With the news that this past July was the hottest month on earth since record keeping 140 years ago, satellite images of the Amazon and State of California burning, the most powerful hurricane ever measured in the Atlantic Ocean east of Florida, carbon dioxide emissions to the atmosphere rising again to near record levels after a brief leveling, and Swedish teenager Greta Thunberg's stirring call to action while staring down both Donald Trump and Vladimir Putin, climate change has been a hot topic in 2019. While the scientific community remains nearly 100% aligned that global warming is driven by the burning of fossil fuels, a relatively small, yet powerful, group of naysayers fights the science. Who are these very powerful people, and why do they fight? One common characteristic - they are mostly baby boomers = the generation of Americans with an insatiable appetite for consumption and a strong resistance to change.
First a disclosure - I am a boomer. Baby boomers are defined as the generation of individuals born just after the end of World War II, from 1946 through 1964. That would put us between 55 and 73 years old this year. As of 2016, this generation has over 74 million members and makes up 22.9% of the population of the United States. (Note that President Trump at 73 years old falls into this generation.). Further, I am a conservative white male, and while I don't feel excessively wealthy, I am certainly better off than most. I own a nice home, my wife and I go on far too many vacations, we own two new cars, and we spend an inordinate amount of money on cafe lattes at Starbucks. I am a registered Republican, and, until recently, believed strongly that the fiscal conservatism and pro-market focus of the Republican Party outweighed their anachronistic social beliefs. Worse yet, I owe my standard of living to fossil fuels, having spent over 40 years working in oil and gas and power generation. I would likely not be as well off as I am today without this country's, and this world's, need for fossil fuel.
I do not feel guilty for where I am or how I got here. Fossil fuels have been critical for economic growth and improving the life of the average American. However, I am ready to admit that the world is changing. The damage to the planet from the burning of fossil fuels is irrefutable. Fortunately, renewable sources of energy are now viable and cost effective alternatives with new onshore wind and solar developments less expensive than running existing coal plants. How quickly America adopts these alternatives will be critical to how the world looks in the future. But change inevitably generates resistance, and the larger the change, the larger the resistance. Let's take a look at the baby boomer generation, the group that has, or believes it has, the most to lose from this change.
Baby Boomers possess about 54% of all US household wealth and 57% of affluent household wealth (see Fig. 1), account for 42% of consumer spending, buy more cars than any other age demographic, account for 80% of all spending on luxury travel, and earn 47% of all income in the United States (see MarketingCharts,com and WiseBread.com). Basically, baby boomers control about two times the wealth in this country as compared to their percentage of the population. On the flip side, 45% of baby boomers have no retirement savings, and of the 55% who have some retirement savings 28% have less than $100,000. The bottom line - baby boomers have made and continue to make a lot of money, but spend it. And what do they like? Big cars, big houses, expensive vacations, cruises, beef, single-use packaging, etc., all of which generate a large carbon footprint. In a very interesting analogy, physicist Geoffery West points out that the average lifestyle in America (counting food, transportation, computers, air conditioning, etc) requires more watts to support than what is required by a blue whale. If baby boomers require about twice the average, we're talking about 150 million blue whale equivalents in the US.
Demographically, baby boomers are 72% white, compared with 50% of all births last year. Politically, they are quite conservative with the difference in percentage between those identifying themselves as conservative vs liberal at approximately 23% (see Fig. 2). And Republicans are much more likely to be the naysayers mentioned above than Democrats.
Although not a one-to-one relationship, there is certainly a correlation between "old white Republicans" who spend lots of money and deny climate change and baby boomers.
Mea culpa. What have I done to impact climate change? Not as much as I could, but I'm moving in the right direction. In addition to trying to inform the public with my OWOE website and blogs, I am professionally involved in some cutting edge technology developments to reduce the cost of renewable energy, I have traded in one gas powered vehicle for a Tesla (please see my blog), and I am contemplating installing rooftop solar panels on my house.
Now the good news. Baby boomers have a built-in sunset provision. The Paris Agreement of 2015 attempts to control greenhouse gas emissions to achieve a balance by 2050 and limit the average temperature increase to 1.5 deg Celsius. Of course, by 2050 the baby boomers will lie between 86 and 104 years old. That means that the vast majority of us will be either dead or in a rest home, both of which result in a very low carbon footprint (and one of which will eventually result in some carbon returned to the earth). In fact, if you do some simple math and assume that each baby boomer will be replaced by one average next-gen consumer when he/she dies, even with no other reductions in average carbon dioxide emissions due to technology improvements or behavior, and ignore population increase, US carbon dioxide emissions will drop approximately 20% and be at about the 1970s level by 2050 (see Fig. 3). Which means that one strategy that could be very effective is simply to wait us out. OK, boomer. Couple this with a continuation of the rapid improvement in renewable energy technology and the tendency of younger generations to adopt new technologies more quickly and, maybe, humanity has a chance.
Guest Blog by S. A. Shelley: In the matter of the transition to renewable energy, there are some nations and governments which do it quite well, e.g., Denmark, some that don't appear to care, e.g. the US, and then there's Canada. Canada claims to be very concerned about the environment and about the need to dramatically cut carbon emissions and transition quickly to a fossil-fuel-free economy. However, it has failed on a number of fronts and will most likely continue to fail.
The Need to Understand Total Cost
Whatever purchase at the personnel, industry or government level that you have, it is very important to have a good understanding of the TOTAL COST in order to make effective and well-reasoned economic decisions. Most people have an inherent ability to assess TOTAL COST and industry has analysts to help determine TOTAL COST; however, governments rely too much upon ideologues to arrive too often at incorrect TOTAL COST.
Strictly speaking, TOTAL COST = the sum of all costs associated with a purchase (or a project). Typically, this is broken into two components: TOTAL COST = Total Capital Costs (CAPEX) + Total Operating Costs (OPEX) over the assumed life of the product.
Let’s consider an immediate example of a consumer buying a car:
CAPEX = purchase price + dealer prep fees + financing costs - salvage / resale value
OPEX = fuel costs + insurance and registration + maintenance and parts
Consumers often buy a personal vehicle (car or truck) based only on the sticker price and consequently vehicle manufacturers have tuned their sales pitches to this almost exclusively. But if one does a TOTAL COST analysis of a car, EVs are now tending to be the lowest TOTAL COST personal vehicle choice (Fig. 1).
Upfront CAPEX for an ICE is still much lower than for a similar sized EV, but when you add in the OPEX to arrive at TOTAL COST, EVs are starting to pull ahead. Therefore, at the personal level, EVs are quickly becoming the best economic choice for those that can overcome the initial high CAPEX, and at the societal level, EVs help reduce carbon emissions and are the right choice for that.
Is it a Good Idea for Governments to Subsidize EV Purchases?
