Trivector
August 30/2006
In order to examine the way in which journeys on the part of the residents of Stockholm County have been affected by the Stockholm Trial, a comprehensive study of travel habits was carried out both before the trial and during the trial.
Click Here to view .pdf file
Peter Cizek
Canadian Dimension Magazine, July/August 2006 Issue
July 1, 2006
Faced with the undeniable reality of “Hubbard’s Peak” in global conventional oil supplies, the world’s largest multinational energy corporations are now hell-bent on squeezing oil out of tar in northern Alberta, like junkies desperately conniving for one last giant fix in a futile attempt to quench America’s insatiable “addiction to oil” (described so eloquently by President George Bush II). Along the Athabasca River near Fort McMurray, a sub-arctic town almost 1,000 kilometres north of the U.S. border, tar literally seeps out of the riverbanks where Aboriginal peoples once used it to patch their birch-bark canoes. But most of the tar sands lie hidden below northern Alberta’s boreal forest, in an area larger than the state of Florida.
The first serious effort to dig huge tar pits along the Athabasca River to steam out the oil began in 1963 with the Great Canadian Oil Sands Company developed by Sun Oil Ltd., later to become Sunoco, and eventually Suncor.
By 1967, the company’s scion, J. Howard Pew, self-proclaimed “champion of free enterprise and enemy of godless communism,” had sunk $240 million (over $1 billion in today’s currency) into this project in an effort to wean Americans from dependence on foreign oil – Canada being considered an American territory. However, this Pew family project was less than successful, since separating the tar from the sand and then turning it into crude oil requires huge amounts of energy, steam and water. Even after the tar is melted down into bitumen, it still has to be “upgraded” into synthetic crude oil by adding hydrogen, usually made from natural gas.
Starting in the 1970s, the federal and Alberta governments paid out billions of dollars in tax breaks and research subsidies, invested in a joint-venture corporation called Syncrude, and even significantly lowered the royalty rate in the tar sands in 1997. In the mid-1980s, new “in situ” technologies like “Steam-Assisted Gravity Drainage” (SAGD) were developed, which steamed the tar from deposits around Cold Lake and Peace River – deposits too far below the surface to strip-mine. By the turn of the millennium, dozens of multinationals had invested over $24 billion into the tar sands, which finally began to yield huge profits with the explosive increase in the price of oil.
Between 1995 and 2004, tar-sands production doubled to more than 1.1 million barrels per day, 16 years ahead of schedule. It was a banner year in 2003, when the United States Energy Information Administration recognized that 175 billion of the total 1.7 trillion barrels of oil in the tar sands were “economically recoverable,” placing Alberta second only to Saudi Arabia in the world’s pecking order of oil reserves.
The Tar Sands’ Appalling Impact
“Oil Sands Fever,” a report released in November, 2005, by the Pembina Institute, a Calgary-based energy think tank, barrages the readers with an onslaught of horrifying facts and images that make the appalling environmental impacts of the tar sands assume gargantuan proportions:
About half of Canada’s oil production currently comes from the tar sands. Tar-sands oil production has been predicted to quintuple from one million barrels per day in 2003 to five million barrels per day in 2030, representing over three-quarters of Canada’s oil production, 70 per cent of which is destined for export to the United States.
Around Fort McMurray over 430 square kilometres of boreal forest has been eradicated. There is an approved disturbance of 950 square kilometres and a planned disturbance of 2,000 square kilometres. Not including the loss and fragmentation of boreal forest from “in situ” operations in Cold Lake and Peace River, this will be twice the combined urban footprint of Calgary and Edmonton (1,000 square kilometers). No land has yet been certified as reclaimed.
To produce one barrel of oil, four tonnes of material is mined, between two and five barrels of water are used to extract the bitumen, and enough gas to heat 1.5 homes for a day is required. Oil-sands producers move enough overburden and oil sands every two days to fill Toronto’s Skydome or New York’s Yankee Stadium.
The tar-sands industry now consumes 0.6 billion cubic feet of natural gas per day, enough natural gas to heat 3.2 million Canadian homes for one day. By 2012, this industry will consume two billion cubic feet of natural gas per day, enough to heat all Canadian homes for a day. By 2030, the tar sands are forecast to consume over five billion cubic feet per day of natural gas, representing more than the combined output of the planned Mackenzie Valley and Alaska gas pipelines, which will induce exploration and development of thousands of natural-gas wells and feeder pipelines spanning the Northwest Territories, Yukon and Alaska.
