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Originally Posted by Vedder
If you implement an emissions cap one of two things is going to happen:
1. Profitable but high emissions intensity barrels will get shut-in to comply with the cap
2. Companies will invest in otherwise uneconomic projects to reduce emissions. While you view this as productive for the economy, it effectively increases the breakeven cost for Canadian barrels relative to global competitors. The end result of this is less overall investment and ceding market share. This is a huge own goal with zero net benefit to the planet.
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*less overall investment in the oil sands relative to the overall investment that may have been achieved without the cap while still being higher than present day investment and greater investment and market share in the “uneconomic projects” (lol)
FYP with what actually has and will continue to happen
Quote:
Originally Posted by Vedder
There is no hyperbole in saying these regulations destroy private investment, and by extension our collective prosperity. Other jurisdictions do not have these costs and layered and confusing regulations, all seemingly aimed at the same goal. Private capital follows profits and favours regulatory regimes that are clear and reduce investment uncertainty. Canada has only increased that uncertainty in the last decade. Ironically this will also hamper any bold action on the energy transition. Things take too long here.
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Dozens of other jurisdictions have these costs and regulations. The EU has a cap and trade system and since it was implemented emissions fell by a greater margin and revenue rose by a greater margin compared to like for like non-EU competitors.
Quote:
Originally Posted by Vedder
You can call it myopic, but after 10 years of talking about just transitions, and creating good green jobs, we have very little to show for it despite massive subsidies. The golden goose for this county continues to be its natural resources, and for some reason we seem hellbent on restricting them.
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Natural resources include more than oil and gas, it also includes renewables and low-carbon/clean resources. Over the last 10 years, low-carbon and clean energy exports have more than doubled to nearly $40b. The clean energy sector is growing at 3x the national average. And renewables already account for the vast majority of electricity generation in this country, with something like wind, which less than 20 years ago provided 1% of the generation that fossil fuels provided now providing 15% of that generation.
We have a lot to show for it. You just don’t want to see it, for whatever reason.
Globally the energy transition is already in progress. The reason investment isn’t booming in the oil sands like it once was is because of OPEC and the US, not because of the Liberals or emissions caps. I understand that Alberta thinks there is nothing beyond O&G, but the world already knows there is and is acting like it. Time for Canada to follow suit and allow the industry to continue growing while ensuring all their eggs aren’t in any one basket, which is exactly what they’re doing and exactly what things like an emissions cap and trade system have helped achieve worldwide, while reducing emissions.