Canada’s oil and gas industry provides Canada with declining royalty revenues, jobs

Earth scientist David Hughes argues that Canada cannot possibly meet its national GHG emissions targets while expanding exports in the oil and gas industry, building pipelines, and developing liquified natural gas in a new report, Canada’s Energy Sector: Status, evolution, revenue, employment, production forecasts, emissions and implications for emissions reduction, released on June 1.   Hughes documents the declining health and importance of the sector with economic statistics: “The energy sector’s contribution to Canada’s GDP, currently at 9 per cent, has declined over the past two decades, and government revenues from royalties and taxes have dropped precipitously. Despite record production levels, royalty revenue is down 45 per cent since 2000, and tax revenues from the oil and gas sector, which totalled over 14 per cent of all industry taxes as recently as 2009, declined to less than 4 per cent in 2018. Direct employment, which peaked at over 226,000 workers in 2014, was down by 53,000 in 2019 although production was at an all-time high due to efficiencies adopted by the industry.”

Combining statistics from the Petroleum Labour Market Information office with industry projections from the federal Canada Energy Regulator, Hughes concludes that energy jobs have peaked and previous levels of employment are unlikely to return.

“Jobs are often cited by industry proponents as a reason to support expansion of oil and gas production. Yet despite record production levels, jobs in the oil and gas sector are down from their peak in 2014 by 23 per cent …..Thanks to technological advances, the sector has become more efficient and is able to increase production using fewer workers….This jobs scenario is particularly true in the oil sands, where much of the production growth is expected. Oil sands production per employee is 70 per cent higher than it was in 2011 (production per employee has increased by 37 per cent in conventional oil and gas and by 50 per cent in the sector overall since 2011). In Canada’s overall employment picture, the oil and gas sector accounted for only 1 per cent of direct employment in 2019 (5.5 per cent in Alberta).”

At the same time, oil and gas production accounts for the largest portion of GHG emissions in Canada, at 26 per cent of the total – and Canada‘s GHG emissions have actually increased by 3.3 per cent since the Paris Agreement was signed in 2016 – the highest increase of any G7 country.  With such limited benefits and such serious negative consequences, Hughes argues against expansion of oil and gas exports – especially LNG in British Columbia and the TransMountain pipeline expansion, and Line 3.

Canada’s Energy Sector: Status, evolution, revenue, employment, production forecasts, emissions and implications for emissions reduction is summarized by the National Observer, here. Author David Hughes has written substantive reports previously, for example: A Clear Look at B.C. LNG (2015); Can Canada increase oil and gas production, build pipelines and meet its climate commitments? ( 2016); B.C’s Carbon Conundrum: Why LNG exports doom emissions-reduction targets and compromise Canada’s long-term energy security (2020); and Reassessment of Need for the Trans Mountain Pipeline Expansion: Project Production forecasts, economics and environmental considerations (2020).

The full report was published by the Corporate Mapping Project, a project of the Canadian Centre for Policy Alternatives in British Columbia and the Parkland Institute in Alberta. The report was co-published with Stand.earth, West Coast Environmental Law, and 350.org.

President Biden’s Executive Orders and Keystone XL cancellation – what impact on Canada?

Incoming U.S. President Biden exceeded expectations with the climate change initiatives announced in week 1 of his term, and many have important repercussions for Canada.  The most obvious came on Day 1, January 20, with an Executive Order cancelling the Keystone XL pipeline and taking the U.S. back into the Paris Agreement.  Also of potential impact for the Canadian clean tech and auto industries – the Buy American policies outlined in Executive Order on Ensuring the Future Is Made in All of America by All of America’s Workers (Jan. 25). On January 27 ( “Climate Day ”), the Executive Order on Tackling the Climate Crisis at home and abroad (explained in this Fact Sheet ) announced a further series of initiatives, including a pause on oil and gas leases on federal lands, a goal to convert the federal government’s vehicle fleet to electric vehicles, and initiatives towards environmental justice and science-based policies. Essential to the “whole of government” approach, the Executive Order establishes the White House Office of Domestic Climate Policy to coordinate policies, and a National Climate Task Force composed of leaders from across 21 federal agencies and departments. It also establishes the Interagency Working Group on Coal and Power Plant Communities and Economic Revitalization, “to be co-chaired by the National Climate Advisor and the Director of the National Economic Council, and directs federal agencies to coordinate investments and other efforts to assist coal, oil and natural gas, and power plant communities.”    

The New York Times summarized the Jan. 27 Orders as “a  sweeping series of executive actions …. while casting the moves as much about job creation as the climate crisis.” A sampling of resulting summaries and reactions: ‘We Need to Be Bold,’ Biden Says, Taking the First Steps in a Major Shift in Climate Policy” in Inside Climate News (Jan. 28); “Fossils ‘stunned’, ‘aghast’ after Biden pauses new oil and gas leases” in The Energy Mix (Feb. 1); “Biden’s “all of government” plan for climate, explained” in Vox (updated Jan. 27) ;  “Biden’s Pause of New Federal Oil and Gas Leases May Not Reduce Production, but It Signals a Reckoning With Fossil Fuels”  (Jan. 27) ; “Biden is canceling fossil fuel subsidies. But he can’t end them all” (Grist, Jan. 28);  “Activists See Biden’s Day One Focus on Environmental Justice as a Critical Campaign Promise Kept”  and  “Climate Groups Begin Vying for Power in the Biden Era as Pressure for Unity Fades” (Jan 21) in The Intercept , which outlines the key policy differences between the BlueGreen Alliance (which includes the Service Employees International Union, the American Federation of Teachers, and the United Steelworkers in the U.S.) and  the Climate Justice Alliance, a national coalition of environmental justice groups.

