Tag Archives: featured

Parks Act changed for Kinder Morgan’s illegal pipeline research?

April 14, 2014Energy and Resources, Pipelines and SupertankersfeaturedCommon Sense Canadian

By Andrew Gage

You may have heard about controversial amendments to the Park Act by way of Bill 4, the Park Amendment Act, which critics say are to allow industrial “research,” or even industrial activity, in B.C. parks.

Over 160,000 people have signed a petition opposing Bill 4. However, B.C. Environment Minister Mary Polak insists that the types of research to be allowed are minor, and that the amendments have nothing whatsoever to do with allowing pipelines in B.C. parks.

Kinder Morgan was illegally researching pipeline

Before Bill 4, any research done in a park had to be “necessary for the preservation or maintenance of the recreational values of the park involved.” But as we’ve recently learned, pipeline giant Kinder Morgan has, with a permit from the B.C. government, been conducting research in B.C. parks for their pipeline expansion project since November 2013, four months before Bill 4 was introduced.

As you read this, researchers hired by Trans Mountain L.P., a subsidiary of Kinder Morgan, are already at work evaluating the feasibility of building its controversial pipeline expansion through five B.C. parks and protected areas, taking soil samples and electro-shocking fish.

The eventual aim is to have these lands taken out of the parks. In some cases the new pipeline will widen the right of way through the park alongside the existing Kinder Morgan oil pipeline, but in other cases entirely new pipeline routes through parks are being considered.

Government admits permits were illegal

This work was authorized by the Ministry of Environment in November 2013, through a park use permit allowing Trans Mountain to conduct “research” related to pipeline construction in Finn Creek Provincial Park, North Thompson River Provincial Park, Lac Du Bois Grasslands Protected Area, Coquihalla Summit Recreation Area and Bridal Veil Falls Provincial Park.

The B.C. government has recently admitted that this industrial park use permit was likely illegal under the Park Act. That’s because the legislation gives B.C. parks a high level of legal protection (who knew?), requiring (as mentioned above) that activities provide a benefit to the park.

So with no public consultation it rushed through Bill 4, the Park Amendment Act. In the legislature, Polak, the environment minister, admitted:

[quote]The reason we brought forward the amendment — and I would say one of the reasons that the consultation has not been aggressive or thorough on this — is that we are seeking to ensure that we have the statutory authority for things that up until now we took for granted that we did….

We’ve been advised that the granting of the permits as we have done likely would not stand the test of a [court] review, and therefore, we need to amend the Park Act to ensure that we can continue on with what we have been doing but with the statutory authority so that we would not be in a case where either the granting of or the denial of the application for a permit could be successfully challenged and overturned based on our lack of authority. [Emphasis added][/quote]

Bill 4 paves path for large-scale industrial activity in parks

Bill 4 explicitly allows the environment minister to authorize research into the “the feasibility of the location, design, construction, use, maintenance … of a pipeline,” and research intended to “inform a [government] decision … in relation to the boundaries of the protected area.” The government has suggested that the Bill 4 amendments were mostly for the film industry or low impact academic research. But Bill 4 is clearly equally about large-scale industrial development, such as the pipeline development being investigated by Kinder Morgan.

Surprisingly, while the government acknowledges that Bill 4 is about authorizing permits like the Kinder Morgan park use permit in future, it does not correct the legal error for a permit issued in November. So in our view, Kinder Morgan continues to be acting under an illegal permit.

Agricultural land to be plowed under for industry too

Meanwhile, following on the heels of Bill 4, the B.C. government has introduced legislation (Bill 24, the Agricultural Land Commission Amendment Act) to make industrial activity and urban development on most lands in B.C.’s agricultural land reserve (ALR) easier, threatening B.C.’s food security.

We hope that these two bills are not part of a broader trend towards weakening laws intended to protect the environment and public values in order to give industry more “flexibility.”

Minister Polak and B.C. Premier Christy Clark need to stand up for our parks. They can start by revoking the illegal Kinder Morgan permit, and by committing not to change B.C.’s laws to accommodate industrial development.

Andrew Gage is an environmental lawyer at West Coast Environmental Law. Follow West Coast Environmental Law on Twitter @WCELaw

With Duke Point incinerator, property values could go up in smoke

April 14, 2014Economics, Health and Environment, Urban & TransportfeaturedErik Andersen

The following is a letter from Common Sense Canadian economic columnist and Gabriola Island resident Erik Andersen to Nanaimo city council, which is hearing arguments on a controversial, proposed waste incinerator at Duke Point this evening.

Over the past several decades the City of Nanaimo has single-mindedly pursued a course of beautifying the City by putting behind itself its industrial past of coal mining and logging. Gradually success has and is being achieved.

The prospect of a garbage incinerator at Duke Point, or anywhere else near by, will only undo these decades of progress.

Studies show incinerators seriously affect property values

Numerous reports and studies show that a devaluation of property values occurs with an uglification event and garbage incinerators top the negative event list.

A 1993 study, sponsored by the US EPA, written by Katherine Kiel and Katherine McClain, states that “individuals who live close to an incinerator will experience declines in housing values.”

“Studies in Andover, Massachusetts strongly correlated 10% property devaluations with close incinerator proximity.”

