A Just Plan to wind down B.C.’s Fossil fuel industry by 2050

Winding Down_report cover_CCPA-BC_1  Winding Down BC’s Fossil Fuel Industries: Planning for climate justice in a zero-carbon economy   was released on March 4  by the B.C. office of the Canadian Centre for Policy Alternatives, as part of the Corporate Mapping Project.  Authors Marc Lee and Seth Klein begin with an overview of the province’s  fossil fuel industries (including locations, production and reserves)  noting that all fossils produce one-quarter of B.C.’s GHG emissions, (most of which is from Liquified Natural Gas (LNG)). Calling the government’s current strategy of promoting LNG production through clean electricity “untenable”, the report proposes a four-point phase-out plan for all fossils over the next 20 to 30 years, including: 1. Establish carbon budgets and fossil fuel production limits; 2. Invest in the domestic transition from fossil fuels and develop a green industrial strategy; 3. Ensure a just transition for workers and communities; 4. Reform the royalty regime for fossil fuel extraction.

To design a Just Transition plan, the authors cite as “helpful” the examples of the Alberta coal phase-out and the 2018 coal phase-out agreement in Spain, as well as the existing Columbia Basin Trust example of community transition.  In the long time frame of 20 to 30 years, they see the retirement of many existing workers, so that attrition will accomplish much of the job shedding. Although they say that Just-transition strategies “must include efforts to maintain employment in areas where jobs are likely to be lost” – implying reinvestment in resource-based communities – they also recognize the built-in gender bias of such a strategy and advocate investment in  public sector jobs – such as child care and seniors services.

To secure Just Transition funding

The report states:

“ ….BC should aim to invest 2 per cent of its GDP per year … or about $6 billion per year in 2019, an amount that would grow in line with the provincial economy. Assuring such levels of investment should give comfort to workers currently employed in the fossil fuel industry. Revenues from higher carbon taxes and royalty reforms (described below) would be an ideal source of funds, and/or governments could borrow (through green bonds) to undertake high levels of capital spending on decarbonization initiatives. In contrast, the 2019 BC Budget lists total operating and capital expenses for CleanBC over the next three years at, cumulatively, only $679 million, less than one-tenth of a percent of BC’s GDP.”

Managing Income loss for transitioned workers:

The authors state: “On average, fossil fuel workers make 28 per cent more than workers in the rest of the economy, although this includes gasoline station workers who earn  comparably low wages. Replacing more than $5 billion of income over the course of the wind-down period is therefore a central challenge”…. By assuming a 20 to 30 year time frame, they calculate a job substitution of 500 to 700 jobs per year, and state: “ There is no reason to believe that such a transition should be a problem if the right policy supports are implemented and a proactive green investment strategy is pursued to create alternative employment options.”  Earlier in the report, the authors estimate that, assuming the province invests 2 per cent of its GDP annually (about $6 billion in 2019) in green job creation, at least 42,000 direct and indirect jobs would be created  in a range of opportunities.

The CCPA offers an 8-page Executive Summary of the report, and an even briefer version , written by co-author Marc Lee, was published in the Vancouver Sun on March 8.

Alberta’s government continues to prop up oil and gas industry with new Blueprint for Jobs, penalties for protesters

As Teck Mines and other  private sector investors rush away from oil and gas investment in Alberta and the price of oil collapses, the Alberta Legislature resumed on February 24, with a  Budget  and a new economic plan: A Blueprint for Jobs: Getting Alberta Back to Work . The Blueprint is built on five pillars: “Supporting businesses; Freeing job creators from senseless red tape; Building infrastructure; Developing skills; Selling Alberta to the world.”  Announced in a March 2 press release as the first step  in the Blueprint:  a $100 million loan to the Orphan Well Association,  promising to generate up to 500 direct and indirect jobs by financing reclamation of abandoned mining sites. The press release also promises  a future “suite” of announcements “covering the entire lifecycle of wells from start to finish”.   As The Narwhal  reports in  “Alberta loans industry-funded association $100 million to ‘increase the pace’ oftes orphan well cleanup (March 2),  this latest loan follows a 2017 loan of $235 million , as the industry-levies which fund the Orphan Wells Association fail to keep pace with the environmental mess left behind by bankrupt mining companies.

The Alberta Federation of Labour  released a statement in response to the Alberta Budget ,  “Kenney’s Budget breaks promises, delivers opposite of what Albertans voted for last year” . The AFL charges that the budget will result in more than 1,400 job cuts, especially in education (244 jobs lost), agriculture (277 jobs lost), and community and social services (136 jobs lost). Further, “Today’s budget increases the deficit by $1 billion because of this government’s short-sighted overreliance on resource revenues, while cutting billions in revenue from corporations.” A similar sentiment appeared from an opposite corner:  an Opinion piece in the mainstream Toronto Globe and Mail states: “The cost of Mr. Kenney’s inaction on economic diversification will be high. Alberta has the advantage of being home to many skilled clean-tech and renewable-energy workers already, but the speed at which the world is innovating in that area means that a lagging Alberta will result in the emigration of some of our best and brightest entrepreneurs.”

