Mr Mulcair Goes to Edmonton, Giving Canadian Climate Hawks a New Dilemma

Posted on May 30, 2012 by admin

Spencer Keys and George Hoberg
May 30, 2012

Today the Pembina Institute released a study contributing to the growing expert consensus that Canada has a mild case of Dutch disease. Later this week, NDP leader Thomas Mulcair is travelling to Western Canada to further argue his own unique form of Dutch disease.

What a difference a month can make.

Six weeks ago we argued that there is a political narrative available to environmental advocates looking to find a coalition between themselves and the labour movement, which can also drive a wedge in Stephen Harper’s Western Canada-and-Ontario coalition that gave him a majority in the 2011 election: the Dutch disease argument that a rising petrodollar makes Canadian manufacturing exports more expensive and has created a decline in Ontario’s manufacturing sector.

Since then several events, both extraordinary and coincidental, have turned Dutch disease into the most significant policy debate the country is facing. It began with Mulcair, on CBC’s The House:

“It’s by definition the Dutch disease: the Canadian dollar is being held artificially high, which is fine if you’re going to Walt Disney World; not so good if you want to sell your manufactured product because the American client, most of the time, can no longer afford to buy it. We’ve hollowed out the manufacturing sector. In six years since the Conservatives have arrived we’ve lost 500,000 good-paying, manufacturing jobs; more than half of them because we’re not internalizing the environmental costs.”

Mulcair’s comments set off a firestorm of controversy, putting him on the opposite of most political pundits, many economists, the government, and the Western premiers.

IRPP Report

Coincidentally, little more than a week after Mulcair’s interview on The House, the Institute for Research on Public Policy released a report evaluating the significance of the Dutch disease. Specifically, the authors noted there has been “little rigorous analysis of the linkages between energy prices, the exchange rate and manufacturing output in Canada.”

The authors used a two-step process, first determining the relationship between energy prices and the Canada-US exchange rate, and secondly determining the role of the Canada-US exchange rate on manufacturing output.

The first conclusion was that, since 2003, “a 1 percent increase in energy prices was associated with a 0.54 percent decrease in the value of the US dollar relative to the Canadian dollar,” which is much larger than the 0.15 percent decrease in the preceding 1992-2003 period. By comparison, non-energy commodity prices were associated with a 0.73 percent decrease over the same post-2003 period.

For the second conclusion, an analysis of 80 manufacturing industries was conducted and, while 53 out of 80 indicated some level of Dutch disease, only 25 were statistically significant while the rest were functionally the equivalent of no relationship as all. Interestingly, while there was no negative relationship for automotive manufacturing, the biggest negative effects were in textiles, apparel, and leather, “which together account for less than 2 percent of manufacturing output.”

Industry Canada Study

Inconveniently for the Harper Government, it was also revealed recently that an Industry Canada sponsored study being published in the journal Resource and Energy Economics, found some support for loss in manufacturing employment due to Dutch Disease. Unlike the IRPP study, the Industry Canada study looked at losses in manufacturing employment. It concluded that, of those jobs lost to exchange rate fluctuations, 33-39% is due to increases in energy commodity prices. However, given the results of the IRPP study, we can reasonably assume that this constitutes a much lower loss of employment than the headline numbers suggest.

Today’s Pembina and MacDonald-Laurier Reports

Using regional economic impact models produced by the Canadian Energy Research Institute, the Pembina Institute argues that large regional disparities are occurring as a result of the oil sands boom. In fact, the authors of the Pembina study reject the Dutch disease label as inadequate to capture what is happening in Canada today. Instead, they argue the distribution of benefits and rapid growth is “a uniquely Canadian strain of the Dutch Disease that could be called “oilsands fever” – a strain that is beginning to create clear winners and losers in Canada’s economy and could pose a significant risk to Canada’s competitiveness in the emerging clean energy economy.”

The authors emphasize the challenges facing provinces without significant natural resource production in attracting and retaining skilled labour in, the overwhelming hold on the economic benefit from oil sands production (94%) by Alberta alone, and the inflationary effects. Their prescriptive elements include establishing a federal savings fund, eliminating preferential tax treatment for the oil and gas sector, convening an expert panel of the Royal Society of Canada to continue study of the problem, have a federal committee study regional competitiveness, and establish a Canadian energy strategy.

However, the waters of the Pembina report have already been muddied by a MacDonald-Laurier Institute report arguing the opposite conclusion from the same data by the Canadian Energy Research Institute. MLI finds a significant positive impact from the oil sands, in absolute terms, for every province in the country.

The two studies are using the same data. The different conclusions from the reports reflect the different perspectives of the groups. MLI emphasizes the absolute magnitude of the contributions of oil and gas to provinces outside of Alberta. Pembina doesn’t disagree, but emphasizes the economic and political effects of the unbalanced distribution of these benefits, an issue on which MLI is silent. Neither study can convincingly say whether the positive economic spillovers of the oil sands are more or less powerful than the negative dynamic of the Dutch disease. Even MLI’s concluding sentence reveals how incomplete our understanding of these competing forces is: “While the so-called “Dutch Disease” mechanism may operate, in practice it is partially (perhaps more than fully) offset by the gains to the overall Canadian economy documented by these studies.”

Analysts will continue to differ about the magnitude of the Dutch disease dynamic and whether and how policy changes should be made to address it.

Mulcair, Polluter Pays, and Gaps in the Research

Returning to Mulcair’s comments on the CBC and elsewhere, in discussing the Dutch disease he continually emphasizes the critical importance of applying the polluter pays principle. In doing so, Mulcair is describing something that is similar to, but not exactly, Dutch disease, and calling it the same. He claims that Dutch disease occurs when you fail to internalize the environmental costs of resource extraction; specifically, because companies do not have to pay the full cost of greenhouse gas emissions and other environmental impacts, they are able to develop resources at a faster rate than they would otherwise be able to do, and therefore putting more upward pressure on the dollar than would be the case if the costs were properly internalized.

This argument about internalizing environmental costs is Mulcair’s own distinctive addition to the concept of Dutch disease.  Unfortunately, none of the studies summarized above actually deal with the argument that Mulcair is making, leaving a giant hole in the current research.

Climate Hawks and the Dutch Disease

It is particularly surprising that the Pembina report does not address the polluter pays part of Mulcair’s argument because the environmental impact of the oil sands have been central to the group’s mission, and placing an effective economy-wide price on carbon seems to be the natural go-to recommendation in all the group’s reports on the topic. Why would Canada’s leading climate hawk environmental group pass up the chance to make the case for effective carbon pricing in another politically salient way?

We can only speculate that they believed including it would produce an undesirable political backlash. They are already well-known for having that position, and when they have made the case for effective carbon pricing in the past they have been accused, like anyone else who mentions the idea in Canada, of advocating regional wealth distribution. And perhaps because Mulcair’s comments have been considered so incendiary, emphasizing the polluter pays component would have associated the group too closely with a divisive partisan argument.