[quote]In 2006, Cleveland State University professor Robert Simons coauthored a paper that looked at 58 peer-reviewed articles dealing with the effects of environment contamination on real estate. In the case of waste incinerators, Simons said that the value of nearby real estate could fall over 10 percent depending on whether the land is downwind of the of the facility and on other factors, such as the amount of truck traffic. However, Simons cautioned that if there are problems at the incinerator site or if it becomes notorious as a result of an accident, property values in the vicinity could drop 10 to 20 percent. He also said that if dioxins are found in nearby soil, that could result in a loss of up to 40 percent in value.[/quote]

Island residents could lose $1.5 Billion

So what would be the financial penalty imposed on the property owners of Nanaimo and vicinity should a garbage incinerator appear at Duke Point? Nanaimo, Gabriola, Lantzville and nearby rural areas, such as Cedar and Yellowpoint are valued at $15.491 billion for assessment year 2014.

Following just the talk of a garbage incinerator for Duke Point, the process of devaluation of property values has started. With an acceptance of the incineration project there is every indication from the experience of others that collectively we will suffer a roll back in total value of $1.5 billion.

No amount of arguing will influence the process of devaluation as markets are driven only by perception. Nanaimo will be perceived as the host of an ugly process, incineration of an awful lot of the garbage of others.

The $1.5 billion does not include the present value of elevated medical costs created from toxic pollution; nor the present value of losses in regional GDP; nor the present value of property devaluations due to incinerator mismanagement. Add these in and the total social losses/costs would exceed $3 billion.

As for metro Vancouver, their garbage disposal issue is just about NIMBIZIM. Why would Nanaimo volunteer to bail them out?

A Change.org petition – “Tell Vancouver that Nanaimo doesn’t want their garbage incinerator” – has already garnered over 4,000 signatures.

Eagle Spirit offers First Nations ‘energy corridor’ as Enbridge alternative

April 14, 2014Energy and Resources, First Nations, Pipelines and SupertankersfeaturedCanadian Press

First Nations company proposes 'energy corridor' as Enbridge alternative — Eagle Spirit’s Calvin Helin speaking the Vancouver Board of Trade

VANCOUVER – A plebiscite defeat for the company proposing a $6-billion oil pipeline across northern British Columbia may have opened the door for another mega-project.

Supporters of a First Nation-backed alternative to the Enbridge (TSX:ENB) Northern Gateway Pipeline are expected to make an announcement today in Vancouver.

Chiefs from two northern B.C. First Nations will join officials from aboriginal-owned and controlled Eagle Spirit Energy Holdings to announce the plans.

Eagle Spirit formed in late 2012 to promote its vision of a First Nations-managed energy corridor across northern B.C., carrying everything from fibre optic, electrical and water lines to pipelines moving liquefied natural gas and Alberta oil.

David Negrin, president of the privately held B.C.-based Aquilini Group, and a former chief operating officer with Alaska’s Alyeska Pipeline Service, will attend the announcement.

Northern Gateway officials say they have some work to do after a non-binding weekend plebiscite suggested about 60 per cent of Kitimat residents disapprove of plans to make their community the west coast terminus of Enbridge’s pipeline.

Kitimat rejects Enbridge in pipeline plebiscite

April 13, 2014Energy and Resources, Oil&Gas, Pipelines and SupertankersfeaturedCanadian Press

Kitimat votes 'No' on Enbridge pipeline — Former Haisla councilor Gerald Amos celebrates the ‘No’ vote (photo: Douglas Channel Watch)

By The Canadian Press

KITIMAT, B.C. – The residents of Kitimat, B.C. have voted against the proposed Northern Gateway pipeline project in a non-binding plebiscite.

The ballot count from Saturday’s vote was 1,793 opposed versus 1,278 who supported the multi-billion dollar project — a margin of 58.4 per cent to 41.6 per cent.

“The people have spoken”

The results from two polling stations and an advance vote all showed a clear majority for the “No” side. Said Kitimat Mayor Joanne Monaghan in a statement issued after the vote Saturday night:

[quote]The people have spoken. That’s what we wanted — it’s a democratic process. We’ll be talking about this Monday night at Council, and then we’ll go from there with whatever Council decides.[/quote]

The $6.5-billion project would see two pipelines, one carrying oilsands’ bitumen from Alberta to Kitimat’s port, and a second carrying condensate — a form of natural gas used to dilute the bitumen — from Kitimat back to Alberta.

Kitimat would also be the site of a proposed two-berth marine terminal and tank farm to store the thick Alberta crude before it’s loaded onto tankers for shipment to Asia.

Until this vote, Kitimat had remained neutral in its opinion on the controversial project. It didn’t take part in the joint-review process, which heard from hundreds of people before a federal panel approved the project with 209 conditions.

The federal cabinet is expected to release its decision on Northern Gateway by June.

“Jobs” argument failed to persuade public

Northern Gateway’s campaign has concentrated on the promise of 180 permanent, direct, local jobs worth $17 million, and more spinoff jobs for contractors and suppliers.

Calgary-based Enbridge, the company behind Northern Gateway, has emphasized its commitment to safety and the environment, saying the National Energy Board Joint Review Panel, which held two years of hearings on the project, had made many of the company’s voluntary commitments a mandatory part of the conditions for approval.

“As a long time-resident of northwestern B.C., I passionately believe that Northern Gateway is the right choice for Kitimat and for the future of our community,” Donny van Dyk, Northern Gateway’s Kitimat-based Manager of Coastal Aboriginal and Community Relations, said in a statement issued after Saturday’s vote.

