Pembina Institute

Scientists offer much-needed reality check on climate implications of Ottawa’s resource agenda

Last week, a group of 12 prominent climate scientists and energy experts from across the country sent Natural Resources Minister Joe Oliver a letter. It’s a great statement that’s worth reading in full, but the following paragraph sums up the central issue:

If we truly wish to have a 'serious debate' about climate change and energy in this country, as you have rightly called for, we must start by acknowledging that our choices about fossil fuel infrastructure carry significant consequences for today’s and future generations.

Put another way, we have a choice about how much fossil fuel infrastructure (e.g., power plants, pipelines, oil and gas facilities) we build. If we’re going to consider building a lot of that infrastructure, we should acknowledge that those projects will help us produce and burn more fossil fuels, adding more heat-trapping gases to the atmosphere. Serious action on climate change must take us in the opposite direction.

Unfortunately, Minister Oliver’s response to the scientists’ letter was simply that it was “unrealistic” to think governments could do something about the issue:

The position of these scientists is unfortunately unrealistic in the real world because what they want to do is to see a diminution of the use of hydrocarbons and they look upon the oil sands as a symbol, as an example of that,” he said adding that the global demand for energy will increase by 33 per cent over the next 25 years. “Even under the most optimistic scenarios for renewables, hydrocarbons, fossil fuels, will represent at least 63 per cent of the source of energy by the year 2035. So we have to be realistic. The world needs energy.”

In the IEA’s 450 Scenario, a big boost in efficiency and a more aggressive role for clean energy means global fossil fuel consumption falls by 10 per cent from 2010 through 2035.We’ve pointed out the troubling implication in this line of reasoning before; every time someone refers to the world’s energy demand growing by a third over the next 25 years, they are referring to a scenario from the International Energy Agency (IEA) that results in extreme levels of global warming, lasting for many centuries and having disastrous impacts on the world’s poorest and most vulnerable people. In the IEA scenario that is based on a serious response to climate change, the outlook for fossil fuels is dramatically different.

Taking climate change seriously inevitably means burning less fossil fuel on a global scale. Overall energy demand will grow much more slowly and fossil fuels, especially coal, will become less and less important in the overall mix. In the “most optimistic” scenario Minister Oliver refers to at the end of his quote above (the IEA’s 450 Scenario), a big boost in efficiency and a more aggressive role for clean energy means global fossil fuel consumption falls by 10 per cent from 2010 through 2035, instead of growing by a quarter, as it does under the IEA’s New Policies Scenario.

Oil Demand and Price

Taking oil as an example, the above graph underscores the scale of this shift. In a world that prioritizes climate action (green lines), oil demand will peak this decade and begin falling, ending up 10 per cent below today’s level by 2035. That’s compared to the 13 per cent increase that occurs in the IEA’s central scenario (blue lines) that Minister Oliver frequently refers to. Falling demand has a big impact on prices too — in the climate action scenario, global oil prices peak in 2015 and are $25 lower than the central scenario by 2035.  

As other countries face up to the climate challenge and begin curbing their demand for fossil fuels, will Canada be left waiting on the shore for tankers that will never come? As former international trade minister David Emerson wrote in 2011’s Shaping Alberta’s Future report, “We may have heavy oil to sell, but few or no profitable markets wishing to buy.”

Perhaps Canada is betting that the world will decide not to address climate change, allowing fossil fuels to reign supreme for decades to come as temperatures climb. Perhaps our government is hoping against hope that other countries will buy into Joe Oliver’s fatalistic message.

If they do, it will be a self-fulfilling prophecy. Because if we do not burn less fossil fuel, dealing with climate change really will be “unrealistic.”

Roger Gagne — May 16, 2013 - 05:51 PM MT

Excellent blog, PJ; thank you! As often happens when I look out at the scene in Canada, I find hope and despair in equal measure in your summary.

In my own effort to accelerate the discussion on climate change and carbon pricing in Canada, I set up this 2-minute anonymous online survey; the five questions each feed into their own word cloud where the larger a word appears, the more often it has been used in the survey responses.
www.carbonconversations.ca

No name or phone number required; I just want your opinion and your postal code!

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