What a difference a week makes! I was all set to jet off to Scandinavia this evening for the 2020 edition of the Nordic Wood Biorefinery Conference. (An excellent conference, by the way, and you should consider attending; it's been postponed to October 13-16).
I won't bother reciting facts about the coronavirus pandemic, as anything I write today will be obsolete tomorrow. But here are some random thoughts about this emergency.
First, it shows that the system of global interactions we've learned to call globalisation has some unintended consequences arising from a severe lack of resilience when faced with a jolt. The system may exhibit resilience in the face of some types of jolt, but a global pandemic is clearly not one of them.
In mechanical engineering and in design of control systems, Lagrangian dynamics define the equilibrium of a system. Imagine a marble in the bottom of a salad bowl; if you poke the marble, it will roll up the bowl a certain distance, then roll back, perhaps oscillating for a while before eventually returning to its original position. This is called stable equilibrium. Turn the salad bowl upside down and balance the marble on it (if you can...); poke the marble and it runs away, never to come back. The marble balanced on the inverted bowl may be in equilibrium, but it is unstable. The equations describing this include a term whose sign indicates the curvature of the response surface: positive means upwards (stable), negative downwards (unstable). The magnitude of the coefficient indicates how shallow or steep the curvature is. We're currently witnessing a pretty big negative coefficient. The trick is predicting the size and sign of the coefficient for extremely large, complex linked systems that are subject to seemingly irrational human actions, such as panic buying of toilet paper; I don't believe we will ever be able to do so, but the model provides a framework for thinking about resilience and stability of global systems. (For more on the topic of Lagrangian dynamics, see, for instance, here. Wikipedia also has a background article on the topic.)
Second, it shows just how much of the world economy is based on businesses that rely on spending at the discretionary end of the spectrum. This includes flights, cruises, hotels, restaurants and bars, movie theatres and concert halls, public sporting events, etc. The list is long, and covers industries that collectively provide a livelihood to an enormous percentage of humanity in the developed world.
Finally the question arises as to how quickly things will get back to "normal", if ever. There were similar questions following 9/11; history shows the stock market bottomed out about 18 months later before roaring back. And SARS was beaten back pretty quickly in 2003, when contact with China was much less common.
But this time may be different. Will business move back to expensive downtown real estate, with rows of employees in cubicles, or will the new video-conference, work-from-home approach become the new norm? Certainly the necessary systems are far more supportive of this than in 2001.Will the tourists return to Venice or the cruise ship industry? If not, what would they do instead, assuming similar levels of disposable income?
Coming back to the Lagrangian view of the world: system dynamics describe the system's response to local curvature of the surface of the universe. Through globalisation, we have moved from a local minimum (inherently stable, salad bowl facing up) to a local maximum (inherently unstable, salad bowl facing down). We've now been displaced from that local maximum by a jolt, and are hurtling downhill at a tremendous rate. But here is a critical question: are we headed back to the same local minimum? The universe can be considered a wavy surface with many peaks and valleys, and we may be headed to a completely new valley, or canyon, or something, of unknown depth and shape, where new conditions of stable equilibrium will exist. Given the gathering momentum, we may even crest other smaller peaks or ridges of instability before settling somewhere new.
So where will we all be in this new equilibrium state? Where will hotel employees or airline pilots earn a living? What will be the impact of the coming social upheaval? What will be the impact on the world's other major issue, namely climate change?
I won't stick my neck out making predictions. We are in uncharted territory. But I am reminded of the (likely apocryphal) Chinese curse: "May you live in interesting times."
Wednesday, March 18, 2020
Sunday, July 7, 2019
Bans on single use products: What do they mean for bioproducts?
For the last 15 years of my career, and in the almost three years since I retired, I've been working on putting wood-based chemicals into places where the incumbent is petroleum-based. The argument was that replacing petroleum is inherently a Good Thing; and that petroleum refineries get their steam from burning carbon-intensive, petroleum-based residuals, while pulp and paper mills largely get theirs from carbon-neutral, wood-based residuals. (No, we never did a proper LCA to quantify this.)
One little snag I'd run into now and then, when discussing this with non-technical folks, is that a lot of people do not understand the difference between bio-based, recyclable and biodegradable (or compostable).