The dilemma faced by Pembina in this report is a dilemma for many climate hawks: does it make political sense to embrace the Dutch disease narrative? Analytically, it would seem preferable to keep the issues separate. Designing effective climate policy for Canada is an enormous task in its own right, why complicate it by including it in the same package of initiatives designed to address Ontario’s struggling manufacturing sector? Even the strongest serious cases for the Dutch disease argument suggest that there are greater and more important forces at work in Canada’s manufacturing challenge than the explosive growth of the oil sands.

But politically, climate advocates are not getting any meaningful traction in Canada, so aligning themselves with the Dutch disease argument makes sense if Mulcair’s political strategy can be a winning one. Nik Nanos, one of Canada’s preeminent pollsters, believes this is a high reward manoeuver for Mulcair, who is looking to shore up support in Quebec and expand into Ontario, for much of the same reasons as were previously discussed in this blog.

Analysts vs Advocates, again

While Mulcair’s rhetoric may be beyond what is well supported by economic analysis, as noted by John Ibbitson he probably does not have much to lose from adopting more extreme positions than the evidence warrants (yet). A sizeable portion of the public agrees with his viewpoint – enough to make a difference in key areas. According to Harris/Decima, 51% in Quebec agree with Mulcair in Quebec, while 47% in British Columbia and 37% in Ontario do.

If the choice comes down to oil sands expansion with demonstrably inadequate environmental checks and balances, or a sketchy economic argument with powerful narrative potential, the choice seems pretty clear for climate hawks.

Posted in Climate Action Policy, Oil Sands | 2 Comments

The Oil Sands Wedge: Could The Next Federal Election Be A Fight Over Dutch Disease?

Posted on April 9, 2012 by admin

Spencer Keys
April 9, 2012

February’s spat between Premiers McGuinty and Redford, about whether the oil sands have contributed positively or negatively to Ontario’s economy, has given national prominence to the spectre of Dutch Disease in Canada. The story is a simple one: a resource boom links the value of the national currency to resource prices; high resource prices change the terms of trade with other nations, lowering the value of exports to other countries because of currency inflation; and export-dependent manufacturing stagnates, leaving the economy even more dependent on high resource prices and creating economic collapse if/when resource prices drop. What is interesting is how different actors are beginning to embrace or reject this story to further their interests.

At first glance, it is easy to see Premier McGuinty’s concern: manufacturing has been declining in Ontario while the loonie has steadily risen from a low of $0.63 in 2002 to its current level around parity. There’s a prima facie case this is bad for both Ontario and Canada as a whole.

However, there is neither consensus on the scale of the problem nor on whether a problem exists at all. Recent statements by Canadian economists show the significant divisions on this topic. Arguments about the size and scope of the public sector, while not directly related, establish one classic left-right division. Andrew Jackson argues Canada’s petrodollar has become a major cause of reduced manufacturing, while Erin Weir identifies the avoidance of Dutch Disease as a reason for extracting higher public revenues from resource projects now, to support robust state activity. Meanwhile on the right, University of Calgary economist, low corporate tax and anti-subsidy advocate, Jack Mintz argues these are solutions without a problem because Ontario’s manufacturing decline tracks most closely with a 30-year trend of manufacturing decline throughout North America, and genuine Dutch Disease would have to have seen a reciprocal rise in manufacturing in the late 1990s, as the value of the loonie dropped, which didn’t occur.

Environmental groups have jumped firmly on the Dutch Disease bandwagon. After the premiers’ dueling talking points, both Greenpeace and Environmental Defence posted critiques of Premier Redford’s view that the country is generally experiencing a benefit from the oil sands. Their interests are clear: if the economy is the overriding concerns for Canadians, promoting the idea that the oil sands are quietly undermining the economy may be a more successful strategy to slow oil sands growth than appeals based on the environmental merits alone.

Interestingly, Canadian political rhetoric is only now latching on to this narrative. In the 40th Parliament and the 41st Parliament, Dutch Disease has been referenced in Hansard on only three occasions, including one speech by new NDP leader Thomas Mulcair. However, given the 2011 election created an unprecedented coalition for the Conservatives between Ontario and the western provinces, focusing on a story that shows the tension of that coalition makes strategic sense. Mulcair is already highlighting that tension through his comments on the oil sands, talking about the need to develop a framework of “sustainable development” that keeps the dollar from inflating for the benefit of manufacturing and the environment. With one policy he can speak to the fears of labour and green constituencies, primarily in urban and suburban Ontario ridings, while trying to avoid a “radical” label from centrists.

It is unsurprising that this debate continues to reflect the framing strategies Hoberg and Rivers have previously identified. Both sides have had ideologically affiliated economic and business leaders speak out, from Robyn Allan on the left to Dr. Mintz on the right. Both proponents of the Dutch Disease narrative and its critics have focused on their preferred criteria: Greenpeace voices concern over the kinds of jobs being created and the effects of those jobs on the environment, whereas some like Laval University economist Stephen Gordon do not see the switching of jobs and capital to another sector of the economy as inherently problematic in the aggregate. Even the phrase “Dutch Disease” is a method of both drawing an unfavourable comparison to the Netherlands in the 1960s, and labelling the scenario unfavourably to imply a problem despite a decent counterargument that the overall increase in wages and shift of capital has produced a net economic benefit.

Whether or not Dutch Disease is happening in Canada, it’s a powerful concept that will continue to plague conflicting interests. And ultimately, because the phenomenon cannot be conclusively said to have occurred until there is a broad economic stagnation, it will be difficult to prove or disprove until it is too late. That feature, similar to the inability to categorically state the the long-term effects of climate change, makes Dutch Disease both an emotional topic and one that is unlikely to resolve itself purely through analysis. If anything, some recent analysis suggests that Dutch Disease is part of the manufacturing decline, but far from the majority of the cause, rendering conclusions about the value of oil sands expansion on economic terms even more difficult to determine.

What is likely is that, as the tension between oil sands expansion and manufacturing decline continues to hang over decision-makers, the Dutch Disease story will become a more prominent part of the policy space. In particular, it is worth monitoring whether this becomes a more significant aspect of environmental advocacy, as environmental groups seek to create a broader political coalition by reframing the oil sands conflict, or if it remains a supportive but ultimately tangential component of the climate action dialogue.

Spencer Keys is a student at the University of British Columbia and a public affairs consultant. He can be found on Twitter @spencerkeys.

Posted in Oil Sands | 3 Comments

Can College and University Campuses Become Nodes of a More Formidable Climate Movement?

Posted on March 12, 2012 by admin

George Hoberg
March 12, 2012

The postponement of the Keystone XL pipeline has breathed new life into climate movement that has been struggling in the US, Canada, and globally. Blocking significant new fossil fuel infrastructure can be important in galvanizing interest and creating momentum, but it is only a means to the much larger end of achieving regional, national, and global climate policies that can produce the rapid and deep cuts in greenhouse gas emissions necessary to achieve international targets. The climate movement needs to scale up dramatically to create the breadth and depth of political pressure necessary to force more meaningful change.

One potential new source of untapped energy may be college and university campuses. At the University of British Columbia, we are experimenting with a new organization that may provide a model helpful to other campuses across North America.

