Canada Pension Plan continues to risk Canadians’ retirement savings – this time, fracking investments in Colorado

The Canadian Pension Plan Investment Board continues to display a hypocritical disregard for its own sustainability principles, as reported in  “CPPIB’s fracking operation in U.S. raises questions” in the Toronto Globe and Mail on September 27. The Globe and Mail describes the fracking activities and political donations of Crestone Peak Resources, a company 95% owned by the Canada Pension Plan Investment Board, and formed out of the ashes of Encana. The article reports that Crestone spent more than US$600,000 to support pro-business candidates who opposed tougher regulation of fracking in the 2018 Colorado state elections. Friends of the Earth Canada were involved in the Globe and Mail investigation and has posted unique information here .

The Energy Mix also published “’Canadians Don’t Want This: Fracking Company Owned By Canada Pension Plan Spent $600,000 To Influence Colorado State Elections” (September 30).The article quotes  Professor Cynthia Williams, Osler Chair in Business Law at Osgoode Hall Law School in Toronto, who states:  “It’s a “perfectly correct statement of corporate law” to say that CPP and Crestone are separate companies”, …. But it’s “an imperfectly correct answer to the ethical questions about CPPIB using its heft, based on the involuntary monetary contributions of millions of citizens and other people working in Canada, to try to shape politics to support its oil and gas investments, in Colorado, even as the Government of Canada has committed to working to transition to a low-carbon economy.”

Professor Williams  is the author of  Troubling Incrementalism: Canadian Pension Plan Fund and the Transition to a Low-carbon Economy , published in September by the Canada Climate Law Initiative.  The report discusses CPPIB investments in fossil fuels in the last six years in detail, including fracking companies in Ohio and the Crestone company in Colorado, as well as oil sands expansion in Alberta and Saskatchewan. The report concludes by calling on CPP Investments to fundamentally re-evaluate its role, stating:

“Our view is that CPP Investments should be, and could be, making a substantial contribution to Canada’s future economy by supporting new technologies, new companies, and the just transition to a low-carbon economy. We argue that doing so would be more consistent with its statutory mandate to manage the assets of the CPP Fund in the best interests of the twenty million Canadian contributors and beneficiaries than is its current approach. It would also be more consistent with its common-law fiduciary duties, which require intergenerational equity.”

What can Canadians do to move their pension funds away from fossil fuels?

Friends of the Earth Canada offers an online letter to Heather Munroe-Blum (Chair, Canada Pension Plan Investment Board) and Mark Machin (CEO), with five recommendations arising from the Crestone investigation. FOE is also conducting open informational meetings about the CPP investments throughout Canada in October.

Shift Action  is a project of Tides Canada which advocates for environmentally-responsible pension management.  Their press release (Sept. 29) cites the Crestone investment, highlights the nearly $12 billion invested in Chinese coal mines and other fossil fuel companies (double its clean energy investments),  and warns: “The CPP is betting Canadian retirement savings against the unstoppable transition to a clean energy economy, and fueling the global climate crisis in the process.”  In an interview published in The Energy Mix , Shift Action’s Executive Director, Adam Scott urges Canadians:  “One of the best ways to have an impact in this crisis is to make sure the funds that are invested on your behalf are invested in solutions to climate change, not in the problem. There’s a tool on our website that makes it easy for all Canadians to send a note to their pension funds asking what they’re doing on climate risk and how they’re investing.”   Shift Action published a detailed guide to engagement in June 2019, Canada’s Pension Funds and Climate Risk: A Baseline For Engagement . It concludes with tips which include:  “Each of Canada’s major pension plans has a different structure for governance and accountability. Beneficiaries should understand this structure and have a clear sense of their pension plan’s sponsors and governance model. Beneficiaries should engage with all relevant points of contact, for example a union pension representative or a government appointed pension trustee.”

And finally, for pension fund trustees, the Canada Climate Law Initiative  flagship initiative is the Canadian Climate Governance Experts program, which offers “pro bono sessions on effective corporate governance to address climate-related financial risks and opportunities to corporate boards of directors and Canadian pension fund boards.”

 

 

Canadian doctors call for moratorium on fracking for gas

On January 29, the Canadian Association of Physicians for the Environment (CAPE) released a report which documents the serious health and environmental dangers associated with fracked natural gas, calling for the phase-out of existing fracking operations and a moratorium on any new fracking projects. CAPE also calls for Just Transition plans to help workers and the communities which would be affected.  Canada is the world’s fourth largest producer of natural gas, and in 2018, 71% of that was “fracked gas”, mostly produced in northeastern British Columbia.  The Narwhal offers a good  (though now dated) explainer about fracking in Canada, and offers several in-depth articles, including “Potential health impacts of fracking in B.C. worry Dawson Creek physicians” (April 2019). The Narwhal has also published recent articles by Ben Parfitt of the Canadian Centre for Policy Alternatives B.C., who has also written extensively about fracking and LNG in B.C. Most recently, Peace River Frack-up  was released by CCPA-BC in January,  calling for an immediate ban on fracking activity for operations  close to BC Hydro’s two existing Peace River dams and the Site C dam, because of the risk of dam failure from fracking-caused earthquakes.

