Introduction
“The real-life global competition over clean
energy is growing increasingly intense, as countries around the world sense a
huge economic opportunity and the opportunity for cleaner air, water,
and a healthier planet.”
Former US Energy Secretary
Steven Chu May 2012
The current
Conservative government wants Canadians to believe that economic development
and sustainable development are opposing forces. Consequently, Conservative see
their Bills C-38 and C-45, with their draconian anti-environmental components, as
justified. Nothing could be further from
the truth.
First, the clean tech
sectors are one of the globe's fastest growing and highest job creation sectors. In 2012, global investments in renewable
energy amounted to $268.7B, down from $302.3B in 2011 due to decline in prices
and costs; policy uncertainty in the US; and European economic woes.
China led the way with
$67.7B in clean energy investments in 2012, an increase of 20% over the previous year due to a surge in its solar
tech sector. The 2012 US, Japan and German investments were $42.2B, $16.3B and
$22.8B respectively.
On jobs, the
employment to date in these sectors that only a few years ago were nascent
sectors are extraordinary. The
global total numbers of jobs in 2011 in clean energy sectors were 5M with
China, once again leading the way with 1.6M, followed by Europe with 1.1M and
Germany and India with 372,000 and 350,000 respectively.
Canada, as a result of the absence
of adequate federal support for being a full participant in this growth misses out
on job opportunities by the 1000's every year and the gap between Canada and
other developed nations grows yearly.
For a sense of lost employment opportunities
for Canadians, the November 2012 report of BlueGreen Canada, an organization
that represents unions and environmentalists, indicated that, if the $1.3B in
subsidies allocated to the oil and gas sector that currently supports 2,300
jobs in the oil and gas sectors were to be transferred to renewable energy,
energy efficiency and public transit, this same amount of money would create 18,000-20,000
jobs in clean energy sectors --- 6 to 8 times more jobs per investment unit.
Behind the
aforementioned growth figures, lies the fact that the point of departure for
much of this leadership by other nations is government support for innovation. Specifically, innovation leads to product
development and ultimately manufacturing jobs.
However, the Conservative Budget 2013-2014, for the first time in over
40 years, did not assign any financing for clean tech innovation, zero!
To catch up, Canada's requires
a highly aggressive climate change action plan that includes substantive fiscal,
legislative, program and research components for immediate implementation after
the next federal election in 2015. Put another way, Canada's catching up to the rest of the
world should not be principally that of a dependency on importations clean
techs, and the sacrificing of the potential for domestic clean tech innovation
and manufacturing in Canada.
China
In 2009, China became the largest single energy
consumer in the world, putting the US in second place. But since then, China has also become the largest clean energy
market in the world and a leader in the manufacturing of clean technologies for
both domestic and international markets.
While thermal coal-fired generating plants)
continued to dominate new installations of electrical power generation, with 50.7
GW in 2012, wind energy came in second with a record 13.2 GW added in
2012. Total 2012 installed wind capacity
was 67.7 GW and the installed projections are for 2020 are 200 GW. (Note, for comparative purposes,
Quebec's total electricity capacity is 37 GW not including Churchill).
From the 150,000 jobs in the Chinese wind sector in
2009, the projections for 2020 in this sector are 500,000 jobs.
With respect to solar energy, there are 14 GW in
the pipeline. There were 300,000 who worked in the photovoltaic sector
and 800,000 employed in solar
heating/cooling in 2011.
Projections for total installed
solar capacity for 2020 are in the order of 50 GW.
The US
The US is the second largest clean tech market and
consequently its energy portrait is changing very quickly. Wind was the largest new source of electrical
power generation in 2012 with 13.1 GW of new installations bringing the total
US installed capacity to 60 GW.
This US migration to a green economy was
kick-started with the American Recovery and Reinvestment Act (ARRA) which pumped $70B
into the green economy, including major investments in innovation, during the
2009 to 2011 period, the first half of the first Obama mandate. Grants, tax credits loans, loan guarantees and
investments in research were among the principle mechanisms applied during the
2009-2011 period. Republicans have since put the brakes on this, nevertheless a strong momentum has been established.
There are
about 75,000 people working in the US wind sector and over 500 facilities
manufacturing turbine components. There were about 119,000 jobs in the US
solar in 2012, a 13% increase over 2011 and the biomass and geothermal sectors provided
152,000 and 10,000 jobs respectively in 2011.
When one adds the sum of the various parts of the renewable energy
sectors, renewable energy capacity in the US doubled in the 5 years from 2008
to 2012.
Meanwhile in
parallel, between 2007 and 2012, oil consumption as a percentage of total US
energy consumption, dropped from 39.3%
to 36.7%. As well, the consumption of coal has dropped from 22.5% of total US
energy consumption in 2007 to 18.1% in 2012.
The impacts of the above-mentioned factors combined
with investments in energy efficiency by power utilities and improved average
fuel consumption of US vehicles, have resulted in a 13% drop in US CO2
emissions from 2007 to 2012.
