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Canadians Hear Mixed Messages on Energy

Cliff Jamieson
By  Cliff Jamieson , Canadian Grains Analyst
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Two very opposing viewpoints on energy were released over the past weekend which is bound to leave Canadians confused over the future of the industry and how we will power our economy in the future.

On Sunday, author and activist Naomi Klein spoke to an audience at Congress 2016, which is the 85th week-long gathering of scholars who discuss a wide-range of topics focused on bettering the lives of Canadians. The function is organized by the Federation for the Humanities and Social Sciences, while this year's event is held at the University of Calgary.

Klein is the author of This Changes Everything: Capitalism vs. the Climate and a driving force behind the controversial Leap Manifesto. She brought her message to Canada's oil province for the second time in recent months: In order to reach the emissions target agreed to by governments in the Paris Agreement, fossil fuels must stay in the ground, the development of infrastructure must stop and the use of fossil fuels must end by 2040.

While she described the Paris Agreement as a "political break-through" and the best yet, she claimed we're still heading for an ecological disaster.

Klein's message was supported by pictures of the Fort McMurray wildfire, where an El Nino event "super-charged by climate change" was responsible for the devastation, a notion not received well in Calgary.

When an audience participant asked her about the future of agriculture, her answer was that the industry must be re-imagined, must shift to greater dependence on localized food and the world must focus on what every piece of land is best used for.

Perhaps one point I do agree with Klein on is that she claimed it is impossible to achieve the radical reductions in emissions needed AND achieve economic growth at the same time, something she claims is supported by economists around the world. This concept seems to be at odds with many political messages of the day. (Klein's presentation can be found at congress2016.ca)

A very contrasting message was presented at the Liberal Party Convention, where economist, author and oil analyst Peter Tertzakian presented on the merits of Canada's energy industry while showing concern for the global emissions issue.

Despite his awareness and concerns surrounding global emissions, Tertzakian showed frustration that advances in technology are often offset by the reluctance of consumers to change. Consumers continue to demand larger vehicles while driving more, making our reliance on fossil fuels difficult to abandon. He stated there are 1.3 billion vehicles on the road in the world, with a net 50 million added each year, while the manufacturers of electric cars may reach a production level of just one million per year by 2020. Market dominance of electric vehicle is far from sight.

Tertzakian built a case for more Canadian fossil fuels to be supplied to the world, which leads to the need for increased infrastructure such as pipelines. He suggested the world utilizes a volume of oil equivalent to an Olympic-sized swimming pool every 14 seconds. Given a global pool of oil, Canada is producing just 3% of the volume. As Canada's production is produced with higher safety and environmental controls, he contended that the world would be a better place if Canada was the last out of the pool rather than the first, or rather, if our country's exports replaced those of our competitors.

(His presentation can be seen at http://www.cpac.ca/…)

Michael Moore, from the School of Public Policy at the University of Calgary, spoke on these two presentations, as well as to a study from a federal government think tank which has recently concluded that the shift away from fossil fuels may take place faster than expected, as heard on Calgary talk radio. One key take-away from his analysis is that there exists no practical replacement for energy-intensive industries such as agriculture and the transportation industry such as trucks, trains and airplanes. In his opinion, the use of diesel or kerosene in these industries is "is not going away in 100 years or so."

Moore also sees it as "stupendous" to dismantle an electrical system which has taken 100 years to build in a few short years, while also price prohibitive. As customers are attracted to vehicles which are better, cheaper and cleaner, the switch to electric cars will be slow to take place, given their cost.

Gary Lamphier of the Edmonton Journal released a piece today titled "While Canada dithers, the world shops elsewhere for energy." While the federal government stalls in making any decision with respect to energy, Lamnphier wrote a vacuum is being filled by the likes of Naomi Klein who flies around to spread her message. At the same time, Canada's competitors around the world, including the United States, are rapidly expanding to meet the global demand.

One can only imagine how bringing Canada's industry to its knees, representing 3% of the global total, is going to achieve the activists' goals while much larger competitors are left alone to grow at warp-speed. It could be a case of follow the money.

**

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Cliff Jamieson can be reached at cliff.jamieson@dtn.com

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