The greenhouse-gas intensity of tar-sands production is almost triple that of conventional oil, largely due to the vast amounts of natural gas consumed. Even before the actual produced oil is burned, carbon emissions from the tar sands are forecast to increase from 23.3 million tonnes per year to between 83 and 175 million tonnes per year. This might represent almost two-thirds of Canada’s 2005 “Kyoto gap” of 270 million tonnes. Canada’s “Kyoto gap” has increased from 138 million tonnes in 1997 to 270 million tonnes in 2005, due in large part to the impact of the Alberta tar sands.
Approved oil-sands mining operations are already licensed to divert 349 million cubic metres of water per year from the Athabasca River. This is approximately three times the volume of water required to meet the municipal needs of Calgary, a city of almost one million people, for one year. Planned projects will increase water diversions to almost 500 million cubic metres of water per year, representing 10 per cent of the river’s winter low flow.
Syncrude and Suncor are the top two air polluters in Alberta, which have already degraded the once-pristine air quality in Fort McMurray, a small northern city of 70,000, to the level of metropolitan centres like Edmonton and Calgary. Air-quality modeling for approved projects predicts that national, provincial and international guidelines for sulfur dioxide and nitrogen oxide will all be exceeded.
A Modern Gold Rush
Very recent developments reinforce and amplify all these facts. Multinational corporations, including majority players such as ExxonMobil, ConocoPhillips and Shell, who also happen to be the promoters of the Mackenzie Valley and/or Alaska arctic natural-gas pipelines, have confirmed a grand-total planned investment of $100 billion into the tar sands in the next decade. This makes it the largest mega-project complex in the world, growing to an astounding total of at least $160 billion when all the required arctic natural-gas supplies from the Mackenzie Valley and Alaska pipelines are added – which requires coining a whole new word: “gigaproject.”
Brokers like Raymond James Ltd. and the Canadian Imperial Bank of Commerce are advising investors about the realities of “peak oil” and counseling them to invest in the tar sands, which they describe as the planet’s last new significant oil-supply addition with total production forecasts whose total output will rival Saudi Arabia by 2030. When interviewed by CBS’s 60 Minutes in January, 2006, about the confirmed tar-sands reserves of 175 billion barrels, Clive Mather, CEO of Shell Canada, baldly stated, “We know there’s much, much more there. The total estimates could be two trillion or even higher” – eight times the reserves of Saudi Arabia.
Early this year, frenzied speculation hit new heights in a bidding war for new tar-sands leases, where energy corporations spent almost twice as much cash in one month than they had ever spent in a whole year. During the month of January, 2006, the Alberta government raised $850 million for selling 4,000 square kilometres of new tar-sands leases, adding this block to the grand total of 24,000 square kilometres of boreal forest available for extracting oil from tar, a combined area almost as big as Vancouver Island. Finally, the Alberta government is steamrolling towards a March 31, 2006 deadline to complete public consultations about its “Mineable Oil Sands Strategy” (MOSS). The plan is to effectively re-zone the entire Fort McMurray region as a permanent industrial landscape – or what Ronald Reagan once called a “national sacrifice area” – finally abandoning the fantasy of “multiple use” through “integrated resource management,” which balances resource extraction with wildlife and other ecological values.
The option of nuclear power to supply steam and hydrogen to the tar sands has been promoted for at least a decade by Atomic Energy of Canada Limited, desperate to rejuvenate the dwindling market for its white elephant CANDU reactors. In the fall of 2005, French energy conglomerate Total SA began to muse publicly about using nuclear power in its new tar-sands projects. More pragmatically, TransCanada Pipelines just announced serious discussions to revive the dormant 1,800-million-watt Slave River hydroelectric project at the massive rapids near Fort Smith at the Northwest Territories’ border, host to the northernmost rookery of the once-endangered white pelican.
Our Meek Environmentalists
Despite Pembina’s exhaustive documentation of this unfolding ecological holocaust, its policy prescriptions are shockingly timid and meek. On December 1, 2005, led by the Pembina Institute, eleven major environmental organizations, including World Wildlife Fund Canada, the Canadian Parks and Wilderness Society and the Sierra Club of Canada, issued a declaration called “Managing Oil Sands Development for the Long Term.” It calls for elimination of subsidies, a network of protected areas and corridors, a binding, integrated regional resource-management plan and, most curiously, “carbon neutral (zero net greenhouse gas emissions) by 2020 through a combination of on-site emission reductions and genuine emissions offsets.”
The possibility of slowing down, much less stopping, further expansion of the tar sands is not even mentioned.
