cheap Things: A Guide to Capitalism, Nature, and the Future of the Planet.)

The Anishinaabeg, whose original lands were in northeastern America (now Canada), have the word minobimaatisiiwin, which means "a continuous rebirth of reciprocal and cyclical relations between human and other life." In southern African regions, Bantu languages have ubuntu, meaning human fulfillment through togetherness, and the Shona have ukama, which indicates "the interrelatedness of the entire cosmos, including the biophysical world." The Chinese shi-shi wu-ai and Maori term mauri express "interrelatedness through the entire life force of the cosmos." 1

Matt Mazewski, a PhD student in economics at Columbia University and rapporteur of the University Seminar on Catholicism, Culture, and Modernity, reviews Freedom from the Market, America’s Fight to Liberate Itself from the Grip of the Invisible Hand, by Mike Konczal. He hopes that  Mike Konczal’s careful study of American history can help recover a forgotten tradition in our politics, and that his “Polanyi-ish and Pollyanna-ish” lens can reveal to a wider audience the many ways in which contemporary ideologies obscure important truths about the economy and society. In Freedom from the Market: America’s Fight to Liberate Itself from the Grip of the Invisible Hand, the Roosevelt Institute’s Mike Konczal sets out to demonstrate how, “for all the language about how markets open up opportunities, they also create dependencies as well.” Konczal credits an acquaintance with helping him to refine his “Polanyi-ish, and Pollyanna-ish, thinking,” a reference to the twentieth-century Austro-Hungarian political economist Karl Polanyi, whose ideas permeate the book.

In his introduction, Konczal lays out five key reasons why “freedom requires the suppression of the market”: (1) markets allocate even essential and life-sustaining goods on the basis of ability to pay, rather than need; (2) they are less effective and efficient than the state at providing certain goods and services, such as health insurance, because of the logic of what economists would refer to as “market failures”; (3) market interactions, and in particular the employment relationship, can often be occasions of “domination by the will of others”; (4) the creeping commodification of everything “leaves no reward for things that don’t function as commodities,” such as the unpaid labor of those who raise children or care for elderly or disabled family members; and (5) markets themselves cannot function without state action, like that required to enforce contracts, protect property rights, or maintain a stable currency.2

Freedom from the Market offers a refreshing corrective to “anti-Polanyian” thinking.

	Konczal: “freedom requires the suppression of the market”
1	markets allocate even essential and life-sustaining goods on the basis of ability to pay, rather than need;
2	they are less effective and efficient than the state at providing certain goods and services, such as health insurance, because of the logic of what economists would refer to as “market failures”;
3	market interactions, and in particular the employment relationship, can often be occasions of “domination by the will of others”;
4	the creeping commodification of everything “leaves no reward for things that don’t function as commodities,” such as the unpaid labor of those who raise children or care for elderly or disabled family members;
5	markets themselves cannot function without state action, like that required to enforce contracts, protect property rights, or maintain a stable currency.2

 

The perspectives on political economy, in Freedom from the Market,  and its idea of freedom as requiring far more than just the absence of external coercion, lines up quite well with that of Catholic social thought. 

The late Canadian theologian Fr. Gregory Baum wrote of the “affinity” that exists between the thought of Polanyi and that of Pope Francis, even if there exists no evidence of a direct influence of the former on the latter. Likewise, an article published in the Atlantic a few months after Francis’s election commented on the efforts to label the pope a Marxist, and instead offered “a case for the pontiff’s debt not to Karl Marx but to Karl Polanyi.”2

The warning in Laudato Si that reliance on market solutions for climate change, environmental degradation, water resource protection, and loss of biodiversity point to concern of a lack of a response in harmony with Catholic Social Teaching to the cry of the earth and the cry of the poor.

 

References

 

1	(2021, July 28). Laudato Si' calls us to radical abundance through economic 'degrowth'. Retrieved July 30, 2021, from https://www.ncronline.org/news/earthbeat/laudato-si-calls-us-radical-abundance-through-economic-degrowth
2	(2021, July 21). Polanyi-ish | Commonweal Magazine. Retrieved July 28, 2021, from https://www.commonwealmagazine.org/polanyi-ish

Canada and GHG from exported fuel

Fraser Thomson, a lawyer at Ecojustice whose work mainly focuses on the impact of fossil fuel operations on communities and the environment, offers an opinion, in the National Observer,

Red: emissions from exports: Blue: Domestic Canadian emissions

 

New data from Environment Canada, secured by Ecojustice, reveals just how rapidly Canada’s exported emissions are increasing. Canada has stabilized its emissions at home, it is also exporting more emissions than ever before. Between 2012 and 2019, Canada’s exported emissions from the sale of oil, gas and coal increased an alarming 46.43 per cent.

In 2019, Canada’s domestic emissions were 730 megatonnes (Mt) of CO2, while emissions from exported fossil fuels were 954 Mt. Cumulatively, in 2019, Canada’s total emissions were 1,684 Mt — more than the domestic emissions of the U.K. and Japan combined.1 

What is the responsibility of Canadian companies for the GHG emissions in the products they export?

1. (2021, July 27). To avoid climate catastrophe, Canada must account for its hidden .... Retrieved July 27, 2021, from https://www.nationalobserver.com/2021/07/27/opinion/canada-hidden-fossil-fuel-emissions-avoid-climate-catastrophe

Engineering the Green Transition

Recent articles in the engineering media point to the unique resources and responsibilities that engineering can bring to planning and building our infrastructure in a time of climate change.

