Oil and gas workers struggling in the wake of collapsed oil prices want to try their hand at clean energy jobs and have asked the federal government to help make that transition a reality.

Members of Iron and Earth, a Canadian non-profit led by skilled trades workers, released the Workers’ Climate Plan Tuesday, calling on Ottawa to support skills training, increase manufacturing of renewable energy, support trades and unions advocating for renewables and integrate renewables into Canada’s existing energy projects.

The plan demonstrates strong support for the clean energy sector from within the industry workforce — a narrative that conflicts with industry support groups like Canada Action that vocally advocate for continued fossil fuel development.

“This isn’t about taking jobs away from people, this is about opening up sustainable opportunities for skilled workers so their families can thrive,” Lliam Hildebrand, a boilermaker in the oilsands and executive director of Iron and Earth, said in a statement.

“We’re giving a voice to real oil and gas workers who deserve a say in these issues and who want a better future.”

The Workers’ Climate Plan is an attempt to find “common ground” and “preparing our country for the future,” Hildebrand writes in the report’s executive summary.

“Addressing climate change while developing our energy industry doesn’t have to divide and polarize our country. As we look ahead one thing is certain: Canada needs to come together around a national climate strategy that unites people and drives growth in a new energy economy.”

An estimated 43,000 jobs were lost in the Alberta oil and gas sector in 2015 as a result of market changes. In a survey Iron and Earth found 63 per cent of workers support making the transition to clean energy jobs with some training upgrades. Sixteen per cent said they wouldn't require retraining to shift into renewable energy.

Kerry Oxford, mechanical engineering technologist and member of Iron and Earth said “workers deserve something sustainable, so we don’t find ourselves in this boom-and-bust mess ever again.”

“That’s why we’re taking time out of our lives to work on this problem together,” Oxford said in a statement. “That’s why we spent four months talking with colleagues, coming up with a plan that works for the long term.”

The Workers’ Climate Plan comes as Canada prepares to attend the United Nations Framework Convention on Climate Change COP22 meeting in Morocco, November 7 to 18.

Iron and Earth is concerned investment dollars targeting renewable energy projects will bypass Canada if the government doesn’t increase support for a domestic renewable energy manufacturing sector.

“With large scale renewable projects ramping up in Alberta and Saskatchewan in 2018, we only have a brief window to build up our workforce and manufacturing capacity for the next employment boom,” Hildebrand writes.

A Solar Skills and Training Program and Renewable Energy Activation Program organized by Iron and Earth are in the works to facilitate the kind of skills upgrades and training needed.

“Our worker-led membership and stakeholders cannot thrive unless the pan-Canadian climate strategy addresses the needs identified in our Worker’s Climate Plan framework,” Hildebrand writes.

“As energy-sector workers we want Canada to lead the transition away from carbon dependency — not lag behind it.”

Image: Lliam Hildebrand from Iron and Earth. Photo: Green Energy Futures, David Dodge via Flickr CC BY-NC-SA 2.0

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Canada can reduce its carbon footprint by 90 per cent, play its part in the fight against climate change and grow its economy at the same time according to a recent report by the United Nations Sustainable Development Solutions Network. 

“This is a really important piece of analysis for Canada. It shows that we can cut our carbon pollution dramatically by 2050, making a strong contribution to tackling climate change, while growing our economy by over 200 per cent,” Clare Demerse, a senior policy advisor at Clean Energy Canada says.

By powering transportation, buildings and electricity with largely renewable energy (water-power, wind, solar) and biofuels and applying wide spread use of greenhouse gas (GHG) capturing technologies such as carbon capture and storage (CCS) in the oil and gas sector the report argues Canada can cut its GHG emissions production by 90 per cent by 2050 based on 2010 levels.

The catch is none of this can happen unless Canada implements policies effectively regulating the production of GHG emissions, something the federal government has so far been unable to do.

“Many of the major changes described in the Canadian decarbonization pathway will not occur without strong policy signals, which will require public support and in many cases will be driven by public pressure,” the UN network concludes. 

Electrification of the Economy Is the Key to Reducing GHG Emissions 

Reducing GHG emissions of transportation and buildings sectors by 97 per cent and 96 per cent respectively are the “two of the core foundations of the Canadian deep decarbonization pathway.” The key to reaching these targets is a substantial shift to renewable energy.

Canada's projected GHG emissions by sector by 2050 in a 90 per cent GHG emissions reduction scenario. Source: UNSDNS

“Decarbonizing electricity production is essential, since it is a precondition to reducing emissions throughout the rest of the economy through electrification,” the report states.

Water-power (Canada’s largest source of renewable energy), biomass, wind and solar are projected to lead the way in decarbonizing Canada’s electrical supply with wind and solar generating as high as 17 per cent and 10 per cent of Canada’s electricity respectively.