That depends upon the objectives of the government and the consensus of the populace. If the aim is to wean a nation state off fossil fuel reliance, which history has shown can be an Achilles heel to national economies, then yes, do as Denmark and China are doing and ban ICEs while supporting EVs.
If the aim is to eliminate the carbon emissions in order to protect the environment, then do as Norway and ban new ICE sales by 2025.
But if your aim is to reward wealthy and upper middle class voters with subsidies for purchasing EVs, then do as the Canadian government is doing (see CBC news and Electrek). The Canadian Federal EV rebate will not help most Canadians because the average household income in Canada is about $64,000 (CDN) per Statistics Canada 2017 data, while the cheapest marginally useful EV starts at $32,000 (CDN) plus sales taxes. Even if average, working Canadians wanted to buy EVs, the initial purchase cost of EVs is still higher than most Canadians can afford.
Canadian consumers across a broad economic range have correctly calculated that less expensive ICEs, new or used, will be the best economic solution for them for some time. This phenomenon of the citizen consumer being economically smarter than big government is not unique to Canada.
What Must Governments Do to Get More EVs On the Roads?
"Canadian Vehicles Are Big, Heavy and Guzzle a Lot of Gasoline"
Canadians rank number one in the world for having the largest, heaviest, least fuel efficient and highest carbon emitting vehicles.
For the befuddled government in Canada, a better approach to reducing carbon emissions and fossil fuel consumption by personnel vehicles could be to make small nudges and then let market forces takeover. For example, it would be fine to allow ICEs to stay on the roads, as long as the net mileage of ICEs continued to improve each year. Looking at Figure 2, between 2005 and 2010 average vehicle mileage increased by about 16%. This means that for the same driving habits, 16% less fuel was consumed and 16% less carbon was emitted, on average just five years down the road.
As late model used cars get removed from the car pool and are replaced with newer more efficient vehicles, then without changing tech or giving away EVs, it is likely that over time carbon emissions and fossil fuel consumption will decrease just by natural replacement of the personal fleet. Eventually, a new car that gets 30 mpg, will filter down to the used car market and replace an older generation model that only got 20 mpg. That’s an evolutionary way of cutting greenhouse gas emissions by 50% on a personnel vehicle. Instead of promising $2000 camping trips for poor families, it may be more helpful to provide rebates for poor families to replace very old low mileage vehicles with newer used ones that get higher mileage. Eventually such rebates could be expanded to cover PHEVs or BEVS as those filter down through the used car marketplace.
Or if the Canadian government really wants to help the environment by reducing greenhouse gas emissions, maybe it should focus first on those gases which trigger the most warming. "The majority of warming results from gases with a much lower media profile than the paparazzi-trailed starlet of global warming, CO2."
Support Transit Instead of EVs
To benefit more people quickly, Instead of spending $billions on EV subsidies that benefit the wealthiest citizens, those same monies may be more effectively spent on upgrading and improving transit systems that benefit a broader subset of citizens.
Canadian Federal Government Carbon Pricing is a Tax, Simple and Ugly
There are two general purposes for taxes. The first is to collect revenue for the government to provide critical services such as courts and defense. The second is to apply taxes to change consumption behavior, such as with sin taxes on alcohol and tobacco. However, with the Carbon pricing policies in Canada, there is no realistic way that Canadians can alter their energy consumption behavior in order to escape the carbon price: Thus it is a tax of the most egregious kind that siphons money from Canadians into government coffers with low to zero traceability. Natural gas is still the dominant energy source for heating homes and businesses, and there is nothing else available, now or in the short term, on a scale large enough for Canadians to use: It’s either heat the homes or freeze or migrate to Florida or Arizona for winter. Watch out America, you may need to build a wall on the northern border, too.
Furthermore, almost every incentive that the Federal Government has provided for green energy and reduction of carbon emission has been targeted at and benefited large businesses, not lower or middle class Canadians. While the PM uses his perk of zipping around frivolously on a private jet (see National Post and CTV News), it’s time for the Federal Government in Canada to honestly admit that the carbon price in Canada hits a captive market with no substantive, alternative choice available.
Carbon Emissions and Fossil Fuel Consumption Inelasticity in Canada
There is no reasonable and realistic way for the Federal Canadian government to achieve its much touted and promised carbon emission and fossil fuel consumption reduction targets. According to data from the World Bank since 1980 energy consumption in Canada has been very consistent at around 52 barrels of oil equivalent per year per Canadian. During the same period, the yearly carbon emissions per Canadian have slowly dropped from about 20 to 15 tonnes, which is still over twice the yearly per capita carbon emissions of a European at 6.8 tonnes. During this same period, the use of renewable energy in Canada has remained fairly flat so most of the gains in carbon reductions have come from elsewhere, either fuel efficiency improvements or the shuttering of coal power plants.
While the Federal government enacts legislation and policies to reduce Canada's carbon footprint and fossil fuel consumption, historical data suggests that such legislation will be ineffective (Fig. 3) and that it is extremely unlikely for the Federal Government in Canada to meet its international commitments to CO2 reduction. More needs to be done for Canada to succeed, but it is also extremely unlikely that the current administration has the technical, fiscal or social where-with-all to do what is necessary without resorting to brute force diktats.
The problem is more difficult to resolve when one considers that current Federal objectives in some areas will nullify any possible gains in other areas. For example, without being able to reduce per capita energy consumption or carbon emissions, adding 350,000 immigrants each year to Canada will by default drive up the total energy consumption and carbon emissions volumes: That will mean an additional 2.6 million tonnes of oil equivalent energy consumed and 5.2 million additional tonnes of carbon emissions each year. Energy will be needed to heat the residences of the newcomers and commute them to their jobs and there is nothing on the horizon to substitute for oil and gas in Canada. Therefore, unless the Federal Government in Canada gives each new immigrant an EV and a solar powered home, there is absolutely no way that the Federal Liberal government can achieve their vaunted carbon reduction targets and the shutdown of Canada’s oil industry.
In Canada, it takes over a decade for new energy projects, renewable or not, to come on stream. In that same decade, 3,500,000 new Canadians will need a lot of energy. Who in the Federal Government in Canada has a realistic plan for that? By realistic, I mean affordable, corruption free, workable and implementable without significant social or economic disruption.
It continues to get worse, because during this year’s Federal Election campaign, the Canadian Prime Minister has decided that he needs two jets while every other prior prime minister or party leader to date has made do with only one jet. To paraphrase Ms. Thunberg, “Shame on You Prime Minister Trudeau”. For the Earth's sake, if the Federal Liberals are returned to a minority Government in Canada, I kindly ask the Green or NDP coalition partners to reign in the Prime Minister's privileged jet setting and plastic bottle consumption habits.