“Over the coming weeks and months we will continue to reach out and listen to our neighbours and friends so that Northern Gateway can build a lasting legacy for the people of our community.”

The project’s main opponent, the local environmental group Douglas Channel Watch, maintains the risk from either a tanker accident or a pipeline breach is too high for the small number of jobs the pipeline would bring to the community.

Vote pitted Kitimat Council vs. Haisla First Nation

The plebiscite had also raised tensions between the District of Kitimat and the nearby Haisla First Nation, which is adamantly opposed to Northern Gateway.

Many Haisla were not allowed to vote because Kitamaat Village, a federal Indian reserve, is outside the municipal boundaries.

In a letter to local media, Haisla Chief Coun. Ellis Ross had called the decision to hold a vote at this late date a “slap in the face” for all the work done by the Haisla on the project.

A demonstration by members of the Haisla Nation at Kitimat’s City Centre Mall quickly turned into a celebration after the vote results were announced. The Haisla Spirit of Kitlope Dancers led the celebration with drumming, singing and dancing.

MP Cullen joins party

Some Kitimat residents also joined the party, as did Nathan Cullen, the NDP Member of Parliament for Skeena Bulkley Valley.

Cullen, who has been a harsh critic of the project, said Saturday’s vote sends a clear message that Stephen Harper’s government must listen to.

[quote]This is a resounding no to the Conservative policies. This is one of the most powerful grass roots things I have ever been associated with. This is good politics.[/quote]

Gerald Amos, an environmentalist and former member of the Haisla Nation Council, said, “The town of Kitimat has rejected a project that is not good for our economy. It endangers everything we worked for as a people here in Kitimat for the last ten thousand years.”

Vote non-binding

A key reason for holding the vote was to fulfil a 2011 promise made by all municipal election candidates in Kitimat to poll citizens on the pipeline project.

But other than gauging public reaction to the proposed pipeline, it remains unclear — even to Kitimat council — what the non-binding vote will mean.

Even the plebiscite question, as chosen by the District of Kitimat council, was controversial, because it focused on the 209 conditions placed on the project by the Joint Review Panel: “Do you support the final report recommendations of the Joint Review Panel (JRP) of the Canadian Environmental Assessment Agency and National Energy Board, that the Enbridge Northern Gateway project be approved, subject to 209 conditions set out in Volume 2 of the JRP’s final report?”

4 years after BP oil spill, health impacts linger

April 12, 2014Energy and Resources, Health and Environment, Oil&GasfeaturedCanadian Press

4 years after BP oil spill, health impacts linger — Health concerns continue to do many who worked to clean up the BP oil spill (photo: Wikimedia Commons)

By Stacey Plaisance And Kevin McGill, The Associated Press

CHALMETTE, La. – When a BP oil well began gushing crude into the Gulf of Mexico four years ago, fisherman George Barisich used his boat to help clean up the millions of gallons of spew that would become the worst offshore spill in U.S. history.

Like so many Gulf Coast residents who pitched in after the April 20, 2010, explosion of the Deepwater Horizon rig, Barisich was motivated by a desire to help and a need to make money — the oil had eviscerated his livelihood.

Today he regrets that decision, and worries his life has been permanently altered. Barisich, 58, says respiratory problems he developed during the cleanup turned into pneumonia and that his health has never been the same:

[quote]After that, I found out that I couldn’t run. I couldn’t exert past a walk.[/quote]

His doctor declined comment.

Medical settlement reached with BP

Barisich is among thousands considering claims under a medical settlement BP reached with cleanup workers and coastal residents. The settlement, which could benefit an estimated 200,000 people, received final approval in February from a federal court. It establishes set amounts of money — up to $60,700 in some cases — to cover costs of various ailments for those who can document that they worked the spill and developed related illnesses, such as respiratory problems and skin conditions.

It also provides for regular physical examinations every three years for up to 21 years, and it reserves a worker’s right to sue BP over conditions that develop down the road, if the worker believes he or she can prove a connection to the spill.

Clean-up workers participate in massive, long-term health study

Some 33,000 people, including Barisich, are participating in a massive federal study that aims to determine any short or possible long-term health effects related to the spill.

“We know from … research that’s been done on other oil spills, that people one to two years after … had respiratory symptoms and changes in their lung function, and then after a couple of years people start to return to normal,” said Dr. Dale Sandler, who heads the study overseen by the National Institutes of Environmental Health Sciences, an arm of the National Institutes of Health.

[quote]What nobody’s ever done is ask the question: Well, after five years or 10 years are people more likely to develop heart disease, or are they more likely to get cancer? And I’m sure that’s what people who experienced this oil spill are worried about.[/quote]

Sandler planned to discuss some early findings Friday during a midday news conference.

The study is funded by NIH, which received a $10 million award from London-based BP, part of $500 million the oil giant has committed to spend over 10 years for environmental and health research.

Researchers compiled a list of 100,000 candidates, drawn from sources including rosters of mandatory safety classes that cleanup crews attended and from records of people who were issued badges permitting access to oiled areas.

They reached about 33,000 for interviews; and 11,000 of them agreed to physical examinations that include blood and blood pressure tests and measurements of lung function. Water and air samples taken during the spill also will be used to attempt to pinpoint how much exposure workers may have had to toxic substances.

