Luiza Savage recently wrote an article for Macleans that connects Obama’s efforts to remake American energy policy to adverse effects on the Canadian economy. The argument goes something like this:
The oil sands currently export about half of their production of 1.2 million barrels per day to the U.S. According to the Canadian Energy Research Institute in Calgary, that production will more than double over the next 25 years to four million barrels per day, with most of that oil going to the U.S. For Canada, that will mean 380,000 new jobs—and an additional $1.4 trillion in GDP, which will kick off $252 billion in tax revenues, more than half of which would go to Ottawa. Obama’s climate change legislation calls for reducing U.S. greenhouse gas emissions by 80% by 2050 (a target Macleans calls ‘whopping’), implementing a ‘cap-and-trade’ policy (which passed the House yesterday by a razor thin 219-212 vote), and requires utilities to get at least 15% of their electricity from renewable fuels. Oh, and provisions that would punish imports from countries whose carbon regulations are deemed by Washington to be less stringent than those of the U.S., meant to address the potential competitive imbalance created for some U.S. industries by the costs of compliance with the new cap and trade regime.
Of course, oil sands production emits up to 15 per cent more greenhouse gases than the production of conventional oil, not to mention the toll it takes on the landscape. Luiza writes: “The reality is that Obama is leading an aggressive effort to remake American energy policy with potentially severe consequences for the oil sands, and by extension, the Canadian economy. … Obama may be a self-proclaimed multilateralist, but the provision holds the potential for a unilateral economic wallop—or at least allowing Washington a very heavy hand in the writing of climate rules of its trading partners.”
According to Macleans’ Luiza Savage, Barack Obama is bad for Canada because he is pro-environment. But we should endeavor to be a world leader in the green industry, and what we’re doing in Alberta is despicable.
For every barrel of synthetic oil produced in Alberta, more than 80 kg of greenhouse gases are released in to the atmosphere and between 2000 and 4000 barrels of waste water are dumped into tailing ponds. The production also threatens Canada’s international commitments under the Kyoto Protocol, in which we agreed to reduce our greenhouse gas emissions by 6% from 1990 levels by 2012. Instead, our greenhouse gas emissions have increased by 24%, with the oil sands accounting for nearly 4% of our total emissions. We are ranked as the 8th largest emitter of greenhouse gas, quite high considering our population.
In 2008 we produced 438,000 cubic metres per day of crude oil, crude bitumen, and natural gas condensate. Of that amount, 65% was exported (283,000 cubic metres per day), almost all of it to the U.S. We could be supplying the U.S. with all the oil they want right now while developing green technology and energy that we could supply them with later. This would make us leaders in environmentally friendly energy & technology (and allow us to enjoy the related economic boon), make our energy policy superior to that of the U.S. (thereby rendering any potential ‘protectionist’ aspect to U.S. energy policy moot), and help us meet our international obligations under the Kyoto Protocol.
So is Obama really bad for Canada?