Canada Can Do Better
Canada has a lot of renewable energy potential and a lot of ability to reuse resources. But maybe the Federal Government in Canada needs to be the first thing recycled before anything real and sustainable can be achieved. I absolutely agree that Canada must change its energy habits, but it needs better moral and technical leadership and a unifying vision instead of a divisive and dismissive cadre of elitist and privileged politicians (see Pierre Poilievre and CBC News).
I’m not against EVs. I commute in Houston on a bicycle and EVs can’t touch me for energy efficiency (15 miles per gallon of beer vs. about 130 mpge for an EV) or lowest lifetime greenhouse gas emissions. In fact, I know that renewable technology has now achieved parity with or surpassed traditional fossil fuel technologies in a lot of areas: My next car will most likely be an EV and my next house will have integrated solar and battery energy.
But I am very much in favor of evolutionary progress and of governments implementing environmental and energy policies based upon reason, science and economics instead of listening to biased and scandal plagued consultants from New York. In the long run, energy and financial independence requires astute and competent governments. Well done Norway, Denmark, Germany and China. Keep trying Canada.
Vive l’Alberta Libre!
Every week seems to bring another attack by the Trump Administration against laws and regulations that have been instituted by prior administrations to protect the environment and fight climate change. The most recent is the campaign to deny California the right to set stricter automobile emissions standards than federal limits. It has caused yet another uproar among environmentalists and liberals and glee among climate change deniers and conservatives and will undoubtedly lead to many years of legal battles. But what is reality? In fact, this move, and all the others, are just meaningless actions that do little more than pander to the Administration's fossil fuel campaign contributors and excite the hardcore Republican base ahead of the upcoming elections. The reality is that technology and market forces are driving the world inexorably and at an increasing pace toward a renewable energy future, despite the last-ditch efforts of the President and his supporters. Let's look at some of the higher profile actions.
Denying California's waiver on automobile emissions goes hand-in-hand with the prior announcement that the administration would rollback automobile mileage requirements set by the Obama Administration. On the surface, this appears to be an extremely serious setback for consumers, the environment and climate. Depending upon the outcome of the various legal challenges, there could certainly be a short term impact. But the transition to Electric Vehicles (EVs) is underway and picking up steam. Looking at California trends as a precursor to what is likely to happen nationwide, the state is experiencing falling total car sales for the third straight year (Fig. 1).
In contrast, EV sales have been increasing rapidly, and by mid-2019 EVs, including hybrid non-plug-in vehicles, represented 13% of new car sales (Fig. 2).
The big question is how quickly that 13% will grow and continue to displace Internal Combustion Engine (ICE) vehicles.
Historically, EVs have been quite expensive compared to their ICE counterparts; however, as the cost of batteries has dropped dramatically over the last few years, so has the cost to build an EV. Nevertheless, the purchase price of an EV such as the Tesla Model 3 is still higher than a similarly sized ICE vehicle, and purchase cost is the primary driver for US car buyers. But the real economic comparison should be on what is called the total cost of ownership (TCO), which includes purchase price, fuel, maintenance and insurance costs over the life of the vehicle, and resale value. There have been a number of TCO comparisons between the Tesla Model 3 and competing ICE vehicles over the past few years. The general consensus has been that the Model 3 TCO is less than other premium sedans from Audi, BMW, etc, but slightly more than mass market sedans such as the Toyota Camry. However, LoupVentures just updated its comparison with recent data on insurance and resale value, plus the latest purchase cost. In particular, resale data shows that the Model 3 holds its value much better than its competitors. As a result, the TCO for a Model 3 is now less than the best selling sedan in the US, the Toyota Camry (Fig. 3).
So the answer to "how quickly" depends on when consumers start to think beyond initial purchase price to the total costs of ownership (TCO). Once consumers realize that they will get a superior product at a lower total cost over time, the transition will begin to accelerate dramatically. Throw in the continued drop in price for batteries and the expanding options as other auto makers begin to offer new EV models, and a date around 2025 for California EV sales to reach parity with ICEs is not unreasonable. In such a scenario, auto mileage standards are pretty much immaterial. In fact, reducing standards makes the TCO of ICE vehicles less competitive and will likely drive the rest of the country to more quickly follow California's lead.
How about the uproar over light bulbs? Several weeks ago the administration issued a decree to roll back the Bush and Obama era attempts to improve lighting efficiency by phasing out incandescent light bulbs. But, here, we are well beyond the early adoption stage of new technology, i.e., light--emitting diode (LED) bulbs. The energy required to power an LED bulb for the same illumination is about 90% less than that of an incandescent bulb. The life of an LED bulb is about 20 times that of an incandescent, and the initial cost of LED bulbs has dropped dramatically and is approaching the cost of incandescent bulbs (you can now buy a 4-pack of off-brand 60W LED bulbs at Home Depot for about $6 or $1.50 apiece). Figure 4 compares today’s common bulb types and illustrates the dramatic savings possible for LED over incandescent bulbs.
In fact, the cost savings in electricity will pay for the initial cost of the bulb in less than one year of use. Manufacturers could give their incandescent bulbs away, and it wouldn't stop the transition. For more information, see the The Little Bulb That Is Killing Coal for more insight into the transition to LED lighting.
President Trump made saving the coal industry a cornerstone of his election campaign and his administration. How has that worked out so far? In June 2019 the EPA issued the Affordable Clean Energy (ACE) rule, an amendment to the Clean Power Plan, with intent to extend the life of the US fleet of aging coal power plants. Shortly thereafter, in July 2019, Blackhawk Mining filed for Chapter 11 bankruptcy, making it the eighth major U.S. coal producer to file bankruptcy since November 2017 and the fifth so far in 2019.
Since 2010, 289 coal-fired power plants have closed, representing over 50% of the plants and 40% percent of US coal generating capacity, with 50 of those closures coming after November 2016. And that trend isn't slowing with an additional 51 pending closures having been announced by utility companies. As a result, and for the first time in history, in April 2019 US electrical power generation from renewable sources exceeded generation from coal (Fig. 5).
Although this was a temporary occurrence due to the cyclical nature of both forms of generation, the long term trend illustrated in Fig. 4 points to a time in the not-too-distant future when yearly coal generation will forever be less than renewables. Again, technology and market forces are driving the change as the cost of new solar and wind power generation facilities continues to drop rapidly. A March 2019 report by Energy Innovation concluded that "America has officially entered the ‘coal cost crossover’…Today, local wind and solar could replace approximately 74 percent of the U.S. coal fleet at an immediate savings to customers. By 2025, this number grows to 86 percent of the coal fleet" The result: no new coal plants will be built in the US, and the existing plants will continue to be shut down.
Oil Drilling in the Arctic
Another focus of the Administration has been to open up the Arctic National Wildlife Reserve (ANWR) in Alaska to drilling and eventual production of oil (Fig. 6).