UBCC350’s Mission

Inspired by the global climate movement fostered by 350.org, UBCC350 is a group of UBC students, faculty, and staff committed to advocating for meaningful government climate action. We strongly support aggressive global, national, and provincial actions to address the climate crisis, but our immediate focus is on carbon exports from British Columbia. BC has enacted progressive climate policies, but they have yet to be fully implemented. At the same time, BC has become a significant exporter of greenhouse gas emissions that are not considered when the province measures its emissions. Current greenhouse gas exports are about twice the existing in- province emissions, and there are proposals to increase them significantly through new tar sands pipelines, new LNG facilities, and increased coal exports.  We believe BC needs to take responsibility for these emissions by enacting policies to reduce or at least price these exports.

Our Model

Campuses should be fertile ground for climate organizing. Most universities have faculty expertise in environment generally or climate in particular, and many faculty who are frustrated with government inaction are looking for a way to make a difference beyond traditional science communication and teaching. Most campuses have very active networks of student groups on sustainability, although usually focused on personal or institutional consumption by students and campuses. There are a variety of existing networks and relationships through residences, student groups, majors, and courses that if strengthened and redirected could become potent organizational tools.

We are guided both by a core policy belief and an organizational philosophy. We believe that to achieve the required scale of change, reliance on individual or organizational efforts to reduce carbon footprints will not be sufficient. Significant government policy action is required to price or otherwise regulate carbon to transform the energy system. Mass mobilization and political pressure is required to force reluctant elected politicians to act.

Our organizational philosophy is that effective movement building will only occur through the “strong ties” that develop through sustained face to face interactions. Social media is an enormously powerful communication tool, but real meaning and commitment come from in person interactions, and real political power comes from the capacity to reach out to voters in important electoral races.  With the proper nudging, the university community can be a very nurturing environment for this type of strategy. We’ve broken down the boundaries between faculty and students and created a distinctive group where a variety of members of the UBC community are working together to move beyond the campus to take political action in the surrounding community.

Our First Campaign

Our first major campaign is “Storm the Riding” on March 31, 2012. We will be canvassing in the Vancouver-Point Grey riding, held by Premier Christy Clark. We’ll set up information stations at busy intersections and go door to door in teams, informing voters about BC’s growing carbon exports and asking that they sign a petition demanding Premier Clark take a position in opposition to the Northern Gateway Pipeline. We will then have a march delivering these petitions to Clark’s constituency office. Our immediate target is Premier Clark, but by targeting marginal polling areas in a competitive riding, we are also trying to send a broader message to provincial and federal parties about the importance of climate issues to voters in BC. We are engaging media in the effort to broaden exposure to the event, and send a signal to the political establishment that youth are mobilizing and climate matters. We believe this strategy will be effective because we need policy change, and the best way to achieve policy change is to convince elected leaders that there is an electoral incentive to act.

A Starter Kit for Creating Your Own Campus Climate Action Group

After Storm the Riding, we will plan additional actions in the Fall and into the future to continue mobilizing support for climate action with grassroots organizing. We are hoping our model of campus-based grassroots political action will inspire other colleges and universities, and help foster a more formidable climate movement.

Here are some ideas for how to get started

  1. Identify catalysts who have the level of commitment and time to take the lead in organizing
  2. Find like-minded faculty members willing to get political
  3. Build on existing organizational networks on campus
  4. Cultivate allies among established non-university activist group
  5. Create a brand that will resonate with your campus and that connects you to the larger climate movement (but that is also acceptable to your university). We used 350.org, and you can now register local chapters of 350.org here
  6. Select a salient policy issue on which to focus
  7. Select an influence strategy at a reasonable jurisdictional scale

If our current scientific understanding is correct, time is short to reverse the trajectory of the energy system and put us on a path for a safe climate. Please consider the words of Bill McKibben, in his speech at UBC n November 2011.

“There’s no guarantee we’ll win the fight against climate change. There are scientists who think we’ve waited too long to get started in this fight, and there is too much momentum behind this heating. There are political scientists who think the odds are simply too high; there’s too much money piled on the other side. If you were a betting person you might be wise to bet with them because we’ve been losing more or less for twenty years. But that is not a bet you are allowed to make. The only stance for a moral human being when the worst thing on earth is happening is to get up in the morning and figure out how you can change those odds.”

Why not make your campus a more vibrant and meaningful place by getting faculty and students together to take political action for meaningful policy change?

Posted in Climate Action Policy | 2 Comments

The Three Logics of Climate Politics

Posted on February 13, 2012 by admin

George Hoberg

Three Logics Visualized by Ben Grossman-Cohen of Oxfam America

February 13, 2012

There are three competing logics of climate politics. One is the climate skeptic, convinced either that climate science is exaggerated or that the costs of action outweigh the benefits. Another is the climate policy analyst who accepts the climate science and evaluates policies designed to meet climate targets based on their cost-effectiveness.  The third is the climate advocate, who is convinced there is a climate crisis and focuses on which political strategies are best suited to decarbonizing the energy system. While having little patience for climate skeptics, the analyst also bridles at the open advocacy of climate advocates, scoffing at their exaggerated rhetoric and bemoaning the inefficiency of their prescriptions. In doing so, however, they frequently misunderstand  the logic of politics guiding the advocates.

The Climate Skeptic

I have a hard time understanding the logic of climate skepticism from serious people. I get that some are contrarian by nature and revel in railing against orthodoxy of any sort. I get that there are widely divergent views of the appropriate relation between the government and markets, and that serious climate policy might seem alarming to those with a libertarian bent. But I have a very hard time understanding how any conservative who understands welfare economics can deny that there are certain well understood conditions, particularly externalities and public goods, which justify a strong government role in climate policy. I find it particularly hard to understand what appears to be a willful inability to accept the logic of probabilities implied by the best climate science. Even though it is frighteningly cynical, I find it easier to understand Doonesbury’s character depicted as “the honest man,” who accepts the science but opposes sound climate policy “because I care much more about my short-term economic interests than the future of the planet! Hello?”

The Climate Policy Analyst

But this post is not about the logic of climate skepticism, which is too mysterious. I want to focus on the difference in the logics of climate advocates and climate policy analysts. The conflict in perspectives between these two views was reinforced in my mind again Saturday by a New York Times column by Joe Nocera about the KeystoneXL pipeline. The column accuses climate advocates of exaggerating the significance of KeystoneXL’s contribution to global warming.  “The crude oil from the tar sands of Alberta, which the pipeline would transport to American refineries on the Gulf Coast, simply will not bring about global warming apocalypse.” Therefore, Nocera’s logic seems to go, given that we need the oil and Canada is a reliable partner, the pipeline should be approved.

Several leading climate policy analyst/bloggers/tweeters chimed in “yup, that’s what we’ve been saying for months.” Andrew Revkin, the dean of climate blogging at the New York Times, tweeted a reference to his September 2011 overview piece that generally supports Nocera’s conclusion. Revkin’s piece refers to the affirming work of two other leading climate policy analysts, Andrew Leach at the University of Alberta and Michael Levi at the Council of Foreign Relations. The analysts’ essential argument is two-fold. First, given the amount of GHG emissions enabled by the pipeline and the nature of North American and especially global oil markets, the marginal impact of the KeystoneXL pipeline on global GHGs will be insignificant. Second, there are much more cost-effective ways to reduce GHG emissions than blocking pipelines.

