John Maynard Keynes advised us to “study the present in light of the past for the purposes of the future.” During my time at the OECD, I frequently invoked that wisdom and encouraged others to do the same. The result? By and large, looking at various economies and challenges across the globe, the future looked optimistic. There was one notable exception: global warming, along with its partner, climate change.
The recent UN conference in Bali has not changed that dismal outlook for the future of the planet. Political leaders have agreed to open negotiations with a view to establishing deep cuts in emissions of greenhouse gases, in particular CO2. There are no targets, but does it matter? Even if there were, they would not be achieved by declarations of intent. And it is discouraging — indeed, unacceptable — that carbon capture and sequestration (CCS) is unlikely to be part of the followup to the Kyoto Protocol, according to UN officials.
As I write this commentary, the Canada-Alberta Task Force on Carbon Capture and Storage has just released its long-awaited report, entitled Canada’s Fossil Energy Future. In it, the joint federal-provincial panel recommended a public investment of $2 billion to move the concept of CCS forward in concrete ways. I am heartened by this recommendation — because carbon capture and sequestration is essential if we are going to slow down global warming and avoid the catastrophic consequences predicted by much of the world’s scientific community.
Is it not time to follow Keynes’s advice so as not to be lulled into a false sense of security about the future, as the world was immediately post-Kyoto 10 years ago? What lessons have we learned from the Kyoto experience?
Look at the record, the past. We are now 15 years beyond the 1992 UN Rio Earth Summit, which told the world that GHG emissions were a serious challenge for the sustainable development of planet earth. Then we moved through difficult negotiations to the Kyoto Protocol of 1997, which required developed countries to reduce GHG emissions below levels specified for each of them — approximately 5% below 1990 levels for developed economies by 2012.
Now look at Canada. According to UN statistics, in 2005 Canada’s CO2 emissions had increased by 54.2% above 1990 levels as against the target of a 5% reduction. (This represents a combination of emissions and deforestation.) So much for targets and commitments.
What does this tell us? Are we doomed to failure in the future as we have been in the past? Targets are of little importance if our leaders happily sign on to them just to be seen as politically correct, knowing they will not be achieved.
The Canadian government has set an ambitious target of reducing 2006 emissions levels by 60%, with a 2050 timetable. Recognizing that emissions are probably increasing substantially each year and have yet to peak, this target will demand herculean efforts and still not bring us to the levels the scientific consensus recommends — namely, a 50% to 80% reduction below 1990.
During a discussion on the environment in the early 1980s, when I was a cabinet minister, Pierre Trudeau asked: “Does the future have a constituency?” I replied that I hoped so, but I have since become reconciled to the reality that it does not when faced with other political imperatives — namely economic growth and job creation. Few well-intentioned non-governmental organizations that promote environmental protection concern themselves with the social and economic trade-offs politicians must deal with. I have sympathy for the challenge the government faces. But there is a way forward.
These objectives need not be in conflict. They should be aligned to illustrate how a reduction in CO2 emissions, through CCS or other technologies, can in fact contribute to growth and job creation.
We were not successful in eliminating the apparent conflict post-Kyoto. Could it be different post-Bali? I believe so, but first the public in all countries must recognize there is no magic bullet in renewable energies, conservation and efficiency, or, in the near term, even nuclear. They each have their place, but the “inconvenient truth” is that the global electrical base load looking out to about 2050 will be met primarily by burning fossil fuels — natural gas, oil and coal, which generate massive amounts of CO2 emissions.
Because CO2, unlike other GHGs, remains in the atmosphere for up to 100 years, simply stabilizing emissions does not solve the problem. (GHGs like SO2 have short atmospheric lifespans.) To explain the dilemma with which we are faced, some scientists use the analogy of a bathtub with a very large faucet and a much smaller drain. In short, the faucet inflow has to be adjusted to the drainage outflow. That is why Bali called for deep reductions in CO2 emissions — and that means by at least 50% below 1990 levels by 2050. Some scientists believe the reductions must be as much as 80%.
This is a staggering challenge if CO2 in the atmosphere is not to exceed 450 parts per million. A large body of scientific expertise argues CO2 concentrations above that could see a rise in global temperature beyond 2°C. Above that threshold, the argument goes, we would witness dramatic, irreversible effects on the biosphere.
While there is a consensus in the scientific community supporting these views and the conclusions of the Intergovernmental Panel on Climate Change (IPCC), there are dissenters, such as Bjørn Lomborg, the Danish author of The Skeptical Environmentalist. He is not alone. But whether Lomborg and those who support him are right or wrong, the broad-based scientific view of climatologists that we are on the fast track to catastrophe surely necessitates applying the “precautionary principle.” That means we must take the measures recommended to slow down global warming and climate change.
Given policy failures to date, global warming and climate change are probably inevitable.
I am not suggesting that we should not try to maximize emission reductions, but post-Bali negotiations over the next two years must set realistic objectives for developed and developing countries. We must at minimum seek to move climate change from the fast track it is on to a much slower one, in order to permit the world to adapt.