Proving correlation is a challenge

Sandler emphasized that making any direct correlation between health concerns and the spill could prove challenging because many of the workers held other jobs that put them in contact with oil. Some worked with boat engines, did regular hazard mediation work or worked at chemical plants. Many also are smokers.

The researchers will try to account for smoking or other factors that could ruin health, and narrow in on problems tied to spill exposure. They plan to monitor the health of study participants for at least 10 to 15 years.

Aside from physical health, Sandler also is interested in knowing whether chemical exposure, in addition to the stress of working the spill, might have contributed to any mental health problems.

“We’re not in a position to say that yet,” she said.

Money will never replace quality of life

Fisherman and former cleanup worker Bert Ducote says he knows the physical and emotional pain. Ducote said dozens of boils have turned up on his neck, back and stomach since the spill — and he theorizes, though shared no medical records that could prove, that his problems stem from the cleanup.

Ducote said he spent months handling the boom used to corral oil. Even with protective gear and rubber boots, he said his shirt often got wet with the combination of crude oil, sea water and chemical dispersant. Ducote, like Barisich, said he is filing a claim under the medical settlement.

“That has been a disaster in our lives,” said Ducote, from the town of Meraux, in coastal St. Bernard Parish.

[quote]The little amount of money they’re trying to give us, it’s never going to replace our quality of life, our health.[/quote]

BP claims settlement was fair

In response, BP points to language in U.S. District Judge Carl Barbier’s order approving the medical settlement. Barbier noted that both sides said the settlement was a fair and reasonable alternative to litigation, and that fewer than 100 of 200,000 potential class members objected.

BP also lists numerous steps it took after the disaster to protect workers’ health, including protective clothing and safety classes.

Cleanup workers who faced possible contact with oil and dispersants were “provided safety training and appropriate personal protective equipment, and were monitored by federal agencies and BP to measure potential exposure levels and help ensure compliance with established safety procedures,” BP said in an email to The Associated Press.

Many clean-up workers lacked protective gear

Not all used that equipment, however. Dr. Edward Trapido, a cancer specialist and the lead researcher on a study of cleanup crews and their families that is underway at the Louisiana State University Health Sciences Center, said many worked without the protective clothing because of sweltering heat.

Trapido said results of the long-term health studies could help improve response to future oil spills and other disasters.

“Oil is not going away, and whatever kind of energy it is — whether it’s nuclear, whether it’s coal or oil — all of these have had problems in recent years where people get exposed to it,” Trapido said.

Kitimat Enbridge vote: Grassroots campaign poised to win unfair fight

April 11, 2014Energy and Resources, Oil&Gas, Pipelines and SupertankersfeaturedCanadian Press

Tensions-high-in-Kitimat-as-Enbridge-pipeline-plebiscite-looms — Signs of the times in Kitimat, BC (Photo: Kathy Ouwehand)

By the Canadian Press

KITIMAT, B.C. – Residents of Kitimat will cast votes in a local plebiscite Saturday for or against the multibillion-dollar Northern Gateway pipeline.

The District of Kitimat has remained neutral on the $6-billion project, but the vote will decide council’s position.

“We’ll see what the people of Kitimat want,” said Mayor Joanne Monaghan.

The city on the North Coast would be the end of the pipeline and home of the marine terminal for loading oil onto tankers. Kitimat council’s neutral stance went so far as to keep the city from participating in a federal review panel on the project.

That panel recommended in December that the pipeline be approved, subject to 209 conditions.

The question at hand

Kitimat residents are being asked:

[quote]Do you support the final report recommendations of the Joint Review Panel (JRP) of the Canadian Environmental Assessment Agency and National Energy Board, that the Enbridge Northern Gateway project be approved, subject to 209 conditions set out in Volume 2 of the JRP’s final report?[/quote]

It’s a question about “as hard to nail to the wall as a bit of Jell-O,” said Murray Minchin, a volunteer with the grassroots Douglas Channel Watch.

He describes a campaign that has been outspent, outmanned and outmanoeuvred from the outset. Enbridge’s campaign started months — if not years — ago, Minchin said.

Enbridge spent big bucks wooing Kitimat vote

They faced no spending limits, as provincial election laws didn’t apply to the municipal vote. Northern Gateway had paid canvassers, full-page ads, glossy brochures, a new website and billboards, Minchin said.

Northern Gateway also runs an annual campaign for youth that saw 50 iPads distributed to essay contest winners along the pipeline route in northern B.C. and Alberta, he said.

But Ivan Giesbrecht, spokesman for Enbridge, said the contest has nothing to do with the plebiscite and that only two of the computer tablets went to students in Kitimat.

And yet, Minchin is hopeful the vote will go his way.

Grassroots anti-Gateway campaign grows support

“Four weeks ago we had $200 in the bank. Then we started making lawn signs and started putting those around town and people started coming up to us in the street and handing us money,” he said.

[quote]Somebody even anonymously dropped off a $2,000 money order into one of our mailboxes. Then we got a website that had a donate button.[/quote]

More than $14,000 and 2,000 doorsteps later, Douglas Channel Watch members believe opponents of the pipeline outnumber supporters 3:1.

“Our goal will be to try to get all of those people who said they were going to vote No to actually get out and vote Saturday,” Minchin said.