There is a technically easy path from sugar cane to ethanol, and another equally simple path from ethanol to ethylene. The Brazilian company Braskem offers a bio-based polyethylene from sugar cane; it's expensive and I gather that they make it on demand for people such as cosmetics manufacturers, where the advertising benefit of a bio-based packaging makes a difference and the added cost of a few pennies is not an issue. But no matter if it is bio-based: it's still ethylene. I can think of other examples. I'm no longer so sure this is a Good Thing.
Next is recyclability. This has suddenly become an issue as Asian countries, sick of getting mixed, contaminated waste instead of a nice clean single-product stream, have decided to stop taking feedstocks for their recycling plants from the West. (The fact that they mostly have a large enough internal market to generate the necessary residual streams is not entirely coincidental). But there were problems before this. Some years ago I recall hearing a producer of an accepted bio-plastic complaining that there was no recycling stream for his product, which, when mixed with ethylene (for example), was seen as a contaminant and thus reduced the value of the supposed recovered ethylene stream. So large customers were refusing packaging made with his material, limiting his potential for growth.
Finally biodegradeability is not always desirable. I don't want my coffee cup to start degrading before I am finished drinking the coffee; and while this example is a bit silly, there are plenty of cases where neither the petroleum-based product, nor its bio-based substitute, are biodegradeable, and for good reason: we need some products to last longer. Mother Nature has made lignin, for example, to be difficult to bio-degrade, as an evolutionary reaction to attacks from insects and fungi; this property makes it a good substitute for plywood glues.
So the conversation with the lay public has been challenging, and people have occasionally asked hard questions when I describe what I have been doing. The conversation is arguably about to get a whole lot more challenging.
This is because of the viral growth in the awareness of the problems around single-use plastics; the point I want to make is that it is only a matter of time before all single use products are seen as a waste of precious resources, regardless of the source.
Plastic drinking straws are to be replaced with paper, as are plastic shopping bags; but arguably the best carbon policy around forest harvesting is to lock that carbon up in long-term applications, such as tall buildings or furniture, and quickly plant some more trees. Simply putting more carbon into the loop, even if we are still replanting to compensate, only maintains the status quo, and does nothing to reduce the amount of carbon in the atmosphere. The same holds true for the mother of all single-use products, namely fuels.
So it may be misguided going forward to assume that a bio-based substitute for a petroleum-based product is still a Good Thing, especially if that petroleum-based product is being phased out because it is going into a single-use product. We are generating way too many leftover single-use products, and shifting from one resource to another may be a short-term solution but does nothing in the long term.
My message is that it may be time to focus on locking up carbon, no matter where it came from, in products that will be in use for months if not years or even decades. Products like my old row house (pictured, in the middle of renovations a couple of years ago) that will be 100 years old next spring. There's a lot of sequestered carbon here, some new and some old.
Just my $0.02 worth. Drop me a line to discuss, specifying if you want the conversation private. You can also sign up to receive notification of updates to this newsletter by putting your e-mail address (which I don't see, so I can't sell it) in the box at right.
One little snag I'd run into now and then, when discussing this with non-technical folks, is that a lot of people do not understand the difference between bio-based, recyclable and biodegradable (or compostable).
There is a technically easy path from sugar cane to ethanol, and another equally simple path from ethanol to ethylene. The Brazilian company Braskem offers a bio-based polyethylene from sugar cane; it's expensive and I gather that they make it on demand for people such as cosmetics manufacturers, where the advertising benefit of a bio-based packaging makes a difference and the added cost of a few pennies is not an issue. But no matter if it is bio-based: it's still ethylene. I can think of other examples. I'm no longer so sure this is a Good Thing.
Next is recyclability. This has suddenly become an issue as Asian countries, sick of getting mixed, contaminated waste instead of a nice clean single-product stream, have decided to stop taking feedstocks for their recycling plants from the West. (The fact that they mostly have a large enough internal market to generate the necessary residual streams is not entirely coincidental). But there were problems before this. Some years ago I recall hearing a producer of an accepted bio-plastic complaining that there was no recycling stream for his product, which, when mixed with ethylene (for example), was seen as a contaminant and thus reduced the value of the supposed recovered ethylene stream. So large customers were refusing packaging made with his material, limiting his potential for growth.