But again, what is the true risk of extensive development of ANWR? There have been several recent actions in Congress to try to block the drilling, there is the likelihood of lawsuits in the near future, and there is the chance that significant oil reserves don’t even exist in the region. But the greatest risk, again, is the impact of technology. With the world inexorably moving to replace fossil fuel based energy with renewables, the oil industry is facing a point of peak oil demand in the next 5-10 years. In the meantime, it's all about low-cost, quick turnaround production. In the US, that means shale oil which has boomed due to technology advancements in horizontal drilling and hydraulic fracturing (fracking). Why would oil companies invest many billions of dollars exploring for and producing oil in ANWR in hopes of (maybe) generating profits in 10 years, when they can invest a fraction of that and start making money almost immediately? ANWR development isn’t going to happen, but it makes good headlines.
The US may go kicking and screaming into this renewable energy future, but go it will.
Guest blog by SA Shelley: No doubt about it, the world runs on energy (and money). Nearly 80% of all the world’s energy is still provided by coal, oil and gas though this fossil fuel proportion of the energy mix is now shrinking and in just under 10 years, the world's energy mix will look markedly different. I hope that in addition to coal, oil and gas the OWOE reader is familiar with some of the other large energy sources such as nuclear, wind, solar, hydro and wave. Here at OWOE we try to bring useful and relevant knowledge and ideas about energy to the reader, and one big potential and virtually zero carbon energy source that has been overlooked by a lot of people including the OWOE bloggers is geothermal energy. Well no more. After a bit of research this OWOE blogger has gone gung-ho for geo for good reason.
In short, geothermal energy basically arrives in two flavors, geothermal heat pump (GHP) and supercritical reservoir energy (CRE). GHP uses the earth as a heat source or sink for heating and cooling (think of heat pumps for residential use). CRE uses high temperature water or steam from a hot reservoir to drive generators to produce electricity. The key benefits of geothermal energy are:
In addition, developing geothermal energy can make use of a lot of oil and gas technology and provide jobs for oil and gas workers who might soon enough find themselves in the next oil and gas downturn.
The Case for the United States In terms of GHP, currently about 2 million homes in the United States use it for heating and cooling. However, the DoE has calculated that by using existing technology and business practices there is enough thermal geothermal energy in the continental United States to heat an additional 26 million homes (Fig. 1).
In terms of CRE current and potential electricity generation, the potential to add 23 times the current CRE power to the U.S. grid is possible using current technology and business practices (Fig. 2).
This CRE is clean, baseload, 24 hour energy. Turn it on and it provides power, rain or shine, wind or none.
The Case for California Thinking about California, there is about 3.2 GW of installed CRE and 16.7 GW potential CRE. It gets really interesting if we compare the potential geothermal power in California (16.7 GW) to the potential wind energy offshore California (58.7 GW ) Let's compare the proposed Morro Bay wind farm rated at 765 MW to an equivalent onshore CRE plant that provides baseload power. Since 765 MW is the rated power of the wind farm that means that the average power output per day will be less. Giving the Morro Bay wind farmers the benefit of technology, let's say that they achieve a capacity factor of 50% offshore, meaning that an equivalent, baseload CRE plant only needs to be rated at 425 MW at 90% efficiency to produce the same amount of power each day. In terms of land or ocean space area required (Fig. 3) the differences are significant.
The offshore wind farm CAPEX is four times more expensive than an onshore CRE that produces the equivalent amount of power (Fig. 4). Adding operating and maintenance costs, the large offshore wind farm economics get worse.
In terms of secondary enviro-economic impacts, such as on fishing activities offshore or potential interference with whale migration, going offshore with large, expansive wind farms in California will be a losing proposition compared to a CRE plant on shore. Geothermal plants with their small local footprints are also designed to minimize any effect upon the local ecosystem.
As presented before on OWOE, it really should be obvious that California does not need large, expensive floating offshore wind farms, not yet, and not for another 10 or 20 years. However, California will soon need a few small offshore wind farms with low numbers of units that feed both into the energy grid and into secondary renewable energy and resource systems.
The Global Case for Geo Returning to geothermal energy for power production, the global potential is also huge (Fig. 5).
In some places, most famously Iceland, there is an abundance of geothermal energy literally bubbling to the surface. Fully 66% of all of Iceland's primary energy is supplied by geothermal with heating and electricity production being the two largest consumers of this geothermal energy. Kenya generates about 47% of its electricity using geothermal power plants. In 2018, Turkey added about 219 MW of geothermal power to its grid and has plans for much more in the future. Almost every country has some good potential for geothermal energy and many have started to develop that potential (Fig. 6; see thinkgeo.com).
A GW of power may not seem like a lot in the United States but in places like the Philippines and Indonesia it is a lot and helps towards sustainable economic progress.
Then of course there is Canada, where the socialist governments are completely blind to geothermal energy and all of its associated very low carbon, renewable potential. They fight too much over historical technologies and cannot see the future among the steam.
Blatant Blogger Recommendation The world needs to be a little more gung-ho for geo.
Guest blog by SA Shelley: The amount of energy consumed to light our modern civilization would surprise most people. In the not too distant past, residential and commercial lighting consumed about 20% of all electricity produced. Basically, every fifth coal, nuclear or gas turbine power plant built was used to just to light cities, factories and homes. However, since the advent of the LED, there has been a remarkable drop in the amount of electrical power required to light our modern world. Depending upon where you live and work, recent data suggests that residential and commercial lighting now consumes only between 7% to 12.5% of all the electricity produced. That's a drop in energy consumption for lighting by almost 1% per year over the last 10 years. The good news is that the energy for lighting continues to decline and will only get better as more LED lighting replaces inefficient technologies (see Fig. 1 and Fig. 2).
The cost for LED lighting has also been falling at an incredible rate (see Fig. 3).
Yet, there is still room for additional drops in energy consumption using LEDs. In the typical U.S. residence, about 10% of total energy costs still go to producing light. For sure, the bulk of residences in the U.S. still rely upon many of those outdated lighting technologies, though folks are adapting, as currently half of all lighting sales in the U.S. are LEDs. Doing a bit of math for the U.S. we can see how much power could still be saved, all other thing equal, if we were to hit 90% LED usage for lighting.
Using households as a proxy for residences, there are approximately 127 million households in the United States. Each household uses an average of about 28.5 kWh of electricity each day. Supposing that by LED sales, at 50%, that we’re already at 50% utilization for LED residential lighting. So if we aim for 90% target, then a household should be able to save another 4% of its total electrical power consumption, or about 1.1 kWh each day. Now, multiplying this number by the number of households in the U.S. yields a total electrical energy savings of about 140,000 MWh each day. The total energy production by all coal fired plants is 3,140,000 MWh per day. Ergo, just by switching to LED lighting in residences it is very likely that about 5% or about 17 of the remaining coal power plants in the U.S. will no longer be needed.