The Narwhal provides an excellent overview of the important issues for Canada in “Biden has hit the ground running on climate and environmental justice. How will Canada respond?

Focus: Cancelling the Keystone XL Pipeline

The January 20 Executive Order halting the Keystone XL pipeline construction was meant to be a highly symbolic break with the previous administration’s policies, as described by Bill McKibben in the New Yorker as “Joe Biden’s cancellation of the Keystone Pipeline is a landmark in the climate fight” . Inside Climate News wrote “Biden Cancels Keystone XL, Halts Drilling in Arctic Refuge on Day One, Signaling a Larger Shift Away From Fossil Fuels” (Jan. 21).       

In Canada, the Keystone XL cancellation set off a torrent of reactions – with  Alberta’s Premier immediately calling for trade retaliation  – summarized in “‘Gut punch’: Alberta premier blasts Biden on revoked Keystone XL permit” (National Observer, Jan. 20) . The federal government held an Emergency Debate on Keystone on January 25, the first day the House of Commons re-convened after Christmas break. Environmental groups, along with social justice groups, First Nations, and the B.C. Government Employees Union, sent an Open Letter to Prime Minister Trudeau and all cabinet ministers on January 26, approving of the Keystone cancellation and stating: “Canada must follow Biden’s lead on Keystone XL and cancel TMX because it directly conflicts with the federal government recently announced climate plan and it does not have permission or consent from affected Indigenous Nations.”  An opposite viewpoint was reported in  “Keystone XL denial will hurt communities, Indigenous business coalition leader says” (National Observer, Jan. 22). Consistent with the past policies of the construction unions in the U.S. and Canada, Canada’s Building Trades Unions issued a press release expressing deep disappointment in lost jobs as a result of the decision – as did their U.S. counterpart the North American Building Trades Union (NABTU) . (The discord amongst unions over pipeline construction has been long-standing and well documented – for example, in Contested Futures: Labor after Keystone XL by Sean Sweeney ( New Labor Forum, 2016.)  

What next for Canada, now that Keystone XL has been cancelled?

CBC reports  “Trudeau government looks to continental energy strategy in wake of Keystone cancellation” (Jan. 27), which summarizes the unimpressive history of international energy initiatives but strikes an optimistic note because of the new Biden administration.  Eric Grenier summarizes the political and public opinion landscape and concludes that “For Trudeau, there’s no political reason to fight for Keystone XL” , and Aaron Wherry expands on that theme in “How political symbolism brought down Keystone XL” (Jan 23). In “Cenovus unveils capital spending plan, confirms up to 2,150 layoffs still targeted” (Jan. 29)  the CEO of Cenovus states that while the Keystone XL pipeline cancellation was a  “tragedy” for the industry, it wouldn’t affect his company’s ability to move oil and that Biden’s pause on oil and gas leasing, “is probably good for the Canadian oilpatch” . The Cenovus layoffs announced are not related to Biden’s policies but come as a result of its takeover of Husky Energy- Cenovus had already announced it would cut 20 to 25 per cent of its combined employee and contractor workforce (approx. 1,720 and 2,150 workers) in October 2020. 

Warren Mabee wrote in The Conversation Canada (Jan.21) “Biden’s Keystone XL death sentence requires Canada’s oil sector to innovate” – (republished in The Narwhal here ) arguing that Canada and Alberta “need to decide if more pipeline capacity is really needed” and “The future of Canada’s oil sector may not be in volume, but in value” – for example, high value-added products such as plastics, rubber and chemicals.   But this is Canada, so pipeline battles will continue: “With Keystone XL cancelled, all eyes turn to Trans Mountain expansion battle” (Ricochet , Jan. 27) and “The cancellation of Keystone XL raises the stakes for Trans Mountain (Globe and Mail Opinion piece, Jan. 26) . David Hughes has written, most recently in October 2020, that the Trans Mountain pipeline capacity is not needed, and on December 8 2020, the Parliamentary Budget Office released a report with the same conclusion. An excellent overview on the status of the Trans Mountain issue appears from the West Coast Environmental Law, and the Dogwood Institute maintains an online petition against TMX here.

No new pipeline construction needed in Canada, and domestic fossil fuel consumption peaked in 2019

The key takeaway from a new flagship government report is that no new pipeline construction is needed in Canada, and  the current pipelines under construction – the TransMountain Expansion, Keystone XL, and Enbridge Line 3 Replacement- are sufficient to accommodate all future crude oil production.  The  new report, Canada’s Energy Future 2020: Energy Supply and Demand Projections to 2050, is the latest annual report by the Canada Energy Regulator CER- (formerly the National Energy Board) and discusses the future of all energy commodities under two scenarios – a Reference case and an Evolving Scenario, which includes a carbon price of $75 per tonne in 2040 and $125 per tonne in 2050.

Under the Evolving Scenario of increased policy intervention, Canada’s domestic fossil fuel consumption peaked in 2019 and by 2050, it will be 35% lower than the 2019 level. However, the report states that even under the Evolving Scenario, fossil fuel consumption is forecast to make up over 60% of Canada’s fuel mix in 2050.  It is worth noting that these CER reports have been criticized in the past for overestimating fossil fuel demand – for example, by the Pembina Institute in 2019, in “Why Canada’s Energy Future report leads us astray” . In 2020, Pembina calls for changes to the modelling assumptions for future reports, saying “the scenarios modelled in the report are still not aligned with commitments set out in the Canadian Net-Zero Emissions Accountability Act. This model of Canada’s energy future is not consistent with the future that Canada has committed to in the Paris Agreement.” Further, it points out “Canada’s Energy Future 2020 report does not reflect the range of recent scenarios for global oil demand, such as those recently released by the International Energy Agency and BP, where demand is predicted to fall by 50 to 75 per cent over the next 20 to 30 years in order to achieve net-zero emissions.”