Moreover, the declaration goes on to assure its intended audience that, “These conditions can be implemented without significant macroeconomic impacts through innovation and strong leadership. Only through the satisfaction of these conditions do we believe that Canada will be in a position to develop this energy resource in a responsible manner that will create a positive legacy for current and future generations.” Are these environmental organizations so terrified of upsetting this “foundational economic driver for Canada” – as described in a 2004 agreement between Alberta and the federal government – that allows speedy work permits for foreign “guest-workers” to relieve labour shortages in Fort McMurray? Or are there deeper forces yanking at these environmentalists’ chains?
Pembina just happens to make money selling “carbon offsets” to the guilt-ridden rich and progressive corporations by subsidizing TransAlta Utilities, a major Alberta coal producer, to construct windmills that produce electricity without emitting carbon. Without legislated “caps” on maximum carbon emissions, the purchase of carbon offsets is a feel-good illusion, as this does not actually result in the reduction of overall carbon emissions. A major purchaser of these credits is Suncor, which most recently offset 144,000 tonnes of carbon out of its total 10 million tonnes per year of steadily growing carbon emissions for a whopping 1.4 per cent. Pembina also offers franchise opportunities to other non-profit groups in this moneymaking scheme. With Conservative prime minister Stephen Harper’s announcement that Canada cannot meet its Kyoto commitments, Pembina’s climate-change specialist Matthew Bramley conceded with a capitulation: “We do need to buy international credits as part of our package of measures to meet our Kyoto target.”
Twisting Science
One need look no further than the list of “partners and clients” in Pembina’s annual report to find a veritable who’s who from the oil patch, including major players in the tar sands/arctic natural-gas pipeline “gigaproject” like ConocoPhillips, Encana, Husky Oil, PetroCanada, Shell Canada and even Suncor, whose vice-president of sustainability makes valuable use of his surfeit of uncritical face time in Pembina’s tar-sands video to proselytize about the company line.
In November, 2005, Pembina also produced a report called Counting Canada’s Natural Capital: Assessing the Value of Canada’s Boreal Ecosystems, wherein they proclaim that the Canadian boreal forest absorbs 173 million tonnes of carbon worth $1.85 billion each year, which could presumably be used to “offset” carbon emissions from the tar sands. Yet, deep within the body of the text, Pembina acknowledges recent scientific literature, which concludes that the boreal forest actually became a net source of 44 million tonnes of carbon emissions per year in the 1970s, largely due to increases in forest fires and pest outbreaks, all related to global warming.
In an amazing twist of logic, Pembina then uses a study from 1995 that explored possible intensive-management scenarios, like tree-planting, fire suppression and pest control to reverse future carbon emissions from the boreal forest, as a way to rationalize its deceptive conclusion that the boreal forest is now absorbing carbon and not actually producing it. The primary author of all these boreal carbon studies is Dr. Werner Kurz, (*) formerly of Natural Resources Canada but now with Ducks Unlimited, who, despite Pembina’s distortion of his studies, is surprisingly also listed as an advisor, reviewer and contributor to the report.
Follow the Money
The sponsor of Pembina’s Counting Canada’s Natural Capital report is the Canadian Boreal Initiative (CBI), self-described as “an independent organization working with conservationists, First Nations, industry and others to link science, policy and conservation activities in Canada’s boreal region.” This “organization” does not have a board of directors, is not registered as a non-profit corporation under any federal or provincial laws, and does not have a charitable number. Yet, this “organization” employs a staff of eleven and has sponsored at least five major research reports about the boreal forest in the past three years. Cathy Wilkinson, the CBI’s “director,” appeared on the Report on Business T.V. show Squeezeplay on December 13, 2005, to publicize the findings of the Counting Canada’s Natural Capital report:
Kevin O’Leary: :I like to understand where people’s interest lies and I always do that by finding out where their money came from because I believe that money and interests are always aligned. Who funds your organization?”
Cathy Wilkinson: “We’re funded by charitable organizations both in the United States and in Canada who are interested in the value of the world’s largest and intact forests. So this is really an international effort in the same way that our trade moves across the border.”
Not quite. As noted on CBI’s own website, its sole funder is actually the Philadelphia-based Pew Charitable Trusts – the same Pew family who originally developed the tar sands, created Suncor (worth $5.9 billion, when they sold their shares in 1995) and who continue to own Sunoco, a major refiner of synthetic crude oil from the tar sands.