I believe that both are these arguments are unquestionably correct. But I also believe that they completely miss the point about why environmentalists are so opposed to the KeystoneXL. The logics of  analysis and advocacy are fundamentally different. The analyst is guided by aspirations for truth and well-reasoned argument, and guided largely by the value of maximizing the cost-effectiveness of solutions. They chaff against exaggerations and misuse of data by advocates on all sides, and search for the best reasoned argument for the most efficient path forward.

The Climate Advocate

In contrast, the climate advocate is trying to maximize political leverage in an effort to foster systemic transformation of the energy system. The logic of political action and movement building is different from the logic of policy efficiency. The advocate works to strategically frame problems and solutions that work politically, not those that best adhere to the standards of analytical rigor. Frequently, this involves exaggerated claims that aggravate the analyst.

Probably the best example from the KeystoneXL is the James Hansen claim that the pipeline represents a “carbon bomb” because it increases access to Canada’s unconventional oil deposits in the tar sands. [Correction: the phrase attributed to Hansen and reported repeatedly by McKibben and others is "fuse to the biggest carbon bomb on the planet."] If fully exploited, Hansen claimed, the tar sands could add 200 ppm of GHGs to the atmosphere, meaning it’s “essentially game over” in the battle against climate change. This” game over” frame was repeated again and again by Bill McKibben, the lead organizer of the anti-Keystone. Analysts chastised him for exaggeration and confusing the magnitudes at stake. Turns out Hansen and McKibben have a pretty good understanding of the magnitudes of carbon flows. It’s just they find the metaphor of “carbon bomb” and “game over” enormously powerful as a catalyst for mobilizing people, so they continue to use it.

McKibben and his allies didn’t choose to draw a line in the sand on KeystoneXL because it was the most cost-effective policy to reduce GHG emissions. They picked it because it made political sense given the state of the climate movement in US and global politics. Having failed so spectacularly at Copenhagen and then in the US Congress to get meaningful action, McKibben and Co. recognized that to have meaningful success, more direct action would be required to galvanize the intensity of preferences at the grassroots level needed to foster a powerful social movement. Keystone XL turned out to be a perfect short-term vehicle for that.  It was a point of leverage they could use to focus concentrated pressure, and it turned out to be a spectacular success on its own terms.

The Leap of Faith

I’ve felt the conflict between these two logics very personally. As an academic, I’ve always prided myself on the commitment to analytical reason and been uncomfortable with the rhetoric of advocates even when I’ve shared their values. But in recent years I’ve felt increasingly unsettled in that stance as the gravity of the climate crisis has become more apparent. The past two decades of climate politics have clearly demonstrated that “speaking truth to power” has not been effective at inspiring climate action. And as I’ve tried to come to a deeper understanding about humanity’s failure to act yet on climate change, I came to an insight that transformed my stance.

When you consider the structure of the climate challenge as a public goods and public choice dilemma, you can see that if we are guided by short term material thinking we will simply be incapable of rising to the challenge of taking the concerted action sufficient to avoid dangerous climate change. The logic of the climate policy analyst is dominated by this economic rationality that can’t generate the necessary solutions. To envision a capacity to act you need to take a leap of faith that enough citizens and leaders are willing to act on moral, not economic grounds. You take climate action not because it is in your or your nation’s interests, but because it is the right thing to do. And you need to start acting that way yourself.

From Analyst to Advocate

UBC was fortunate to have Bill McKibben come visit and give a series of talks in November. I had breakfast with him in a small group and challenged him on all of these factual issues. What was immediately apparent is that he understood all of the criticisms, but was simply working from a different logic about how to maximize political opportunities. In a larger group he had a session about the tensions between academics and advocates. He bemoaned analysts who were “in love with the caveat” and unwilling to join hands with advocates in the fight for climate action. He explained that he was sensitive to the concerns of many academics that they would be sacrificing their credibility if they engaged in advocacy. He then spoke of the gravity of the climate crisis, calling it the “greatest challenge of our time,” and asked: “What are you saving your credibility for?”

McKibben closed his November speech at UBC with the following words:

“There’s no guarantee we’ll win the fight against climate change. There are scientists who think we’ve waited too long to get started in this fight, and there is too much momentum behind this heating. There are political scientists who think the odds are simply too high; there’s too much money piled on the other side. If you were a betting person you might be wise to bet with them because we’ve been losing more or less for twenty years. But that is not a bet you are allowed to make. The only stance for a moral human being when the worst thing on earth is happening is to get up in the morning and figure out how you can change those odds.”

What I’m doing is working with students at UBC to create a campus climate movement, UBCC350, oriented towards fostering meaningful government action against carbon exports from British Columbia. By taking on a more explicit advocacy role, I’m not abandoning the commitment to analytic rigor typified by the logic of the analyst. I see myself as harnessing that in the service of advocacy.

Up next: more on the model will are building for using university campuses as strategic nodes in the climate movement.

Posted in Climate Action Policy | 25 Comments

Canada’s Third Great Pipeline Debate: The Political Landscape as the Northern Gateway Pipeline Hearings Start

Posted on January 10, 2012 by admin

George Hoberg and Andrea Rivers
January 10, 2012

Map of Route from EnbridgeJanuary 10, 2012

As hearing finally start today on the Northern Gateway pipeline from the oil sands to coastal British Columbia, politics on all sides of the dispute have been escalating. The Joint Review Panel process is well described here. This post surveys the political landscape leading into the hearings.

This is Canada’s third great pipeline debate. The first was in 1956, when the debate over the TransCanada pipeline between Alberta and central Canada became an issue for Parliament and contributed the defeat of the St. Laurent government. The second was in the 1970s over the MacKenzie Gas Pipeline from the Beaufort Sea to the south. The Berger Inquiry on the issue was a landmark event in Canadian environmental policy and aboriginal rights.

As we move into this third major debate, the political landscape is dominated by high-level accusations of foreign interests hijacking the process, continued massive economic stakes for the oil industry and vehement opposition by environmental groups, divisions between Western provinces, uncertain public opinion, and continued challenges of adamant opposition by a significant number of affected First Nations. The political economy of Canadian natural resource policy in a nutshell.

Harper Government Support, Castigation of Opponents and Procedures

The Harper government continues to play an active role promoting the project. Both the Prime Minister and Minister of Natural Resources Joe Oliver have taken a curious twist in their arguments. At first, they were pretty direct in expressing support for the pipeline, even though it had yet to go through a process of environmental assessment and regulatory review. They then shifted tack, in an effort to appear more respectful of the process, and began focusing more on the general benefits of opening Asian market to Canadian energy exports. Minister Oliver trumpeted the pipeline as no less than “nation-building”:

“We believe that we have to have access to Asian markets for our energy products, for our oil and gas. That is clearly in our national interest. We’ll survive without it, but not nearly in the same way…It’s nation-building, without exaggeration.”

