Let’s Not Rush the Energy Transition

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In a new report released last week, the University of Waterloo’s Angela Carter argued that Canada’s oil sector would be a major obstacle to reaching the world’s GHG reduction targets. According to the political scientist’s analysis, whereas Canadians represent just 0.5% of the world’s population, the production of Canadian oil would account for 16% of the “global carbon budget,” namely the GHGs that would be deemed acceptable in order to keep climate change under control. While the document contains some interesting information, its hypotheses are very strict, and some important details go unmentioned.

An incomplete picture

First of all, Carter’s entire report is based on the hypothesis that for global warming to remain less than 1.5 degrees Celsius above preindustrial levels as prescribed in the Paris agreement, countries taken together must keep their total GHG emissions below 230 billion tonnes. Thus, using government estimates, the report finds that the Canadian oil sector would represent 16% of this total, which the researcher considers a “carbon bomb.”

But let’s take a moment to properly evaluate the situation by comparing apples to apples and including other variables in our analysis.

Canada is currently responsible for just 1.5% of global GHG emissions. The oil and gas sector today generates 27% of Canada’s total GHG emissions. In other words, this industry is directly responsible for about 0.4% of global GHG emissions. Yet Canada supplies more than 5% of the global demand for oil. Not bad for a small economy like ours!

The reason our country has been able to contain its GHG emissions in this sector is that the intensity of oil sands emissions has fallen by over 36% since the year 2000. This improved record is due among other things to technological innovation and increased operational efficiency.

Canadians outside of the oil sector have also been making an effort. GHG emissions per person are at their lowest level since 1990, and one of the sources used in the report contains an interesting passage not mentioned by Carter: The Canadian population is expected to increase by 15% between 2017 and 2030, while GHG emissions should fall by 6%, for a per capita decrease of over 18% (from 19.6 to 16.0 tonnes per capita). So we can see that Canada’s climate change record is constantly improving.

The transition is already happening

By painting such a bleak picture, Carter gives us the impression that Canada is a champion of inaction and that we will be one of the main culprits if the Paris agreement’s very stringent targets are not met.

Yet whether we look at it by sector or per capita, Canada’s energy transition is already well underway. We have reduced our consumption of coal by 26% since 2000; the residential sector’s energy efficiency improved by 51% between 1990 and 2017; non-GHG emitting sources now produce 82% of electricity in Canada; and we have adopted numerous environmental policies, including a carbon tax.

Insisting on dangerously accelerating the energy transition, as Carter implies we must, will only hurt our economy, and Canadian families across the country will end up paying the price. While remaining passive in the face of climate change would be a big mistake, so too would rushing our transition measures.

We need to find the right balance between growing the economy and slowing global warming. Either extreme would be harmful. And to be able to strike this balance, it is important to present all the facts, and not to misrepresent Canada as a major impediment to the energy transition. We need to continue to innovate and improve, as we have been doing for many years now.

Miguel Ouellette is Director of Operations and Economist at the MEI. The views reflected in this op-ed are his own.

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