Bow to the LED, the little lightbulb has become a killer of king coal.
Guest blog by SA Shelley: I try to avoid writing about oil too often for three reasons: 1) the oil markets are well observed by more than enough highly paid analysts, 2) the changes in energy technology and distribution are more interesting (and still largely misunderstood by highly paid analysts) and 3) I try to build anticipation for my oil industry supply and demand blog in January of each year. But because of some recent peculiarities that have arisen in the oil markets, a short blog about oil now seems warranted.
For the past 30 years fossil fuels have provided about 80% of global energy needs (see Fig. 1). Oil and gas constitute about half of that supply, so about 40% of all global energy needs are still provided by oil and gas. Even though there are massive investments in renewable energy, most of these renewable investments are displacing coal while oil and gas are still largely unaffected. One of the big reasons for this is that the oil and gas industry is so large and well established that massive amounts energy can be purchased on the spot markets to provide very large, nearly instantaneous energy supplies. Renewables still don’t have that massive market capacity, but it's coming, especially in light of the lower cost investment and higher returns available in renewables compared to fossil fuels.
Historically, the oil market has worked in a very basic way:
Sure there were agreements and cartels (pre-OPEC, OPEC and probably post-OPEC) that have been successful to some degree to control prices, but in the long run the oil markets have behaved market-like. But what's happening now in the world of oil as evidenced by its recent price trajectory (see Fig. 2)?
In March of this year, the IEA released their Oil Forecast during the CERA conference in Houston. The IEA argued then that the bulk of oil supply growth will come from the U.S., followed by a group of five other nations and that supply loss will be mainly from Iran and Venezuela (see Fig. 3).
In that report, the IEA forecast oil demand growth of 1.2 million bbls / day for 2019, essentially stating that demand is stable and growing modestly.
However, supply has not remained stable. Recent data suggests that supply losses in Iran and Venezuela are much greater than originally thought. Supply loss from Iran onto world markets is actually twice that indicated by the IEA at close to 2 million bbls / day lost instead of 1 million bbls / day. For Venezuela, it is likely that since March oil supply has fallen by another 1/2 million bbls / day. Between just these two states, since March, it is probable that another 1-1/2 million bbls / day of oil supply has disappeared from the markets.
So why are oil prices falling again when demand is supposed to be stable, but supply is decreasing (!!!)? Some possible answers:
I’m guessing 5). Other overlooked, misunderstood and scary data and analysis from the IEA report will be discussed in the January oil blog.
SA Shelley, WH Luyties: OWOE is a small site, with just a few dedicated and experienced staff who follow energy technologies, economics and policies. Occasionally, OWOE bloggers dare to forecast energy developments that tend to be contrarian, and, much to everyone's surprise, they have been very good at forecasting trends correctly and ahead of much larger analytical organizations. Are we that good at more quickly analyzing publicly available information along with some insight and soft analysis? Or do we have access to the dark arts such as whiskey and voodoo?
From the early days of OWOE, and especially over the last six months, the prescience and value of OWOE blogs has been proven by the volume of similar analysis and conclusions that have followed after OWOE blogs have been posted. Some examples:
Oil price collapse (due to building supply and slowing demand)
EVs are Evil (through their ability to destroy industries and the jobs that go along with them)
EBuses will have a greater effect on oil demand than EVs
Canada will lose $trillions in oil revenue
Large oil companies to focus on short term production investments
Switch from ICEs to other forms of transport
So, how well have we done at OWOE? Very well, indeed!
And how do we consistently do so well? There are several reasons:
If we get stuck or our analysis proves inconclusive, then we may call upon the dark arts for assistance. It is surprising how good a shot of whiskey and a chat with a voodoo doll can help; however, it can be dangerous to rely upon such mystic arts lest too much is foreseen.
In the end, it's all about keeping OWOE readers informed and providing different perspectives. Please don't hesitate to request from the OWOE bloggers any particular energy related analysis, discussion or forecast for which you may have a need. OWOE bloggers have yet to charge for anything, not even lunch.
Guest blog by S. A. Shelley: In the past few months, a lot of people around the world have probably wondered about why oil prices have again quickly and significantly fallen. I've argued in a prior blog at the beginning of this year that the world is awash in oil supply. Even though oil production is collapsing in places like Venezuela, Iran and Mexico, is in danger of collapsing in more places like Angola and Libya, and is politically constrained in places like North Venezuela (Canada), there still is plenty of oil to supply most global markets. The plentiful supply of course comes from surging production in the U.S., ample production in Russia and new offshore fields coming on stream in places like Guyana and Brazil. If you couple increasing supply with softening global demand for oil, you get such downward pressure on oil prices. So what’s with this nonsensical sport of shooting tankers in the Gulf of Oman?
Comparing oil imports from the Middle East for both Europe and the U.S. shows some interesting trends. Over the past dozen years or so, the U.S. has been quietly and consistently reducing the amount of oil it imports from the Middle East. Europe on the other has started to increase the amount of oil it imports from the Middle East (Figure 1).
If we examine the data for oil imports from the Middle East as a percentage of oil demand (Figure 2) we see that in recent years the trend has been worse for Europe and better for the U.S. The Europeans appear to have become more dependent upon Middle East oil while the U.S. has become noticeably less dependent upon Middle East oil.
In case of a major crisis in the Middle East, who do you suppose will have a more difficult time adjusting to any supply shutdowns, Europe or the U.S.?
If push comes to boom in the Persian Gulf, the U.S. does not need Middle East oil anymore. At this time, the U.S. is in a position to effectively say, "No more American lives for Persian Gulf oil, you sort it out yourselves." With a bit of emergency demand curtailment here and there of only 8% or a bit of additional ramping up of on-shore supply, the U.S. can and should ride out the next big Middle East war.
Which leaves the Europeans hanging in the wind. Europe is way more dependent upon Persian Gulf oil than their political leaders like to admit or that their populace knows. If anyone needs to send ships, aircraft and troops to the Middle East to protect their oil supply and their remaining democratic and economic system, it's the Europeans. If they lose Middle East oil there will be devastating impacts on their economies and societies. Fortunately (and unfortunately) the Europeans have the Russians from whom to buy oil, as much as the Russians will sell subject to politics. So instead of fighting, the Europeans can chose to capitulate to the Russian oligarchs, in which case the Europeans will consign to history their freedom and liberal democratic values. Suck it up Europe, you better stop bickering internally and pull together because for the near future, both Russia and the Middle East have you over a barrel.
What about Japan or South Korea? Forget it - they can't protect enough of their oil shipments. Japan imports 80-% of its oil from the Middle East. Korea is in a similar situation. At best these nations can hope for additional oil shipments from the U.S. and maybe a few extra barrels from Canada.
