Wednesday, January 30, 2013

Memo to Harper and Redford: try for base hits, not home runs!

There is a depressing malaise around the Canadian reputation on both "energy superpower" and "carbon emissions" files. And, of course, these two files are intimately linked, if not embedded.
Burning fossil fuel is one of the most contaminating of human influences on the environment, and most reasonable people would argue, thereby on climate. Deploying more fossil fuels to extract 'dense crude' further contaminates the environment. Scientifically, there is so little room for questioning these premises, according to an increasing flow of both data and interpretation of that data.
Politically, however, conservative governments, tied to their dependence on the balance sheet, thereby rendering them blind to the big picture, seem tunnelled into attempting the home run on energy production, hence the concept of Canada as an energy superpower. Historically, both Ottawa and Alberta are so deeply committed to the 'home-run' approach, to what they clearly pictured as the "golden cow" of their political aspirations, selling Alberta tar-sands oil to the world at world oil prices, seems to be fading, both in their dreams and on the ground where real decisions count.
Pipelines blocked, both in the Keystone and Northern cases, one by the Obama administration, the other by Canadian First Nations and British Columbia, have so far thwarted those home-run swings by Ottawa (Harper) and Alberta (Redford). Selling unrefined crude either to the U.S. or to China and the East, for the moment, seems, if you will pardon the pun, something of a "pipe-dream".
And yet, in the midst of this confluence of influences, economic, environmental, ethical and political, one thinks of the Canadian beaver, the little creature who continues his laborious task of cutting trees, carrying them to his dream home, and constructing his trademark "house"....never one to dream of home runs, s/he is content with a long string of base hits to accomplish his goal.
For Redford and Harper to be reminded of the little beaver, in this situation, would bring them face to face with the need to get serious, immediately, about the protection of the environment. If both were to bring the full force of their respective governments to bear on the need for environmental protection standards strictly enforced, including the imposition of some form of carbon tax (a move all executives know is coming sooner or later), and the inevitable cries of victimhood from the corporate sector (their political and financial base), these leaders would enhance the air, land and water in the public domain in Canada, their political reputations and thereby their likelihood of re-election, and the Canadian reputation as a leader in environmental protection among the global community.
Sometimes the best sales pitch is also doing the right thing, and not merely relying on the base argument of volume and access of a needed supply of energy.
Furthermore, if both leaders wanted to establish their respective political legacies, they would join together, with other Canadian provincial and energy leaders, to propose, detail and lead a national energy pipeline of Canadian crude to the eastern portion of the country, currently still dependent on Middle East imports.
Link a national energy supply, refinery and distribution system to a world-leading environmental protection strategy, including a carbon tax and a balanced thrust toward clean energies, and a guaranteed price on fossil fuels for Canadian purchasers, for a decade for example, and these two governmental leaders would have shattered so many false ceilings of public expectations, broken down walls of red tape, opened the country to at least two of its outstanding, and glaring opportunities and, in the process, opened the eyes and ears of the rest of the world to a new kind of Canadian player on the world stage. Like beavers, we would be able to show how we can cut trees (harvest oil) and build houses (protect our natural home) at the same time! Amazing!
Tunnelling to home runs too often relegates a player to the minor leagues, until he recovers his full game commitment to include base hits in his repertoire. And so it should!

Goar: Obama casts doubt on Canada’s ambition to be an energy superpower

Hopes for a quick U.S. approval of the Keystone XL pipeline fade, forcing Canada to rethink its status as an energy superpower.
By Carol Goar, Toronto Star, January 30, 2013
Much has changed since Barack Obama threw a spanner into Stephen Harper’s plan to make Canada an energy superpower.

A year ago, the U.S. president rejected an application by TransCanada to run a massive pipeline from Alberta to Texas. Canada’s prime minister assured oilsands producers it was just a hiccup; the project would get the green light after the U.S. election.
Three months ago, Americans re-elected Obama. He still hasn’t approved the Keystone XL pipeline.
Last week he pledged to make climate change a higher priority in his second term. “The path toward sustainable energy sources will be long and difficult,” he said in his Jan. 21 inaugural speech. “But America cannot resist this transition; we must lead it.”
Two other shifts in the landscape have occurred:
•The U.S. has moved a long way toward energy self-sufficiency. It produces enough natural gas to meet its own needs thanks to hydraulic fracturing (“fracking”). And it is ramping up domestic oil production, thanks to new technologies that have unlocked the “tight oil” trapped in rock formations. Americans won’t be buying nearly as much energy as Harper anticipated.
•Ottawa’s backup plan — to export oil to eager overseas buyers — has run aground. There is no way to get Alberta’s bitumen to the Pacific coast. British Columbia won’t provide a transit route. The aboriginal peoples whose territory Enbridge proposes to cross with its Northern Gateway pipeline are even more adamantly opposed to the $6-billion project.
The bottleneck has already driven down the price of Alberta’s tarlike oil. It is now selling at 40-per-cent below the North American benchmark (the West Texas Intermediate price) and 50-per-cent below the global standard (Brent crude price).
Last week Premier Alison Redford warned Albertans the province faces a $6-billion budgetary shortfall because of dwindling royalty payments. Ottawa is feeling the fiscal pain, too. For two years running, Finance Minister Jim Flaherty has had to reduce his revenue projections because of lower-than-expected taxes from the oilpatch.
The bottom line is clear: Canada needs the Keystone XL pipeline more than the U.S. does.
“We’ve made it extremely easy for Obama to say no,” warns Simon Dyer, policy director of the Pembina Institute.
The Edmonton think-tank is not opposed to oilsands development, he stresses. But the rapid pace of expansion and the complete lack of federal regulation over greenhouse gas emissions are sending the wrong signal to the White House. (Alberta has regulations but they’re too weak to provide much protection.)
Dwyer places most of the blame on the prime minister. Unlike Alberta Premier Alison Redford, who is open to ideas to clean up the oilsands, Harper and his natural resources minister, Joe Oliver, are inflaming environmentalists on both sides of the border, thereby validating Canada’s reputation as a producer of “dirty oil.”
Obama is expected to wait until the state department completes its analysis of the environmental impact of the proposed pipeline in April before making a decision.
Keystone has support in the U.S. Congress. Fifty-three senators (out of 100) called for quick approval of the pipeline application last week. The House of Representatives has voted in favour of the project four times in the last two years. And Nebraska Governor Dave Heineman, mollified by TransCanada’s acquiescence to his demand that the pipeline be rerouted around an environmentally sensitive region, has dropped his opposition.
But that won’t be enough to convince Obama to give TransCanada the go-ahead.
Harper could improve the odds, Dyer says, by placing a firm cap on carbon emissions. Redford could do her part by closing Alberta’s coal-fired generators and requiring oilsands producers to adopt cleaner technologies and extraction methods.
Neither will guarantee a yes from the White House. But both would strengthen Canada’s position whatever lies ahead.

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