Other reactions to the CER report focus on the forecast of declining need for pipelines , summarized in  “No Future Need for Trans Mountain, Keystone XL Pipelines, Canadian Energy Regulator Report Shows”  (The Energy Mix, Nov. 25), and even echoed in the conservative Financial Post .  Followers of David Hughes will recognize this argument that he has made many times, most recently in Reassessment of Need for the Trans Mountain Pipeline Expansion Project , published by the Canadian Centre for Policy Alternatives at the end of October .

The press release and summary from the Canada Energy Regulator report is here, with data sets and interactive tables here  and an archive of past annual reports here.  Beyond fossil fuel projections, this year’s Report includes a discussion of the transition to a  Net-Zero Emissions energy system, focusing on  personal passenger transportation, oil sands production, and remote and northern communities. It also briefly notes the impact of  the Covid pandemic, stating  “Canadian end-use energy demand will fall by 6% in 2020 compared to 2019, the biggest annual drop since at least 1990. Energy to move people and goods will fall the most due to less travel and increased remote work and learning.” (A report  published by the World Meteorological Office on Nov. 23 provides preliminary estimates of a reduction in the annual global emission between 4.2% and 7.5% because of Covid).

 

 

 

Export Development Canada continues to undermine climate change goals, using Covid-19 recovery to fund Coastal GasLink pipeline

Reforming Export Development Canada:  Climate-Related Risk Management and the Low Carbon Transition  is an important new report released on June 9,  commissioned by advocacy groups Above Ground and Oil Change International.  The report analysis was conducted by consultancy Horizon Advisors, who calculate that the crown corporation Export Development Canada (EDC) has provided roughly $45 billion in support for the oil and gas sector since 2016, compared to $7 billion for clean technology. “These investments not only undermine Canada’s international climate efforts but also increase EDC’s exposure to carbon risks.”  The report recommends that the government amend the Export Development Act to bar EDC from supporting any fossil fuel energy projects, including new fossil fuel infrastructure such as pipelines, and that the agency should “stress-test its investment decisions against Canada’s climate targets.”

The Reforming Export Development Canada report is not the first time EDC has been examined for its fossil-friendly investment strategy  and criticized for undermining Canada’s climate change progress. Oil Change International and Above Ground published  Risking it All: How Export Development Canada’s Support for Fossil Fuels Drives Climate Change in 2018,  which documents investments of more than $10 billion a year to oil and gas between 2012 and 2017 ( twelve times more support than it offered for clean technologies).

Fossil fuel companies cashing in on Covid-19 Recovery Funds in Canada and worldwide

RiskingItAllcoverDianne Saxe, the former Environmental Commissioner of Ontario, cited the 2018 Risking it All report in her April 2020 Opinion piece in the National Observer, reacting to the federal $750 million Emissions Reduction  funding as part of the Covid-19 Recovery stimulus.  Environmental Defence voiced similar suspicions in their April response :  “… hidden inside this new law were changes that will make it easier for Canada’s export credit agency, Export Development Canada, to funnel billions more towards domestic oil and gas operations — without public scrutiny.”

And sure enough, following the recovery stimulus announcement,  in May EDC signed an agreement to loan up to $500 million to Coastal GasLink pipeline  – the same pipeline project which Wet’suwe’ten First Nations had blockaded, causing RCMP arrests which triggered Canada-wide solidarity  protests and crippling rail blockades  in Ontario and Quebec in the winter of 2020.  (And despite objections from the Wet’suwe’ten  Hereditary chiefs, reported in the Toronto Star ). “Meet Export Development Canada , the secretive crown agency financing the big oil bailout” (May 27) is a blog by Environmental Defense Canada, calling  out EDC investments and calling for greater transparency.

Oil Change International and Friends of the Earth U.S. address this ongoing issue Still-Digging-Cover-Image-pdf in  Still Digging: G20 Governments Continue to Finance the Climate Crisis , released on May 27.  From the Oil Change International Press release: “G20 countries have provided at least $77 billion a year in public finance to oil, gas and coal projects since the Paris Climate Agreement was reached. This government-backed support to fossil fuels from export credit agencies, development finance institutions, and multilateral development banks is more than three times what they are providing to clean energy. China, Japan, Canada, and South Korea are the largest providers of public finance to oil, gas, and coal, together making up over two-thirds of the G20 total.” The report is endorsed by Environmental Defense Canada and Climate Action Network Canada , among many others.

From Still Digging, a warning:

“with the health and livelihoods of billions at immediate risk from Covid-19, governments around the world are preparing public spending packages of a magnitude they previously deemed unthinkable.…. The fossil fuel sector was showing long-term signs of systemic decline before Covid-19 and has been quick to seize on this crisis with requests for massive subsidies and bailouts. We cannot afford for the wave of public finance that is being prepared for relief and recovery efforts to prop up the fossil fuel industry as it has in the past. Business as usual would exacerbate the next crisis—the climate crisis—that is already on our doorstep.”