Results to be revealed at Monday council meeting

Ballots will be counted this weekend and Kitimat council is scheduled to meet Monday night to discuss the results.

Giesbrecht said the vote has been an opportunity to talk to residents.

He declined to say how much the company has spent on the campaign but said there was a temporary website, newspaper and radio ads, and door-to-door canvassers.

The pipeline is worth $5 million in property taxes and 180 jobs for Kitimat, he said.

“It’s a significant proposal for Kitimat, so it’s important that we provide the information that people need to make informed decisions,” Giesbrecht said.

“Regardless of the outcome, our commitment to Kitimat remains unchanged.”

Campaign highlights election law loopholes

Northern Gateway has been a divisive issue across the province and the imbalance in spending power has its critics.

During a provincial election or initiative vote, provincial law limits third-party advertising spending to $3,000 in a single electoral district, and $150,000 overall.

Dermod Travis, of Integrity BC, said those rules don’t apply here but they should.

“It’s really turned into a free-for-all in terms of having any type of democratic order to the vote,” said Travis, whose group was funded by a private businessman to push for democratic reform.

[quote]Having that type of an exercise in a democracy is healthy but it’s not healthy when the scale is so heavily tipped in one direction.[/quote]

But Monaghan said both sides have been out knocking on doors and she expects a true read of what Kitimat residents want.

“Neither of them have gone over that line,” she said of the campaigning.

The federal government is expected to announce a final decision on the pipeline in June.

Clark govt signs LNG deals with two more First Nations

April 9, 2014Energy and Resources, First Nations, LNGfeaturedCanadian Press

Two more BC First Nations sign deals for LNG — photo: Tina Lovgreen / BCIT Commons

By Dirk Meissner, The Canadian Press

VICTORIA – The British Columbia government has moved to bring First Nations on board its much-anticipated multibillion-dollar liquefied natural gas boom.

Two north coast First Nations signed revenue-sharing agreements Wednesday with the government related to the development of a proposed liquefied natural gas export terminal on their traditional territories near Prince Rupert.

It’s a deal that could be worth up to $15 million for the Metlakatla and Lax Kw’alaams nations.
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Premier Christy Clark and leaders from the First Nations who participated in formal signing ceremonies at the legislature called the agreements — the first such connected to LNG — historic.

Clark said the revenue-sharing agreements signal her government’s aims to include First Nations in the province’s LNG development plans, which she says represent a generational opportunity that will rival Alberta’s oilsands.

The First Nations’ leaders said the achievement indicates willingness among some aboriginal groups to embrace some forms of resource development.

A majority of First Nations have opposed the proposed Northern Gateway pipeline project that would move Alberta oil products to B.C.’s coast for export to Asia.

The LNG revenue-sharing agreements were negotiated with the First Nations because their communities, located north of Prince Rupert, are close to a proposed Aurora LNG development at Grassy Point.

Aurora LNG is a proposed joint venture by Nexen Energy ULC (TSX:NXY), a wholly owned subsidiary of CNOOC Limited, INPEX Corporation and JGC Corporation.

“Agreements like this plant the seed for prosperity that lasts for generations,” Clark said at the signing ceremony. “This kind of an opportunity, this kind of co-operation, the stability that this agreement represents today, between First Nations, between government and industry, is going to play a crucial role in creating the confidence that investors need to make sure that their final investments come to fruition.”

By signing the agreements, the First Nations give their support and co-operation for prospective LNG development on their territory, she said.

Metlakatla Chief Harold Leighton said the status quo is no longer acceptable for First Nations who want to be part of development efforts in northwest B.C.

“Revenue sharing agreements related to Grassy Point are a good example of how things can happen when we approach LNG and other types of development in the spirit of partnership and co-operation,” said Leighton. “We have an opportunity to build an economy and improve the social well-being of the Metlakatla and northwest.”

The agreements with Metlakatla and Lax Kw’alaams involve sharing portions of B.C. government revenues related to the Grassy Point lands.

Clark has said government revenues from prospective LNG developments in the northwest could erase the province’s debt, currently at more than $60 billion.

Earlier this year, the government unveiled a proposed LNG tax that could start at 1.5 per cent but rise to seven per cent.

The rate will rise once the plants recover the capital costs of building what are expected to be multibillion-dollar terminals that will super-cool natural gas into LNG for shipment to Asia. The first such plant could be in operation within four years.

There are about a dozen proposed LNG developments in B.C., but none has moved to the final investment-decision stage.

Fossil fuel economy costs Canada far more jobs than it creates

April 7, 2014Economics, Energy and Resources, Tar SandsfeaturedMark Taliano

Petro-state economy costs Canada far more jobs than it creates — Canada’s economy – including its dollar – is too attached to fossil fuels, financial experts warn

The current trajectories of Canada’s predominant political economies are increasingly dysfunctional, due in no small part to the fact that we have become, in many respects, a petro state, rather than the much vaunted “Energy Superpower” that we were promised.

A petro-state, as defined by Bruce Campbell, executive director of the Canadian Center for Policy Alternatives (CCPA) is “dependent on petroleum for 50 per cent or more of export revenues, 25 per cent or more of GDP, and 25 per cent or more on government revenues.”

While Alberta is not a sovereign nation, it does qualify for “petro-state” status under these criterion. So does Norway. But the differences between the two polities ends there. While Norway manages its resource wealth extraordinarily well, Alberta — and Canada, by extension — does not.