In his late June 2013 statement on new actions on
climate Change, President Obama announced an objective of a reduction of 3B
metric tons by 2030. Unfortunately, the new support
proposed for clean energy in his pronouncements were very modest.
The good news is that President Obama June 2013 announcement stated that the
process for approving clean energy production and distribution on federal lands
would be accelerated. This is good because federal lands represent 20% of the US continental land mass. The bad news is the June 2013 proposals are
in effect an accelerated version a Department of the Interior mandate assigned
during the ARRA 2009-2011 period. No
details have been provided as to the nature of initiatives to speed up DOI approvals.
Disappointing in the June 2013 action plan, is the lion's share of new funding, $8B, is to be allocated to technologies to
reduce fossil fuel emissions, in particular to support carbon capture and storage technologies
(CCS). CCS technologies are
prohibitively expensive and consume
enormous amounts of energy while only offering modest carbon reduction.
Short time line extensions from the ARRA days are
1) the Investment Tax Credit of 30% on investments, primarily applied for the construction
of solar farms and 2) the Production Tax Credit of 2.2 cents/kWh used mainly by
wind farm developers.
Europe
In Europe, renewable energy represented 69% of new electrical
power capacity installed in 2012 while the oil, coal and nuclear sectors
experienced negative growth.
There were
11.6 GW of wind power installed in 2012 bringing the total installed capacity
in 2012 to 105.6 GW. Wind is expected to
reach 136.5 GW by 2014 and 230 GW of installed capacity by 2020.
Solar installations surpassed wind in 2012 with 21
GW of installations representing one quarter of 2012 global solar installations
in that year.
This rapid growth of the European renewable sectors
is generating rapid growth in employment in these sectors. From 192,000 jobs in Europe's wind sector in
2009, the European Wind Energy Association (EWEA) is predicting
280,000 jobs in 2015 and 450,000 by 2020. So quickly is the industry growing that
despite the exceptionally high unemployment in many parts of Europe, the EWEA
estimates that the industry will experience a skilled labour shortage of 5500
jobs/year.
Germany is a leader among European nations with about
372,000 jobs in its renewable energy sectors for the year 2011. That's bigger than the German auto sector. By
2020, the projections are for 400,000 to 500,000 employed in the renewable
sectors.
In parallel, Germany's nuclear
sector is on the way out, a consequence of the Fukushima crisis. Germany has shut down 8 of its nuclear plants
and intends to shut down the remaining 9 by 2022.
Germany's installed wind capacity was 31.3 GW in
2012, representing 30% of the European Union total. It's installed capacity of
solar energy in 2012 reached 32 GW making it the second largest solar market in
the world after China. With respect to
its renewables targets for the percentage of total energy consumption by 2020
(total energy consumption including the transportation sector) , Germany has a
higher target than the 20% target of the European Union. Germany is going for 35% target and offshore
wind will play a major role in pursuing this target. To this end, the German
development bank, kfw will be backing offshore wind development with $7.2B
(€5B) in financing.
Conclusion
The US,
Europe, China and other developed nations are well-engaged in the migration to
a green economy -- from supporting domestic innovation; to the construction of
green technology manufacturing plants; to the development of clean energy
production sites; and more generally, to the expansion of national and
international markets.
These
developments continue to give rise to the creation of jobs by the thousands in
most regions of the developed world - with the exception of Canada. They
also offer hope for developing countries where more than 50% of the global
potential for renewable energy power production exists.
Conversely,
all the evidence indicates that the old model, the fossil fuel-based economy,
no longer makes sense. The old model not
only requires massive dependencies on importing energy and the resulting
exportation of ,and concentration of, energy wealth, but it is also not good for the planet. Surely a healthy economy cannot exist in a
planet that cannot sustain healthy life.
For at
least the next 2 and a half years until the federal election of 2015, Canada will largely miss out on the global
green economy opportunities both in terms of spreading the energy related
wealth across the country and in terms of green technology market
possibilities, domestic and export markets alike. Perhaps more important, under the present
circumstances, Canadian innovation capabilities cannot be adequately supported
to keep pace with the rest of the world and ultimately offer Canada high-job
creating manufacturing and export opportunities.
In a recent special report on renewables to the
United Nations, the International Panel on Climate Change concluded that public
policies, rather than the availability of the resource, are the key
determinants regarding expansion or constraints to renewable energy
development/deployment. In it's June 2013 report, the International Energy
Agency came to similar conclusions and added that uncertainty about renewable
policies may hamper investment and growth.
In other words the extent to which ,nations
benefit from the high job-creating clean tech sectors while reducing emissions,
is a matter of political will.
There certainly are no lack of possiblities for those who choose to be a part of
the solution in light of the fact that less
than 2.5% of the globally available technical potential for renewables is currently
exploited— over 97 % is untapped.
Indeed, the
technical potential of renewable energy technologies exceeds the current
global energy demand by a considerable amount. As well, the prices of clean technologies have declined considerably.
Will Dubitsky, July 10, 2013
willdubitsky@gmail.com