Government gives the go- ahead to Trans Mountain pipeline despite declaring a climate emergency

climate emergencyOn June 18, in a controversial but expected move, the federal cabinet approved the expansion of the Trans Mountain pipeline, which would triple the capacity of the existing pipeline, and allow up to 890,000 barrels per day of bitumen to travel from the Alberta oil sands to a marine terminal in Burnaby, British Columbia.  The approval was described by The Energy Mix as “the height of cynicism” because the House of Commons had only 24 hours previously approved a government resolution declaring a climate emergency.  Although the government put on a positive face by predicting that “shovels will be in the ground” by September, the project still has to satisfy conditions set out by the National Energy Board,  including negotiated approval from First Nations.  As described in  “Why we’ll be talking about the Trans Mountain pipeline for a long while yet” in The Narwhal: “The embattled oilsands pipeline has become a proxy battle, pitting the urgency of the climate crisis against near-term economic concerns”.

A sampling of  Reaction and Analysis:

An Angus Reid poll, Shovels in the Ground was released on June 21.  It reports that 56% of Canadians agree with the government’s  approval of  TMX, compared with 24% who disagree. The primary concerns for Canadians, both those who support and oppose the TMX, are the possibility of a tanker spill due to increased traffic in the Burrard Inlet (68%) and the increased burning of fossil fuels from pipeline expansion (66%).

Canada approves Trans Mountain pipeline expansion for second time”  in the National Observer (June 18).  This general overview of the decision is part of the ongoing Special Report on Trans Mountain by the National Observer.

Trans Mountain approval makes mockery of climate emergency declaration” press release from the Council of Canadians.

“Cognitive Dissonance: Canada declares a national climate emergency and approves a pipeline” by Warren Mabee of Queen’s University  in The Conversation (June 20).

“Trudeau Declared a Climate Crisis, then Backed Trans Mountain Again” in The Tyee (June 18), which summarizes reactions from British Columbia, and states that B.C. will  take its case to the Supreme Court of Canada as it seeks the legal right to regulate the shipment of materials (including oil and gas)  within the province.

“Transmountain  pipeline approval triggers lawsuits leaves fossils unsatisfied”    in The Energy Mix (June 19).

“Business leaders welcome pipeline approval but fear it may not be completed”  in The National Observer. The article states:  “Mark Scholz, CEO of the Canadian Association of Oilwell Drilling Contractors, who said in a statement the pipeline approval is “trivial” and will do little to help a suffering western Canadian drilling sector. Approval doesn’t make up for the federal government’s pursuit of Bills C-69 and C-48, bills reviled by the industry to revamp the regulatory system for resource projects and impose an oil tanker ban on the B.C. coast, he said.”

Minister Morneau in Calgary to talk about the Trans Mountain Expansion project and the future of Canada’s Energy Sector “ (June 19)  a press release that lays out  the government’s best case for Albertans, and states that: “Every dollar the federal government earns from the project will be invested in Canada’s clean energy transition. The Department of Finance estimates that additional corporate tax revenues could be around $500 million per year once the project is online. These funds and any profits earned from the sale of the pipeline will be invested in the clean energy projects that power our homes, businesses and communities for years to come.”

billion-dollar-buyout LaxerA substantial analysis from a different viewpoint, Billion Dollar Buyout: How Canadian taxpayers bought a climate-killing pipeline  was just published by the Council of Canadians. Written by Gordon Laxer, professor emeritus at the University of Alberta, the report summarizes the long history of the Trans Mountain project, with a special interest in how it fits in to the United States Mexico Canada trade agreement (USMCA) and the energy goal of integrating Canadian oil and natural gas into the U.S. market.  Laxer also authored an OpEd in the Toronto Star on June 12, Don’t waste any more money on the Trans Mountain pipeline  .

Not all First Nations Oppose the Trans Mountain pipeline:  The National Observer summarizes First Nations opposition in “As Trans Mountain gets shovels ready for pipeline, First Nations vow to protect territory” (June 19), which  states that the Tsleil-Waututh Nation and Squamish Nation will use “all legal tools” available to challenge the TMX approval.  The Tsleil-Waututh Nation has commissioned an independent environmental assessment and an economic study which estimates that TMX expansion will cost Canada $11.8 billion, in addition to the environmental costs. It also predicts lower demand than the government has anticipated and unused capacity. The 127-page economic study, Public Interest Evaluation of the Trans Mountain Expansion Project is dated June 2019 and was written by Thomas Gunton, a professor at the  School of Resource and Environmental Management at  Simon Fraser University, and by Chris Joseph, a B.C. consultant.

Project Reconciliation  is an Indigenous-led coalition which aims to buy part of the pipeline and direct any profits to a Sovereign Wealth and Reconciliation Fund.  Their press release on June 18 applauds the government’s TMX decision.  A January 2019 article by CBC gives background on the group.  The Indian Resource Council is another group, composed of 134 First Nations bands most of whom are also interested in the economic benefits of  pipelines. CBC describes their meeting in  “More than 100 First Nations could purchase the Trans Mountain expansion pipeline” (Jan. 2019).  More recently, in June, the Iron Coalition  launched – “an Alberta-based Indigenous-driven organization with the sole purpose of achieving ownership in the Trans Mountain Pipeline (TMX).”  Iron Coalition leaders are from the Nakota Sioux Nation, the Papaschase First Nation and the Fort McKay Métis, and state that “all profits generated by Iron Coalition will be directed back to each member community to bring lasting economic benefit to Métis and First Nations in Alberta.”

