New modelling forecasts 46 million jobs by 2050 in a 100% renewable energy scenario

achieving paris goals teske coverA newly-released book, Achieving the Paris Climate Agreement Goals, provides detailed discussion of the the implications, including job implications,  of a transition to 100% renewable energy.  The  book’s findings are summarized by Sven Teske of the Institute for Sustainable Futures, University of Technology Sydney, in “Here’s how a 100% renewable energy future can create jobs and even save the gas industry”,  which appeared in The Conversation (Jan. 23). That article states: “The world can limit global warming to 1.5℃ and move to 100% renewable energy while still preserving a role for the gas industry, and without relying on technological fixes such as carbon capture and storage, according to our new analysis.” The scenario is built on complex modelling – The One Earth Climate Model  – and foresees a gradual transition from gas to hydrogen energy, so that “by 2050 there would be 46.3 million jobs in the global energy sector – 16.4 million more than under existing forecasts….  Our analysis also investigated the specific occupations that will be required for a renewables-based energy industry. The global number of jobs would increase across all of these occupations between 2015 and 2025, with the exception of metal trades which would decline by 2%. ”

The article summarizes a book with a daunting title:  Achieving the Paris Climate Agreement Goals: Global and Regional 100% Renewable Energy Scenarios with Non-energy GHG Pathways for +1.5°C and +2°C . It is the culmination of a two-year scientific collaboration with 17 scientists at the University of Technology Sydney (UTS), two institutes at the German Aerospace Center (DLR), and the University of Melbourne’s Climate & Energy College, with funding provided by the Leonard DiCaprio Foundation and the German Greenpeace Foundation.   It was published in January 2019 by Springer as an Open Access book , meaning it is free to download the entire book or individual chapters without violating copyright.  Of special interest:  Chapter 9,  Trajectories for a Just Transition of the Fossil Fuel Industry , which provides historical production data for coal, oil and gas production, discusses phase-out pathways for each, and concludes with a discussion of the need “to shift the current political debate about coal, oil and gas which is focused on security of supply and price security towards an open debate about an orderly withdrawal from coal, oil and gas extraction industries.”

The data presented in Chapter 9 form the foundation of Chapter 10,  Just Transition: Employment Projections for the 2.0 °C and 1.5 °C Scenarios . This consists of quantitative analysis, ( the overall number of jobs in renewable and fossil fuel industries) and occupational analysis – which looks into specific job categories required for the solar and wind sector, and the oil, gas, and coal industry. The chapter provides projections for jobs in construction, manufacturing, operations and maintenance (O&M), and fuel and heat supply across 12 technologies and 10 world regions. The conclusion:  “Under both the 1.5 °C and 2.0 °C Scenarios, the renewable energy transition is projected to increase employment. Importantly, this analysis has reviewed the locations and types of occupations and found that the jobs created in wind and solar PV alone are enough to replace the jobs lost in the fossil fuel industry across all occupation types. Further research is required to identify the training needs and supportive policies needed to ensure a just transition for all employment groups.”

Supreme Court rules in Redwater: bankruptcy is no escape from “polluter pays”

Supreme court of canada buildingOn January 31, the Supreme Court of Canada released a long-awaited, precedent-setting decision which holds fossil fuel companies responsible for the clean-up costs of their abandoned operations, and gives environmental clean-up costs precedence over other creditors’ claims.  The case arose from the 2015 bankruptcy  of Redwater Energy, a small, Calgary-based oil and gas company; the agent managing the  bankruptcy was proposing to  sell the company’s  profitable wells to pay off debts, and leave the clean-up costs of the other non-producing wells to the Orphan Well Association (OWA), a provincial, industry-funded agency.  The Supreme Court provides its own “Case in Brief” summary of the the case,  Orphan Well Association v. Grant Thornton Ltd.  here , with links to all the official documents.  The full decision is here ; French-language versions of the Case in Brief , and the full decision are also provided. The response by the Orphan Well Association is here  .

For a brief reaction:  “Redwater decision reassuring, but we aren’t out of the woods” by the Pembina Institute (Jan. 31) or from the  National Observer special series Legacy of Liabilities ,  a summary of the decision  and the more detailed, “Alberta lauds court ruling but has no oil well cleanup plan”

Deeper background and analysis appears in  “Alberta’s Mega Oil and Gas Liability Crisis, Explained” in The Tyee , in which Andrew Nikoforuk asks, “Just how will an increasingly indebted industry, hobbled by low energy prices and rising costs, find the up to $260 billion needed to clean up its inactive pipelines, wells, plants and oilsands mines as it enters its sunset years?”  He concludes with words from Regan Boychuk, a founder of Reclaim Alberta, an advocacy group which began in 2016 to propose an Alberta Reclamation Trust , which would clean-up inactive wells and provide funding for job creation in the energy sector.   Boychuk’s own insider’s view appeared in the National Observer as “Putting the Supreme Court’s Redwater decision in context”  (Feb. 1) .  (Boychuk also provided a briefer Opinion piece as a guest blogger in David Climenhaga’s Albertapolitics.ca ).