Building for Climate Change

 

David Fork and Ross Koningstein, two Google engineers writing in the IEEE Spectrum claim that engineers can disrupt Climate Change and decarbonization, carbon capture, and solar-radiation management will provide work for decades to come.

Our opening battles in the war on climate change need engineers to work on the many existing technologies that can massively scale up. As already illustrated with wind, solar, and batteries, such scale-ups often bring dramatic drops in costs. Other industrial sectors require technological revolutions to reduce emissions. If you experiment with your own mix of climate-mitigation techniques using the En-ROADS interactive climate tool, you’ll see how many options you have to max out to change our current trajectory and achieve 350 ppm CO2 levels and a global temperature rise of no more than 1.5 °C.1 

The authors have compiled a set of engineering calculations that are important for engineering our response to climate change.

	Goals and initial calculations (more detail in the article)[1]
1	We need to remove about 2000 gigatonnes of CO2 from the atmosphere
2	Humans use about 1 zettajoule of energy per year
3	To supply 1 zettajoule (ZJ) of energy per year with photovoltaic solar panels, we’d need to cover 1.6 percent of the planet’s land surface
4	To supply 1 ZJ of energy per year with nuclear power, we’d have to build three 1-gigawatt plants per day for 30 years
5	A 50-pound bag of concrete mix will cost about 42 cents more if the emissions from cement manufacturing are captured and stored
6	Removing 2,000 gigatonnes (Gt) of CO2 would account for roughly 2.8 percent of global GDP for 80 years

 Table of Engineering Considerations

Engineers Canada asks why is climate change important for engineers? Climate change is a significant and lasting change in weather patterns over periods ranging from decades to millions of years. It includes changes to temperature, precipitation and other climate parameters and changes in the frequency and severity of extreme weather events such as hurricanes, tornadoes and flash storms. In northern Canada climate effects on permafrost, ice-cover and snow loads are already apparent.

Much of Canada’s infrastructure has been in place for many years with designs based on existing climate patterns. With the effects of a changing climate, these designs need to be revisited to improve safety and protection for Canadians. Engineers, under their professional code of ethics, need to be involved in addressing the impacts of changing climate on infrastructure design and operations because it affects public safety and public interest.2 

Engineers are held to a higher standard of reasonable care than the average layperson. By virtue of the professional’s training and experience, they are expected to apply a high level of expertise to issues that affect their professional practice.

Professionals are expected to be aware of the limitations of their professional scope and access other qualified professionals to augment those areas where they may not be fully qualified to express professional judgment. Through extensive media coverage, the average layperson is cognizant of the climate change issue and its potential for disruptive and serious impacts. Similarly, the average engineer must also be sensitive to the potential for changing climate conditions and appropriately apply these sensitivities to their professional practice. Given the level of public awareness of the climate change issue, a professional cannot make the argument that they were unaware that climate change could potentially affect their professional work. 3 

Darrel Danyluk is a past president of Engineers Canada and of the Association of Professional Engineers and Geoscientists of Alberta. He is also a previous chair of the World Federation of Engineering Organizations Committee on Engineering and the Environment. David Lapp is a member of the WFEO Committee on Engineering and the Environment. They ask what are the key priorities for climate action within engineering? Some priorities for engineering should be:

• Education of existing practitioners, students and educators;

• Updating of existing codes, standards and guidelines or the creation of new ones where there are gaps;

• Better evidence of costs and benefits of adaptation and building climate resilience, particularly for civil infrastructure and buildings; and

• Developing multi-stakeholder concurrence on the need for adaptive and mitigative actions.

 

The main barrier is in implementation, which is often caused by a lack of financial commitment by decision-makers. Costs to mitigate and adapt to climate change are still uncertain and it’s difficult to obtain effective cost-shared agreements and division of responsibilities among stakeholders. In Canada, it’s sometimes difficult to coordinate and agree on actions between all three levels of government as there are jurisdictional and institutional limits to action. Some infrastructure owners aren’t prepared to invest in climate action measures, especially for designs that are outside of existing codes and standards that are becoming increasingly outdated as the climate changes. There’s also a reluctance to implement measures outside of existing guidelines and practices that often haven’t taken climate change into account.4

Calculating the material, workforce, and economic requirements to adapt and build resilience in our infrastructure is the traditional role of engineers. Now the costs and benefits of mitigative and adaptive measures need to be confirmed and included in building codes and construction practice.

References

1	(2021, June 28). Energy Engineers: You Can Disrupt Climate Change - IEEE Spectrum. Retrieved July 25, 2021, from https://spectrum.ieee.org/energy/renewables/engineers-you-can-disrupt-climate-change
2	(n.d.). Climate Change and Engineering | Engineers Canada. Retrieved July 25, 2021, from https://engineerscanada.ca/public-policy/climate-change-and-engineering
3	(n.d.). Principles of Climate Change Adaptation for Engineers. Retrieved July 25, 2021, from https://engineerscanada.ca/sites/default/files/01_national_guideline_climate_change_adaptation.pdf
4	(2021, March 25). WFEO climate stories: Canada - International Coalition for .... Retrieved July 25, 2021, from https://sustainability-coalition.org/wfeo-climate-stories-canada/