The CAPE report, Fractures in the Bridge: Unconventional (Fracked) Natural Gas, Climate Change and Human Health  documents the environmental and climate change impacts of fracking, with an over-riding concern about the significant health dangers, especially for communities and workers. The report notes: “Data from the US show that the risk of death among workers in this sector is two-and-a half-times higher than the risk for workers in construction and seven times higher than the risk for industrial workers as a whole.”  “America’s Radioactive Secret” is a troubling article which appeared in Rolling Stone on January 21, summarizing a journalistic investigation of the  unregulated trucking of fracking waste: “Oil-and-gas wells produce nearly a trillion gallons of toxic waste a year. An investigation shows how it could be making workers sick and contaminating communities across America.”

Fractures in the Bridge provides a Canadian perspective on the overwhelming evidence from established studies which have reported “negative health outcomes including adverse birth outcomes, birth defects including congenital heart defects and neural tube defects, cancer, cardiovascular diseases, dermal effects, gastrointestinal symptoms, neurological effects, psychological impacts and respiratory illnesses.” Fractures in the Bridge  also provides a very complete bibliography as well as an appendix showing how fracking is regulated in each province in Canada.

An important related source of information, updated in 2019, is the Compendium of Scientific, Medical, and Media Findings Demonstrating Risks and Harms of Fracking (Unconventional Gas and Oil Extraction) , published by the Concerned Health Professionals of New York (CHPNY) and Physicians for Social Responsibility (PSR).

Federal government announces $275 Million subsidy to LNG Canada in B.C.

Despite the ongoing contentious development of Liquified Natural Gas (LNG) in British Columbia and commitments to end fossil fuel subsidies, on June 24 federal Finance Minister Morneau  announced that the federal government will invest $275 million into LNG Canada’s $40 billion liquefied natural gas project in Kitimat: $220 million to be spent on energy-efficient gas turbines for the project, and  $55 million spent on replacing the Haisla Bridge in Kitimat. The announcement is summarized by the CBC in “Feds announce $275M ‘largest private sector investment in Canadian history’ — Kitimat, B.C.’s LNG project”

The Narwhal maintains an ongoing archive of excellent articles which chronicle the controversy over fracking and LNG in B.C,  here .  Two recent “must read” articles from: “6 Awkward Realities behind B.C.’s big LNG Giveaway”  (April 6)  which discusses the B.C. government’s move to bundle tax exemptions and cheap electricity rates into a $5.35 billion  incentive package for  LNG Canada in March 2019, and “B.C. government quietly posts response to expert fracking report” (June 28) which discusses the government’s  response to the report of its own  independent Scientific Review of Hydraulic Fracturing in British Columbia, released in February 2019. As noted in the Narwhal article, the panel was mandated to assess the potential impacts of fracking on water quantity and quality; on seismic activity, and on  fugitive emissions – but not on public health, despite concerns raised and the known scientific evidence.  According to the government news release,  a working group has been established to address the  97 recommendations made by the expert panel.

Some recent relevant reading about LNG and the fracking associated with its production: 

RE the Emissions of LNG: The New Gas Boom , published  on July 1 by the Global Energy Monitor, an international non-governmental organization that catalogues fossil-fuel infrastructure. The report states that a growing global supply of natural gas is on a “collision course” with the Paris Agreement, and that the increase in natural gas is driven largely by the North American fracking boom- with 39% of new development  occurring in the U.S., 35% in Canada.  The GEM report is discussed from a Canadian viewpoint in  “Global boom in natural gas is undermining climate change action: reportNational Observer (July 2)  and  “’Clean’ natural gas is actually the new coal, report says: Don Pittis” at CBC  .  Previous to the Global Energy Monitor report, Marc Lee had weighed in on the high GHG emissions of fracked natural gas in  “ LNG’s Big Lie”, an article in the Canadian Centre for Policy Alternatives Policy Note ( Lee’s arguments were also published in The Georgia Straight,  (June 17) and an OpEd in The Globe and Mail . )

compendium re frackingIn the U.S.   in June 19, The sixth edition of the Compendium of Scientific, Medical, and Media Findings Demonstrating Risks and Harms of Fracking  was published by Physicians for Social Responsibility and Concerned Health Professionals of New York. Written by scientists, doctors and journalists, it is an analysis of original research studies published from 2016-2018 on the health impacts of fracking . One of the most impactful statements from the press release: “The notion that natural gas can serve as an intermediate “bridge fuel” between coal and renewable energy is fallacious and now disproven by new scientific evidence showing that methane is a more powerful greenhouse gas than formerly appreciated and escapes in larger amounts from all parts of the extraction and distribution process than previously presumed, including from inactive, long-abandoned wells. Grossly underestimating methane emissions threatens to undermine the efficacy of efforts to combat climate change.” A summary press release is here ,  or see the Common Dreams article “’We Need to Ban Fracking’: New Analysis of 1,500 Scientific Studies Details Threat to Health and Climate”   (June 19).

International Energy Agency report, LNG Market Trends and their Implications   (June 20) provides statistical analysis of the changing Asian markets for LNG.

