Oil Sands Profits into Green Energy
James M. Byrne, PhD., Professor, University of Lethbridge
Please, wake up Alberta?Remember the Slave Lake fire?They lost 374 properties in the firestorm on May 15, 2011.How about the January 4 Nanton grass fires?Slave Lake and Nanton should have been snow covered.Downunder - Australia summer 2013 -- they are burning up.The USA 2012:record heat, forest fires and storms in 2012; and of course, Hurricane Sandy.We all heard about record Arctic and Greenland ice melt. The International Energy Association Annual Report released November 2012 says no more than one-third of proven reserves of fossil fuels can be consumed prior to 2050 if the world is to limit global warming to 2 C. North Dakota oil production from the Bakken Formation has gone from zero to almost a million barrels/day .. and growing.
Our governments are so wrong betting on oil sands.We will only market a tiny fraction of the current reserves of 170 billion barrels -- then those $12 billion plants will be mothballed and no cleanup will occur. Bitumen production emits too many climate-warming pollutants and pollutes water and air.
The USA gets climate change.We all watched the impacts of Hurricane Sandy on the Caribbean, USA and Canada.Record flooding from heavy rain and an unprecedented storm surge flooded New York and New Jersey. Hurricane Sandy was a hybrid storm -- combining tropical and cold polar air.Expect more of the same - coastal populations will suffer heavy rains and much higher storm surges on top of substantial sea level rise.
We saw many 10,000s of heat records set in North America, accompanied by extreme drought and an unprecedented wildfire season across the USA.The drought, combined with severe weather in India and other locales, has set world food prices rising.There will be tens, more likely hundreds, of millions of people hungry around the world in 2013.
The Yale Project on Climate Change Communication says 70% of Americans believe climate change in happening.That report was release in mid October, before Sandy happened.How will USA post-Storm Sandy opinions impact purchases of GHG intensive oil sands investments with a 40-year lifespan?
The attached pie chart presents the government view of the Alberta GDP in 2011.Twelve sectors contribute to the economy, and the biggest is energy.Is this diversity?Two primary industries: energy, 27.6% and agriculture, 1.8%.Would any economist or any Canadian argue the remaining sectors are not dependent on the energy sector? A decline in the energy industry will lead to a decline in all sectors. Alberta is headed for an economic crash.
The USA is working on realistic change to their energy options in the next few decades.Richard Alley, a leading global change scientist from Penn State forecasts USA fossil fuel consumption in 2030 will be around 13% of the total energy use, compared to 78% today. Mark Jacobson from Stanford University has worked out the engineering to move the world to renewable energy in a few decades. Green energy, generated in the USA, will save their economy close to half a trillion dollars in foreign oil costs while creating many jobs.The US will also save almost $120 billion on health care cost related to fossil fuel pollution, according to the U.S. National Academy of Sciences.
China is investing a small amount of their budget in oil sands short term while they lead the world in green technology research and investment.China does not have to keep buying oil sands products.They are building electric cars and green technology to minimize their long-term demand for petroleum. In the near future we will be buying our green technology from China -- a further burden on an economy invested in fossil fuels that will soon be uneconomic.
There is a solution.Forget new pipelines and new oil sands markets.These have no economic longevity.Work with current oil sands on a real clean up of the pollution they emit.Then, diversify!Have the courage to stop the massive flow of fossil fuel profits out of Canada.We have immense renewable energy potential in solar and wind in the southern prairies.Developing that potential with current fossil fuel profits will diversify our economy and create many jobs in Alberta and Canada.
Wake up to climate change Alberta.Wake up to the bad long-term economy of oil sands; and to the vast potential we have in renewable energy. Wake up to the fossil fuel economy cliff.