Norway: $656 Billion / Alberta: $16 Billion

One significant difference is savings. Norway has a savings fund, known as a “Sovereign Wealth Fund” which is worth about $656 billion for a population of under 5-million people.

Norwegian-oil-industry — Unlike Canada, Norway’s oil industry generates huge public profits

Alberta’s Heritage Trust Fund, on the other hand, is worth a relatively paltry $16.6 billion, for a population of about 3,847,100 people.

The differences in the sizes of these savings funds has far-reaching impacts. As author Terry L. Karl explains in “Understanding The Resource Curse,” a country (such as Norway) that diverts its resource revenue to a savings fund, is necessarily compelled to use its tax base for government funding. Consequently, citizens pay higher taxes, but the politicians represent those who pay the bills (the citizens) rather than representing the insular interests of oil-producing corporations, to the detriment of the public sector, and democracy.

Unlike Norway, Canada, is quite dependent on its resource revenues for government funding. About 40 per cent of Canada’s resource revenues go to Ottawa, and about one third of Alberta’s bills are paid by oil and gas revenues. According to Karl, these differences explain why Alberta’s tax rates are so low, (the lowest personal taxes in Canada) and why its governance is more top down, corporation oriented. As long as taxes are low, people remain relatively disinterested in issues of governance. In the 2008 elections, 60 per cent of eligible voters in Alberta stayed home.

There are other significant problems which are generated by this dependency on resource revenue. One of them is wealth distribution.

Rich get richer from energy wealth

Stephen Leahy explains in “The Bigger Canada’s Energy Sector Gets, The Poorer People Become” that economic markers can be deceiving. Consider statistics for Gross Domestic Product (GDP), which is a measure of economic activity. The GDP averaged about $600 billion per year in the ’90s and by 2012 it had increased to $1.7 trillion. On the surface, this seems laudable, but little of the wealth stayed in Canada, and what did stay went to a small percentage of the population. Consequently, income inequality has also increased.

Similarly, our reliance on the boom/bust cycle of resource revenue funding (without setting aside sufficient funds) means that governments habitually overspend. Resource rich Alberta has run a deficit for the last six years running.

This boom/bust revenue model, a hallmark of neoliberal economic theory, impacts the whole country. Safety, environmental, and human rights have become less important; international efforts to address global warming, such as the Kyoto Protocol, and the United Nations Convention to Combat Desertification (UNCCD) have been rejected; real science is now seen as an enemy to overcome; and democracy is an inconvenience.

16,000 jobs gained, half a million lost

Our mixed economy is also being decimated. Leahy explains that from 2000-2011, the oil and gas sector created about 16,500 jobs, while, at the same time, Canada lost 520,000 manufacturing jobs.

Much of the manufacturing losses are tied to the rise of the petro-dollar which tends to rise and fall with the price of petroleum. Ten years ago, the Canadian dollar was worth about 65 cents relative to the U.S. dollar. Now both dollars are at about the same level. This parity negatively impacts exports and, therefore, the manufacturing base.

Even Industry Canada acknowledges the problem. Their report notes that between 2002 -2007, from 33-39 per cent of Canadian manufacturing job losses were due to “resource-driven currency appreciation.”

Major banks, think tanks warn against Canada’s economic model

Despite the overarching negatives, including job losses and deficits, trajectories of Canada’s reigning political economies have remained unchanged. Continued on-the-ground realities, however, may force the government’s hand. Sources as varied as the International Energy Agency (IEA), HSBC, the Conference Board of Canada, and the International Monetary Fund (IMF) are increasingly concerned about Canada’s misdirected obsession with extreme energy extraction.

The International Energy Agency’s (IEA) World Energy Outlook states that “no more than one third of proven energy reserves of fossil fuels can be consumed prior to 2050.” (Barring the unlikely and exponential growth in carbon capture storage strategies.)

The HSBC Global Research Report (2013) cautions investors about capital intensive extreme resource extraction such as bitumen extraction, and recommends instead low cost companies with a “gas bias.”

Alberta needs more sustainable model: Conference Board

Solar already beating coal on job creation, energy cost — Canada should be promoting green jobs, experts suggest

The Conference Board of Canada in an article entitled “Opportunity Lost? Alberta is Facing Short And Long Term Financial Challenges Despite its Oil Wealth” observes that Alberta is facing a $4-billion budget deficit, and recommends a “more sustainable fiscal model.”

Meanwhile, the International Monetary Fund (IMF), recognizing the imperatives of transitioning to a low carbon world, is urging nations to slash carbon subsidies, which would drastically slow bitumen extraction developments.

Unlike Norway, Canada’s economic and political self-determination is already curtailed by NAFTA, and by the time Harper’s next suite of corporate empowerment treaties (FIPPA, CETA etc.) are ratified, our ability to determine better political economies will be further hamstrung.

However, despite the restrictions, there still remain some possible alternatives to our current self-defeating political economy.

End subsidies, raise taxes

The Pembina Institute, paralleling views of the IMF, argues that the $1.3 billion in subsidies handed out to the oil and gas industries would be better spent on transitioning to clean energies, as it would create 18,000 more jobs as well as “a healthier economy, and a cleaner environment.”