Over the past week, however, the tone of the Harper government rhetoric has sharpened. Last week Harper publicly echoed the message of the “Ethical Oil” campaign by expressing concerns that the pipeline’s regulatory process could be stalled by foreign-funded groups: “Growing concern has been expressed to me about the use of foreign money to really overload the public consultation phase of regulatory hearings just for the purpose of slowing down the process… We have to have processes in Canada that come to a decision in a reasonable amount of time and processes that cannot be hijacked.”

Monday morning, Natural Resources Minister Oliver escalated the rhetoric further in an open letter, and he repeated the theme in a media blitz throughout the day. After describing the benefits of the project, Oliver launched into a lengthy attack on pipeline critics:

“Unfortunately, there are environmental and other radical groups that would seek to block this opportunity to diversify our trade. Their goal is to stop any major project no matter what the cost to Canadian families in lost jobs and economic growth. No forestry. No mining. No oil. No gas. No more hydro-electric dams.

These groups threaten to hijack our regulatory system to achieve their radical ideological agenda. They seek to exploit any loophole they can find, stacking public hearings with bodies to ensure that delays kill good projects. They use funding from foreign special interest groups to undermine Canada’s national economic interest. They attract jet-setting celebrities with some of the largest personal carbon footprints in the world to lecture Canadians not to develop our natural resources. Finally, if all other avenues have failed, they will take a quintessential American approach: sue everyone and anyone to delay the project even further. They do this because they know it can work. It works because it helps them to achieve their ultimate objective: delay a project to the point it becomes economically unviable.”

This blatant attempt to discredit pipeline critics as un-Canadian radicals sent a shockwave through the environmental policy community.

This high level government attack has highlighted two major political issues. First, the support received by Canadian environmentalists from US charitable foundations has become a significant issue for project proponents. The mainstream media has become somewhat more balanced over the past week on noting the extensive foreign involvement in the Canadian energy sector, but the rhetoric of the Harper government remains one-sided.

Second, the time-consuming nature of the environmental assessment and regulatory review process has become an even bigger issue for the Harper government. Both Harper and Oliver are accusing project opponents of abusing the process and trying to stymie progress to create interminable delays in the project with the intent of killing it. The Canadian oil industry and others jumped on the bandwagon today. Streamlining the regulatory process has been an enduring concern for the Harper government and they appear to be using the “foreign plot to hijack” the Northern Gateway proceedings to strengthen the political case for statutory change. CBC’s The National reported that changes may actually be made to the Northern Gateway process itself.

The Continental Divide between BC and Alberta

Harper and Minister Oliver have made their stance on the project very clear to Canadians over recent months, and Alberta premier Redford has expressed clear support for the project. On the other side of the Rocky Mountains, however, B.C premier Christy Clark has yet to declare a position. Clark has stated that she refuses to take a side on the issue until the National Energy Board has given a ruling on the project in 2013. However, it is being suggested she may be “forced off the fence” by pressure from both sides of the argument and at different levels of government.

Environmental Opposition

The mainstream media have given extensive coverage to the concerns of project opponents leading up to the hearings. The Vancouver Sun ran a thorough 8-part series on the risks and benefits of the pipeline that was picked up by other Postmedia outlets including the Edmonton Journal. One article including the  star power environmentalists have mobilized  to fight the project. Another pair of articles in this series weighs the risk of pipeline and tanker spills –among the strongest arguments for northern gateway opposition.

Public Opinion in BC

Over the past week, a series of opinion polls have been released showing dramatically different levels of support and opposition. Enbridge released a poll that received a significant media attention suggesting more British Columbians supported the pipeline than opposed it. Prior to this time, the only publicly available polling was from environmental groups that showed up to 80% of British Columbians opposed oil tankers along the BC coast, so it was treated as a major correction to that impression. Closer scrutiny of the wording and results raised doubts about how significant the findings were, especially in light of another poll released that showed quite different results.

The Enbridge poll was conducted by Ipsos Reid. The poll showed that 55% of respondent were not familiar with the pipeline, suggested there is a lot of room for advocates on both sides to move opinion. The question was posed as follows: “As you may know, Enbridge is the company leading the Northern Gateway Pipelines Project, which is a proposal to build an underground pipeline system between near Edmonton, Alberta and Kitimat, in northern BC. One pipeline will transport oil to Kitimat for export by tanker to China and other Asian markets. A second pipeline will be used to import condensate (a product used to thin oil products for pipeline transport) to Alberta.” While the question did have a reference to tankers, it did not mention the oil sands, nor did it mention the risks of a pipeline rupture or oil spill. (It also did not mention the economic benefits.) Given this question, 48% of respondents favoured the pipeline, 32% opposed it.

At the same time, an older Mustel poll commissioned by ForestEthics in May 2010 asked a different question and got opposite results. This poll tended to prime environmental concerns in respondents:  “Based on what you currently know, would you say you support or oppose Enbridge’s proposal to build an oil pipeline from the tar sands and bring oil tanker traffic to B.C.’s North Coast? “ In almost the exact reverse of the Enbridge poll, this one found that 51% were opposed and 34% were in favour. The contrast in the polls is a classic example of how polling results can vary depending on the design of the question.

In the wake of Harper and Oliver’s attacks this week on foreign funding for environmentalists, West Coast Environmental Law released a poll conducted in April 2011 suggesting that British Columbians were far more concerned for foreign ownership and control  of Canadian resources than they were about foreign funding of environmental groups. (The wording of those questions is important to consider as well.)

First Nations Opposition

One of the most challenging issues in the case is the adamant opposition of First Nations in the Fraser River watershed and along the BC Coast. Enbridge claims that two dozen First Nations support the project and have signed equity agreements with them, but other than the Gitxsan, they have not revealed the identity of these groups.  In contrast, 130 First Nations have announced opposition. That includes the Coastal First Nations who have issued a ban under their laws of oil sands tanker traffic along the BC inland coast and approximately 70 that have signed the Save the Fraser Declaration banning new oil sands pipelines through their territories.  Here’s a map that shows the extensive territory covered by BC First Nations who have formally opposed the pipeline (some in the Northwest Territories have as well). First Nations east of Prince George have apparently been more open to the pipeline. Many of them have far more extensive experience with oil and gas pipelines, and seem to have a different benefit-risk calculus with respect to Northern Gateway.

Enbridge announced an equity agreement with the Gitxsan First Nation with great fanfare in early December. Since then, significant opposition to that announcement has emerged within the Gitxsan community, and it is uncertain whether the individuals signing that commitment had the authority to do so. At this time it is best to consider the Gitxsan decision as contested and uncertain.

Posted in Energy Pipelines, Oil Sands | 3 Comments

Hoberg’s Media (MSM and not) Guide to Western Canadian Energy/Environment Policy

Posted on January 2, 2012 by admin

George Hoberg
January 2, 2012

This guide is intended for the students in my energy policy classes but I wanted to make it more widely available. You can find it here.

