Clean Canadian Energy: Missing the Opportunity of a Generation

Throughout our history, generation after generation of Canadians have faced up to the tremendous challenges of their times. From the construction of the Canadian Pacific Railway to the introduction of Medicare, we have not been afraid to take the big steps necessary to achieve our policy goals. As we drift into the 21st century, however, Canada has remained at a relative standstill in the face of what will surely be the defining issue of our generation: global climate change. In our neglect to take any serious action on climate change, we are not only setting ourselves down a potentially catastrophic path, but are missing an enormous opportunity to transform the foundation of our economy to meet this century’s needs. Canada can become a renewable energy powerhouse with the right investments and political will, but it remains to be seen if we will seize this opportunity.

As it stands right now, we’re falling behind. Countries around the globe are taking big steps toward transforming their energy systems, creating thousands of jobs and transitioning to a modern, low-carbon economy. In the past six years, world-wide clean energy investment has grown by 230 percent, with $162 billion invested in renewables in 2009 alone. $34.6 billion of that total came from China, which last month announced even further acceleration of renewable energy development. Recent reports show that per capita investment in renewable energy, energy efficiency, and public transit in the United States will surpass Canadian federal investment by a ratio of 8:1 this year. Similar investment trends are seen across the EU. Global investment in renewable energy technology is crucial for fighting climate change and protecting our ecosystems, and Canada’s relative absence is troubling.

Canada has enormous potential for renewable energy given our plentiful natural capital and capacity for technological innovation, but we have largely ignored these opportunities. Green job creation, technology, and renewable energy exports can all be significant drivers of Canadian prosperity in the future. Our companies can become global leaders in innovation and production given our rich testing ground for wind, solar, hydro, and geothermal; without investment and support from our governments, however, the push for innovative technologies will come from elsewhere.

In the absence of substantive federal leadership on climate change and clean energy, some Canadian provinces have taken it upon themselves to act. Ontario, Quebec, British Columbia, and Manitoba (among others) have been taking leadership roles on climate and energy issues by entering into the Western Climate Initiative, closing dirty power plants, and investing in renewables. For others, however, the geographic concentration of fossil fuels has led to much prosperity, and from that, political and institutional resistance to low-carbon alternatives and sustainability. This sentiment finds its boldest expression in Alberta, where the oil sands have become a central part of the economy. Going forward, tensions between emissions-reducing and emissions-increasing provinces are likely to mount.

The biggest problem is lack of federal leadership and coordination on environmental issues. Without a national strategy to combat climate change, provinces like Alberta will be unlikely to shift their priorities. Alberta, in fact, has significant potential in wind and hydro power to meet future energy needs and create new sources of prosperity. A national strategy would support further renewable energy development in Alberta and other provinces, while outlining a credible plan for meeting national emissions targets. An economy-wide carbon tax or “premium,” for example, which returns revenues to the province of origin might indeed be the way to go.

Canada must develop a comprehensive and ambitious energy policy to meet the environmental needs of the 21st century and ensure our long-term prosperity. The challenges that we face this century will be immense; our well-being in the future will be intimately tied to our ability to transform Canadian energy systems to be environmentally and economically sustainable. Canada has unique and unrivalled potential in this regard, and it affords us enormous opportunities. It’s time for government to take big steps on energy and climate change like we did on cross-country rail, health care, and many others in the past – an opportunity we cannot afford to miss.

– By Phil Donelson

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