If we are to break the cycle of failures following Kyoto, global political leaders need a new script that breaks with the vapid declarations of intention to “tackle the challenge.” They need a script backed by action. There must be concrete solutions aligning political imperatives such as growth and jobs with environmental protection. This is not new territory. For years at the OECD and elsewhere, economists wrote of “decoupling” economic growth from environmental degradation. In other words, environmental health and economic growth were not only compatible, but more growth and jobs could flow from the right set of policies to protect and enhance the environment.
Moving from the theoretical to practical design and implementation of such policies is what must now happen. We need bold new approaches recognizing that fossil fuels will remain the dominant energy source for as long as 50 years. What should they be? There must be a combination of actions to control GHG emissions achieved primarily through carbon capture and sequestration (CCS), reforestation, energy conservation and efficiency, a focus on renewable energy, especially solar, plus a huge investment in nuclear fission technology and new plants with ultimately (perhaps) fusion in our future.
The recent report of the National Round Table on the Environment and the Economy suggests that a carbon tax is the way to go. The government at this point has rejected that approach. But the real issue is, what combination of “sticks and carrots” will introduce CCS in a significant way?
I am uncertain of the effect of carbon taxes, because they will be weighed against the cost of introducing CCS. If the latter is calculated to be higher for a particular industry, then the tax will be paid, pushing the increased costs onto consumers. International competition then comes into play, as do exchange rates, which might in some countries keep domestic producers competitive despite a carbon tax not imposed on the competition in other countries.
My political nose tells me that carrots represent the preferred route to the introduction of CCS. Accelerated depreciation and other tax measures might do the trick. They would be nondiscriminatory, available to all industries whether or not foreign-controlled. The Alberta-Canada task force’s recommendation, that federal and provincial governments invest $2 billion over the next seven years in CCS projects, is a step in the right direction.
In any case, how to get Canadian GHG emissions reduced as suggested is a tall order and each approach will be contested by numerous groups of NGOs and individuals. I learned from my experience at the OECD that there are devoted advocates of many different forms of renewable energy who would like to stop the burning of fossil fuels, eliminate nuclear and replace our energy needs with wind, solar photovoltaics, geothermal, conservation and perhaps other sources of renewable energy. But these laudable objectives are not realistic alternatives to meet the near- or even medium-term energy needs of our civilization.
In the long term, it may well be that renewable energy will play a dominant role. In particular, we are already beginning to see the emergence of technologies able to capture higher and higher percentages of solar energy. It could become competitive with conventional sources of electrical energy, but it will take much time and investment. There are many advocates for wind power — but again, think of its limitations (apart from the fact that the wind does not always blow). A Canadian study on wind energy in the early 2000s concluded that powering the City of Toronto would take about 40,000 one-megawatt wind generators — enough to cover an area three times the size of Prince Edward Island. In brief, there are no credible numbers suggesting renewable energy sources could meet the global base load demand out to 2050. That base load today is approximately 18,197 terawatt-hours, and will likely double by 2030.
Perhaps, prompted by creative communication strategies and strong international alliances, a majority of citizens will support realistic alternatives — namely, a combination of energy sources but, above all, measures to shut down CO2 emissions from the use of fossil fuels without unduly curbing their use. The latter is simply not an option for most countries.
Think of that challenge in terms of today’s world, where fossil fuels — principally coal, which is abundant in the fastest-growing regions (namely China and India) — generate about two-thirds of global electricity.
So when we speak of developing low-carbon economies in the near and medium term, it is futile to think there will be a meaningful reduction in the use of fossil fuels. We must focus on preventing emissions of CO2 from entering the atmosphere. This is possible through the widespread commercial deployment of CCS.
(Since transportation is a large source of CO2 emissions, a logical step would be to put all rail and road transport on electricity, with road transport batteries charged from stationary fossil-fuel-fired generating stations equipped with CCS capacity. Rail is easily accommodated, as France has proven for many years with the best high-speed train system in the world. In the United States, electricity generation accounts for 38% of CO2 emissions, but transportation contributes 32%.)
Had much of the world not abandoned nuclear energy for at least a generation, we might have broken fossil fuel dependency, as France has done. Hopefully, nuclear fission (perhaps fusion) or another non-carbon-emitting technology will provide the energy needs of the world later in this century. But it will be too late to stabilize CO2 concentrations at or below the 450 ppm level. Only carbon capture and sequestration can do that.
Do we have the time and resources to bring CCS to the forefront? To retrofit stationary sources of CO2 emissions with CCS technology? To ensure new plants emitting CO2 are so equipped? To establish regulatory standards for the application of the technology? To ensure public opinion is well informed of the importance of CCS and its beneficial impact?
Edward Rubin of Carnegie Mellon, an expert on CCS and a lead writer on the subject in the latest special report of the IPCC, advises that there are examples where “integration of CO2 capture, transport and geological sequestration has been demonstrated in several industrial applications, but not yet at an electric power plant.” In fact, EnCana is using the technology in a limited way in Weyburn, Sask., where CO2 is injected to enable secondary oil recovery. And injection technology is used in the United States, where enormous amounts of fluids of different kinds — municipal wastewater in Florida, for instance — are disposed of through subterranean injection.
