Max Fawcett: India's green energy ambitions outstrip our own, Mr. Kenney
Jason Kenney can't see what's right in front of him: the world is starting to move on from oil.
Sometimes, in politics, you have to read between the lines.
But sometimes, as with the recent press conference in which Alberta Premier Jason Kenney vented about the federal government’s throne speech and the insult it apparently added to Alberta’s economic injuries, the lines read themselves.
In response to a question about California’s decision to ban the sale of fossil fuel powered vehicles by 2035, Kenney tipped his hand. “If you really think the billion people in India who desperately want to move to a higher standard of living are all going to be driving Teslas 15 years from now, you’re disconnected from reality,” Kenney said. “They don’t have the luxury of repeating all these California-style pieties. They want to stop burning cow dung.”
Never mind, for the moment, the fact that burning cow dung isn’t exactly the primary source of fuel in India — a country whose renewable energy ambitions massively outstrip our own. The parochialism and ignorance of the comment was galling in and of itself. But what was most telling was Kenney’s unwavering belief in the future of an industry whose best days are clearly in the past. “In the real world,” Kenney continued, “where you can’t fuel airplanes or produce petrochemicals with good wishes, there will be tens and tens of millions of barrels of oil consumed in 2040 and beyond.”
While no one is suggesting that we won’t need oil to power our trains, planes, and automobiles for the foreseeable future, it’s Kenney who isn’t living in the real world when it come to the rapidly shifting global landscape for oil and gas. BP, for example, recently came out with a revised forecast suggesting that demand for oil will start falling within a decade, and even included a scenario in which it has already peaked. And while California’s ban on the sale of fossil fuel vehicles may have drawn Kenney’s ire, it isn’t the only place that’s announced a ban on the sale of gas guzzlers. The U.K., which has already announced a ban effective 2040, is expected to move that date up by a full decade. China may follow.
Automakers aren’t waiting around for politicians to tell them what to do, either. Instead, they’re rolling out a growing array of electric vehicle models, including an electric F-150 that Ford expects to debut next year. Even India’s Tata Motors has the Nexon EV, a nifty compact SUV that has over 300 kilometres of range — and doesn’t, in fact, run on cow dung.
That may come as a shock to Kenney, who seems to be labouring under the belief that technological progress is linear, and that places like India will need to move through their fossil fuel phase before graduating to wind and solar. But that isn’t how technology progresses. There is an imperialistic presumption at play, here, that we in the developed world have discovered the one true path toward improved living standards, and that the developing world will have to follow us. Under this model, it becomes difficult to imagine that these countries would learn from our own errors of development, and skip ahead of us.
That’s not how it seems to be playing out — just ask the millions of people who have gone from having no telecommunications facilities in their communities to a profusion of low-cost mobile phones without first installing landlines. The assumption that new technologies like cellphones were luxuries for the rich West blinded us to the opportunities they presented in poorer nations. (Ironically, it’s cheaper to own a cellphone in India now than it is in Canada.)
It’s likely that the same path will be seen with energy and transportation technologies in places like India, which wants to increase its supply of clean power from under 100 GW today to over 500 GW by 2030. India will not replace its more than 200 GW of coal-fired electricity with natural gas, and it will not force drivers to fill their cars with gasoline. Instead, it will try to move past fossil fuels. The government of Delhi, for example, wants to see 25 per cent of newly registered vehicles on its roads be electric by 2024, while it plans to require all two and three-wheeled vehicles to be electrified by March 31, 2025.
This is not great news for the oil and gas industry, and by extension places like Alberta that depend so heavily on it for their economic livelihood. The long-term demand growth for oil that seemed like a virtual certainty just a few years ago is now very much in question, and the recent performance of large oil and gas stocks like ExxonMobil and Suncor suggests that investors are betting the under there, not the over.
Raging about technological disruption isn’t an effective way to slow it down, and pretending something isn’t happening won’t make it stop. There are still plenty of opportunities for Alberta over the next few decades as the global economy transitions towards lower-carbon sources of energy — I argued as much just a few months ago in the National Post. But the only way Alberta will thrive in this rapidly changing world is if its leaders are willing to accept what’s actually happening in it first.
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