Posted in Uncategorized | Leave a comment

The Constitutional Threat to the California Effect: A Court Strikes Down California’s Low Carbon Fuel Standard

Posted on December 31, 2011 by admin

George Hoberg
December 31, 2011

This week a federal district court in California declared the California low carbon fuel standard unconstitutional for its violation of the interstate commerce clause. The grounds for the decision are revealing about the tensions of sub-national jurisdictions producing complex regulations that have economic implications for other parts of the federation. One of the most important dynamics in US and indeed global environmental policy has been the “California effect,” where innovations in environmental regulation produced by such a gigantic market spillover into other jurisdictions and get adopted more broadly. If upheld, the ruling could have the effect of negating future California effects.

The case is Rocky Mountain Farmers Union v. Gladstone. It focuses on standards for corn-based ethanol, but has direct implications for other unconventional sources of transportation fuels, including oil sands. It also may have implications for state renewable portfolio standards that treat out of state renewable different from in-state. Because the judicial standards for interstate commerce are similar to what they are for international trade, the logic of the ruling also has implications for the consistency of domestic international regulations with NAFTA and WTO.

Does the LCFS discriminate on the basis of location?

There are three essential findings of the case. The first is that the LCFS is, on its face, discriminatory of out of state sources of fuel. This is probably the most controversial and consequential part of the ruling. In its LCFS, California gives different carbon intensity values to different source of fuel. The standard contains a table showing the default carbon intensity values of Midwest corn-based ethanol is 10% higher than California corn-based ethanol. These different values are based on a life cycle analysis (LCA) of greenhouse gas emissions (from the CA-GREET model adopted by the California Air Resources Board). Like any good LCA, the model attempts to be comprehensive, and includes as factors in the analysis transportation distance and the GHG intensity of electricity input. Because Midwest corn-based ethanol needs to travel farther to get to California, and is based on a more coal-intensive electricity supply, it is considered more carbon intensive.

The core issue is whether including transportation distance and type of electricity supply is simply a sensible consequence of the application of a well-intentioned methodology to address a legitimate state policy problem, or whether it constitutes impermissible discrimination based on place of origin. The court sided with plaintiffs and firmly adopted the latter conclusion: “Having considered the parties’ arguments, relevant case law, and admissible evidence, this Court finds that the LCFS…explicitly differentiate[s] among ethanol pathways based on origin (Midwest vs. California) and activities inextricably intertwined with origin (electricity provided by Midwest power companies vs. California power suppliers and interstate transportation).”

California argues this logic is flawed, that the standard discriminates on the basis of carbon intensity, which is exactly its purpose, and not location per se. But the court ruled differently.

If the argument that application of a life cycle analysis is “inextricably intertwined with origin” holds up, it posed grave threats to state-level regulatory standards under the US constitution and national regulatory standards under international trade law. In fact, the judge in this case goes so far as to imply that any standard addressing carbon leakage is discriminatory: “California is attempting to stop leakage of GHG emissions by treating electricity generate outside of the state differently than electricity generated inside its border. This discriminates against interstate commerce.”

Can Climate Change be Legally Constructed as Legitimate Local Concern?

Under US constitutional law (and international trade law), discrimination based on location is not inherently unlawful. The state must “demonstrate both that the statute ‘serves a legitimate local purpose,’ and that this purpose could not be served as well by available nondiscriminatory means” (p.  22).

The second part of the ruling addresses whether the LCFS serves a legitimate local interest. The ethanol producers argued that because greenhouse gas emissions have a global effect, that they do not have a particular local impact on California. The district court rejected this argument, based on previously established decision in the landmark Massachusetts v. EPA case.

Can the Policy Objective be Achieved by Non-discriminatory Means?

The third part of the ruling addresses whether California’s policy goals can be a achieved through other means that don’t discriminate based on location. The court ruled that “California has failed to establish this fact. “ The judge pointed to testimony that even state experts acknowledge that a carbon tax, vehicle emission standards, and reductions in vehicle miles travelled could be applied to pursue the same objective of reducing carbon emissions from transportation in the state. The judge faulted the state for not demonstrating that alternatives to the LCFS could meet the same objective with less discriminatory effect.

What’s Next?

The future of this case is critical to the development of climate policy in the US and perhaps other jurisdictions. The state could win on appeal (the next stage is the federal court of appeals, and then potentially the US Supreme Court). Another court may be more convinced by California’s logic that the standard discriminates on the basis of carbon intensity and not location. The provision in the standard for “customized carbon intensity pathways” should strengthen its case. The law provides for tailored carbon intensities for suppliers that can demonstrate that their practices differ from the assumptions in the standard, and the state has already granted a number of these.

However, if higher courts agree that application of a life cycle analysis is “inextricably intertwined with origin,” the ability of states to use LCA as the basis for climate policy will be thwarted. The state could attempt to redesign a low carbon fuel standard that was more neutral to location, but that would undermine its effectiveness. California might be forced to abandon its LCFS and pursue other policy instruments.

It is important to note that all these unfortunate dynamics are being created by the failure of the US government to take concerted action on climate change. In the past, California’s leadership on environmental policy has prompted more effective and comprehensive federal action. In the case of California’s LCFS, Midwestern corn-ethanol producers have succeeded in using the courts to stop the California effect in its tracks. For now.

See also Richard Frank’s analysis from Legal Planet.

Posted in Climate Action Policy, Oil Sands | Leave a comment

Had enough of the read-world farce of the Durban climate talks? Check out this climate change satire by one of the great novelists our time: Ian McEwan’s Solar (2010)

Posted on December 11, 2011 by admin

Lisa Danielson and George Hoberg
December 11, 2011

The Seventeenth Conference of the Parties to the UN Framework Convention on Climate Change just concluded with a “plan for enhanced action” in which we’ve agreed to agree at some later point to “raise levels of ambition” and “close the ambition gap.” If we are going to turn the struggle for climate action into a farce, it makes more sense to look to the professionals. One of the great writers of our time, the UK’s Ian McEwan, has written a cutting, insightful satire about climate change. His book was inspired by the farce at COP15 in Copenhagen, but rings just as true in the wake of COP17.

Solar is centered on the unlikable protagonist Michael Beard, an English physicist who won the Nobel Prize for his pathbreaking “Beard-Einstein conflation.” Beard’s physical appetites are just as prolific as his mental faculties, and have jointly turned him into an overweight egoist. Beard’s consumption patterns are described in painful detail, as he goes through food, drink, and women with little thought to the consequences.

McEwan has a keen eye for the disciplinary dynamics of intellectuals. One scene in the book has Beard acting as the token climate expert on a boondoggle cruise to the Arctic with artists and musicians. McEwan’s depictions of the personal interactions are packed with insight into the “two cultures.” The book also has a devastating indictment of past-their-prime academics as Beard flagellates himself for the “pseudo work he did to mask his irrelevance.”