Other detailed articles:  An Explainer from The Narwhal: “What the Redwater ruling means for Alberta’s thousands of inactive oil and gas wells”  or from a legal point of view, from Osler law firm, “Supreme Court of Canada decision in Redwater: Early Implications “. 

It is clear that the implications of this decision are huge and expensive, not only for Alberta, but for all extractive industries across Canada.  As the Pembina Institute points out:  “obligations have steadily grown, and now include over 80,000 inactive oil and gas wells, facilities, and pipelines as well as 1.4 trillion litres in fluid oilsands tailings. The Government of Alberta officially estimates it will cost CAD$57 billion to cleanup these sites, though there are ongoing concerns about the accuracy of this figure. Conversely, only $1.2 billion is currently held in securities to protect the public. ”  (A joint investigation by the National Observer, Global News, the Toronto Star, and StarMetro Calgary  in November 2018 estimated that the actual clean-up costs are approximately $260 billion in Alberta alone).

The latest analysis: What does Canada gain from the Trans Mountain Pipeline purchase?

pbologoInto Canada’s highly sensitive and highly political debate over pipelines comes the report on January 31 from the Parliamentary Budget Officer (PBO) :  Canada’s purchase of the Trans Mountain Pipeline – Financial and Economic Considerations . The report provides an overview and timeline of the negotiations and federal government purchase of the pipeline and its assets from Kinder Morgan, in August 2018 . The PBO financial analysis estimates that the $4.4 billion  price paid by the government  was at the high end of the value, and calculates the effects of construction delays or higher construction costs on the price that the Government could negotiate for its re-sale –for example, a one year delay would result in a loss of value $693 million. The report finds that the economic benefits relate to the pre-construction and construction periods: impact on GDP is estimated to peak at 0.11 per cent in 2020; impact on employment is estimated at  7,900 in 2020, with both declining thereafter.

“The main benefit of the TMEP would arise from the increased capacity of Canadian producers to sell oil to export markets, which could lead to a reduction in the differential between Western Canadian Select (WCS) grade of crude oil and other grades, most notably West Texas Intermediate (WTI).”  Stating “It is difficult to determine the impact of the TMEP on the price differential between WTI and WCS grades”, the report refers to estimates in its December 2018 report to Parliamentarians, and flags the other factor which might affect the economic impact, which is “increasing transportation capacity.”

Coinciding with the PBO report, the National Observer has brought an article out of its archives, which critiques the economic arguments used by supporters of the Trans Mountain purchase. “False oil price narrative used to scare Canadians into accepting Trans Mountain pipeline expansion” was written by Robyn Allen, and was originally published in November 2018.  More recently, she has also written,  “What Bill Morneau didn’t tell Canadians about the Trans Mountain Purchase” (Dec. 5 2018)  and an Opinion piece “Trudeau’s oilsands supply outlook reflects a future that doesn’t exist” (Jan. 25 2019)  , which concludes: “It is madness pretending that Trans Mountain’s expansion is financially or economically viable. A return to sanity begins with getting realistic about the supply of heavy oil in a world that knows — even if Trudeau won’t take his head out of the oilsands — that neither the economic system nor the ecosystem can, or will, support rapid oilsands growth.”

orcasagainstvancouverskylineFor coverage of both the economic and environmental aspects, follow the National Observer Special Reports on Trans Mountain.  An up-to-date review of the  environmental arguments by experts Marc Jaccard and Kirsten Zickfeld  appears there in “IPCC authors urge NEB to consider climate impacts of Trans Mountain pipeline expansion” (Jan. 21).

The National Energy Board documentation about all stages of the Trans Mountain Expansion project is here (and  here for French documentation).  Information about the current Reconsideration process is here   (and here in French); the deadline for the Reconsideration report to the government is February 22, 2019.