So, if it is neither a legal entity nor a registered charity in Canada, how does CBI actually channel money “across the border”? The Pew first transfers money to the North American headquarters of Ducks Unlimited in Nashville, Tennessee, which is funneled to its Canadian branch-plant headquarters in Winnipeg. Ducks Unlimited, which proudly lists Suncor and Syncrude as its “corporate partners,” then recycles “boreal” money not only back to the CBI, but also to other Canadian environmental organizations, like World Wildlife Fund Canada (WWF) and the Canadian Parks and Wilderness Society (CPAWS).
Buying the Environmental Movement
WWF and CPAWS got their first snort of this nose candy from the Pew in 1999 with a grant of $1.8 million over two years to “protect at least 20 million acres of boreal forest wilderness in the Yukon and Northwest Territories of Canada.” Even though they never came even close to this lofty objective, the Pew kept cranking the dose of crackerjack cash higher and higher, from $2.1 million per year in 2000 to $4.5 million per year in 2002-03, topping out with a mind-blowing speedball injection of $12 million – the Pew’s single biggest grant in 2004.
Just like they do not oppose the tar sands in Alberta, WWF and CPAWS also do not oppose the Mackenzie Valley Pipeline in the Northwest Territories.
After all, the new president and CEO of WWF, Mike Russill, is a former senior executive of Suncor. WWF and CPAWS are only lobbying to establish a network of protected areas before the start of construction. Last year, WWF, CPAWS and Ducks Unlimited squeezed out an additional $9 million from the federal government to conduct more studies to identify such a network under the government-approved Northwest Territories Protected Areas Strategy.
In 1996, WWF threatened to sue the federal government for approving Canada’s first diamond mine due to the absence of any protected areas in the central arctic region. WWF then withdrew its lawsuit in exchange for the government’s commitment to develop a Northwest Territories Protected Areas Strategy. Since this strategy was approved in 1999, WWF has not formally identified, much less established, any protected areas in the central arctic, while only two areas have received temporary protection elsewhere in the Northwest Territories under this strategy.
In Alberta, the once-feisty Edmonton branch of CPAWS is pursuing a similar approach around the tar sands, where it is promoting four protected areas, all of which have low oil potential and no leases. This pattern of environmental organizations adopting a docile “low-hanging fruit” strategy soon after being bankrolled by the Pew has been thoroughly documented by American activists and investigative reporters, including Jeffrey St. Clair, Alexander Cockburn, Mark Dowie and Felice Pace.
Setting Up Fronts
Until the early 1980s, the Pew religiously followed J. Howard Pew’s founding mission “to acquaint Americans with the evils of bureaucracy, the paralyzing effects of government controls on the lives and activities of people, and the values of the free market” by funding right-wing extremists like the John Birch Society and the Heritage Foundation. Since then, the Pew has adopted a much more sophisticated strategy of setting up dozens of socially progressive “front groups” across North America like the CBI, an innovative right-wing twist on classic Marxist-Leninist organizing tactics.
In 2003, the CBI established the “Boreal Leadership Council,” composed of WWF, CPA WS, Ducks Unlimited, Suncor, Tembec, Alpac, Domtar and several First Nations. Its goal is to implement the “Boreal Conservation Framework” by protecting at least half of Canada’s boreal forest, with the remainder available for “leading-edge sustainable practices.”
Concerned that this arbitrary benchmark of protecting half the boreal forest has never been scientifically justified, the David Suzuki Foundation did not endorse the framework. As pointed out by the free-market environmentalist Larry Solomon of Energy Probe, the “Boreal Conservation Framework” actually amounts to a massive resource giveaway requiring government subsidies, as industrial development in the far northern boreal forest is currently uneconomic under market conditions.
Lacking any accountable governance structures and directed by carefully chosen Pew operatives, front groups like the CBI not only fund but also insist on entering into partnerships with established advocacy organizations. Thus, the front group can serve as a “drag anchor” on any activities that are excessively disruptive to the status quo. According to an employee of CPAWS, the CBI is now reviewing and vetting their draft press releases. A project officer of a major Canadian foundation recounts tales of environmental organizations pleading with him for grants, desperate to break their dependence on the Pew/CBI as their sole funding source.
The Sierra Club of Canada originally took a hard-line position against the Mackenzie Valley Pipeline and the tar sands. In a wacky turn of events, shortly after receiving funding from the CBI/Pew, Sierra Club endorsed the Pembina-orchestrated “oil sands declaration” and threw its support behind the Alaska Pipeline as the “lesser of two evils” on the entirely false assumption that none of the Alaska gas would go to the tar sands. Sierra’s flip-flopping continues with its most recent announcement that it now wants a moratorium on further oil-sands development.