Oil consumption for transportation will need to plummet with the majority of Canadian vehicles running off of biofuels, hydrogen or electricity in the 90 per cent GHG emissions reduction scenario. The report sees a slight shift to mass transit (trains, buses) over personal vehicles and a large transformation from trucks to trains for freight.

Electricity production (left) and fuel consumption (right) by source by 2050. 

“The results the modelers presented are one way to hit the target they were given, but they’re not a prescription. As they point out, Canadians and our governments will need to make policy choices about what kind of low-carbon path makes the most sense for us,” Demerse told DeSmog Canada.

British Columbia’s successful and surprisingly popular carbon tax and Quebec’s cap-and-trade system are two homegrown Canadian climate policy examples Prime Minister Stephen Harper’s government could follow to fulfill Canada’s international responsibilities to cut global warming GHG emissions.

Report Surprisingly Projects Oil and Gas Output Will Double by 2050

The report assumes Canada can remain an oil and gas “energy superpower” in a world that has gone nearly zero-carbon. The report predicts Canadian oil and gas production will double by 2050 as well.

“The report’s assumptions on global oil demand seem a little unrealistic. Studies have shown that demand will drop as countries transition to low carbon economies,” Professor Mark Jaccard, an energy economist at Simon Fraser University says.

Canada's GHG emissions by sector (2010 baseline). Source: UNSDSN

“If Canada is able to power its cars and buildings with virtually zero fossil fuels by 2050, why wouldn’t the rest of the world want to do the same? If global demand for oil drops, oil prices will drop too — and then we would see far lower production than the oilsands industry is counting on today,” Demerse told DeSmog Canada.

To keep the oil and gas sector in play in a near zero-carbon scenario the report recommends Canada employ widespread use of technologies such as carbon capture and storage (CCS) in the sector. CCS captures carbon emissions, and converts them into a dense fuel that can be transported to sites below ground for storage.

Canada only has one operational CCS project. The Pembina Institute, an energy policy think tank, predicts Alberta alone will need twenty-five large-scale CCS projects to meet its own GHG emissions reduction targets.

“Why would companies adopt expensive CCS (carbon capture and storage) technology if at the moment they can dump waste into our atmosphere for free?” Jaccard says.

The authors of the report admit CCS is not “commercially viable” in Canada at the moment given “current climate policy stringency.” The low price on carbon and lack of regulations on GHG emissions in the Canadian oil and gas sector provide very little financial incentive for companies to invest in expensive technologies that decrease the carbon footprints of their operations.

“Until there are regulations on carbon in Canada technologies like CCS are going nowhere,” Jaccard told DeSmog Canada.

Unclear If the Oilsands Have A Place In A Decarbonized Canada

The UN network behind the report is unable or unwilling to say if the oilsands (also called tar sands) industry, the fastest growing source of GHG emissions in Canada, has a future in a low carbon Canada. The report cites “literature conflicts on whether production from the oil sands can be cost-effective in a deep decarbonization scenario.”

Image Credit: Blue Green Canada, United Nations Sustainable Development Solutions Network

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The recent shelving of the Joslyn mine oilsands project in Alberta is a reminder of the fragile economics of the oilsands. No economic formula could be found to make the $11 billion project work and it has been put on hold indefinitely.           

Oil major Total E&P, the biggest partner in the project, said the Joslyn mine project “cannot be (financially) sustainable in the long term.” Interestingly, Total did not blame lack of new pipelines for squeezing profit margins either.

“You run the risk in developing fossil fuels that one day will either become fully depleted or too expensive to extract,” Philip Gass, a policy analyst at the International Institute of Sustainable Development, said from Winnipeg.

It would be difficult to deny Canada has economically benefited from developing the oilsands, a particularly difficult and expensive fossil fuel to mine and refine into light fuels — but failing to diversify the Canadian economy beyond an oil and gas ‘energy superpower’ makes for a very uncertain economic future for Canada.

“Canada could find itself an energy superpower overspecialized in the ‘old economy’ (resource extraction) in a world rapidly trying to cut carbon emissions and avoid catastrophic climate change,” Andrew Jackson, a senior policy advisor with the Broadbent Institute, told DeSmog Canada.

“Putting all your eggs in one basket is never a good economic strategy,” Jackson said.

Benefits of Energy Development Remain Largely Locked in the Sector

The idea that all Canadians benefit from a surging oil and gas industry is slowly turning into a farce. An International Monetary Fund (IMF) report earlier this year finds every dollar invested in the energy sector in Alberta grows Canadian gross domestic product — an economic vitality indicator — by 90 cents. Of this growth, 82 cents remains in Alberta, mostly in the energy sector (67 cents).