German Coal Exit Commission recommends Just Transition measures but a 2038 deadline

coal machine germanyOn January 26, the German Commission on Growth, Structural Change and Employment, (better known as the Coal Exit Commission) delivered its highly-anticipated report and a “roadmap” for lignite coal plant closures in the country. The report calls for Germany to end coal-fired power generation by 2038 – subject to reviews by independent experts in 2026, 2029, and 2032, when it  will be decided if the deadline can be advanced to 2035. The 28 official Commissioners, drawn from industry, unions, environmental NGOs, community leaders and government, negotiated for six months , with all but one voting in favour of the final recommendations. Greenpeace voted “yes”, but also issued a dissenting opinion, stating  “Germany finally has a road map for how to make the country coal-free. There will be no further coal plants. Greenpeace and other groups made sure that the commission has clearly supported keeping Hambach forest. However, the report has a grave flaw: the speed is not right.” Other participants, including Sir Nicholas Stern, also criticized the slow speed of the plan.  The Powering Past Coal Alliance , of which Canada and the U.K. were founding members, state that, in order to meet the goals of the Paris Agreement,  “a coal phase-out is needed by no later than by 2030 in the Organisation for Economic Co-operation and Development and in the European Union.”

A compilation of reactions from Commissioners is here. From Michael Vassiliadis, head of the miners’ union IG BCE :“We have found a compromise after 21 hours of negotiations that cannot make us happy, but leaves us overall satisfied. We managed to shield the employees in coal power generation from social hardships from the structural change. At the same time, the coal phase-out is closely tied to verifiable progress with the future energy mix, the expansion of renewables and the grids. The regions get money for structural change, to create new quality jobs. The commission laid the foundation for a new Energiewende of reason.”

The 336-page report is currently available in German only; , but it is well summarized in English in a Fact Sheet from Clean Energy Wire. According to CLEW, key issues addressed are the stability and pricing of energy supplies for Germany, CO2 reduction, and compensation to industry.  Regarding Just Transition for workers and communities, the report devotes almost 40 pages to the economic measures for the regional economies and workers. While the report itself doesn’t estimate those costs, an article in Der Speigel   states that communities will receive 40 billion euros in structural assistance over the next 20 years.  The Commission calls for the coal mining regions to remain energy-oriented, through the development of innovative technologies, such as electricity storage, renewable energy, or power-to-gas production .

The Commission’s recommendations are expected to be accepted by government, but there is a long road ahead in passing legislation and negotiating financing, as outlined in  “German government stands ready to move on coal exit proposal” (Jan. 29). The coal exit will be one part of the government’s Climate Action Law package, promised for the end of 2019.

Economists debate decarbonization: optimistic and pessimistic scenarios

debate forum , Is Green Growth Possible? was hosted by the Institute for New Economic Thinking in December, consisting of papers by  economists debating whether catastrophic global warming can be stopped while maintaining current levels of economic growth. The arguments are summarized  for the non-economist in “The Case for ‘conditional optimism’ on climate change” by David Roberts in Vox (Dec. 31) .  Economists may be interested in the full papers, which  include “The Road to ‘Hothouse Earth’ is Paved with Good Intentions” and “Why Green Growth is an Illusion”, both by Enno Schröder and Servaas Storm.  The authors conclude that  “..  The world’s current economies are not capable of the emission reductions required to limit temperature rise to 2 degrees. If world leaders insist on maintaining historical rates of economic growth, and there are no step-change advances in technology, hitting that target requires a rate of reduction in carbon intensity for which there is simply no precedent. Despite all the recent hype about decoupling, there’s no historical evidence that current economies are decoupling at anything close to the rate required…. Without a concerted (global) policy shift to deep decarbonization, a rapid transition to renewable energy sources, structural change in production, consumption, and transportation, and a transformation of finance, … the decoupling will not even come close to what is needed.”

The Inconvenient Truth about Climate Change and the Economy”  by  Gregor Semieniuk, Lance Taylor, and Armon Rezai summarizes and analyzes the October 2018 IPCC report, Global Warming of 1.5 °C. ,  finding it overly optimistic about global productivity growth and fossil fuel energy use, and reiterating the argument that politics are holding back climate change solutions. They conclude that “a big mitigation push, perhaps financed by carbon taxes and/or reductions in subsidies, is possible macroeconomically even if the link between energy use and output is not severed. This, however, would require considerable modifications of countries’ macroeconomic arrangements. Needless to say, military establishments and recipients of energy subsidies wield political clout. Fossil fuel producers have at least as much. Whether national preferences will permit big shifts in the use of economic resources is the key question.”

Finally, in “Conditional Optimism: Economic Perspectives on Deep Decarbonization”, author Michael Grubb  takes issue with Schröder and Storm, saying that their papers rely on historical data and rates of change, and thus are characterized by a “pessimism about our ability to change what matters fast enough. ” Grubb states that this “may  be emblematic of a growing trend in energy-climate economics, of what we might term historical futures analysis.”  He lays out a  technical economic critique and suggests four fundamental principles for his own “conditional optimism”, which relies on analysis based on the rate of displacement of carbon intensive energy supply by the growth of alternate sources.