 

Public opinion polls: on carbon tax, pipelines, and a growing fear of climate change around the world

On February 8, Clean Energy Canada released results from an online survey of 2,500 Canadian adults, conducted by Abacus Data. Across Canada, 35% support a federal carbon tax, 37% say they are open to considering it, and 28% oppose it  – with the highest opposition from Alberta (41%). When told that revenues would be rebated to households (the ford and carbon tax infographicCarbon Incentive Plan),  support climbed by 9 points – and even more in Alberta. Asked if they agreed with  Ontario Premier Doug Ford’s statement that a carbon tax will bring a recession, 64% of Canadians  and 63% of Ontarians disagreed – and when asked a follow-up question asserting that many economists disagree with Premier Ford, 74% of Canadians and 73% of Ontarians stated they would trust the economists over the Premier.

The Angus Reid Institute  has tracked opinion about a carbon tax in Canada since April 2015, and are due to release new survey results in winter 2019 . Their online survey conducted in October 2018 (just after the announcement of the federal Carbon Incentive plan), showed that support for a carbon tax had increased nationally  from 43% in July 2018 to 54% in October.  The leading cause of opposition to the carbon plan is the sense that it is a “tax grab”, followed by the opinion that it will not help reduce emissions. Also notably, “six-in-ten Canadians say they do not trust information about climate change from their provincial government – with  only 24% of Manitobans  trusting their government.  Who do Canadians trust on this issue?  78% trust university scientists; 56% trust “international organizations doing work in this field”.

Angus ReidI can help cc

From Angus Reid Institute, “Duelling realities” poll

Other recent Angus Reid analysis of Canadians’ overall attitudes on climate change was released on November 30 in “Dueling realities? Age, political ideology divide Canadians over cause & threat of climate change”.   Only 9% of Canadians do NOT perceive climate change as a threat, with 55% of 18 to 34-year-olds  said they believe climate change to be a very serious threat.  Yet  a survey  released in January 2019, “Six-in-ten Canadians say lack of new pipeline capacity represents a crisis in this country” details the polarized opinions about oil pipelines, showing that 53% of Canadians surveyed support both the Energy East and TransMountain pipeline projects, and  six-in-ten say the lack of new pipeline capacity constitutes a “crisis”. Opinions are divided by region, ranging from 87% in Alberta and 74% in Saskatchewan seeing a crisis, versus 40% in Quebec.

Opinion in the United States:  Results from the December 2018 national survey, Climate Change in the American Mind ,  reveal that 46% of Americans polled have personally experienced the effects of global warming, and a majority are worried about harm from extreme events in their local area –  including extreme heat (61%), flooding (61%), droughts (58%), and/or water shortages (51%).  This longstanding survey (since 2013) is conducted by the Yale Program on Climate Change Communication and the George Mason University Center for Climate Change Communication. It also updates the results in the series, “Global Warming’s Six Americas” , which categorizes attitudes from  “Alarmed”, to “Concerned”, all the way to “Doubtful” and “Dismissive” –  showing that in December 2018, the “Alarmed” segment is at an all-time high of 29% , while the “Dismissive” and “Doubtful” responses have declined to only 9%.  The full report   also includes responses concerning emotional responses to global warming, perceived risks, and personal and  social engagement – which includes such questions as “How much of an effort do your family and friends make to reduce global warming?”

Australian women are re-considering having children:  A survey released in February by the Australian Conservation Foundation and the  1 Million Women organization reports on climate change attitudes of Australian women, in the lead-up to the country’s federal election in 2019.  Of the 6514 Australian women who responded to the survey between September – October 2018, nearly 90% are extremely concerned about climate change.  Again, concern is highest in the under-30 bracket, where  one in three are so worried about what global warming that they are reconsidering having children.  A four page summary of survey results is here 

Finally, international attitudes are reflected in a survey published in February by Pew Research Center:  “Climate Change Still Seen as the Top Global Threat, but Cyberattacks a Rising Concern”.   This top-level survey of 26 countries shows that climate change was perceived as the most important threat in 13 countries:  including Canada,   Germany, Greece, Hungary, Spain, Sweden, U.K., Australia, South Korea, Kenya, Argentina, Brazil, and Mexico.  In the U.S., the top threat was seen to be cyberattacks from other countries (74%), followed by attacks from ISIS (62%). Global climate change was the third-ranked threat at 59% .

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.

Review of Alberta’s Climate Leadership Plan and carbon levy; updates on renewables and methane regulations

env defence carbon-pricing-alberta-fbEnvironmental Defence released a report in December 2018, Carbon Pricing in Alberta: A review of its success and impacts  . According to the report, Alberta’s carbon levy, introduced in 2017 as part of the broader Climate Leadership Plan, has had no detrimental effect on the economy, and in fact, all key economic indicators (weekly consumer spending, consumer price index,and gross domestic product) improved in 2017. The report also documents how the carbon levy revenues have been invested: for example, over $1 billion used to fund consumer rebates and popular energy efficiency initiatives in 2017; support for Indigenous communities, including employment programs; a 500% growth in solar installations; funding for an expansion of light rail transit systems in Calgary and Edmonton; and prevention of an estimated 20,000 tonnes of greenhouse gas (GHG) pollution. The conclusion: the Climate Leadership Plan and its carbon levy is off to a good start, but improvement is needed on promised methane reduction regulations , and the regulations to enforce the legislated cap on oil sands emissions need to be released.

Methane Regulations:    The Alberta Environmental Law Centre published a report in 2017 evaluating the province’s methane emissions regulations. On December 13, the government released new, final regulations governing methane. On December 19, the Alberta Environmental Law Centre published a summary of the new Regulations here  

Since the Environmental Defence study, on December 17, the government announced  agreement on five new wind projects funded by Carbon Leadership revenues, through the  Renewable Electricity Program. Three of the five projects are private-sector partnerships with First Nations, and include a minimum 25 per cent Indigenous equity component to stimulate jobs, skills training and other  economic benefits. The government claims that all five projects will generate 1000 jobs.