Finally biodegradeability is not always desirable. I don't want my coffee cup to start degrading before I am finished drinking the coffee; and while this example is a bit silly, there are plenty of cases where neither the petroleum-based product, nor its bio-based substitute, are biodegradeable, and for good reason: we need some products to last longer. Mother Nature has made lignin, for example, to be difficult to bio-degrade, as an evolutionary reaction to attacks from insects and fungi; this property makes it a good substitute for plywood glues.
So the conversation with the lay public has been challenging, and people have occasionally asked hard questions when I describe what I have been doing. The conversation is arguably about to get a whole lot more challenging.
This is because of the viral growth in the awareness of the problems around single-use plastics; the point I want to make is that it is only a matter of time before all single use products are seen as a waste of precious resources, regardless of the source.
Plastic drinking straws are to be replaced with paper, as are plastic shopping bags; but arguably the best carbon policy around forest harvesting is to lock that carbon up in long-term applications, such as tall buildings or furniture, and quickly plant some more trees. Simply putting more carbon into the loop, even if we are still replanting to compensate, only maintains the status quo, and does nothing to reduce the amount of carbon in the atmosphere. The same holds true for the mother of all single-use products, namely fuels.
So it may be misguided going forward to assume that a bio-based substitute for a petroleum-based product is still a Good Thing, especially if that petroleum-based product is being phased out because it is going into a single-use product. We are generating way too many leftover single-use products, and shifting from one resource to another may be a short-term solution but does nothing in the long term.
My message is that it may be time to focus on locking up carbon, no matter where it came from, in products that will be in use for months if not years or even decades. Products like my old row house (pictured, in the middle of renovations a couple of years ago) that will be 100 years old next spring. There's a lot of sequestered carbon here, some new and some old.
Just my $0.02 worth. Drop me a line to discuss, specifying if you want the conversation private. You can also sign up to receive notification of updates to this newsletter by putting your e-mail address (which I don't see, so I can't sell it) in the box at right.
Thursday, June 20, 2019
2nd International Forest Biorefinery Conference
The second edition of this conference, hosted by Lakehead University and sponsored by CRIBE, was held in Thunder Bay June 10-12, 2019.
I hadn't been back to Thunder Bay since the last conference, in March 2017. The big news in Thunder Bay, at least in the biorefinery field, is the recent announcement of the new TMP-Bio pilot plant by FPInnovations and the Resolute Forest Products mill (click here and here). As described by Zhirun Yuan of FPInnovations, this was made possible through large investments by governments at all three levels as well as the two industrial partners. I am particularly excited about this because the patent for this process has my name on it, and because I started the process of building this pilot when I was still research manager. As with everything, it took much longer than expected, but better late than never. Briefly, the process uses a combination of chemistry and mechanical action to reduce woody biomass to sugars and lignin, using simple and proven pulp and paper technologies; competition comes from other hydrolysis and steam explosion processes. Sadly no tour was possible, and while my name is on the patent, I am not privy to recent progress, so I can't spill anything confidential.
Beyond this, the conference (click here) included high-level overviews, detailed reports from a range of graduate students, and a day on business and marketing issues which included a session explicitly on the challenges around scale-up. Some highlights follow.
Matti Heikkila, Chief Technology Officer of Metgen, covered the EU approach to a circular economy. As always, staggering amounts of money are being spent in the field, hopefully leading to rapid progress. The key point for me, however, was that the cost of gene sequencing is currently decreasing by half every 4 months, a staggering rate of advance and one that implies we can expect very rapid development in this field. The forest biorefinery field desperately needs breakthroughs in enzyme applications for lignin and cellulose, and the rapidly decreasing cost of this technology should much allow smaller firms to move much more quickly in this direction. Metgen, as an enzyme producer, is developing interesting new strains, and this is worth tracking.
Ludo Diels of the Flemish research institute VITO provided an overview of some of the pathways under development in the EU, specifically in the area of lignin-based products. Driven by market pull from brand owners, processes for aromatic chemicals from lignin are being moved to pilot scale. It would be very nice if the Canadian forest sector had some market pull! Market push, as I discovered during my career as research manager, is a bit like pushing a rope, uphill, with rabid raccoons dragging the rope back downhill overnight.