Updated:  

The Alberta Federation of Labour released another statement on March 16 , condemning the Budget proposal as an “  ideological budget that does not fit the times”.  Further, it is  “no longer worth the paper it’s written on. The revenue side of the budget is in tatters because oil is now trading nearly $30 per barrel less than projected” , and because of the Covid-19 crisis, the planned cuts to health care “will hurt, not help our province.”   The AFL is demanding that the Budget be scrapped, but the CBC reported on March 16, “Alberta government plans to accelerate budget process, add $500M to health spending” , reporting that the government dramatically curtailed study and debate , and on March 17, CBC reported “Alberta legislature approves $57-billion budget in race against COVID-19 spread”.

For those concerned about the erosion of the democratic process under the threat of the pandemic, this is a worrying sign.

And not the first worrisome sign in Alberta:  the first order of business in the new Session was  Bill 1, The Critical Infrastructure Defence Act , introduced by Premier Kenney. As described in a National Observer article here  , the Bill  proposes to discourage citizen protest by making it easier for police to intervene in blockades, and proposes individual fines for protesters of up to $10,000 for a first offence, and up to $25,000 for each subsequent day a blockade or protest remained in place. The Alberta Federation of Labour released a statement on March 6 calling on the government to withdraw the Bill immediately, stating that the justification (ie protection of rail lines) is misleading, and “The legislation is clearly designed to stop or discourage all collective action that goes against the UCP agenda, including potential labour or worker action.”

 

 

Positive examples of climate action needed to bring unionists into the climate fight, says veteran activist

“The Climate Movement Doesn’t Know How to Talk with Union Members About Green Jobs” appeared in The Intercept on March 9, transcribing an interview with Jane McAlevey,  a veteran labour activist in the U.S. and now a senior policy fellow at the University of California Berkeley’s Labor Center.  One interview  question: “What do you think organizers should be doing right now to make sure a climate-friendly platform can win in a presidential race where Trump will argue that ending fossil fuel investment means lost jobs?” In response, McAlevey urges activists to allay workers’ fears about the future with examples of positive changes – citing as one of the best examples  the “New York wind deal”  when,  “unions won a far-reaching climate agreement to shift half of New York State ’s total energy needs to wind power by 2035. They did it by moving billions of subsidies away from fossil fuels and into a union jobs guarantee known as a project labor agreement.”   (A previous WCR post  summarizes the campaign which culminated in the New York Climate Leadership and Community Protection Act in the summer of 2019).  Ultimately, McAlevey calls for “spade work” which educates workers about the climate crisis and reassures them by providing positive solutions. Citing the deeply integrated nature of the climate and economic crises, she concludes: “We have to build a movement that has enough power to win on any one of these issues that matter to us….. We’re relying on the people that already agree with us and trying to get them out in the streets. We can’t get there with these numbers.”

McAveley CollectiveBargain-book-cover-329x500The Intercept interview is one of many since Jane McAlevey’s published her third book  in January 2020.   A Collective Bargain: Unions, Organizing, and the Fight for Democracy  discusses the climate crisis, but is a much broader call to arms for  the U.S. labour movement.  A very informative review of the book by Sam Gindin appears in The Jacobin, here .

Australia Senate Committee Report shows a green economy is possible

Flag_of_Australia.svgOn 31 July 2019, the Australian Senate established a Select Committee into the Jobs for the Future in Regional Areas, with a mandate to inquire and report on new industries and employment opportunities that can be created in regions and rural areas. The terms of reference were broad and included “lessons learned from structural adjustments in the automotive, manufacturing and forestry industries and energy privatisation ; the importance of long-term planning ; measures to guide the transition into new industries and employment; and the role of vocational education providers, in enabling reskilling and retraining.”

Public consultations were conducted in seven locations and 174 submissions were received from academics, policy experts, government representatives and unions, between July and September.  The Report of the Select Committee was released in early December 2019, but because Senators were unable to set aside politics and arrive at consensus recommendations, the report consists mostly of excerpts from the submissions heard.  There are 14 recommendations made by the Chair , and separate recommendations by Labor members and by Government Senators, who said: “The word ‘transition’ is a loaded term which necessarily involves preconceptions around the direction of the Australian economy. The issue surrounding the definition of ‘transition’ is one of the reasons why the committee could not reach agreement on recommendations.”

Neverthess, the report and submissions are a valuable record of the current situation in Australia because they discuss examples of the technological innovations in current industry, and future job opportunities in renewable energy, biofuel, mining, lithium-ion battery manufacture, waste management, hydrogen energy export to Asia, and ecological services and natural infrastructure (including site rehabilitation and reef restoration).