Oil sands companies called on to “keep it in the ground” – but Suncor opens new mine near Fort McMurray, deploys driverless trucks

Parkland report big oil coverThe majority of Alberta oil sands production is owned by the five companies: Canadian Natural Resources Limited (CNRL), Suncor Energy, Cenovus Energy, Imperial Oil, and Husky Energy.  What the Paris Agreement Means for Alberta’s Oil Sands Majors, released on January 31 by the Parkland Institute, evaluates what the 2°C  warming limit in the  Paris Agreement means for those “Big Five” –  by assessing their  emissions-reduction disclosures and targets, climate change-related policies, and actions, in light of their “carbon liabilities.” The carbon liabilities are calculated using  three levels for the Social Cost of Carbon, ranging from $50, $100, and $200 per tonne. Even under the most conservative scenario, the carbon liabilities of each corporation are more than their total value, and the combined carbon liabilities of the Big Five ($320 billion) are higher than Alberta’s GDP of $309 billion. Conclusion: “the changes required to remain within the Paris Agreement’s 2°C limit signals a need for concrete, long-term “wind-down” plans to address the challenges and changes resulting from global warming, including the fact that a significant portion of known fossil fuel reserves must remain underground.” What the Paris Agreement Means for Alberta’s Oil Sands Majors was written by Ian Hussey and David Janzen, and published by the Parkland Institute as part of the SSHRC-funded Corporate Mapping Project.  A National Observer article reviewed the report and published responses from the Big Five companies on January 31.

autonomous electric mining truckRather than keeping it in the ground, Suncor Energy announced on January 29 that it is continuing to ramp up production at its Fort Hill oilsands mine, about 90 kilometres north of Fort McMurray.  The next day, Suncor also announced  the beginning of a 6-year phase-in of approximately 150 autonomous electric trucks at numerous locations. The company said it will “continue to work with the union on strategies to minimize workforce impacts,” and that “current plans show that the earliest the company would see a decrease in heavy equipment operator positions at Base Plant operations is 2019.”   Reaction from the local union is here in a notice on the website of Unifor 707A;  Unifor National Office response is here:  “Driverless trucks aren’t the solution for Suncor” .  The National Observer published an interview with a Suncor spokesperson on January 31.  According to”Suncor Energy says driverless trucks will eliminate a net 400 jobs in the oilsands” , Suncor is the first oil sands company to use driverless trucks, and “Suncor’s plan to test the autonomous truck systems was initially criticized by the Unifor union local because of job losses. But Little says Suncor is working with the union to minimize job impacts by retraining workers whose jobs will disappear. The company has been preparing for the switch by hiring its truck drivers, including those at its just−opened Fort Hills mine, on a temporary basis.”

The good news is that  “the era of oil sands mega-projects will likely end with Suncor Energy’s 190,000 barrel-per-day Fort Hills mining project, which started producing this month”, according to an article by Reuters.  The bad news is in the title of that article:  “Why Canada is the next frontier for shale oil” (Jan. 29) . The article extols the strengths of Alberta’s mining industry, and quotes a spokesman for Chevron Corporation who calls the Duvernay and Montney formations in Canada “one of the most promising shale opportunities in North America.”  For a quick summary, read   “Montney, Duvernay Oil and Gas Fields Seize the Momentum from Athabasca Tar Sands/Oil Sands” ( Jan. 31) in the Energy Mix.

Also,  consider the work of Ryan Schultz of the Alberta Geological Survey.  Most recently, he is the lead author of  “Hydraulic fracturing volume is associated with induced earthquake productivity in the Duvernay play”, which  appeared in the journal  Science on January 18 , and which is summarized in the  Calgary Herald  on January 18.  It discusses the complexities of how fracking has caused earthquakes in the area.

Trade unions in the U.K. actively engaged in climate change policy, advocating for environmental representatives

Trade Unions in the UK: Engagement with climate change is a new report, based on research conducted between September 2016 and January 2017 by the Campaign Against Climate Change Trade Union Group . The report asks:  what are the driving forces behind trade union engagement in climate change issues, and what are some of the barriers and difficulties for trade unions?  It summarizes the results of interviews with policy officers and environmental activists from the largest 15 unions in the Trades Union Congress (TUC), as well as two smaller but active unions: Transport and Salaried Staff Association (TSSA) and the Bakers, Food and Allied Workers Union (BFAWU). The report is also based on the results of systematic searches of the unions’ websites and relevant policy documents (with links to key documents).  It reveals an overview of the diversity and context of trade union climate policy, focusing on issues such as environmental representatives, energy supply, airport expansion, fracking and divestment from fossil fuels. The report summarizes the positions on these issues, union by union, but for those who want even more detail, there is a supplementary inventory .

This first-ever report was released in August 2017, and since then, Unison has voted to campaign for pension fund divestment and the TUC adopted an historic motion for public ownership of energy at its September Congress.  Also at the Fringe Meeting of the September Congress, the Campaign Against Climate Change Trade Union Group presented its discussion paper  ‘Another world is possible: jobs and a safe climate‘. And most recently, the U.K. government at long last released its Clean Growth Strategy, to limited union approval.