How Canada’s incoherence on climate is killing Keystone

There’s no shortage of blame being passed around in the wake of another delay in the U.S. regulatory approval process with respect to TransCanada’s Keystone XL pipeline which, it was announced last Friday, will now drag on for at least another six months. Among other reasons cited for the decision, the Calgary Herald’s Deborah Yedlin and others have cited a lack of greenhouse gas policies applied to Canada’s oil sands. Yedlin is direct, saying that, “the evidence to date suggests (that the Harper government hasn’t listened to what is being said in Washington) because the Harper government has not moved on anything resembling a policy on greenhouse gas emissions.” I think she’s right, to a point, but I think the problem is not that we haven’t been listening, but that our governments, both in Edmonton and in Ottawa, have yet to establish a coherent vision on anything which includes the words climate change and oil sands.

This post previously appeared at Maclean’s magazine.

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My Twitter Account

Many of you have noticed that I suspended my Twitter account over the weekend.  I expect that this will be a temporary decision, at least in some respects, although I am not sure what my re-engagement will look like. I’ve used Twitter for many years now, and I love the medium for news, learning, and interacting … Read more

Finite Resources and Infinite Growth

Today’s Globe and Mail featured a column by Gary Mason on a world without oil.  “If you believe that the economy is structured in such a way that it needs to grow continually in order to survive,” it states, “then it will take an endless supply of energy to feed it. ” The article then raises the question,  “How does an economy grow exponentially forever if the one element it needs more than anything to flourish is contracting with time?” This is a common refrain from environmentalists such as David Suzuki (here, here, here and likely a thousand other places): “it’s absurd to rely on economies based on constant growth on a finite planet.” But, is it? I’ll have more on this at Macleans in a couple of days, but this will serve as a technical primer.

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Can we dismiss this `economists only care about GDP’ crap, once and for all?

Yesterday, the Pembina Institute and Equiterre released a report entitled Booms, busts, and bitumen: The economic implications of Canadian oil sands development.   The report opens with a foreword from University of Ottawa economics professor Serge Coulombe. His opening paragraph states that, “Environmentalists don’t accept gross domestic product (GDP) as a complete measure of well-being in the … Read more

Extraction vs Upgrading

The NDP put forth a motion in the House last week which states that, “the Keystone XL pipeline would intensify the export of unprocessed raw bitumen and would export more than 40,000 well-paying Canadian jobs, and is therefore not in Canada’s best interest.”

This motion provided me with the motivation to dig into a question – if you had a given amount of capital to spend in the oil sands, would an oil sands mine alone or an integrated project with an upgrader generate the largest value-added return on investment, including total wages, royalties, taxes, and profits, and how would these be distributed?

To tackle this question, I ran two iterations of an oil sands project model based loosely on Suncor’s Fort Hills project combined with upgrader assumptions based on Suncor’s now-cancelled Voyageur project.

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Fort Hills tale of the tape

This morning, Suncor held an investor conference call to discuss the decision announced late last night that it would proceed with the development of the Fort Hills mine – a joint venture with Total and Teck. Everything associate with this project is huge – it’s expected to produce 180,000 barrels per day and to cost … Read more

Carbon pricing is not a panacea

Pretty well every economist you talk to will agree; if you want to reduce pollution, carbon or otherwise, the most cost-effective way to do so is with a price on the emissions of that which you seek to reduce. They’ll also tell you that, under some basic assumptions, the cost-effectiveness result holds whether you impose that price through a … Read more

Transparency and Credibility

Tonight, I was a little surprised to read the following tweets from Marc Lee, Senior Economist with the Canadian Centre for Policy Alternatives (CCPA), and Co-Director of the Climate Justice Project: “I’m appalled by your acceptance of Enbridge professorship. You’ve lost credibility.“ and “If I recall correctly you also own Enbridge stock. So a double … Read more

Common sense, sample selection, representative samples, and sample sizes

As Statistics Canada continues to roll-out the results from the National Household survey, I seem to become involved in arguments at least once a week as to the importance of sample selection in survey data.  This week, my argument was with IPSOS CEO Darrell Bricker – someone who should know a lot about statistics.  In particular, Mr. Bricker should know that you can’t solve a sample selection problem with an increased sample size, and I actually think he does. I think the issue is that he’s thinking about practical polling issues with respect to sampling, not about statistical issues with respect to selected samples.  Statistics Canada differentiates between sampling error and non-sampling errors, and I think that’s where our key difference lies. Let me see if I can explain this, and hopefully Mr. Bricker will respond and let me know if I am on the right track.

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