On  December 19 the government also  announced   new funding of  $50 million from Alberta’s Climate Leadership Plan for the existing  Sector-specific Industrial Energy Efficiency Program , to support technology improvements in the  trade-exposed industries of pulp and paper, chemical, fertilizer, minerals and metals facilities.

Balanced against this, a December 31 government press release summarized how its “Made in Alberta ” policies have supported the oil and gas industry: including doubling of support for petrochemical upgrading to $2.1 billion; creation of a Liquefied Natural Gas (LNG) investment team to work directly with industry to expedite fossil fuel projects; political fights for new pipelines (claiming that “Premier Notley’s advocacy was instrumental in the federal government’s decision to purchase the Trans Mountain Pipeline”), and the ubiquitous Keep Canada Working  advertisements promoting the keepcanada workingbenefits of the Trans Mountain pipeline . The press release also references the November announcement that the province will buy rail cars  to ship oil in the medium term,  and the December 11 press release announcing that the province is  exploring  private-sector interest in building a new oil refinery .

Canadian press coverage of pipelines lacks workers’ voices

ccpa-bc_jobsvsenvironment whose voices are missingJobs vs the Environment? Mainstream and alternative media coverage of pipeline controversies  examines how the press—classified into corporate and alternative outlets —treats the relationship between jobs and the environment, and how frequent and influential are the voices of workers and labour unions. The report uses two sophisticated methods of communications analysis – content analysis and critical discourse analysis – to examine two samples:  The first sample comprises 129 articles about Canadian pipeline projects from the Vancouver Sun, the Edmonton Journal  and the Toronto  Globe and Mail  representing corporate media; articles from Ricochet, The Tyee, and the National Observer  represent alternative media.  The second examination was slightly different, made up of 170 articles about the Kinder Morgan Trans Mountain Pipeline Expansion which appeared in the Vancouver Sun and two commuter tabloids in Vancouver, and including Rabble.ca  to the previously examined alternative sources of  Ricochet, The Tyee, and National Observer.

The analysis is detailed and makes many interesting observations. Briefly, the authors conclude from these samples that both  mainstream and alternative media frequently reinforce the assumption that there is a trade-off between environmental protection and job creation. Though alternative media are more critical  of pipeline projects and provide more of the  perspectives of Indigenous people and environmentalists, the authors conclude that  “neither corporate nor alternative media gave much voice to the perspectives of workers and their unions.” And  “while job creation is often touted as a rationale for pipeline projects, the actual workers and their unions—the presumed beneficiaries of fossil fuel expansion—appear to be largely missing from news reportage.”

To sum up, they write that : “… alternative media provide analyses and sources that help counterbalance the apparent extractivist orientation of the corporate press. They make a valuable contribution to well-rounded public discussion and offer perspectives on energy, climate and economic policies that are evidently under-represented in the corporate press.

The authors briefly discuss the labour press – mentioning Rank and File.ca  specifically, and see a role for the labour media in the climate and energy debate. They state: “….. labour’s voice in the media system is muted. There are many reasons why a movement for a just transition has not gained greater traction. Governments have not sufficiently committed to retraining and other supportive measures, and thus there are few working examples for just transition advocates to highlight. But part of the problem lies in the lack of public arenas for exploring the common ground between workers and environmentalists regarding a low-carbon economy. Engaging the public imagination about such a necessary transition would be a valuable goal for corporate and alternative media, as well as media produced by the labour movement itself.”

The authors are Robert A. Hackett, a professor emeritus, and  Philippa R. Adams, a PhD student, both from the School of Communication at Simon Fraser University in British Columbia.  The publisher is the Corporate Mapping Project, a research and public engagement initiative investigating the power of the fossil fuel industry,  jointly led by the University of Victoria, the Canadian Centre for Policy Alternatives’ BC and Saskatchewan Offices and the Parkland Institute.

Return of oil and gas jobs? New pipelines and new technology are essential conditions

The headline of a Calgary Herald story on March 30 warns: “ Another 8,700 oil jobs are at risk if prices drop below US$50 for a sustained period, according to new study” .  Based on a labour market study by Enform consultancy,  the Herald states that this possible job loss would follow the loss of 52,500 direct jobs between 2015 and 2016, without even taking into account the job turmoil caused by the 2017 mergers and acquisitions in the Canadian oil sands: Canadian Natural Resources and Shell  ; Cenovus Energy and Conoco Phillips; and most recently, Enbridge and Spectra Energy  .

oil sandsThe original Enform study on which the newspaper article is based provides much more detail.  Labour Market Outlook 2017 to 2021 for Canada’s Oil and Gas Industry  was prepared by PetroLMI, a Division of Enform, and was partly funded by Canada’s Sectoral Initiatives program.  It reports that the oil and gas industry directly employed an estimated 174,000 workers at the end of 2016, (down by 25 per cent from the industry peak of over 226,000 in 2014). It forecasts job growth for two different scenarios – oil prices well above or well below  US$50 per barrel from  2017- 2021 .  The “modest recovery” scenario, (prices above US $50) ìs forecast to support an annual average of 554,000 direct and indirect jobs in the next five years; the “Delayed Recovery” is forecast to support 508,000 jobs.  The report provides detailed statistics by subsectors, occupations, and regions.  The report also notes the shrinking labour pool, as workers are discouraged from remaining or entering the sector, and as older workers retire.  Although the forecast expects limited job recovery in the next two years, it concludes that the peak employment levels will not return.  “Heading towards 2021 and beyond, accessing world markets via new pipelines will be critical for full job recovery. Equally important will be investing in technology, innovation and a highly-skilled and technical workforce to sustain the productivity and efficiency gains achieved in the last few years. These things will be critical if the industry is to compete globally and make a transition through carbon regulations.”  See the full suite of forecasts for the oil and gas industry, including the LNG industry, here .