While that is good news concerning the state of the technology, it will not be easily implemented. In a recent presentation at an International Risk Governance Council/Swiss Re conference on CCS, Rubin outlined a series of barriers to the deployment of CCS technology, including high costs, the absence of any large-scale coal-based power plants to demonstrate the technology, and the lack of any rigorous assessment of regional storage capacity in the U.S. What are the appropriate geological formations and where are they? Will there be the same debate as on the deposit of nuclear waste?
Apart from these technical, economic and environmental issues, Rubin cited institutional barriers: no current requirement in the U.S. or Canada for large CO2 reductions; no regulatory framework for large-scale sequestration; no adequate GHG accounting and inventory procedures; a host of legal issues, including liability and property rights. Finally, as in the case of nuclear, there must be widespread public acceptance.
In September 2007, a workshop in Banff dealt precisely with this issue. The conclusions were not heartening. There is a low level of public perception, and not necessarily any connection in the minds of many between CCS and climate change. Also, the public wants to know about the comparative costs between CCS and other carbon-reducing technologies. In late 2006, a European survey suggested that CCS was not considered necessary by the public in France, Germany, Italy and Spain.
What conclusions are to be drawn from the welter of conflicting views and speculation, some scientific, some not, with which we are beset?
First, despite some dissenting views, there is overwhelming support behind the IPCC findings that human activity is largely responsible for global warming because of increasing GHG emissions, notably CO2 from fossil fuels.
Second, fossil fuels will remain the major source of electrical generation around the globe for many years.
Third, while we cannot substantially reduce the use of fossil fuels, we can develop and deploy CCS technology, which will very substantially reduce the emission of GHG and hopefully stabilize atmospheric concentrations of CO2 at a level that will mitigate rapid temperature increases.
Fourth, doing so will be very costly and will require the resolution of many technical, economic, environmental and legal issues, as well as significant international co-operation and public/private partnerships. If widely deployed, however, CCS could provide breathing room while other non-CO2-emitting sources of energy are developed. The Canada-Alberta report is a significant first step in addressing these issues, especially since the U.S. Department of Energy’s CCS project, FutureGen, has been put on hold.
Fifth, renewable energy (especially solar), conservation and efficiency should be developed as broadly and as quickly as possible, supported by much public and private R&D, while recognizing that within the 2050 time frame they will not supply the base load energy needs of the planet.
Sixth, there must be a major investment in nuclear energy, especially in the new IV generation reactors whose safety features should reduce public opposition to the technology. France has proven that nuclear can meet base load energy needs without GHG emissions.
Seventh, adaptation policies to accommodate evident consequences of rising global temperatures and climate change should be on the agenda of all countries, especially those vulnerable to rising sea levels.
Eighth, strong messages from our political leadership of the importance of acting urgently to implement CCS supported by credible cost-benefit analysis of the kind presented by Nicholas Stern in his report to the U.K. government. We must illustrate the incredible economic, ecological and social costs of inaction as Stern did.
Ninth, we must carefully assess the impact of some approaches that, while well intentioned, run into the “law of unintended consequences.” For example, a recent report in New Scientist magazine detailed the incredible volumes of CO2 released by draining peat bogs in Sumatra. Ironically, locals are draining the bogs to plant acacia for paper and palm oil trees to make biofuels to help reduce Europe’s CO2 emissions. “The fact that European countries can meet their Kyoto protocol obligations by sponsoring activities that have helped turn Indonesia, of which the giant island Sumatra is a part, into the world’s third largest emitter of greenhouse gases,” wrote author Fred Pearce, “is a savage indictment of the perverse incentives created by the protocol.”
What role for Canada?
As one of the biggest offenders in CO2 per capita emissions and a country rich in science and engineering expertise of the kind required, I see an important opportunity for Canada to tackle these issues on a urgent basis. Apart from the global economic opportunities for industry, Canada could regain any international credibility it might have lost due to its sub-optimal performance since Kyoto and its negative image at Bali.
Given the global imperative of meeting this challenge, Canada should take the lead in putting together an international public-private consortium, with contributions from many governments. Canada is well positioned to lead the world in scaling up CCS technology. All the challenges raised by Rubin — technical, environmental, financial and regulatory — should be taken on by Canadians with strong co-operation among levels of government and industry. The results would be made available to the world.
If not Canada, who?
When we hear the rumblings of a distant, approaching thunderstorm, we know to take cover. That option is not available with climate change. We are all exposed. We have known this now for many years, and we have failed to act. Putting our heads in the sand and ignoring the signs of an impending global disaster is unconscionable. Our children, grandchildren and future generations deserve better.
I wish I could have replied to Pierre Trudeau that, yes, on the health of the environment, the future does have a constituency. To our current political leadership, I say, let us prove that it does.
Donald J. Johnston is former secretary general of the Organisation for Economic Co-operation; counsel, Heenan Blaikie; chairman, the International Risk Governance Council, Geneva.
