Zoopolis

The Ontario government just signed a massive deal (billed as possibly the world’s largest) with Samsung and a South Korean consortium  that includes a heavy stake from the South Korean government to construct a whackload (that’s the technical term) of green energy manufacturing and generation in Ontario. The consortium has promised to invest between $6B and $7B in the province to build four manufacturing plants for green energy parts such as wind rotors and turbines, and to construct wind and solar energy generating capacity to supply around 4% of Ontario’s electricity needs, by 2016. In return they will get a higher rate for that electricity under Ontario’s FIT program, so long as the plants and the capacity are up and running on time.

Predictably, the opposition parties have gone nuts. It’s too much money and not enough jobs! There wasn’t enough transparency and they weren’t involved! Before I go any further, the Liberals are the only party I have never voted for; I have no personal or political stake in the governing party and, one might think, quite a bit invested in the other three. Yet I can’t help but think that they are complaining because that’s what opposition parties are supposed to do, rather than because there is anything substantive to complain about. Ontario is spending under $500M to get a $6.7B investment.

The Green Energy Act* was meant not only to stimulate the development and construction of renewable energy supplies for the province, but to help replace Ontario’s obsolete automobile manufacturing capacity (sorry, folks–I know this is an unpopular stand with the labour crowd but the car is dying, and rightfully so. The faster we move to the new reality the better for us in the long run) with green manufacturing capacity. Right now the vast majority of green energy manufacutring is in Europe, and so whenever anyone in North America wants to put up a wind turbine they end up ordering parts from halfway around the planet. This is Not Good. It’s not good for the environment and it costs a lot of money.

Encouraging manufacturers of renewable energy products to locate in Ontario is better than continuing to bail out auto manufacturing in the misguided belief that their union jobs can be propped along with public money forever.

The Samsung Deal is apparently meant to be part of that: get Samsung to manufacture here, get them to promise to bring another four manufacturers along, and build a “critical mass” of local green manufacturing capacity, which should then become an attractor for other manufacturers, and then Ontario’s environment gets cleaner, our electricity supply gets greener, and displaced workers from traditional manufacturing sectors have somewhere to go.

What’s not to like?

Oh, right: the capacity deal. As part of the overall package, the Ontario Liberals promised 500MW of transmission capacity to the consortium, bumping them ahead of local manufacturers and projects who have patiently waited their turn to access the grid. Yep, I’d be steamed too. But if the Samsung deal works to attract manufacturing to the province, it could end up being a boon to the very parties who are now so disgruntled. (I am willing to be corrected if anyone would like to.) Parts should be easier and cheaper to source, purchase and replace. It should stimulate local R&D.

In the meantime, they’ll have to wait longer for access to Ontario’s overworked grid–so let’s hope the Powers that Be recognize this as a significant weak spot and make a nice big announcement of a significant upgrade in grid capacity. We need it.

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* I see someone forgot to replace Smitherman’s photo on the GEA website, now that he’s retired from provincial politics to run for Toronto’s mayor. Oops!

You may not have heard of the Pembina Institute and David Suzuki Foundation’s release of a report analyzing the economic implications of two greenhouse gas reduction targets in Canada, but if you have, I can nearly guarantee that all you’ve heard is “dealing with climate change is the end of the economy in Western Canada and too divisive to even contemplate” or “what are you talking about, it’s not that bad.” Which is a shame, because the real problem with the report isn’t about the cost of dealing with climate change or the geographic disparities and implications of that cost or the job gains to be had with transitioning to a clean energy economy.

The real problem is that the entire report is mythical.

Imagine this: you are the owner of a home with a leaky roof. You have hired someone to tell you how much it will cost to fix that leaky roof, and have received an estimate of the cost. When you consider whether or not you can afford to fix the roof, do you compare it to the imaginary cost of living in a house that does not require any roof repairs for the next twenty years? Or do you compare it to the cost of not fixing the roof and experiencing constant flooding and water damage for twenty years?

You own a car with an engine that is on the brink of disintegration. Do you compare the cost of fixing the engine or replacing the car with the cost of having an imaginary car that requires no repairs for twenty years, or do you compare it to the cost of not having a car to get around in?

For some unaccountable reason (and I’ve read the report, and they don’t explain it), the consultants chose to compare the cost of dealing with climate change over the next twenty years to an imaginary future in which climate change itself imposes no costs of its own, as if we have the option of living in a Canada for the next twenty years which can simply opt out of precipitation changes, shifts in tropical disease patterns, heat waves, the enormous die-backs in Western forests and possibly the boreal, the loss of permafrost, the likely extinction of thirty per cent of terrestrial species, the acidification of oceans, and so on.

This has the entirely expected effect of making climate change mitigation look expensive. Much as it would look really expensive to fix a leaking roof if you could just wish it away and pretend to live in a different house for twenty years.

Any economic analysis of the costs of climate change over the next couple of decades shows that it far, far outstrips the cost of dealing with it–and that we can successfully deal with climate change using current technology at a price tag of about 1% of global GDP.

All they had to do was compare the cost of dealing with climate change to the cost of not dealing with it–even the most basic, preliminary estimate–or at least of explaining why they could not do so but where interested readers could go for such estimates.

Boys and girls, climate change is not free. There is no potential Canadian future where we and our children will not pay through the nose for it–economically, socially and politically. Let’s stop living in Neverland.