 

 

National Energy Board Modernization – Hearings are underway

Public hearings by the Expert Panel on the Modernization of the National Energy Board   began in Saskatoon in January and will conclude in Montreal at the end of March (the schedule is here ).  With transparency and accountability a key concern about the NEB, it is surprising that no transcripts or submissions will be made available online, only government- prepared summaries . Fortunately, press reports are providing the public with some information:  an important example, a report by Andrew Nikoforuk from the Vancouver hearings appeared in The Tyee on  February 9, summarizing the testimony of Marc Eliesen, a former chair of Ontario and BC Hydro and a critic of the NEB since the 2014 Trans Mountain Pipeline hearings.  As quoted in  “Time to Reform Our ‘Captured’ National Energy Board, Says Expert” ,    Mr. Eliesen reiterated his earlier criticism that the NEB  a “captured regulator” that no longer operates in the public interest. “The attitudinal bias that stems from a close interaction between NEB board members, NEB staff and the energy industry, means the goals and aspirations of the Alberta energy sector have become those of the board.” Eliesen recommended that all current NEB board members should be replaced by people from a broader range of expertise, not just the oil and gas industry. He also recommended that the NEB’s head office be moved from Calgary back to Ottawa. In “How to Fix the National Energy Board, Canada’s ‘Captured Regulator’”  , DeSmog Blog (Feb 8) also summarized Eliesen’s testimony, as well as that of  Eugene Kung, staff counsel at West Coast Environmental Law.

Proposals for improving the discredited NEB have come from a Pembina Institute report:  Good Governance  in the era of low carbon: a Vision for a modernized National Energy Board   . From Pembina: “significant reforms to the NEB Act, and to the operating culture and practices at the Board, are required.”  The report lays out 9 essential conditions to transform energy regulation, including : “Energy regulators must be independent of bias and interferences from government and non-government stakeholders. …Energy regulators should proactively  and predictably support involvement of all interested parties and the public as a fundamental component of evidence gathering, decision-making and monitoring.”  Environmental Defence  has also weighed in with “Six key ways to modernize energy regulation in Canada”, and has also called for the restart of the Energy East Pipeline review process to wait until new rules for the NEB are in place. (the previous Energy East Review was declared void in January 2017).   The report and recommendations of the Expert Panel on Modernization of the National Energy Board is scheduled for  submission to the Minister of Natural Resources by mid-May 2017.

A whiff of the bias that so many have noted at the NEB continues, in one of the “related documents” provided at the Expert Panel website: the Interim Report of the Standing Senate Committee on Transport and Communications, titled Pipelines for Oil: Protecting our Economy, Respecting our Environment   (Dec. 2016).  It begins: “Petroleum pipelines, like highways, railways and power line corridors, are long established in Canada. They are instrumental to the quality of life and the standard of living we enjoy in Canada today. Pipelines have no equal when it comes to the safe, reliable and cost-efficient movement of petroleum over long distances. They are critically important to the creation of wealth in Canada and their use and development are in the public interest and the greater good of all Canadians.”  It pronounces on the concepts of social license, the public good, confidence in the regulatory process, then proposes an oil transportation strategy which includes pipelines and tankers.  From the conclusion:  “The Committee believes that new pipelines will act as a lifeline to the Canadian economy, which has been hard hit in the oil and gas sector. Pipelines to the east and west coasts will ensure that Canadian oil producers get the full value of this resource on world markets, reduce refineries’ dependence on oil imports and improve public safety. The Committee has made recommendations to Natural Resources Canada, Transport Canada, and Fisheries and Oceans Canada. The Committee believes that these recommendations will help form a strategy to improve public confidence and break the paralysis preventing the construction of pipelines in Canada.”

Finally, the National Energy Board Modernization process is underway

The Review process for the Modernization of the National Energy Board has begun.  The Terms of Reference  are here, summarized on the website as focussing on “ governance and structure; mandate and future opportunities; decision-making roles, including on major projects; compliance, enforcement, and ongoing monitoring; engagement with Indigenous peoples; and, public participation.” Twelve Discussion Papers are available   to guide input.  Comments can be submitted online here , with a deadline of  March 31, 2017;   cross-country “engagement sessions” for the public will begin in Saskatoon on January 25, and end in Montreal on March 29.  The Expert Panel will deliver its report to the Minister of Natural Resources, with a  May 15 deadline.     See an article in the  National Observer (Jan. 16) , which notes that the process launch comes amidst legal challenges: Two First Nations of Northern Ontario have named the National Energy Board and the government of Canada as defendants in their suit against TransCanada pipeline, for failing to consult with them before  allowing work on a 30-kilometre stretch of the pipeline that runs through their traditional territories  (details here) .  A second  court challenge was filed on January 10 by community group Transition Initiative Kenora, asking that the entire Energy East consultation process be voided and re-started, because of the conflict of interest allegations of the Charest Affair  in  Fall 2016.     (more details about the court challenge from Energy Mix here or from Ecojustice here  )

Kinder Morgan Pipeline approval: a new chapter in the struggle against pipelines

On November 29, the government of Canada announced  the highly anticipated decision   to approve the expansion of  two pipeline projects:   Line 3 (with 37 conditions) and the Kinder Morgan Trans Mountain Expansion pipeline project (with 157 conditions). The Northern Gateway project was finally, officially dismissed.