Warren Mabee of Queen's University provided a typically thought-provoking, high-level view of carbon capture and storage. Termed carbon capture and reuse, it starts with locking carbon up in long term storage, not in the form of carbon dioxide injected into old oil wells, but in the form of wooden tall buildings. Subsequent steps, when the building needs to be replaced, involves recycling that carbon into progressively shorter-term uses until its end use as a fuel. The key aspect is sequential rather than parallel use of wood in applications of decreasing value, which keeps the carbon involved out of the atmosphere for a longer time. Policies are needed to encourage this long-term sequestration, by providing a benefit to carbon equity, similar to the equity that a home owner builds through mortgage payments. Rewards for designing a building for easy and rapid disassembly for recycling would be a key policy initiative. The issue, of course, is that this will take many years to become effective, but needs to be part of the toolbox to fight climate change in the long term.
In the same context, Ian de la Roche of UBC described ongoing development of tall buildings of wood. While progress is rapid, the number of such buildings world-wide is still small; building and fire codes are part of the challenge, as well as stiff competition from cement and steel producers.
As always a large contingent of graduate students and their supervisors provided updates on a range of processes and products, involving plenty of detailed chemistry. I'll pass on this, mainly because I am poorly placed to comment on chemistry; there is a lot of very high-quality work going on in university labs and the fact I am not providing detailed reviews should not be taken as a comment on quality.
Pedram Fatehi of Lakehead University provided the highlight in this area. This was a review of processes for grafting other molecules to lignin. The ideal pathway is an aromatic monomer from lignin, but this is technically and economically a long way off. While these processes are being developed, the ability to use lignin as it comes direct from the kraft mill will keep the lignin plants in Plymouth and Hinton running until new transformation processes are available and economically feasible.
Day 3, sponsored by CRIBE, focused on business issues and challenges in scaling up. David Mackett and David Flood, representing First Nation communities in Northern Ontario, told heartbreaking stories of repeated delays in getting community heat and power systems built. It should be obvious that the objective, of getting these communities off Diesel power, which benefits only the oil companies, and on to wood-based systems, which provide jobs and opportunities for residents, is critical, but politicians don't always see this. The issues facing First Nations were brought home by the presence in the conference hotel of the entire population of one such northern community, forced out of their homes by flooding. Hopefully progress will be made before the next conference, specifically on the stalled distributed heat and power systems as well as on the broader challenges facing First Nations in Canada.
Scale-up stories from Domtar, Iogen and several small start-up firms highlighted the pitfalls that await, even if you have a solid technology that is economically sensible. I was asked to talk about the pathway taken to get the LignoForce process from the FPInnovations laboratories in Pointe-Claire, Quebec, to commercial scale at the West Fraser mill in Hinton, Alberta; getting the technology to work, economically, was the easy part. The overall message is that it's challenging, and unexpected non-technical barriers will throw wrenches in even the best-laid plans.
Overall it was another good conference, documenting the extensive progress since the last one in 2017, but also the ongoing challenges still facing the industry. Hopefully progress, as measured by the number of commercial activities started up, will accelerate between now and the next one.
I hadn't been back to Thunder Bay since the last conference, in March 2017. The big news in Thunder Bay, at least in the biorefinery field, is the recent announcement of the new TMP-Bio pilot plant by FPInnovations and the Resolute Forest Products mill (click here and here). As described by Zhirun Yuan of FPInnovations, this was made possible through large investments by governments at all three levels as well as the two industrial partners. I am particularly excited about this because the patent for this process has my name on it, and because I started the process of building this pilot when I was still research manager. As with everything, it took much longer than expected, but better late than never. Briefly, the process uses a combination of chemistry and mechanical action to reduce woody biomass to sugars and lignin, using simple and proven pulp and paper technologies; competition comes from other hydrolysis and steam explosion processes. Sadly no tour was possible, and while my name is on the patent, I am not privy to recent progress, so I can't spill anything confidential.
Beyond this, the conference (click here) included high-level overviews, detailed reports from a range of graduate students, and a day on business and marketing issues which included a session explicitly on the challenges around scale-up. Some highlights follow.
Matti Heikkila, Chief Technology Officer of Metgen, covered the EU approach to a circular economy. As always, staggering amounts of money are being spent in the field, hopefully leading to rapid progress. The key point for me, however, was that the cost of gene sequencing is currently decreasing by half every 4 months, a staggering rate of advance and one that implies we can expect very rapid development in this field. The forest biorefinery field desperately needs breakthroughs in enzyme applications for lignin and cellulose, and the rapidly decreasing cost of this technology should much allow smaller firms to move much more quickly in this direction. Metgen, as an enzyme producer, is developing interesting new strains, and this is worth tracking.