Meanwhile, Shannon Stunden Bower, Research Director for the Parkland Institute, advises that Alberta needs to raise taxes:

[quote]Alberta could collect nearly $11 billion more in taxes and still remain the country’s lowest tax jurisdiction.[/quote]

Clearly Canada’s economic direction, which is to increase rather than decrease extreme energy extraction, is hitting the wall.

Evidence shouts that we should be transitioning to a low carbon model. Creating a strong Federal Savings Fund, reducing carbon subsidies, and increasing taxes in certain jurisdictions (like Alberta and New Brunswick) would be a start, but we also need more evidence-based policy making, and therefore different governance.

The longer we wait before the inevitable and necessary transitions, the more it will cost.

Can Ontario Liberals raise the green for public transit expansion?

April 7, 2014Urban & TransportfeaturedCanadian Press

Ontario Liberals to raise billions for public transit expansion — Photo: Wikimedia Commons

by Maria Babbage, The Canadian Press

TORONTO – With the prospect of an election growing more likely every day, the minority Liberals’ spring budget may turn out to be more campaign platform than peace treaty.

It will also need to lay out a plan to fund a massive expansion of public transit in the vote-rich Greater Toronto and Hamilton area — one of their key promises — without raising taxes for the middle class.

Premier Kathleen Wynne has promised that a new “revenue stream” to raise the estimated $2 billion a year that’s needed to fund public transit will be unveiled in the budget, expected May 1.

But she’s ruled out a hike in the HST, gas tax and personal income tax for middle-income families, which has been defined in finance documents as individuals earning between $25,000 to $75,000 a year.

Increased corporate taxes could help pay for transit

Wynne could raises taxes for businesses or higher-income earners — something the kingmaker New Democrats could support.

Last December, a government-appointed panel recommended that the Liberals raise corporate taxes to 12 per cent, coupled with other measures such as hiking the gas tax and the Harmonized Sales Tax.

Metrolinx, the provincial transit authority, had proposed a 15 per cent increase in development charges for businesses, as well as an average 25 cents per day off-street parking levy, among other “revenue tools.”

However, the parking charge could be passed on to drivers who use those spaces in places like shopping malls. As well, both measures on their own won’t raise the billions of dollars annually that’s needed.

“Green bonds” offer alternate funding tool

Experts say there is another option: so-called “green bonds,” which the government plans to issue this year.

Green bonds are a relatively new financing tool, intended to raise money that’s used exclusively to support projects with specific environmental benefits.

It will require legislation and certification, but the Liberals say it won’t be a confidence vote that could topple the government.

Green bonds would be a part of Ontario’s regular borrowing program, but that portion will be dedicated to environmentally friendly transit projects, officials say.

They argue the bonds would capitalize on the province’s ability to raise funds at low interest rates and save money over the long term because there are many investors who are prepared to pay to invest in specific green initiatives.

Green bonds are more appealing to investors if they have a competitive return relative to regular bonds, experts say.

Investors want green options: TD economist

Many investors would go the green route, all things being equal, said senior TD economist Sonya Gulati.

But green bonds have additional administrative costs. They have to be certified and monitored to ensure the money is being spent appropriately.

Right now, the World Bank is the big issuer of green bonds, but it has the expertise so it doesn’t incur extra costs, said Gulati. There may be additional fees attached if a government or corporation issue green bonds.

When those costs are passed on to consumers, they tend to be received poorly and rarely reach maximum subscription.

But at the end of the day, green bonds are still debt, said Mike Moffatt, a professor of business, economics and public policy at the University of Western Ontario’s Richard Ivey School of Business.

Debt servicing now province’s third biggest budget item

Servicing Ontario’s estimated $272.8-billion net debt — which has doubled since the Liberals took office in 2003 — is the third-largest government expenditure after health care and education.

If the Liberals plan to issue green bonds to fund transit in addition to the regular bonds they issue each year, that could become a problem, said Moffatt.

“There’s already concerns that the Ontario government is getting itself into a little too much debt, so if they keep compounding that by issuing more and more debt, it’s going to make a problem the province has even worse,” he said.

Spending more on servicing the provincial debt means less money spent on public services and government programs. It could also mean they won’t hit their deficit-shrinking targets.

Gridlock costing Toronto $6 billion a year

The Liberals have argued that improving public transit can’t be put off, that gridlock in the Toronto region is already costing the economy $6 billion a year.

While green bonds may save the Liberals’ political hides by avoiding new taxes, it does come at a cost, said Moffatt.

[quote]There’s no free lunch here. The transit’s going to get paid for, one way or another.[/quote]

“Either it’s going to get paid for by higher taxes or it’s going to get paid for by a higher debt, which means either higher taxes or less spending in the future.”

Transport industry driving a ‘SmartWay’ to tackle emissions

April 4, 2014Urban & TransportfeaturedCommon Sense Canadian

by Jesse Yardley

An innovative new method for tracking the transport industry’s fuel consumption may hold the key to reducing carbon emissions, according to a group of academics and industry representatives.

Government partner Natural Resources Canada explains, “The SmartWay Transport Partnership is a collaboration designed to help businesses reduce fuel costs while transporting goods in the cleanest most efficient way possible.”

Originally developed in 2004 by the US Environmental Protection Agency, the program was adopted in Canada in 2012 by the Supply Chain Management Association (SCMA) and Natural Resources Canada. It offers shippers the opportunity to choose carriers based on their emissions rating – the transportation equivalent of “Certified Organic” food labelling.