What about China? They can, and they probably will, protect their tankers, but that won't help much if a Tanker War expands to include a Refinery and Production Field war. China imports just under half of all its oil from the Middle East, and China is becoming a local player with assets in the Persian Gulf. However China, like Europe, has the option of turning to Russia for more supply. But, unlike Europe, China can probably buy Russian oil without having to worry about Russian political terms.
India is in a similar situation as China with respect to Middle East oil, though India's volumes are lower, and, in case of emergency, India could survive oil supply shortages much better than China.
The rest of the world should survive a Tanker War relatively unscathed.
What about the probable belligerents in a potential Tanker War in the Middle East? Everyone will suffer. At this moment, the Tanker War seems to be starting because one of the principal belligerents is facing economic collapse, precipitated largely by various sanction regimes. A Tanker War will only accelerate that state's total economic collapse. Oil is money in the Middle East. As soon as the shooting starts, oil flows will fall, and, while the price of oil will spike, the volume of money necessary to keep principal belligerents fiscally solvent will be insufficient. Whatever the thinking in various headquarters in the Middle East, a Tanker War will not help anyone anymore. Short and quick might bring about a regime change (whose?); long and drawn out, will accelerate oil demand collapse in the rest of the world as nation states realize that it is better to wean themselves off oil as much as possible because of all the inherent economic and political risks associated with it.
Currently, OPEC supplies about 30% of global oil demand and it is now possible for the rest of the world to adapt existing alternative energy technology in sufficient volume to cut oil demand and to use new production technology to increase supply from more rational and stable nations. It will just take time, maybe just 10 years if push comes to boom or 20 years with appropriate planning and investment.
P.S. Data used for Figures 1 and 2 taken from the U.S. EIA and the European Commission Directorate-General for Energy.
I live in California. That gives me a front seat to virtually every new initiative and trend related to saving the planet, whether it is about turtles and plastic straws, banning single-use plastic bags, electric vehicles, or green energy. Although not the first state to adopt a Renewable Portfolio Standard (RPS), California has been one of the most aggressive in its timetable for replacing fossil fuel based electricity with carbon-free. In 2018, California updated its RPS to the requirement to achieve 60% of electricity sales from renewable sources by 2030 and 100% by 2045. Of course, California's aggressive push toward renewables has triggered a wide range of reactions. For example, Michael Shellenberger of Environmental Progress has been pushing the idea that California's electricity rates are significantly higher than the rest of the US (see Figure 1) and rising significantly faster because of its dependence on renewables. His culprit is renewable energy and his solution is to keep nuclear plants open. In contrast, Roger Sowell, who blogs about renewable energy issues, argues that California's unique climate, geography, and large population make such differences to be expected.
The data in Figure 1 appears to show that California rates are higher than US averages by between 2 cents and 4 cents per kWh, but this has been the case for at least 25 years. It’s impossible to identify any causation from raw prices, which is why I was very interested when the Energy Policy Institute at the University of Chicago released its "Working Paper: Do Renewable Portfolio Standards Deliver?" on April 22nd. The paper summarizes the impact of 12 years of experience with RPSs on renewables adoption, electricity price, and carbon emissions reductions. Based on a quick read of the summary, the report is a pretty damning characterization of such a renewable energy policy, particularly one which is being implemented by a wide range of US states. In particular, it appears to imply that the push toward renewables has dramatically increased electricity prices for average Americans and failed in its effort to cost effectively reduce carbon emissions. As a supporter of renewable energy, this troubled me, and I decided to dig more deeply into the paper to make sure I understood the issues. What I found troubled me even more than the initial summary - either the University of Chicago (of which I have high regard) erred in their conclusions, were selective in their data choices and analysis, or poorly presented their results. Or possibly a combination of all three.
To start, let me quote the online summary: "…Using the most comprehensive panel data set ever compiled on program characteristics and key outcomes, we compare states that did and did not adopt RPS policies, exploiting the substantial differences in timing of adoption. The estimates indicate that 7 years after passage of an RPS program…average retail electricity prices are 1.3 cents per kWh, or 11% higher…the comparable figures for 12 years after adoption are…a price increase of 2.0 cents per kWh or 17%. These cost estimates significantly exceed the marginal operational costs of renewables and likely reflect costs that renewables impose on the generation system, including those associated with their intermittency, higher transmission costs, and any stranded asset costs assigned to ratepayers." (Note: I've removed some items for the sake of brevity to focus on the issue of cost to ratepayers.) In an attempt to understand how the researchers arrived at these conclusions, I downloaded the working paper, then read through and analyzed the full document.
Figure 2 is taken from the working report itself (labeled therein as Figure 2). From the report: "Figure 2 plots the number of RPS programs passed into law in each year…Figure 2 also plots real national average retail electricity prices (right y-axis) which declined from about 12 cents per kWh to 10 cents per kWh from 1990 through 2002 but by the end of the sample in 2015 returned to 12 cents per kWh." Let me point out here that although the figure doesn't state it, the report specifies these rates as "real", i.e., after removing the impact of inflation. This is the only place in the entire 51-page document where any distinction is made between real and nominal electricity rates. The importance of this distinction can be seen in Figure 3, which plots EIA electricity rate data over a time period that encompasses the range of dates examined in the study. Here we see a similar pattern, but with somewhat less variability from a low of about 11 cents per kWh in the early 2000s to 12 cents in 2016. The EIA quotes "The average retail price of electricity in the United States has risen about 1.5% per year between 2006 and 2016, about the same as the 1.6% per year general rate of inflation over those years." In any single year, the inflation rate has been as low as about -2% and as high as about +10% per year. Nowhere in the report does it indicate how this highly variable and critical factor was accounted for in their evaluation.
Now let's look at Figure 4 (which is taken from the working report Figure A.2b) and forms the basis for the claim regarding electricity cost increase due to RPSs.
According to the notes from the figure "Blue lines show the point estimates and gray lines contain the 95% confidence interval." I have four fundamental issues with this figure: 1) again, it is silent on the question of real vs nominal values; 2) in year 12 the point estimate appears to be 1 cent per kWh increase from time of passage, and there is no way to link the results to the summary which quoted an increase of 2 cents per kWh; 3) the 95% confidence bands range from a decrease of about 0.3 cents per KWh to an increase of about 2.3 cents, i.e., some scenarios in their model show a decrease in cost; and 4) the report makes no effort to explain the significant drop at the high bound that occurs from year 10 to year 12 and is not mirrored in the low bound.
Based on the information supplied, I would argue that the small increases supposedly identified, less than 1% per year, are lost within the noise of inflation. Back to California, Figure 5 (from Sowell) shows EIA rate data, both real and nominal (adjusted by the consumer price index (CPI) to 2014 values.