As the novel progresses it becomes apparent that Beard’s attitude towards consumption serves as an allegory for humanity; his overeating (and other habits) can be likened to our overuse of finite resources and destruction of the natural world. As Beard’s gluttony-induced health problems increase, his doctor tells him “I’m afraid we really must address your lifestyle.” But McEwan’s protagonist won’t listen, because his lifestyle is too important to him. He also uses the creeping chaos of the boot room of the Arctic cruise ship as an apt metaphor for the tragedy of the commons at the centre of the climate dilemma.

However, the book is not simply metaphor, nor does it read like a morality tale. Through a series of mishaps and lies, Beard accidentally turns into a crusader to thwart anthropogenic climate change, as he becomes the voice of a project with the goal of turning solar power into the most important renewable energy source through artificial photosynthesis. (Go here for a real world version.)

It is this plot convolution that makes the novel so fascinating, as tension between Beard the overweight and at times ridiculous hedonist, and Beard the rational physicist whose project could potentially save the world, somehow match up. There is an especially striking scene where Beard is pushed to give his most convincingly passionate speech about the ailments of our planet because he needs to rush off the stage to vomit a gluttonous second lunch.

McEwan’s Solar is about the climate crisis but its characters and plot are also metaphors for the humanity’s apparent unwillingness to address global warming.

This is our first blog that looks at environmentally-relevant fiction. Fiction as a metaphor for environmental challenges is one genre of environmental literature. Others include:

  • perspectives of non-humans (e.g., Coetze’s Elizabeth Costello)
  • carving “civilization” out of the wilderness (e.g., Stegner’s Angle of Repose, Dilliard’s The Living, and Faulkner’s Go Down Moses)
  • environmental activists (e.g., Franzen’s Freedom, Adderson’s The Sky is Falling, and of course Abbey’s The Monkey Wrench Gang).

More to come. Suggestions welcome of course!

Posted in Environmental Fiction | Leave a comment

Recipe for Forest-Devastating Insect Outbreak: Take Fire Suppression, Add Global Warming – Book Review: Andrew Nikiforuk’s The Empire of the Beetle

Posted on December 9, 2011 by admin

Lisa Danielson, Environment and Natural Resource Policy Intern
December 9, 2011

“It’s not something you’ve ever seen before. It’s like a tsunami that takes twenty-five years instead of two seconds” Keith Dufresne, manager of the Cariboo-Chilcotin Beetle Action Coalition

In Andrew Nikiforuk’s latest book, “The Empire of the Beetle”, the bark beetle outbreak that has killed over 30 billion pine and spruce trees is described in great detail. The story is told like a parable, staring the little bug that significantly disrupted a huge industry.

Chapter three, “The Lodgepole Tsunami”, describes how the outbreak took over British Columbia. Beginning with the biology of the beetle, he explains how beetles and pine trees have coexisted in harmony for decades. So how did a harmonious balance turn into an outbreak that devastated B.C’s forests?

First, the British Columbia forest industry was based on a model of “cost minimization and volume maximization”(52). The model led to a policy of fire suppression, following the logic that lost trees to fires meant lost dollars.  This policy was a “multi-million dollar annual effort created a more uniform, dense, and expansive patch of adding lodge poles”(60). This is how “cost minimization and volume maximization” turned what was originally an age diverse forest into a monoculture of aging pine trees, or in other words, how a short term economic decision created long term ecological consequences.

However, fire suppression was not the only culprit in creating a perfect setting for a beetle population surge. “Dedicated firefighting may have set the table, but it looked as if climate change had reconfigured the table’s shape and size, so that it now extended into northern and alpine forests” (61). A subtle regular warming had removed the restraints cold weather had put on beetle population growth.

This is how human action set the scene for the unprecedented epidemic.

The beetle outbreak was met with a series of policy decisions that did nothing to slow it down. In 1996, the federal government abandoned the Canada’s Forest Insects Disease Survey (FIDS) to save money. While the duty of monitoring forest health was officially passed on to the provinces, it took a few years for British Columbia to pick up the slack. This resulted in no surveys in 1997 or 1998, which were both critical to the mountain pine beetle increase. Better monitoring may not have changed the course of the outbreak, it could definitely have shaped a superior, more informed response.

Allan Carroll, now with UBC’s Department of Forest Sciences, advised the park service that the best plan was to “predict the outbreak’s size and determine what was driving it”(55). Instead, a series of war like tactics where employed in efforts to kill the beetles. First, nearly a million dollars was spent on a “fell and burn” program, which involved cutting down and burning individual infested trees. After this didn’t work, a “snip’n'skid” program was put into place, followed by a “hack and squirt”. Hack and squirt was cutting into the tree and then injecting arsenic into it. In 2006, it came out that the arsenic was not just killing beetles but in addition killing fifteen species of woodpecker, the beetle’s best natural predator.

In response to the ever-growing beetle outbreak, in 2001 the annual allowable cut was increased to “salvage dead wood”. At the same time stumpage fees were lowered and mills expanded, upping the production and transportation of beetle kill wood. Of course, this resulted in some unintended environmental consequences, such as the transportation of beetle infested trees creating outbreaks along the highways (63).

In 2001 the province also commissioned a review on the costs and benefits of clear-cutting the beetle kill (which of course, they were already doing). The results of the review showed that letting the dying trees stay allowed natural processes of forest regeneration to continue, while removing the trees negatively impacted wildlife diversity and habitat. According the Nikiforuk, the results of this review where ignored.

In 2009, The B.C. Forest Practices Board released a report about the clear cuts that concluded, “The ecological consequences of salvage harvesting on a spatial scale” had “no precedent globally”(100).

While this book offered interesting insight into what policy choices helped contribute to the mismanagement of the crisis, the real value of it comes from the personal accounts Nikiforuk collects. The book is mainly focused on the emotive aspect of the beetle outbreak, and how the forest destruction affects the people and the animals that depend on it. Through personal interviews and stories, Nikiforuk paints a truly tragic story of environmental ruin.

Andrew Nikiforuk. The Empire of the Beetle: How Human Folly and a Tiny Bug Are Killing North America’s Great Forests. Vancouver: Greystone Books and the David Suzuki Foundation. 2011.

For more information about the environmental effects of the mountain pine beetle epidemic in British Colubmia, journalist Larry Pynn had a 5-part series in the Vancouver Sun this past week.

Posted in BC Forest Policy | Leave a comment

Pressure Rising on Both Sides of Northern Gateway Oil Sands Pipeline: December 2011 Update

Posted on December 6, 2011 by admin

George Hoberg and Andrea Rivers
December 6, 2011 (last updated December 8, 2011)

[Due to rapidly developing events we've decided to keep this post a living document with frequent updates. Updates from original text will be in italics.]

Since US President Obama’s decision to put off a decision on the Keystone XL pipeline for 18 months, pressure has increased on other alternatives for expanding oil sands access to markets. Enbridge’s Northern Gateway pipeline project has become the new focal point, especially given the opportunity it provides to diversify exports away from the uncertain US market.

We’ve been following developments in the Northern Gateway controversy closely and will continue to provide periodic updates here.