Ludo Diels of the Flemish research institute VITO provided an overview of some of the pathways under development in the EU, specifically in the area of lignin-based products. Driven by market pull from brand owners, processes for aromatic chemicals from lignin are being moved to pilot scale. It would be very nice if the Canadian forest sector had some market pull! Market push, as I discovered during my career as research manager, is a bit like pushing a rope, uphill, with rabid raccoons dragging the rope back downhill overnight.
Warren Mabee of Queen's University provided a typically thought-provoking, high-level view of carbon capture and storage. Termed carbon capture and reuse, it starts with locking carbon up in long term storage, not in the form of carbon dioxide injected into old oil wells, but in the form of wooden tall buildings. Subsequent steps, when the building needs to be replaced, involves recycling that carbon into progressively shorter-term uses until its end use as a fuel. The key aspect is sequential rather than parallel use of wood in applications of decreasing value, which keeps the carbon involved out of the atmosphere for a longer time. Policies are needed to encourage this long-term sequestration, by providing a benefit to carbon equity, similar to the equity that a home owner builds through mortgage payments. Rewards for designing a building for easy and rapid disassembly for recycling would be a key policy initiative. The issue, of course, is that this will take many years to become effective, but needs to be part of the toolbox to fight climate change in the long term.
In the same context, Ian de la Roche of UBC described ongoing development of tall buildings of wood. While progress is rapid, the number of such buildings world-wide is still small; building and fire codes are part of the challenge, as well as stiff competition from cement and steel producers.
As always a large contingent of graduate students and their supervisors provided updates on a range of processes and products, involving plenty of detailed chemistry. I'll pass on this, mainly because I am poorly placed to comment on chemistry; there is a lot of very high-quality work going on in university labs and the fact I am not providing detailed reviews should not be taken as a comment on quality.
Pedram Fatehi of Lakehead University provided the highlight in this area. This was a review of processes for grafting other molecules to lignin. The ideal pathway is an aromatic monomer from lignin, but this is technically and economically a long way off. While these processes are being developed, the ability to use lignin as it comes direct from the kraft mill will keep the lignin plants in Plymouth and Hinton running until new transformation processes are available and economically feasible.
Day 3, sponsored by CRIBE, focused on business issues and challenges in scaling up. David Mackett and David Flood, representing First Nation communities in Northern Ontario, told heartbreaking stories of repeated delays in getting community heat and power systems built. It should be obvious that the objective, of getting these communities off Diesel power, which benefits only the oil companies, and on to wood-based systems, which provide jobs and opportunities for residents, is critical, but politicians don't always see this. The issues facing First Nations were brought home by the presence in the conference hotel of the entire population of one such northern community, forced out of their homes by flooding. Hopefully progress will be made before the next conference, specifically on the stalled distributed heat and power systems as well as on the broader challenges facing First Nations in Canada.
Scale-up stories from Domtar, Iogen and several small start-up firms highlighted the pitfalls that await, even if you have a solid technology that is economically sensible. I was asked to talk about the pathway taken to get the LignoForce process from the FPInnovations laboratories in Pointe-Claire, Quebec, to commercial scale at the West Fraser mill in Hinton, Alberta; getting the technology to work, economically, was the easy part. The overall message is that it's challenging, and unexpected non-technical barriers will throw wrenches in even the best-laid plans.
Overall it was another good conference, documenting the extensive progress since the last one in 2017, but also the ongoing challenges still facing the industry. Hopefully progress, as measured by the number of commercial activities started up, will accelerate between now and the next one.
Tuesday, May 14, 2019
Personal posts have been moved
I've decided to separate the bio-economy posts from personal ones (diary, travel) and so I have created a new blog at https://tcbrownemtl.blogspot.com/ to host more personal content. Come see me sometime; meanwhile I intend to increase the bio-economy focus here in the coming months.
As always I am looking forward to hearing your comments.
As always I am looking forward to hearing your comments.
Carbon taxes: EU price update
This follows on my last post on carbon taxes. In Portugal a month ago, 95 octane gasoline was selling for about €1.65 per litre, and Diesel (gasoleo) €1.45; it was a bit lower in Spain and Germany, higher in Belgium and Switzerland.