SmartWay enables companies to measure vital emission factors such as fuel consumption, mileage and payload data. Once collected and entered into the system, the data is available for review by shippers who want to lower their carbon footprint.

[quote]Historically, shippers have focused on cost, service and quality when choosing a carrier. However, sustainability has a chance of becoming a fourth consideration on par with the others.[/quote]

Climate scholars, government embrace program

The transportation industry is one of the biggest producers of climate change-causing CO₂, says UBC associate professor and logistics expert Garland Chow. In Canada, the sector contributes 25% of the country’s greenhouse gas emissions, according to the federal government.

Last year, with the financial support of Natural Resources Canada, the SCMA’s Chow led a nationwide survey of 169 shippers and logistics providers. The results, published in January, provide valuable insight into how Canadian companies view sustainability and make decisions affecting greenhouse gas emissions.

Helping industry go green

SCMA project manager Alison Toscano says the transportation industry is responsible for a large and “growing share” of air pollutants, which is why SCMA has been holding information sessions across Canada to show companies how they can be more green.

“SCMA has also been conducting one-on-one meetings with target companies to make them aware of the program,” says Toscano.

In the first quarter of 2014, meetings have been held across Canada in Vancouver, Calgary, Toronto, Montreal and Halifax.

“Our motivation is to encourage industry to be more green,” Chow says.

Sustainability becomes a consideration for shippers and carriers

Historically, shippers have focused on cost, service and quality when choosing a carrier. However, sustainability has a chance of becoming a fourth consideration on par with the others.

Both shippers and carriers can make use of SmartWay in their own unique ways.

Natural Resources Canada explains the value of the program as follows:

Shippers can use SmartWay to:

Compare the environmental performance of carriers

Calculate their freight carbon footprint

Qualify to use the SmartWay Transport Partnership logo

Carriers can use SmartWay to:

Market themselves to shippers that are concerned about emissions

Benchmark themselves against industry peers

Qualify to use the SmartWay Transport Partnership logo

Shippers, as the customer, can put pressure on individual carriers to be more sustainable when they transport goods.

But it won’t be easy. Chow says fewer than 5% of the companies surveyed would be willing to make capital investments – such as buying more fuel efficient transport vehicles – to support sustainability if it negatively affected profits.

A win-win solution

Thankfully, it’s not a zero sum game. The most effective ways of reducing emissions often have the effect of increasing profits, which is a win-win situation.

According Toscano, in many instances, companies will see a return on investment within two to three years.

“There’s no reason why you can’t earn a profit and be sustainable at the same time,” Chow says.

[quote]Many sustainability practices are actions that should be taken to increase efficiencies anyway.[/quote]

The most commonly used sustainability practices involve optimizing:

Trip movement by making delivery routes as direct as possible
How goods are fitted into shipping containers
Using the most efficient means of transport, such as rail
Using more energy efficient vehicles, such as natural gas powered trucks

Training drivers correctly is also important says Alison Toscano, a SCMA project manager.

[quote]Even if you have the most fuel efficient trucks, if the operators drive them like Ferraris, it defeats the purpose.[/quote]

Taking the guesswork out of improved efficiency

For too long, shippers and carriers have only been able to guess at efficiency improvements.

“If you can’t measure the performance that you’re looking for, you can’t manage it,” says Chow.

That’s where the SmartWay system comes in. “Shippers that select SmartWay-registered carriers can see very clearly those who have reduced their emissions,” Toscano says, offering sustainable carriers a competitive advantage.

SCMA says on its website that SmartWay won’t improve operations directly, but it helps companies understand where improvements can be made.

Measurements better prepare companies for carbon taxes

Measurements are also important for forward-thinking executives who recognize that carbon taxes might be inevitable. British Columbia, for instance, has already implemented such taxes. In other provinces and territories, some companies are preparing for that eventuality. A true carbon tax would be levied on all emissions, unlike performance regulations that only set limits on certain industries.

“It’s a matter of risk management,” Chow says.

[quote]If you are not already measuring your emissions, if and when a tax is implemented, you’ll be forced to play catch up.[/quote]

The implication is that judicious companies would have the upper hand over competitors scrambling to meet new regulations.

Consumers support green companies

Government is not the only source of pressure for shippers and carriers to be more sustainable. Consumers are increasingly rewarding green companies with their patronage. Companies are responding by increasingly adopting programs that address environmental concerns. They market their involvement by showcasing environmental program logos on product labels or websites. The idea is to demonstrate their commitment to the environment.

“Now you can communicate your data to your customers, and show them why they should buy from you and not your competitors,” says Chow. “You can show how being more efficient is the same thing as lighting 5,000 homes, or taking ten trucks off the road every day, or planting six trees.”

But Dr. Gwen O’Sullivan of Mount Royal University cautions against ‘green-washing’. According to her, consumers don’t always know what these programs represent.

[quote]Sometimes it looks like companies are taking big steps, but what is the reality?[/quote]

Clearly, there’s a long road ahead for the transport industry to become more sustainable, but programs like SmartWay help put companies on the right path.

Jesse Yardley has over 15 years experience in communications and has owned and managed two successful businesses in Calgary, AB. He is currently enrolled in the journalism program at Mount Royal University.