California's rates increased nominally from about 13 cents per kWh in 2002 (first year of its RPS) to about 16 cents, whereas the real cost decreased from about 17 cents to 16 cents. Then throw in the complexity of the electrical generation and distribution system in California, the impacts of drought on hydro power generation, the cost of repairing infrastructure damaged by forest fires, the disruption of the traditional power utility business model from the adoption of rooftop solar, etc., and it seems hard to get excited about a possible 1 cent per kWh variation with no clear causation.
My conclusion is that the University of Chicago has presented an incomplete analysis based upon a limited set of data. However, let me give them the benefit of the doubt. Let's say that their conclusions are spot-on, and that the adoption of RPSs has resulted in an increase in electricity costs to residents of those states. Let's look at the two key drivers of that increase:
And, finally, if I step way back from the numbers and look at the big picture of global warming and climate change, I find it very hard to get concerned over a 2 cent per kWh increase in the average cost of electricity. Another venerable institution, the Massachusetts Institute of Technology (MIT), which has been on the forefront of investigation into climate change, has recently become much more negative on the chances that the world can dramatically reduce carbon emissions in time and cap the increase in global temperature to Paris Agreement levels. In fact, MIT researchers see strong evidence that the process of global warming has accelerated, and they are now promoting adapting to the new world that is coming. More extreme views are even using the phrase "climate apocalypse" to describe the impact on world civilization.
So, while I will continue to disagree with the University of Chicago's conclusions until I see more details of their work, more importantly, I believe those results are meaningless in the larger context of global impact.
Guest blog by S. A. Shelley In the first blog of this series, I summarized the huge energy resources of Canada. In the second blog, I showed how most of those resources have been or are being squandered and how governments with good intentions, at times more often than naught, deliver bad outcomes. While statistically bad outcomes can be unintentional, in Canada a lot of bad outcomes are actually the deterministic result of government strategy. Coupled with the breakdown of the rule of law at the highest levels, Canada is in bad shape. That unfortunately is the very big ugly in Canada. Other factors resulting in Canada's bad energy situation are the focused actions by small groups of well-funded opponents and the apathy by the populace who have been habituated to the sweet lucre of government largesse. Canadians are generally kind and polite people, but at the governing level, the plotting and duplicities surpass a Shakespearean tragedy. The Russians probably learn by watching what happens in Ottawa.
The biggest warning that I have is that the path that Canada is on will more likely lead to Canada becoming the next Venezuela - corrupt, ineffective and when in trouble, doubling down on failed collectivist ideas, instead of returning to integrity, order and prosperity.
Much like Maslow's hierarchy of needs for individuals, nations also have a hierarchy of needs in order to survive and thrive. For individuals it begins with basic needs, then psychological needs and finally the self-fulfillment needs. A nation's needs are similar: a nation needs food, water, energy, then trading partners, and finally self-fulfillment, which often happens on Olympic podiums or in cultural accolades. In Canada, the national needs have been simplified to Peace, Order and Good Government. Canada has peaceful access to all the energy that it needs, but Canada lacks order and good government to harvest that energy and thus is putting itself into a precarious and untenable situation in the long run. Without ample energy supplies, logistics breaks down, farming founders and economic output plummets. A digital economy still needs food, transport and energy to thrive.
In the first blog of this series, Fig. 7 indicated that the largest growth in foreign investment in Canada is in Finance and Insurance. If we think about output, finance and insurance shift electrons from place to place to chase probabilities of events occurring or not occurring. Guess correctly and win big. Guess incorrectly too often, then a financial crisis results and everybody loses (except the investment bankers). Only a few nations can comfortably tie their continued prosperity to finance, and even then usually for only a small percentage of their populace. By contrast, a thousand standard cubic feet of natural gas is just that. An option on the TSE VIX can be something or nothing. There needs to be a balance to ensure long term economic viability.
Unfortunately, Canada has allowed a large part of its economic engine, its energy industry, to collapse and, while heralding new technologies, is really just chasing the herd in many areas with too few dollars, and again without a clear, widely accepted vision and coordinated goals. Economic imbalance and inequality is growing in Canada and it bodes not well.
For the most part, the rule of law still applies to ordinary citizens, but when it comes to elite interests, it is now very clear that the governing Liberal Party of Canada will write new laws and regulations quickly, overlook others or apply them in excruciatingly abusive detail according to selfish political will.
By now, I hope that most readers are aware of the corruption scandal in Canada regarding SNC-Lavalin and the Prime Minister, principal cabinet members and the highest levels of the civil service. If you are not aware of cause of the scandal, the short story is something like this: SNC-Lavalin, a politically very well connected engineering firm from Montreal, has been caught bribing foreign regimes and domestic governments for work (see also theSpec.com). It has been so bad that the World Bank, along with several other international agencies, banned SNC-Lavalin and its subsidiaries from bidding on work, and the OECD even issued a warning to Canada about how the government is handling the affair. A good summary of SNC-Lavalin's achievements can be found in this Financial Post article.
The problem is that as SNC-Lavalin was being called to account for its wrong doings, it was lobbying the federal government to ensure that SNC-Lavalin would only get a slap on the wrist, more or less. Consequently, the current government of Canada acted inappropriately, drafted new laws to protect SNC-Lavalin and overlooked egregious misconduct, all with the stated best of intention of protecting 9,000 jobs (see OttawaCitizen.com and PierreEmp.ca). On the other hand, in 2016 alone, the Canadian oil and gas business shed 40,000 jobs, and the Prime Minster and his party weren't concerned one bit.
Corruption among friends is to be fixed by all means necessary while prosperity among adversaries is to be hammered into oblivion. This method of governance, while common in despotic regimes, is now also the norm in Ottawa. Ottawa just doesn't yet shoot people, though character assassination is encouraged (see WinnipegSun.com and TheGlobeandMail.com).
Now it gets convoluted. While this SNC-Lavalin affair was happening, Canada, at the request of the United States, arrested a Huawei executive. China, of course, was upset. The Prime Minister of Canada stated emphatically on January 23, 2019 that Canada is a country of the rule of law and that the Canadian justice system is impartial and independent. However, the actions of the Right Honorable Prime Minister, with respect to the SNC-Lavalin scandal, demonstrated otherwise. I agree with China that Canada is no longer a nation of an independent and impartial justice system.
This loss of judicial independence and impartiality also applies to regulations for energy projects. If Canada is no longer a nation of rules and laws, in which a company that followed precisely all published regulatory procedures yet still has a project stopped, then why would anyone invest in or buy energy from Canada?