Some excerpts:

“… the growth in renewable energy generation presents direct opportunities for increasing manufacturing activity: Installation and construction employs large numbers of people for short periods of time, but a globally competitive renewables manufacturing industry creates jobs for decades. The Victorian state government has only scratched the surface of the opportunity for Australia in this space. They have reopened the Ford plant in Geelong and allowed Danish multinational Vestas to start assembling wind turbines, but there is also Keppel Prince in Portland and Wilson Transformers in Wodonga, who have also been involved in the renewables supply chain, creating high skilled, meaningful manufacturing jobs.”

“…. the GFG Alliance in Whyalla which is proposing to revitalise the steelworks and bring down the cost of production with a variety of innovative and technologically advanced initiatives. Depending on the final configuration, a portion of the energy used at the steelworks would be sourced from a 280 MW solar farm in the Whyalla region….. Sun Metals, a solar electricity generation farm, supplies the existing zinc refinery with about 30 per cent of its electricity needs. That refinery is expanding its zinc production and is looking to expand its portfolio of renewable generation assets to further reduce its exposure to volatile electricity grid prices. Similarly, the development and commercialisation of the EnPot technology for aluminium smelting has the potential to redefine and expand the role of aluminium smelting in Australia as an electricity grid stabiliser as well as a value-adding base metal producer.”

Regarding future skills and labour market concerns:

The Centre for Policy Futures characterized the role of industry skills councils as critical to ensure that training matches the available jobs.  “… These councils must be part of the community consultation process; work with the public authority to identify what future employment opportunities might look like; and determine the future employment, reskilling and retaining opportunities that might be available.”

Concerns about the skill differences between workers currently employed in coal mines and power-stations were highlighted by the Institute for Sustainable Futures: “The nature of the workforce in coalmining means that the transition there is going to be more challenging than it is in power generation. Power generation has a lot of trades, technicians and professionals. One in two coalminers is a truck driver or a machine operator—the second-lowest skill category. So it is going to be a lot more challenging than power generation, where you’ve got a relatively skilled workforce.”…. Regional Development Australia South West noted that: Average wages here in the mining sector are $137,000. Average wages in tourism are $49,000. You can’t replace those mining jobs with tourism jobs.”

Regarding Transition Planning :

Several submissions supported the creation of a National Transition Authority, with responsibility for planning and collaboration, but  not replacing the need for local transition planning bodies.

The Next Economy (Submission #16 here ) put forward a model for a national Transition Authority which would : 1.  oversee funding and coordination of transition planning at both a national and regional level 2.  coordinate with other authorities and government agencies to ensure that the scale, type and pace of the transition will enable us to meet international climate obligations to reduce emissions 3.  coordinate an industry-wide, multi-employer redeployment scheme to provide retrenched workers with the opportunity to transfer to other power generators 4.  ensure companies meet their responsibilities to workers in terms of redundancy payments and entitlements, retraining opportunities, and generating jobs through full decommissioning and rehabilitation of sites .

Sadly, these recommendations and examples hold little sway with the current government of Australia, as Prime Minister Morrison continues to support the development of new coal projects.  The Senators’ Comments in the Select Committee Report are a catalogue of government positions, summed up by this :

“In the view of the Government Senators, the majority report (approved by the Greens and the ALP Committee members) inadequately highlights the importance of jobs associated with coal mining and oil and gas production to the Australia’s economy.”

Saskatchewan announces $10 million aid for Estevan and Cornach coal transition

A February 28 press release from the government of Saskatchewan announced funding to support the communities of Estevan  and Cornach     – the province’s principal coal-producing communities – as they transition after the federally- mandated phase-out of traditional coal-fired electricity generation by 2030.  Estevan is scheduled to receive $8 million and Cornach  $2 million in this provincial announcement – money that had already been pledged in the government’s Throne speech in October 2019 .

Climate Justice Saskatoon has studied and compiled research into  the coal transition for these two communities as a project called Future of Coal.  A useful timeline highlights key developments in the phase-out process from 2017 to 2019 and a report,   Bridging the gap: Building bridges between urban environmental groups and coal-producing communities  (2018), reports on “in-depth conversations with coal and service industry workers, town administrators, union representatives, and farmers”  in Cornach and Estevan.

The federal Task Force on a Fair and Just Transition for Canadian Coal Power Workers and Communities visited the two communities – briefly noted in their What we Heard report  and reported at length by the Estevan Mercury newspaper here.   The  Regina Leader Post reported in detail on the anxiety and frustration of workers in  “ ‘Energy city’ feeling powerless as coal phase-out haunts Estevan” (June 2019) . Workers are members of  United Mine Workers Local 7606 ,  and many are hoping that investment in carbon capture and storage (CCS)  might prolong their working lives.  A  video explains their view of  CSS  here on the Local 7606 website .