Reaction, focused on Kinder Morgan,  was swift and strong and very critical on many grounds: economic, environmental, and as a betrayal of the rights of First Nations.  The Globe and Mail summarized reaction and quoted a Stand.earth representative that the decision “signals the beginning of a new phase in the struggle against pipelines” – which will include protests, the courts, and the ballot box.  And immediately, on December 1, a rally to support the Dakota Access Pipeline protests expanded to include Kinder Morgan protest, with over 1000 people on the streets of Victoria, B.C., according to the National Observer.  See also “Trudeau’s pipeline approvals spark protests” , which quotes the president of the Canadian Union of Postal Workers: “”You can either be serious about climate change, or you can expand the tarsands. But you cannot do both.”  Others have written with the same message: UBC Professor Kathryn Harrison in the Globe and Mail   ; Simon Donner  in  “Blowing the Budget on Pipelines”  (Nov. 30) in Policy Options;  Seth Klein and Shannon Daub of the Canadian Centre for Policy Analysis (CCPA) in a Policy Note article, “The New Climate Denialism“;  Tzeporah Berman, “Pipelines of Paris: Can Canada have its cake and eat it too? “. David Hughes’June 2016 report, Can Canada Expand Oil and Gas Production, Build Pipelines and Keep Its Climate Change Commitments? is again being widely cited.

The same message comes from a a Dec. 13 article, “ With Oil Sands Ambitions on a Collision Course With Climate Change, Exxon Still Stepping on the Gas”  by Inside Climate News (the Pulitizer Prize winning news organization whose reporting has sparked the current U.S. investigations into Exxon).  This highly detailed historical look at Imperial Oil investments and operations in Canada (complete with photos of Murray Westgate), concludes by noting the recent pipelines approvals, and states:  “Canadian officials, who have committed the nation to emissions cuts, continue to promote growth, even though environmentalists say the two are incompatible….Politicans are not being honest with Canadians.”

orcas-against-vancouver-skylineOpposition in the courts – with seven cases already underway – is being led by First Nations.  In an OpEd in the Globe and Mail, Grand Chief Stewart Phillip of the Union of British Columbia Indian Chiefs wrote: “ Prime Minister Justin Trudeau failed to protect the health and safety of Canadians or uphold his government’s vaunted new relationship with First Peoples when he announced approval for the Trans Mountain pipeline expansion.”  He stated that there are  more than 10,000 “Coastal Protectors”   who are ready “to do what needs to be done to stop Kinder Morgan”. This is in addition to  the Treaty Alliance Against Tar Sands Expansion  formed  by 50 First Nations and tribes from all over Canada  and the Northern U.S. in in September 2016 – now over 100 –   to work together to stop all proposed tar sands pipeline , tanker and rail projects in their respective territorial lands and waters. And see  DeSmog blog,  “ Federal Liberals Approval of Kinder Morgan Is Final Nail in the Coffin of ‘Reconciliation’ . For a first-person account of First Nations reactions and mobilization, see “Field notes: A week of pipeline action and cross-Canada solidarity” from West Coast Environmental Law.

From Greenpeace :  “With this announcement, Prime Minister Trudeau has broken his climate commitments, broken his commitments to Indigenous rights, and has declared war on B.C. If Prime Minister Trudeau wanted to bring Standing Rock-like protests to Canada, he succeeded.”    Similarly, Common Dreams published  “Kinder Morgan Pipeline Might Be Canada’s DAPL ” (Dec. 4) , and  from ThinkProgress  , ” The next Standing Rock: Fossil fuel battles loom across North America“.

Representing reaction from ground zero, British Columbia:  The B.C. office of the Canadian Centre for Policy Alternatives blogged: “Trudeau disappoints a generation, betrays rights and title of Indigenous people with Kinder Morgan decision” .  Andrew Nikoforuk wrote in  The Tyee , “Kinder Morgan Approval Insults Democracy, Science and Economic Logic”   (Nov. 30) , that the decision “put his government on a collision course with First Nations and British Columbia’s coastal communities.” Robyn Allan, quoted by Nikoforuk, states:  “Trudeau has out-trumped Stephen Harper.”

 

Why has the Dakota Access Pipeline become a divisive issue for U.S. Labour?

Protests against the Dakota Access Pipeline in North Dakota are continuing, according to Democracy Now on October 7.  On October 5, three U.S. federal judges heard arguments  over whether to stop the construction, but they are not expected to make a ruling for three or four months.  Meanwhile, Jeremy Brecher of the Labor Network for Sustainability released a new post , Dakota Access Pipeline and the Future of American Labor,  which asks “Why has this become a divisive issue within labor, and can it have a silver lining for a troubled labor movement?”  The article discusses the AFL-CIO’s  statement  in support of the pipeline, and points to the growing influence of the North America’s Building Trades Unions’ within the AFL-CIO through their campaign of “stealth disaffiliation”.  It also cites an “ unprecedented decision” by the Labor Coalition for Community Action,  an official constituency group of the AFL-CIO , to issue their own statement in support of the rights of the Standing Rock Sioux Tribe, in direct opposition to the main AFL-CIO position. The Climate Justice Alliance, an environmental justice group of 40 organizations, has also written to the AFL-CIO in an attempt to begin discussions.  Brecher’s article concludes that the allies and activist members of the AFL-CIO are exerting increasing pressure, and asks “Isn’t it time?” for a dialogue which will shift direction and build a new fossil-free infrastructure which  will also create jobs in the U.S.    For unions interested in supporting the protests against the Dakota Access Pipeline, a sample resolution for local unions is available from the Climate Workers website.