In early 2018, the Federal Government of Canada issued an Advanced Contract Award Notice (ACAN, NRCan-5000036064) for between $275,000 to $280,000 to Wood Mackenzie to study and report on the Competitiveness of Canada's Upstream Oil and Gas Industry. Subsequently, upon some firms challenging that ACAN, the government initiated a tender process on May 14 for the same study, but at the much reduced amount of $88,490. Some firms then declined to bid and eventually Wood Mackenzie was awarded the contract for $88,490. In the United States, such procurement changes are illegal; in the European Union, the same. But in Canada, by the whim of the governing party, changes like this are acceptable. The good news though is that the companies that challenged the ACAN, while not winning, did manage to save the Canadian taxpayers about $200,000, or, at least until the follow on study.
Most egregious is that the governing party has adopted a platform that aims to thwart Canadian oil and gas production. Paramount to this effort is Bill C69 (see FinancialPost.com and WilsonCenter.org).
While Canada stumbles, in the United States construction has already commenced on three pipelines that by 2020 will bring an additional 2.4 million barrels per day of oil to deepwater ports with access to global markets. All this achieved in a shorter time frame than Canada's regulatory review cycle for just one pipeline.
As noted in previous blogs about oil supply and demand, world oil demand is not going to zero anytime soon. But the Prime Minister of Canada and his Party, by adapting a zero oil policy, have conceded oil markets and revenues to regimes such as Venezuela, Saudi Arabia and Russia. Would it not be better for the world if Canada, with its heretofore independent judiciary, thorough environmental protections and (formerly) transparent markets, is a major producer? When disaster or economic collapse hits an area, Canada sends aid, Russia sends troops. Who should get the money for oil, Saudi Arabia, Venezuela, Russia or Canada?
Or rather, the fix is in against affordable, inexpensive hydropower. Graft is costing individual Canadians hundreds or thousands of dollars every year. In B.C. this is especially true with hydropower. Due to explicit Liberal Government policies and actions, from 2007 onwards, B.C. Hydro was mandated to buy expensive green power, such as run of the river hydro, from independent power producers (IPPs). Many of those IPPs were donors to the ruling Liberal party and by some manner managed to get above-market prices for long term supply contracts that B.C. hydro was legislated to buy. Just this one incident of graft gone wild costs B.C. residents at least $200 more per year for hydro power. Every year, $200 here, $108 there adds up quickly to a princely sum over the long term for the average Canadian family.
When it comes to project cost overruns, it has been calculated that graft and corruption in Canada increases project costs up to 10%. Think about it. For the Site C hydropower dam in B.C., projected to cost about $10.7 billion, it is quite possible that $1 billion of that cost is due to graft and corruption. That's another $200 that every resident of B.C. will have to pay for just this one project.
Similar shenanigans ensued at the Muskrat Falls hydropower project in Newfoundland.
"A number of CEOs of both domestic and international energy companies have publicly stated they will not invest further in Canada due to its deteriorating competitiveness." (See WashingtonTimes.com, FinancialPost.com, and theStar.com.)
In the first blog, I noted that Canada still imports oil from Saudi Arabia. Canada could not get the Energy East pipeline built which would have brought oil from Western Canada to Eastern Canada, and therefore Canada still imports oil form Saudi Arabia (and doctors too (see theGlobeandMail.com and OttawaCitizen.com). The premier of Quebec was somewhat gleeful about this, saying that, "There is no social acceptability for oil in Quebec". But apparently it is still socially acceptable to import oil from an autocratic state like Saudi Arabia? Yet, over 60% of Quebec residents think that it would be better to have oil from Alberta than from Saudi Arabia.
What the federal Canadian government proclaims in one press release, it readily ignores when inconvenient. To wit, the Canadian government designated an Ocean Technologies Supercluster for the Atlantic Provinces in part because of the expertise in ocean technology and shipping located there. However, the Canadian government then deliberately decided to ignore those same Atlantic Provinces when it sought input to evaluating the safety of ocean going oil tankers.
Looking west at British Columbia (B.C.), the situation is just as bad, with a Premier who fights for his own pipeline, but is against anyone else's pipeline. Here again, most residents in B.C. are in opposition to the elected officials and in favour of all pipelines.
The other irony is that B.C. has the largest coal export terminal in North America and is happily exporting millions of tonnes of greenhouse gas (GHG) emitting pollutants to overseas power plant. Wsorse yet, while B.C. fears the environmental dangers of expanded oil exports, B.C. coal producers have for decades been quietly poisoning waters that flow into U.S. watersheds (see ElkValleyCoal.com and DesmogBlog.com). The hypocrisy in B.C. deserves international recognition.
When it comes to Political and economic icons, the Prime Minister of Canada is forthright about his admiration for the basic dictatorship in China. When it comes to interacting with the rich and powerful, the Prime Minister is secretive and cavalier about ethical boundaries (see bbc.com and cbc.ca).
When the Prime Minister espouses that he, and only he, has a climate action plan for Canada which includes carbon taxes for the masses, yet he is self-entitled to fly frivolously on a private jet, one of the most intensive carbon emitting ways to travel, one can see the differences between the privileged ice-wine life of the ruling elites, the old boys club, versus the Habitant Pea soup of the governed masses.
Let's also compare the thinking and actions of the federal governing party in Canada - see Table 1.
There is a big cognitive disconnect with governments at all levels on almost everything. I've addressed energy, but other examples abound:
The true north is strong and free in the wrong areas.
Affordable and reliable energy is necessary for a modern, comfortable and well-functioning society. Energy jobs are also well paying and support a comfortable middle class life for a lot of people. Energy investments and a careful transition to clean and renewable energy can be achieved in a fiscally viable and coordinated manner that will benefit most Canadians and the world in general. I'm all for clean energy, but I'm definitely for doing it without graft or corruption and in open markets in order to get the lowest cost energy for all Canadians. If Canadians want Canada to function better you must not be afraid to look at and compare across nations and figure out why things work better here or there.
Canada has a lot of natural energy wealth, both conventional and renewable. But too much energy wealth has already been squandered by governments, while hydrocarbon energy is now being deliberately killed by governments. What Canada has now in terms of energy policy and goals is stressing families, bankrupting corporations and strangling revenue to governments.
In America, nobody trusts the government; in Canada everybody trusts the government too much. When Canadian governments announce new energy policies, Canadians really need to ask, "How much will this cost, how will I benefit and who is getting rich off me and why?" Canadians need to think about the future, about their children and grandchildren, and then Canadians need to work towards common objectives and get Mad like Max in order to ensure energy security and financial prosperity. The great bogeyman in the world is not America, it is places like Venezuela. Plan your path wisely Canada.
Vive l’Alberta Libre!
P.S. I will gladly debate any Canadian government or political leader about energy policy and technology at any time, in any town hall, in any caucus meeting, in front of anyone, young and old, near and far, rich or poor, CBC or CTV. Name the time and the place and I'll be there because I am not afraid to speak truth to power and incompetence.