The only bright light in this deep, dark pit of depravity is a report entitled Fuelling Fortress America, released in March, 2006, by the Parkland Institute, the Canadian Centre for Policy Alternatives and the Polaris Institute. This report clearly advocates a moratorium on further tar-sands development, a national energy policy and exemption like Mexico from the “proportional sharing” clause of the NAFTA free-trade agreement, which only allows Canada to reduce energy exports to the United States in proportion to reductions of our own consumption.
“Canadian Oil Is Ours”
While allegedly supporting boreal conservation in Canada, the Pew is also busy addressing American foreign policy regarding the tar sands. With its partner, the $6-billion Hewlett Foundation, which also funneled $1.85 million through the Pew to the CBI in 2004, the Pew established the “National Energy Commission,” a bipartisan group of twenty energy experts.
This group includes James Woolsey, a former director of the CIA and a member of the “Project for a New American Century,” which advocated pre-emptive war and the invasion of Iraq as early as 1998. In its 2004 report, “Ending the Energy Stalemate,” the Commission advocated, “a $300 million increase in federal funding over ten years to improve the environmental performance of technologies and practices used to produce unconventional oil resources” in Alberta’s tar sands and Venezuela’s Corinoco heavy oil belt. Overall, the Commission advocates $36 billion in government subsidies to the energy sector to be financed though the sale of carbon credits.
Canada’s tar sands and arctic natural gas have been on America’s foreign-policy radar screen at least since 2001, when Dick Cheney’s “National Energy Policy” report stated that the continued development of the tar sands “can be a pillar of sustained North American energy and economic security.” Last year, American politicians were outraged by a relatively small Chinese investment of $225 million in the tar sands, which prompted energy analyst Irving Mintzer to blurt out the widely held but publicly unspeakable opinion of Beltway insiders: “The problem with the Chinese is that they don’t know that the Canadian oil is ours. And neither do the Canadians.” Mintzer is also a co-author of the report, U.S. Energy Scenarios for the 21st Century, commissioned by the Pew Center on Global Climate Change.
In 2005, Dick Cheney’s “National Energy Policy” was transmuted into legislation called the “National Energy Policy Act,” with the support of the “Set America Free Coalition,” a front group of the “Institute for the Analysis of Global Security.” A member and advisor to both organizations, James Woolsey proudly proclaims that, “We’ve got a coalition of tree-huggers, do-gooders, sodbusters, hawks and evangelicals,” including the Natural Resources Defense Council, a regular recipient of millions in Pew and Hewlett funding, which has also become involved in a boreal-forest campaign in northern Manitoba.
In addition to providing $13.6 billion in subsidies to the energy sector, the National Energy Policy Act has a “Set America Free” sub-section, which establishes “a United States commission to make recommendations for a coordinated and comprehensive North American energy policy that will achieve energy self-sufficiency by 2025 within the three contiguous North American nation area of Canada, Mexico, and the United States.” Since the United States currently imports 60 per cent of its oil supply, this continental self-sufficiency will require much additional Canadian and Mexican oil. Furthermore, the Act establishes a Task Force to initiate “a partnership with the Province of Alberta, Canada, for purposes of sharing information relating to the development and production of oil from tar sands.” Finally, the Act requires the Secretary of Energy to update his/her assessment of domestic heavy-oil resources to include “all of North America and cover all unconventional oil, including heavy oil, tar sands (oil sands), and oil shale.” However, this legislation merely formalizes the continent-wide “deep integration” that has been well underway with the establishment of the “Security and Prosperity Partnership,” which released its “Oil Sands Experts Working Group” workshop report in March, 2006.
Stockholmsförsökets
June 30, 2006
This report investigates what effect the Stockholm Trial has had on road traffic.
Click here for .pdf file
Transek
June 30, 2006
This study analyses the benefits and costs to society of the two largest components of the Stockholm Trial: the congestion-charging system and the expansion of bus services.
Click here to view .pfd file
Lawrence Solomon
National Post
May 31, 2006
Prime Minister Harper needs an alternative to Kyoto. Just about everyone seems to agree that our government can’t just do nothing about greenhouse gas emissions.
But what if doing nothing is the best way governments can reduce emissions?
Just about everything our governments do, have done and plan to do in the economy increases emissions. This is the unintended but inevitable consequence of government activities which, by their nature, decrease the efficiency of our economy and cause us to do less with more – including more carbon dioxide and other greenhouse gas emissions.
This maxim applies to energy policy and to environmental policy, to tax policy and to economic policy. It applies to the federal and the provincial and the territorial and the municipal levels of governments. Just about everything in the economy that they do, just about everywhere. This is why our greenhouse gas emissions have been rising, and why they have been rising more in Canada than in (relatively) do-nothing governments such as those in the United States. If the U.S. government did more, U.S. emissions would be higher.
