Canada Must Switch Its Loyalty From Big Oil to Renewables

The opening of the Trans Mountain Pipeline expansion this month—widely celebrated in the media—reminds us that Canada is still very much in the grip of Big Oil.

That $34 billion expansion was financed by Ottawa, and it amounts to a massive public subsidy for the oil industry—at a time when we should urgently be financing renewable energy, not fossil fuels.

The renowned U.S. climatologist James Hansen famously said the oilsands were such a “dirty, carbon-intensive” oil that if they were to be fully exploited, it would be “game over” for the planet.

Over the past four years, Ottawa has provided $65 billion in financial support for oil and gas, but only a fraction as much for renewable energy.

Yet here we are, applauding the tripling of the pipeline’s capacity to carry oil from the oilsands, even as that moves us closer to “game over.”

A report this month revealed that the world’s top climate scientists believe the world is headed in a frightening direction—toward more than 2.5°C degrees of warming, charging past the international target of 1.5°C, beyond which fires, floods, and heatwaves become seriously unpredictable.

Today, we’re at just 1.2°C of warming, and look at the mess we’re in. Already this season, wildfires are burning out of control in B.C. and Alberta.

Climate scientists have been clear: The only real hope of avoiding climate disaster lies in dramatically ramping up the transition to clean energy by building new wind and solar farms at breakneck speed.

But this isn’t happening, even though the price of wind and solar power has become very competitive. That was supposed to be the trigger point at which the market would begin working in our favour, with renewables cheaper than fossil fuels, facilitating the transition to clean energy.

Renewables keep getting cheaper. The price of solar power has plunged by 90%, yet Big Oil remains dominant.

That’s because, with its long-established monopoly and extensive government support, Big Oil is far more profitable—and therefore more attractive—to major financial investors than the struggling, competitive firms that make up the budding renewable sector, notes Brett Christophers, a political economist at Uppsala University in Sweden.

Clearly, given the climate emergency, we can’t just leave the vital task of transitioning to renewables up to the whims of financial investors, whose only interest is maximizing their returns.

Governments must become a lot more involved, and they have to switch their loyalty from Big Oil to renewables.

The Biden administration has moved in this direction, with sweeping measures aimed at doubling renewable capacity in the U.S. over the next decade. Meanwhile, the Trudeau government is locked into serving the immensely powerful oil industry.

Over the past four years, Ottawa has provided $65 billion in financial support for oil and gas, but only a fraction as much for renewable energy. Its main program for subsidizing renewables provides less than $1 billion a year, says Julia Levin, an associate director with Environmental Defence.

The extent of Ottawa’s willingness to accommodate Big Oil became clear in 2018 when it took over the Trans Mountain Pipeline expansion, rather than let the project collapse after its original backers threatened to pull out amid intense environmental opposition.

Now Ottawa is planning to spend $10 billion, possibly much more, subsidizing Big Oil’s futile but costly efforts to reduce its carbon emissions through “carbon capture and storage”—despite ample evidence the technology is highly ineffective at reducing such emissions.

This enables Big Oil to pretend it’s serious about reducing emissions, lulling Canadians into believing we’re making progress on climate, when we’re really just spinning our wheels and wasting a lot of public money in the process.

For years, there was the comforting thought that, when the horrors of climate change truly became clear, humans would be smart enough to figure out a solution. That turned out to be true. It’s just that we haven’t figured out how to override the powerful so we can implement the solution.