ACADEMICS OUT TO KILL OUR ENERGY SECTOR!
Canadian academics from the U of A, plus other institutions, are lobbying the Canadian Prime Minister to destroy the oil and gas industry, and not provide much needed government assistance in a time of need. Questionably, these academics say they want to transition to a “green” sustainable economy. Talk about kicking an industry when it is down!
Wonder if these ivory tower dwellers have any idea of the contribution that the oil and gas industry make to the Canadian economy? Simply put, resource extraction, including oil and gas is the third largest sector in the Canadian economy. In 2018 oil and gas put $117 billion directly into the Canadian economy, supported 530,000 direct jobs and provided $8 billion to governments, on product prices that were far below world average.
About 30% of Alberta’s $338 billion GDP is based directly and indirectly on oil and gas. Contrast this to universities across Canada who annually suck close to $12 billion out of governments. As a sad side note, over the years governments in Canada have contributed about $11 billion to groups fighting to destroy oil and gas. Talk about biting the hand that feeds you! We need oil and gas to survive in this climate, let alone generate revenue for paying taxes. Governments should stop funding groups trying to shut down our fossil fuel energy industry.
Governments should stop funding groups trying to shut down our fossil fuel energy industry.
About 30% of Alberta’s $338 billion GDP is based directly and indirectly on oil and gas. Contrast this to universities across Canada who annually suck close to $12 billion out of governments. As a sad side note, over the years governments in Canada have contributed about $11 billion to groups fighting to destroy oil and gas. Talk about biting the hand that feeds you! We need oil and gas to survive in this climate, let alone generate revenue for paying taxes. Governments should stop funding groups trying to shut down our fossil fuel energy industry.
The principal authors of this letter are from the University of Alberta. What a way for the University staffers to thank the oil and gas industry for its support of academic and research programs at the University. U of A is home to the Institute for Oil Sands Innovation (IOSI), a multi-million-dollar institute, doing oil sands research. Several oil and gas related Research Chairs, with industry support from companies like Cenovus, Suncor, CNRL, PetroCanada, to name a few, are located in the Faculty of Engineering.
The principal concern of the complaining academics authoring this letter seems to be much-needed aid to the oil and gas sector. Government assistance to business takes many forms - grants, tax breaks, subsidies, loans, loan guarantees and forgivable loans. Between 1981 and 2009 all levels of government provided almost $684 billion in financial assistance to industry. Industry recipients included agriculture, aerospace, electronics, manufacturing and many others. In some cases, recipients were profitable and had substantial cash on hand.
The academics’ argument seems to be that instead of subsidizing oil and gas, government aid should go to such causes as renewables, public transportation, regenerative agriculture, and more to stop global warming. However, this warming may be coming to an end as our sun enters a lower energy level, a Grand Solar Minimum, for the next 35 years or so. They are also advocating more centralized planning for all sectors of the economy. We have seen how this has played out in recent years with the plethora of regulations and hoops to jump through to get a new energy project, or any project, underway. Years and years of hearings, massive costs for the proponents, and billions of dollars leaving to countries that actually allow development to go ahead. Best to cut the red tape and allow free enterprise to take risks and develop new projects. Centrally planned economies usually fail spectacularly!
Another reality is that global emissions are set to raise. By 2050 increased use of fossil fuels is expected to increase emissions by 43%, principally in China, Southeast Asia, India, the Middle East and Africa (non-OECD countries) as these economies grow and eliminate poverty. Alberta has the third largest fossil fuel reserves on the planet and can be a responsible and ethical major supplier for this energy demand.
Generally, wind and solar, which are heavily subsidized, are unreliable and don’t produce a consistent baseload. Ontario is a perfect case study of the negative effects of transitioning to wind and solar. Utility costs increased massively due to feed in tariffs and preferential contracts - consumers had to pay $9.2 billion more over 20 years for green power, and suffered energy poverty.
By 2016 Ontario had some of the highest electricity rates in North America.
In addition, Ontario had to pay $3.1 billion more than the revenue it received for exported power - power that had to be dumped because it was being generated in excess of Ontario’s immediate demands. By 2016 Ontario had some of the highest electricity rates in North America. World wide the experience with wind and solar renewables is that they increase the cost of electricity up to 3.4 times the cost of conventionally produced power. Increasing utility costs cause businesses of all types to move to lower cost locations.
Life on earth is carbon based, and CO2 is essential to that life continuing to thrive on this planet. It is very amusing to watch highly educated academics vilify CO2 and advocate that we eliminate it from the atmosphere to prevent “global warming”. There is no proof that increasing atmospheric CO2 levels cause anything other than improved plant growth. Plants take CO2 from the atmosphere, combine it with minerals from the soil and sunshine, to produce plant tissues. These plant tissues are known as food, and all animal life on this planet (humans included) is dependent on plants for food. Prior to the beginning of the industrial age (in 1750) CO2 was constant at 273 parts per million in the atmosphere, a starvation level diet for plants. Today the CO2 level is 415 ppm and raising - resulting in an increase in our food crop yields.
Canada is a heavily taxed economy awash in debt (government, personal, business) that currently sits at about 320% of GDP. The current COVID-19 crises will have a major impact on our economy by increasing debt, putting many enterprises out of business, increasing unemployment and scaring away investment. The crises, while slowing down the economy, will cut government tax revenue resulting in severe austerity across all levels of government. From a business point of view, it makes a lot of sense to support a proven, reliable, economical, responsible and ethical source of energy. We should not chase the nightmare of expensive, unreliable, heavily subsidized solar and wind.
In short, academics without a grasp of basic economics, or science, and food production, are advocating the shut down of an economical, reliable source of energy for renewable energy that has proven to be uneconomical and unreliable. Further, they want massive government funding for a green transition and generous social programs. This is not realistic. It will drag Canada’s economy to third world level poverty and stagnation. Meanwhile, non-OECD economies that choose to use fossil fuels will grow and prosper.