I grant you that regular gasoline in North America has a lower octane rating, but this still works out to $CDN 2.20 per litre ($US 6.20 per gallon) for gasoline. Yet these economies seem to work, and judging by traffic on highways between Brussels and Dortmund, the prices do not stop people driving at very high speeds when possible. The big difference: No Ford F150s, and very few big SUVs.
The picture shows a station in Portugal.
Friday, April 12, 2019
Carbon taxes: do they provide the right price signal to consumers?
My last post elicited some interesting comments, and I thought it useful to bring up one more comment from Tasha Kheiridden, to the effect that taxes don't work. She pointed to the example of cigarettes, where shame and health concerns played a bigger role, in her view, than taxes alone. But cigarettes are addictive, with only two choices: give up, or keep smoking. There is no middle ground.
Gas prices in the Montreal area are about $1.35 today; and (as almost always) $0.10 cheaper in Ottawa in spite of the new $0.04 carbon tax. But historically, I can recall gas prices at the pumps as high as $1.55 per litre at the beginning of the decade when oil prices ran in the $80 to $100 per barrel range. Sales of full-sized pickup trucks and SUVs plummeted as people switched to more efficient vehicles. the reverse happened in 2014, when the Saudis opened the oil taps in an effort to put the US shale oil people out of business, which is why the Ford F150 outsells the Honda Civic 2 to 1 in Canada today.
In Finland, which is a large sparsely populated country like Canada and where distances are large, gas prices are consistently well above $2.00 per litre. Yet the economy is doing fine and people drive long distances to their cottages. The thing is, there are essentially no full-sized pickup trucks in Finland. Finns select their cars partly with gas prices in mind. The choice is not between quitting or carrying on as before; there are options the consumer can select.
So in the case of gas prices, it seems to me that the consumer will respond to a price signal, however it comes about, as demonstrated by the choices made by Canadian and Finnish consumers when they buy a new car.
Keep the comments coming!
Gas prices in the Montreal area are about $1.35 today; and (as almost always) $0.10 cheaper in Ottawa in spite of the new $0.04 carbon tax. But historically, I can recall gas prices at the pumps as high as $1.55 per litre at the beginning of the decade when oil prices ran in the $80 to $100 per barrel range. Sales of full-sized pickup trucks and SUVs plummeted as people switched to more efficient vehicles. the reverse happened in 2014, when the Saudis opened the oil taps in an effort to put the US shale oil people out of business, which is why the Ford F150 outsells the Honda Civic 2 to 1 in Canada today.
In Finland, which is a large sparsely populated country like Canada and where distances are large, gas prices are consistently well above $2.00 per litre. Yet the economy is doing fine and people drive long distances to their cottages. The thing is, there are essentially no full-sized pickup trucks in Finland. Finns select their cars partly with gas prices in mind. The choice is not between quitting or carrying on as before; there are options the consumer can select.
So in the case of gas prices, it seems to me that the consumer will respond to a price signal, however it comes about, as demonstrated by the choices made by Canadian and Finnish consumers when they buy a new car.
Keep the comments coming!
Thursday, April 11, 2019
Does it make sense to impose carbon taxes while buying pipelines?
The Max Bell School of Public Policy, a new school hosted by McGill University in Montreal, has now run two, free, public debates. The first one, held in February 2019, had as its topic "Does Rising Populism Threaten Good Public Policy?", and featured an excellent cross-section of panelists. (They didn't actually answer the question, although there was plenty about Trump.)
The second one, held last night and live-streamed on the school's website, brought an interesting if somewhat imbalanced set of panelists to debate whether the Canadian government's imposition of a carbon tax, while spending $4.5 billion on a pipeline to take Alberta bitumen to tidewater in Vancouver, makes sense.
The conclusion, I am afraid, is no.
The most forceful speaker, the one most at ease clearly getting her point across, and the one with the best grasp of facts, was by far Tzeporah Berman. I'll skip her CV, but you should look her up if you don't know her: she can be considered a radical, having helped organise the Clayoquot Sound protests in the early '90s; but she also served as co-chair of the Oil Sands Advisory Working Group, where she tried to dialog with oil company executives in an effort to understand their positions and develop common ground in the fight against climate change. This makes her, in my view, one of those environmentalists with whom it is actually possible to have a rational conversation, unlike the BANANA folks (Build Absolutely Nothing Anywhere Near Anything). Her view was that we have, maybe, ten years to get emissions under control in order to stay below 2 degrees; that there is enough coal, oil and gas in existing resources for a 4 degree world even if we do not expand production or drill new wells; and that building pipelines, which will lead to oil sands expansion, is at best a bad decision and will at worst be catastrophic.