Look at energy policy. We subsidize the development of Arctic pipelines and offshore oil. We subsidize long-distance transmission of power. We subsidize the expansion of the natural gas grid. The government-created energy glut that then results is soon soaked up as industry discovers new ways to consume it, all of which lowers the cost of fuels to the consumer and discourages investment in energy-efficient technologies. Meanwhile, governments do their best to increase consumption by keeping energy prices down. Some provinces have price controls on gasoline, others subsidize natural gas, most sell power at cost through subsidized Crown agencies.
Governments increase carbon dioxide emissions even when they say they’re doing the opposite. Our governments are embarking on a crash program to run cars on ethanol, billing this as a way to reduce our dependence on oil. In fact, the greater our ethanol use, the greater our oil dependency. It takes 75% more energy to grow, crush, ferment and distill corn into ethanol than the ethanol itself contains. The more ethanol we burn, the more tar sands, Arctic gas and coal mines we’ll need.
We don’t just subsidize the energy industry, we also subsidize everything with a gas tank. Our auto manufacturers are big recipients of tax dollars, as are railroads and shipyards and, of course, Bombardier jets. We subsidize our ports and our airports.
We especially subsidize the rural resource industries – pulp and paper, mining and agriculture – Canada’s leaders in greenhouse gas production. Agriculture alone accounts for almost one-seventh of Canada’s emissions, according to the federal government’s Greenhouse Gas Emission Summary. We so love these resource emitters that they merit direct subsidies as well as layer upon layer of indirect subsidies through the tax and regulatory systems. The Employment Insurance system has special provisions for resource regions, to keep as many resource workers at maximum exploitation levels. The equalization system among provinces likewise maximizes resource depletion. These payments chiefly transfer wealth from Canada’s most industrialized and least resource-dependent province, Ontario, to the more rural resource-reliant provinces. Within Ontario, the wealth is likewise transferred from the energy-efficient urban economy to the energy inefficient rural regions.
Within cities, the government bias toward consuming fuel continues. The city of Toronto, for example, directly and indirectly promotes the private automobile through hundreds of bylaws and regulations. With few exceptions, the city strives for a car-friendly city at the expense of tenants, businesses, pedestrians, cyclists and transit users. Apartment buildings, for example, must provide surplus parking for cars, even when they are located at subway stops and even when their tenants take transit. The expense of the unneeded parking facilities drives up rents for tenants and drives down costs for car use. Likewise, neighbourhood coffee shops must provide car parking, even when the coffee shops cater to locals.
Cities ban private transit operators, who would provide faster service and more direct routes at lower cost, and they ban the use of shared taxis, which would accomplish much the same thing. They simultaneously limit the number of taxicabs on the roads, all of which tells the public that the only way to get good service is to obtain a private automobile.
Although some government programs reduce carbon dioxide emissions – investments in sidewalks, for instance – these are few and far between, and low-ticket items. The great mission of government is to boost the ratio of machine exhaust per unit of economic output. Numerous recycling programs, though billed as energy savers, in fact lead to extra energy consumption. Even energy conservation programs turn into energy consumption programs, thanks to a well-documented “rebound effect” – programs to subsidize energy-efficient fridges not only spur new purchases for the kitchen, they simultaneously lead to beer-fridges in the basement. The expectation of government conservation programs also lead people and businesses to postpone money-saving investments in insulation and other energy-efficient technologies. Without such government programs, the energy- and money-saving technologies would be installed earlier, and less energy would be consumed overall.
Trim government programs, almost any government program, and you’ll trim greenhouse gas emissions. Stephen Harper: A do-nothing agenda is the only viable Kyoto alternative. Your three Rs shouldn’t be to reduce, reuse and recycle products. They should be to reduce, repeal and rescind government programs.
Lawrence Solomon, author of the forthcoming book Toronto Sprawls, is executive director of Urban Renaissance Institute and Consumer Policy Institute, divisions of Energy Probe Research Foundation.; www.urban.probeinternational.org
Just do nothing?: Climate change debate
by Mark Jaccard, National Post, June 10, 2006
Two recent FP Comment columns make the case that Canada should have no policies to reduce greenhouse gas (GHG) emissions. Lawrence Solomon argues that eliminating government subsidies throughout our economy would reduce energy use enough to reduce our GHG emissions. Terrence Corcoran argues (as I do) that the Canadian policy reliance on subsidies and information to reduce GHG emissions has been ineffective, but he disagrees with my policy alternative – a gradually rising emissions tax or a gradually tightening emissions regulation over the next few decades. He argues that the best government strategy for the time being is to follow Mr. Solomon’s advice and do nothing but cut government subsidies throughout the economy, while waiting to see if a future Isaac Newton will prove definitively that human activity is changing the climate.