Decision Delay

On December 7th, it was announced that the Joint Review Panel decision on the project will be delayed until late 2013, a year later than previously expected.  Enbridge remains publicly supportive of the process despite possible delays to the pipeline’s in-service target if approved. The first phase of community hearings is slated to begin on January 10th 2012 in Kitimat where the panel will hear oral evidence from registered intervenors.

The Gitxsan Kerfuffle

Media attention on Northern Gateway reached a new crescendo over the past several days when Enbridge announced Friday afternoon that it had reached a deal with the Gitxsan First Nation to support the pipeline in exchange for an equity share in the project.

But within 48 hours of the announcement, it became apparent that there was significant opposition with the Gitxsan community about the deal. By Monday afternoon the uproar within the community resulted in a significant backlash against the decision within the community and a group of Gitxsan Hereditary Chiefs are renouncing the deal and demanding the resignation of the individual who participated in the announcement.

On Saturday December 3 an Enbridge spokesman stated: “We’ve done a lot of research and we think we understand the governance structure of the Gitxsan quite well and we’re comfortable with the way this has proceeded. We’re convinced we’re speaking to the right people.” While the Gitxsan situation has yet to be clarified, the backlash against the announcement casts doubt on Enbridge’s handle on First Nations politics.

The situation remains uncertain. Members of the Gitxsan nation formed a blockade outside the Hazelton, BC treaty office in protest. On December 7, an court injunction was issued ordering protesters blockading the Gitxsan treaty office to leave the site.

The Strength and Breadth of First Nations Opposition

More important, even if it turns out the Gitxsan decision sticks, the much, much bigger story is the remarkably strong opposition from so many other First Nations in BC – along the pipeline route, along the Pacific coast, and downstream in the Fraser River watershed. A total of 130 First Nations have announced opposition. That includes approximately 70 that have signed the Save the Fraser Declaration banning new oil sands pipelines through their territories, and the Coastal First Nations who have issued a ban under their laws of oil sands tanker traffic along the BC inland coast. Here’s a map that shows the extensive territory covered by BC First Nations who have formally opposed the pipeline (some in the Northwest Territories have as well.)

Questions about Media Bias

Some have raised questions about the disparity in the limited media attention paid to the overwhelming First Nations opposition and the sensational treatment of the Gitxsan support announcement. This differential treatment is more likely due to the fact that First Nations opposition was well known in advance and the Gitxsan announcement appeared to be such big news because it is the first instance of a First Nation declaring support for the pipeline. The story on dissent within the Gitxsan community was also given the lead story in Monday’s print version of the Vancouver Sun. The media thrives on fresh news and conflict, and does not always excel in depth and perspective.

Should We Expect Other First Nations to Announce Support?

Those who have followed the Northern Gateway case have never expected First Nations opposition to be unanimous. There are First Nations east of Prince George that, because of the existing footprint of oil and gas on their land, may not have the same objections to this new pipeline. In an interview with Post Media’s Peter O’Neil, Enbridge CEO Patrick Daniel “boldly predicted…that at least 30 of the 45 First Nations along the 1,170-kilometre pipeline route from Bruderheim, near Edmonton, to Kitimat on the B.C. coast, will have deals with Enbridge by next June.”

We can anticipate a numbers game of competing assertions of support vs opposition based on number of bands, kilometers of pipeline covered, and totals throughout the broader region. But the larger point remains that a very substantial number of the most directly affected First Nations are adamantly opposed.

Can First Nations Legally Block the Pipeline?

First Nations get their power within Canadian law from their constitutional rights as interpreted by the Supreme Court of Canada. At present, Canadian law does not specifically require First Nations consent for resource development and authorization within their traditional territories. Current law requires that they be consulted meaningfully and that their interests be accommodated. The test for sufficient accommodation, however, is very uncertain. The key question is whether authorizing the construction of this pipeline can be consistent with accommodating the interests of so many First Nations who are so adamantly opposed.

Opposition by the Environmental Community

The opposition of First Nations is a formidable political force, but it is also important to understand that the environmental community in BC is also deeply opposed to the pipeline, and has allies across Canada and in the United States to help them. A coalition of environmental groups released a report arguing that the pipeline’s environmental risks outweighed its benefits. The authors of the report were from Canada’s Pembina Institute and Living Oceans Society, as well as the highly influential American group Natural Resources Defense Council. Also highly influential on the issue within BC are the Dogwood Initiative, ForestEthics, and West Coast Environmental Law.

It is uncertain how much this opposition by First Nations and environmental groups resonates with the general public. We were not able to find any publicly available polls specifically on the Northern Gateway pipeline. On the related issue of tanker traffic, public opposition appears to remain intense. An opinion poll commissioned by an environmental group shows 80% opposed to allowing oil tanker traffic in B.C.’s inside coastal waters.

The pipeline threatens to become an electoral issue within British Columbia. BC Premier Christy Clark has adopted a decided “wait and see” attitude towards the federal assessment of the pipeline. This stance is striking, given the enthusiastic support for the project by the previous premier and Clark’s aggressive jobs-through-resource-projects strategy.

Disjunction in Net Costs and Benefits between Alberta and BC

This opposition within BC poses a serious threat to the viability of the pipeline. No wonder Enbridge’s CEO Patrick Daniel is appealing to British Columbians to think from a broader perspective, from the “Canadian national good.” Daniel, along with the Prime Minister of Canada and Premier of Alberta, have stressed the importance diversifying the Canadian market for oil sands away from the American market that seems increasingly unreliable in the aftermath of the Keystone XL delay.

This theme was accentuated by federal Natural Resources Minister Joe Oliver. In an interview he stated: “We believe that we have to have access to Asian markets for our energy products, for our oil and gas. That is clearly in our national interest. We’ll survive without it, but not nearly in the same way…It’s nation-building, without exaggeration.”

The economic logic for diversification is powerful. But so is the environmental, cultural, and political logic of opposition to the pipeline from First Nations and many other British Columbians. The political problem is that the benefits of the pipeline will flow mostly to Alberta. The direct economic benefits to BC are relatively minimal, but BC is being asked to shoulder the bulk of the risk to rivers and coasts from potential oil spills. Opposition in BC appears both widespread and very intense.

Other recent developments: US Foundation Influence

A considerable amount of media attention remains focused on the issue of U.S. charities funding various pipeline opposition groups. The investigative research of  Vivian Krause has gained significant traction with mainstream media columnists, some suggesting environmental opposition is underlain by illicit commercial activity to ensure protection of American economic and trade interests. Much like Ezra Levant’s brainchild Ethical Oil was embraced by the oil industry and members of the federal government, support for Krause’s perspective has proliferated within Canada’s corporate and political elite. Enbridge’s CEO and Canada’s Prime Minister are the most recent high-profile vocalists. As they question the financial backing of opposition to the Northern Gateway project, Steven Harper vows to protect the “best interests” of Canadians. We’ve tried to put US foundation influence in perspective by highlighting the significant role played by foreign corporations in the oil sands in a previous blog and op-ed.

Other Resources

A detailed case document accurate up to May 2011 is here

Our previous September 2011 blog update of that case document.

Posted in Energy Pipelines, Oil Sands | 1 Comment