The second panelist, Trevor Tombe, a professor of economics at University of Calgary, made the point that, from a purely economic standpoint, solutions which cost the least per tonne of CO2 avoided or sequestered would be preferable. While I accept Berman's point that economics can't address the full climate change costs of delaying any further, or the intangible non-climate costs such as leaking tailing ponds in the oil sands, I think there is an element of truth here. The third panelist, the commentator Tasha Kheiridden, came from the conservative side of the aisle and kept going on about market-driven technological solutions such as carbon capture and storage (CCS) or hydrogen vehicles; sadly Tombe didn't pull the cost per tonne for these approaches out of his hat, which I would assume is huge; further the long timeframes required to build and commercialise these systems conflicts with Berman's point about timeliness.
That being said, Tombe outlined a scenario where existing pipelines continue to run but are not expanded, and no new ones are built. The cost to the Canadian economy, in his calculation (which I won't try to repeat as he went over it pretty quickly), was estimated to be $1500 per tonne of CO2 avoided, a large number, and for a saving of 450,000 bbl/d at (by this estimate) 433 kg CO2 emitted per barrel burned = 71 million tonnes of CO2 per year. Now this is a reduction of roughly 10% of Canada's total emissions, obtained by the simple expedient of not building any new pipelines; but his point was that we should build the expanded pipelines, take the cash and use that $1500 to save two or four or ten tonnes of cheaper CO2 elsewhere; a value of $200/t has been floated by a number of pundits as more than sufficient for a 2 degree world. This is a somewhat warped argument in my view, and arguably it would be better to leave that oil in the ground, especially since (hopefully) we won't be needing that oil past 2030, making the long-term economic viability of new pipelines somewhat suspect from a banker's point of view.
Actually these new pipelines are, in fact, somewhat suspect from a banker's point of view, which is why the Canadian government had to step in and buy one, with several billion taxpayer dollars, to ensure it gets built. But arguably this is a declining industry: Berman made the point that Norway will stop drilling in its coastal waters, and will not invest any of its sovereign fund in new drilling; several world-scale banks have decided to not fund any more drilling or expansion; employment is declining as efficiencies reduce the need for manpower. Perhaps the industry should be allowed to quietly fade away...
And the $200/t number, while larger than the $20/t recently imposed in Ontario to much opposition caterwauling, still only adds $0.40 to a litre at the pumps; even at this rate, gas prices would still be lower than in most of Europe. I paid €1.45 a litre for diesel in Finland last fall; gasoline was running €1.60 to €1.65. The exchange rate is about $1.50 per euro, so these prices are all well over $2.00 per litre, or $USD 5.70 per gallon for my American cousins. And somehow they seem to have healthy economies over there, just not a lot of Ford F150s. (Granted it would be a shock to go to $0.40 per litre overnight, but phased in over a small number of years would be possible).
Kheiridden, in my view, crashed and burned fairly spectacularly, not once but repeatedly, with rambling references to the Gods of unfettered markets, small government and technological prowess. I have not been paying attention to the conservative movements out there, but if this is consistent with the level of discourse coming from the right on this topic, they have a problem. She did however admit that the conservative movement, historically, would have been a strong proponent of conserving the environment, and unloaded on the Canadian conservatives and their leader, Andrew Scheer, for not having an environmental platform of any kind.
The second one, held last night and live-streamed on the school's website, brought an interesting if somewhat imbalanced set of panelists to debate whether the Canadian government's imposition of a carbon tax, while spending $4.5 billion on a pipeline to take Alberta bitumen to tidewater in Vancouver, makes sense.
The conclusion, I am afraid, is no.
The most forceful speaker, the one most at ease clearly getting her point across, and the one with the best grasp of facts, was by far Tzeporah Berman. I'll skip her CV, but you should look her up if you don't know her: she can be considered a radical, having helped organise the Clayoquot Sound protests in the early '90s; but she also served as co-chair of the Oil Sands Advisory Working Group, where she tried to dialog with oil company executives in an effort to understand their positions and develop common ground in the fight against climate change. This makes her, in my view, one of those environmentalists with whom it is actually possible to have a rational conversation, unlike the BANANA folks (Build Absolutely Nothing Anywhere Near Anything). Her view was that we have, maybe, ten years to get emissions under control in order to stay below 2 degrees; that there is enough coal, oil and gas in existing resources for a 4 degree world even if we do not expand production or drill new wells; and that building pipelines, which will lead to oil sands expansion, is at best a bad decision and will at worst be catastrophic.