These entertaining columns provide useful challenges to conventional thinking. But they also have some critical challenges themselves.
Mr. Solomon provides no numerical estimates for the GHG emissions reductions that would result from an end to government subsidies, but this can be roughly calculated. The economy in Canada and globally is driven by the use of fossil fuels. The easiest way to get energy from fossil fuels is to burn them, which produces carbon dioxide, the most important GHG emission. If we removed subsidies in our economy, would people combust fewer fossil fuels and emit less carbon dioxide?
The likely answer is that there would be little change. First, it is unlikely we would replace fossil fuels with alternative sources of energy because we also subsidize nuclear power, hydro power, and other renewables such as wind and biomass. Production cost data (with subsidies removed) indicate that fossil fuels would remain the fuel of choice for Canada and the planet.
Second, it is also unlikely we would use much less energy. If we remove the subsidies, we would presumably also remove the taxes we collect from fossil fuels. Refined products such as gasoline are the most heavily taxed commodities in our economy. Even if we kept high taxes on fossil fuel consumption, research shows that people place a high value on the services they get from energy and would continue to consume large amounts.
Mr. Corcoran inadvertently supports this point when he argues that raising energy taxes will not significantly curb consumption, citing recent oil price increases in support. But if energy price increases because of tight market conditions will have little downward effect on demand, why would comparable energy price increases because of subsidy removal have a downward effect?
Both Mr. Solomon and Mr. Corcoran focus on our use of energy as the issue when it comes to the risk of climate change. Herein lies the problem. The risk of climate change is an environmental concern related in large part to how we use energy, not to how much we use. If carbon dioxide emissions are causing detrimental climate change, this is a market failure that requires some action by government – provided the benefits of such action are likely to exceed the costs.
Mr. Corcoran critiques my policies for reducing GHG emissions by saying they will lead to higher energy prices with little affect on energy use. I agree that there will be little effect on energy use. Again, the important issue is the effect on emissions.
Industry leaders, governments and increasingly the environmental community are beginning to recognize that we can use fossil fuels without emitting GHGs and without significantly higher energy prices. In my book, Sustainable Fossil Fuels, I summarize the evidence from industry and independent researchers showing that policies that constrain GHG emissions by financial penalty or regulation would motivate the electricity industry (to take one sector as an example) to shift over the next few decades toward zero-emission generation of electricity using coal, natural gas and perhaps other fossil fuels (in addition to more nuclear and renewables). The price of electricity over this period would rise by less than 1% per year with prices in 50 years no more than 25% to 50% higher than today. Electricity use won’t fall appreciably. But emissions will.
Mr. Corcoran refers to these as “get -tough policies.” But how tough are electricity price increases of about 10% over the next 10 years as we learn more about the climate change risk? Taking the case of automobiles, industry data suggest that the California vehicle emission standard of 1990, which resulted in today’s hybrid car and advanced the development of fuel cell vehicles, raised the selling price of vehicles everywhere by perhaps $20 to $50 (to pay for research, development and marketing of low emissions cars). Compare this to an average selling price of over $20,000.
Allowing ourselves to continue installing new long-lived equipment, factories and infrastructure that uses fossil fuels and emits GHGs, even though we know that for a reasonable cost we could begin to shift these investments toward zero emission technologies, is tantamount to saying that we are absolutely certain we are not changing the climate. But since we are uncertain, as Mr. Corcoran admits, we should approach the issue in the same way that businesses approach risks in their daily decisions.
A business leader cannot afford to say, “I will only make this risk reduction expenditure if every one of my safety engineers is absolutely certain that a hideous accident will otherwise occur.” Likewise, humanity cannot say, “We will only incur costs to reduce climate change effects or their probability when we are certain the effects will be devastating and that their probability is 100%.” This is no way to run a business – or a planet.
Mark Jaccard is professor of resource and environmental management at Simon Fraser University and author of Sustainable Fossil Fuels: The Unusual Suspect in the Quest for Clean and Enduring Energy.
A true believer in government
by Lawrence Solomon, National Post, June 10, 2006 Academics, policymakers and regulators can succumb to fads as easily as anyone. Honourable people admit their mistakes and move on, and hopefully learn from their experiences.