IMF‘s breakdown of $1 investment in the energy sector scenario.

“There appears to be an important scope to increase inter-industry linkages across Canada that would lead to wider sharing of benefits from the energy sector,” concludes the IMF report released in January.

Increasing inter-industry linkages or value-added jobs does not appear to be priority of the federal government. New oil pipeline projects are almost all geared to shipping Canadian oil and oilsands bitumen to refineries in the U.S. or overseas, not in Canada. Most of the heavy equipment for oilsands extraction comes from the U.S.

“The spin-off effects of the energy boom are not being felt in Ontario and Quebec, where most Canadians are,” Jackson says.

The federal government’s low corporate tax rate and the exemption of provincial resource royalties from the Canadian system of wealth redistribution (which ensures all Canadians receive the same public services) further locks the economic benefits of the energy sector within the sector and resource-rich provinces.

Energy Sector Is Not A Big Jobs Creator

“The oil and gas sector is capital intensive, not labour intensive. Manufacturing could employ more people,” David Macdonald, a senior economist with the Canadian Centre for Policy Alternatives, says.

The same IMF report on the Canadian energy sector indicates that of the 752,000 jobs created in Canada between 2007 and 2012, the oil and gas sector can only take credit for less than 13,000, or 1.7 per cent, of them.

Job creation is not exactly Canada’s strong suit at the moment.

“The employment rate in Canada, that is the percentage of Canadians over fifteen years of age who are working, is sixty one per cent. This is the same level the employment rate was at during the worst of the recent financial crisis,” Macdonald told DeSmog Canada.

Employment rate (blue) and unemployment rate (black) from 2003 to 2013. SOURCE: Canadian Centre for Policy Alternatives 

The official unemployment rate (seven per cent) in Canada has returned to pre-recession levels, but Macdonald points out that Statistics Canada does not count Canadians who are not actively searching for employment as unemployed.

“Eighty per cent of the so-called ‘recovered jobs’ since the recession are Canadians who have simply given up looking for work,” Macdonald says from Ottawa.

Part-time/Temporary Job Creation On The Rise

Ninety-five percent of all net jobs created in Canada in 2013 were part-time according to the Canadian Chamber of Commerce. Part-time workers and the self-employed, who earn on average 20 per cent less than their employed counterparts according to CIBC, now make up 30 per cent of the Canadian work force.

Canada has created more full-time than part-time jobs since the recession but the rate of part-time job creation has grown faster than full-time. Fifty-three per cent of Canadians between the ages of 25 and 44 who found work since the recession could only find temporary jobs. The rate of Canadian part-time workers who want full-time work but cannot find it has grown 37 per cent during the same period.

“Since 2011 the number of underemployed workers has exceeded the number of unemployed workers — in 2013 there were 1.35 million unemployed workers and 1.43 million additional underemployed workers. And that is before we even begin to take into account skills-related underemployment. This is an issue that needs to be taken seriously,” a Canadian Labour Congress report concludes.

SOURCE: Canadian Labour Congress

Fourteen per cent of working Canadians are underemployed or unable to get enough work to meet their financial needs, a 28 per cent increase since 2008.

Canada Needs to Create Well-Paying, Long-Lasting Jobs

“Whether you are talking about green jobs or brown jobs (fossil fuels extraction) you want to create jobs that are fair, well-paying and long lasting,” Gass of the International Institute of Sustainable Development told DeSmog Canada.

“We would like to see federal policy facilitate the creation of more specialized manufacturing jobs and encourage unionization in the work place. Unions tend to create better paying full time jobs,” Macdonald says.

A report released last month by the Parkland Institute examining unions in Alberta (the province most hostile to unions) found in terms of economic performance, wage growth is lower in Alberta compared to other provinces with higher unionization rates, despite Alberta’s oilsands boom.

“There is $600 billion sitting on companies shelves in Canada that is not being reinvested in the economy. Companies only invest where there is an expectation for growth. At the moment it appears the expectations are low,” Jackson says from Ottawa.

Corporations operating in Canada are not the only ones with low expectations for growth. When polled earlier this year by the Broadbent Institute, Canadians between 20 and 30 believed they will face a future of precarious employment and the income gap will grow during their lifetimes despite Canada’s energy boom. Baby boomers (50 to 60 years of age) in the same poll stated they think their children are more likely to slip down an economic class than move up.

“With interest rates at all time lows I would like to see public investment into mass transit, passenger rail, etcetera ramped up. Public investment can pave the way for private investment,” Jackson said.

Unfortunately the current priorities of the federal government — tax cuts, tax breaks, battling unions and cuts to public spending — are taking Canada in just the opposite direction.

