Mid-Term Elections - Game Changer, Not the End of the World
U.S. mid-term election results effectively
kill chances for a comprehensive national climate change policy, at
least during President Obama’s first term in office. While this
represents a significant ‘game-changer’, it does not mean the end
of the world, nor does it mean progress is not possible in other
important areas such as clean
technology.
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2010 - This week’s U.S. Mid-term election
results have sent many messages to the U.S. political and business
communities, but one thing is very clear - there will be no
national cap-and-trade program in the foreseeable future, nor any
national consensus on a new climate change
policy.
class=”MsoNormal”>While at the Obama administration has
little room to manoeuvre with respect to a national climate change
policy, the defeat of Proposition 23 in California sends a clear
signal that the nation’s most populous state - and by far its
biggest market for renewable energy - will continue to
grow the clean industry sector.
class=”MsoNormal”>The defeat of Proposition 23, the
proposal that would have suspended that state’s emissions-reduction
law until unemployment rates fell sharply, is cause for optimism in
the alternate energy community, despite continued uncertainty about
the economy.
class=”MsoNormal”>John White, Executive Director of the
Center for Energy Efficiency and Renewable Technologies and a
longtime clean-technology advocate in Sacramento said in a Los
Angeles Times interview that California’s future clean-technology
economy could be “as important as the aerospace industry was to
California during World War II,” with a new generation of wind and
solar projects that “lead the world again.”
class=”MsoNormal”>It’s a view echoed by
Rhone Resch, head of the U.S. Solar Energy Industries
Association, who says the results ensure “that California and the
entire United States will continue to grow the clean industries and
reclaim leadership in the world.”
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mean for Canada?
class=”MsoNormal”>Had Proposition 23 succeeded, it
would have had implications for Canada - particularly for British
Columbia - notes the University of British Columbia’s Sauder School
of Business.
class=”MsoNormal”>Given that California is the economic
engine for climate policy on the West Coast, it notes in a
target=”_blank”>Briefing Paper, Proposition
23 not only would have stalled key climate change mitigation
programs in California, it would have had a negative ripple effect
on other regions looking to limit GHG emissions, including British
Columbia.
class=”MsoNormal”>California’s economy,
which is larger than those of 90 per cent of the countries in the
world, creates a much larger pool for firms in British Columbia and
other economically smaller jurisdictions to find a viable carbon
trading market, notes the
target=”_blank”>Vancouver Sun.
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trade
class=”MsoNormal”>The election results also sent a
strong signal that states (and provinces) should consider going it
alone to create their own climate change policies and programs. In
particular, it gives further momentum to the Western
Climate Initiative, a cap-and-trade program that includes
California, six other American states, as well as Ontario, Quebec,
British Columbia and Manitoba, which is scheduled to come on line
in 2012.
class=”MsoNormal”>Clearly, that is California’s view in
the face of little action at the federal level in either Canada or
the U.S., noted Danielle Droitsch, director of U.S. policy for the
Calgary-based Pembina Institute in a CBC
interview.
class=”MsoNormal”>President Barack Obama said he will
look for ways to control global warming other than placing a
ceiling on greenhouse gases. “Cap-and-trade was just one way of
skinning the cat; it was not the only way,” Obama said at a news
conference. “I’m going to be looking for other means to address
this problem.
class=”MsoNormal”>Rather than seeking a
broad approach to energy and climate change, he
target=”_blank”>said, he would look
for smaller policy bites that could attract bi-partisan support
such as further development of electric vehicles, or converting
some of the nation’s heavy truck fleet to run on natural gas,
programs that lead to innovation and which could create
jobs.
class=”MsoNormal”>That touches on the other clear
message the election results have sent to the Obama Administration
- that great deal more emphasis must be placed on job creation in
the face of sluggish recovery of the U.S.
economy.
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Jobs
class=”MsoNormal box”>“Genuine improvement on the
jobs front is a prerequisite for future success and conservatives
should be forced to take responsibility for the economy.”