Marc Jaccard is such an honourable person, but he hasn’t learned from his mistakes. He still strives to correct “market failures,” not recognizing that they seem always to occur in government-dominated sectors and because of government intervention. He still tries to use government to influence energy consumption, although he realizes government has often done more harm than good. He still ignores data from those whose viewpoints don’t correspond to his, all the while deploring their absence of data.
In the 1990s, Mr. Jaccard was in thrall to one of the biggest and wonkiest fads going in the energy game, demand side management. If you don’t know what this jargon means, you have nevertheless seen it in action and probably participated in it, to doubtful outcome. A DSM program gave you those energy-efficient lightbulbs or water-saving showerheads that now clutter your basement storeroom.
A DSM program provided the subsidy that convinced you to buy a new energy efficient fridge, expecting you to throw out your old fridge and save society some energy. Only your old fridge ended up in your garage as a beer fridge, and you now have two fridges, consuming more electricity than before.
If you lived in British Columbia, DSM came to you courtesy of Mr. Jaccard. As chair of the British Columbia Utilities Commission, he became one of the country’s leading exponents of DSM programs, and, because he could also impose his policies on society, waste was the outcome. In this he was not alone – the great majority of energy experts were then caught up in the DSM mania, disregarding the relatively few dispassionate voices that argued otherwise (I am proud that Tom Adams, my colleague at Energy Probe, was among the very first, in 1990, to expose the sham of DSM programs).
To his credit, Mr. Jaccard has seen the light. Now, along with most of the best brains in the energy business, he realizes just how dim DSM can be, and himself exposes it. He doubtless wonders how he could have been taken in by programs that proved so spectacularly wrong, and how he could have ignored so much evidence from the Tom Adamses of the world that proved so spectacularly right, particularly when the evidence was submitted directly to him in his capacity as BC’s electricity regulator.
Yet although Mr. Jaccard has seen what grief comes of following the herd, he is again ignoring incontrovertible evidence from impeccable sources, this time over greenhouse gas reduction, the gargantuan new rage among energy analysts.
In his response to columns by Terence Corcoran and me on the best way to deal with the greenhouse gas issue, Mr. Jaccard once more sees evidence of “market failure” in a market dominated by government intervention, once more selectively sees the data he’d like to see and blinds himself to the rest, including facts and the data from impeccable sources.
Take David Pimentel, whose data I cited in my column. Mr. Pimentel is the leading critic of ethanol production, the chief government program that promotes an alternative to gasoline. Mr. Pimentel could not have better credentials. This Oxford, MIT, and Cornell-educated agricultural scientist helped establish the U.S. Environmental Protection Agency, he has been chairman of the Environmental Studies Board in the National Academy of Sciences, he has served on 12 of their distinguished panels, and he is the former chair of a U.S. Department of Energy panel that investigated the efficiency of ethanol production. His more recent ethanol findings have been published in the authoritative Encyclopedia of Physical Sciences and Technology.
Yet Mr. Jaccard, in criticizing my column, shows no interest in Pimentel’s data, acting as if I hadn’t even presented data.
“Every time you make one gallon of ethanol, there is a net energy loss of 54,000 BTUs,” Mr. Pimentel calculates for the U.S. market (in Canada, where ethanol crops have a lower energy yield, the loss would be greater). In the real world, this energy loss leads to more tar sands, Arctic pipelines, and coal plants, and thus to more carbon dioxide.
In the world Mr. Jaccard inhabits, wasteful government policies that inefficiently increase fossil fuel use are of little account because, in the next 50 years, his pet technology will become economically viable and rampant energy use will fade in importance.
Mr. Jaccard asserts that government penalties, properly applied, will motivate industry over the coming decades to invent zero-emission coal-burning technology at a cost that is a mere 25% to 50% more than today.
While he peers into his crystal ball, he criticizes Mr. Corcoran as fanciful for thinking that inventions will continue to occur without government prodding. Mr. Jaccard also believes energy costs should rise, although the history of the world shows the costs of energy (as well as every other major resource) to consistently decrease while becoming ever cleaner.
Only a true believer could share Mr. Jaccard’s faith that the future should depart so dramatically from the past, and that government will in future do so much right where before it has done so much wrong.
If the world were run on a businesslike basis, Mr. Jaccard claims, it would protect itself against a possible calamity such as global warming. This analogy, though often recited, is always wrong. No CEOs would sign blank cheques to avoid undefined risks for undefinable benefits centuries into the future, especially when the governments that would be charged with mitigating the risks had a proven track record of making matters worse.