Image Credit: Cheryl via Flickr

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The message the federal government has been pushing through its ‘responsible resource development’ ad blitz in recent years is one of all Canadians benefiting from developing our energy sources (particularly the oilsands). This is why export pipelines must be built through our communities and LNG plants for natural gas constructed on our coasts. Canadian oil and gas must reach international markets for the economy to thrive, argues Prime Minister Stephen Harper’s government.

The International Monetary Fund (IMF), the infamous global finances referee, took a closer look at Canada’s energy sector – oil and gas primarily – earlier this year and finds the benefits from Canada’s energy boom still remain largely within the energy sector.

“There appears to be an important scope to increase inter-industry linkages across Canada that would lead to wider sharing of benefits from the energy sector,” concludes the IMF report released last January.

The IMF finds every dollar invested in the energy sector in Alberta grows Canadian GDP – an economic vitality indicator – by 90 cents. Of this growth, 82 cents remains in Alberta, mostly in the energy sector (67 cents). The leftover GDP growth is split between Ontario (four cents), the rest of Canada (three cents) and the U.S. (two cents).

“The (IMF) report also shows that the positive impacts of additional exports outside of the energy sector and the producing provinces are surprisingly modest,” says Andrew Jackson, senior policy advisor at the Broadbent Institute in a recent article.

Energy Sector Created Only 1.7 per cent of New Jobs in Canada from 2007 – 2012

Make no mistake the IMF report favours increasing Canadian oil and gas production and building more pipeline capacity. As one would expect the IMF sees impacts of the energy sector on Canada’s economy as positive. The report does not assess the environmental or the social consequences – particularly on Canada’s relationship with First Nations – of the energy sector, which have their own social and economic impacts.

IMF's breakdown of $1 investment in the energy sector scenario.

But the IMF almost appears disappointed by the energy sector’s contributions to economic growth and job creation in Canada:

“The energy sector accounts for only 0.1 percentage points of the average (2¼ percent) annual GDP growth over the last decade. Also, employment in the energy sector increased by less than 13,000 over 2007–12, against a total 752,000 jobs created over the same period in Canada,” states the report.

Health care and social assistance created 22,000 jobs in December 2013 alone according to Statistics Canada.

Photo from federal government's responsible resource development campaign.

While the IMF does not dare to say Canada is suffering from “Dutch disease,” it does conclude the energy boom has taken its toll on the Canadian manufacturing industry.

“Higher energy prices contributed to the real appreciation of the Canadian dollar since early 2000s, which has intensified Canada’s competitiveness challenges in non-energy sectors, particularly in manufacturing,” reads the IMF report.

Rapid Growth vs Slow Growth in Energy Sector – Modest Difference

The IMF gazes into the economic crystal ball to try to predict the future impacts of rapid versus slow development of the energy sector on the economy. If no additional infrastructure to export Canadian energy were to be built – the slow scenario – Canadian GDP would only decrease 0.5 per cent by 2020.

At the other extreme, if all proposed energy export infrastructure is approved and the energy sector develops rapidly (i.e. a 20 per cent increase in oil and gas production in the report) GDP would increase be 2 per cent by 2020. However, the IMF concludes there would be a certain downside to this growth:   

“the current account would be slightly negative, reflecting larger deterioration in the non-energy balance driven by higher imports demand from households and firms.”

Jackson says the “gap between the two scenarios is more modest than might have been thought” given the daily dose of rhetoric Canadians hear insisting the “approval of new pipelines to export oil and gas are central to Canada's economic future.”

IMF Recommendation: Strengthen Domestic Supply Chain

Strengthening Canada’s “domestic-supply chain” will increase the “spillover” benefits from the energy boom into non-energy sector industries according to the report. Building more domestic pipelines to connect western Canadian oil to eastern Canadian refineries is one of the recommendations:

“Canada’s internal market remains segmented, as refineries in eastern Canada are not connected with pipelines to western Canada…. and import much of their crude oil at the higher global (Brent) price,” argues the report.

“This has not only a direct negative impact on Canada’s energy trade balance, but potentially also an indirect one as it limits the competitive boost that Canadian manufacturing firms could derive from accessing a cheaper, domestic source of energy,” concludes the report.

All new pipeline proposals in Canada including TransCanada’s “nation builder” Energy East pipeline involve exporting Canadian oil to international markets. Enbridge’s recently approved Line 9 pipeline from Sarnia to Montreal may be the only exception, but Line 9 could easily be transformed into an export pipeline as well.

The IMF reports supports similar findings by the Canadian Energy Research Institute in 2011 that finds 94% of the economic benefits of expanding the oilsands remain in Alberta.

Image Credit: Government of Canada, IMF

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