The second panelist, Trevor Tombe, a professor of economics at University of Calgary, made the point that, from a purely economic standpoint, solutions which cost the least per tonne of CO2 avoided or sequestered would be preferable. While I accept Berman's point that economics can't address the full climate change costs of delaying any further, or the intangible non-climate costs such as leaking tailing ponds in the oil sands, I think there is an element of truth here. The third panelist, the commentator Tasha Kheiridden, came from the conservative side of the aisle and kept going on about market-driven technological solutions such as carbon capture and storage (CCS) or hydrogen vehicles; sadly Tombe didn't pull the cost per tonne for these approaches out of his hat, which I would assume is huge; further the long timeframes required to build and commercialise these systems conflicts with Berman's point about timeliness.
That being said, Tombe outlined a scenario where existing pipelines continue to run but are not expanded, and no new ones are built. The cost to the Canadian economy, in his calculation (which I won't try to repeat as he went over it pretty quickly), was estimated to be $1500 per tonne of CO2 avoided, a large number, and for a saving of 450,000 bbl/d at (by this estimate) 433 kg CO2 emitted per barrel burned = 71 million tonnes of CO2 per year. Now this is a reduction of roughly 10% of Canada's total emissions, obtained by the simple expedient of not building any new pipelines; but his point was that we should build the expanded pipelines, take the cash and use that $1500 to save two or four or ten tonnes of cheaper CO2 elsewhere; a value of $200/t has been floated by a number of pundits as more than sufficient for a 2 degree world. This is a somewhat warped argument in my view, and arguably it would be better to leave that oil in the ground, especially since (hopefully) we won't be needing that oil past 2030, making the long-term economic viability of new pipelines somewhat suspect from a banker's point of view.
Actually these new pipelines are, in fact, somewhat suspect from a banker's point of view, which is why the Canadian government had to step in and buy one, with several billion taxpayer dollars, to ensure it gets built. But arguably this is a declining industry: Berman made the point that Norway will stop drilling in its coastal waters, and will not invest any of its sovereign fund in new drilling; several world-scale banks have decided to not fund any more drilling or expansion; employment is declining as efficiencies reduce the need for manpower. Perhaps the industry should be allowed to quietly fade away...
And the $200/t number, while larger than the $20/t recently imposed in Ontario to much opposition caterwauling, still only adds $0.40 to a litre at the pumps; even at this rate, gas prices would still be lower than in most of Europe. I paid €1.45 a litre for diesel in Finland last fall; gasoline was running €1.60 to €1.65. The exchange rate is about $1.50 per euro, so these prices are all well over $2.00 per litre, or $USD 5.70 per gallon for my American cousins. And somehow they seem to have healthy economies over there, just not a lot of Ford F150s. (Granted it would be a shock to go to $0.40 per litre overnight, but phased in over a small number of years would be possible).
Kheiridden, in my view, crashed and burned fairly spectacularly, not once but repeatedly, with rambling references to the Gods of unfettered markets, small government and technological prowess. I have not been paying attention to the conservative movements out there, but if this is consistent with the level of discourse coming from the right on this topic, they have a problem. She did however admit that the conservative movement, historically, would have been a strong proponent of conserving the environment, and unloaded on the Canadian conservatives and their leader, Andrew Scheer, for not having an environmental platform of any kind.
Where she did manage to put Berman on the defensive, briefly, was the charge that the environmentalists want to "shut down the oil sands", leading to huge losses of jobs and incomes; Berman's view, which she struggled to make, was that it is a declining industry and should be allowed its market-driven decline, with support and retraining for those put out of work taken out of the subsidies the industry currently receives: while some may want to shut it down tomorrow, Berman seems realistic enough to realise that the economic and social fallout needs to be addressed. And in any case it seems there are already more employees making beer than bitumen in Canada, which if true would be an interesting factoid.
A very interesting evening and I highly recommend watching the website for future debates, which will hopefully continue to be both free and live-streamed.
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