Center for American Progress
class=”MsoNormal”>If the Obama Administration responds
to that message, this could translate into renewed stimulus
spending programs, many of which would focus on clean technology,
the one area where new jobs are possible in the short term
according to recent research by the GLOBE
Foundation.
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relations
class=”MsoNormal”>While acknowledging that the U.S.
election results will put a national cap and trade system in
America on the back burner for a “continued period of time,”
Canada’s now former Environment Minister Jim Prentice said recently
in a
target=”_blank”>CBC interview that the
federal government won’t move by itself on cap-and-trade
legislation to lower greenhouse gas emissions.
“We’ve been very clear that we will not go it alone on
cap-and-trade legislation,” he said.
class=”MsoNormal”>What impact Jim Prentice’s sudden
resignation from the Harper Government Cabinet will have on
Canada’s climate policy is unclear. His interim replacement as
Environment Minister, John Baird (who previously held that post)
has been equally adamant that Canada
would proceed in concert with the U.S. on climate change
goals and regulations.
class=”MsoNormal”>Both countries have promised to lower
emissions 17 per cent below 2005 levels by 2020.
class=”MsoNormal”>“If the U.S. is on pause for federal
climate legislation, does that mean Canada really is on pause for
the next two years?” asks Pembina Danielle
Droitsch. “I hope not.”
class=”MsoNormal”>Ideally, the Conservative government
should now shift to a “
target=”_blank”>made in Canada” approach
that will get the country started on a road to a serious climate
change policy, she says, and then adapt to “whatever the U.S. does,
whenever the U.S. does it.”
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class=”MsoNormal”>On the energy policy side, the
changed political landscape in the United States has been
interpreted by some analysts as providing additional breathing
space for U.S. fossil fuel energy imports from Alberta’s oil sands,
and there is every indication that major new developments in this
regard will proceed.
class=”MsoNormal”>Nonetheless, Canadian energy giants
such as Transalta will continue to explore opportunities in the
alternate energy sector. (See GLOBE-Net article (
TransAlta is now Canada’s largest producer of wind
power).
class=”MsoNormal”>In fact, an industry led initiative
is underway to develop a new ‘National Energy Strategy’ that places
Canada’s clean energy resources at the forefront of the initiative
is another ‘game changer’. A recent ‘
target=”_blank”>Clean Energy Dialogue’ that
took place in Banff involved some of the heavy hitters in the
fossil fuel sector.
class=”MsoNormal”>The three-day conference included
energy leaders, environmentalists and analysts, including
representatives of the Energy Policy Institute of Canada (EPIC),
the Energy Framework Initiative, the Canada Council of Chief
Executives and the Canadian Chamber of Commerce. It purposely
excluded government representatives.
class=”MsoNormal”>Bruce Carson, a former senior adviser
to Prime Minister Stephen Harper who now co-chairs the EPIC,
presented the strategy to the country’s energy ministers at their
annual meeting in September, in Montreal.
class=”MsoNormal”>Quoted in a CBC
target=”_blank”>interview, he
said “I think that going forward with a
coherent strategy, then one sector of the energy sector relates to
another … and it would allow us to really take on the world
leadership role that we could possibly [have].”
class=”MsoNormal”>“Without a strategy, everything
that’s announced by government, everything that industry does, is
always just a one-off. If you’ve got a strategy, you could make
your energy efficiency announcement relate to international trade,
relate to demand-side economics, relate to other parts of the
energy sector and other parts of the Canadian economic and social
sector.”
class=”MsoNormal”>That is a view that is shared by
other business leaders as evidenced by a
target=”_blank”>BSR/GlobeScan State of Sustainable Business Poll
2010 released this week shows that more than eight in 10
respondents (84 percent) of corporate leaders are optimistic
businesses will embrace sustainability as part of their core
strategies and operations in the next five years, with a major
emphasis on energy efficiency, use of renewable energy, and carbon
offsets as the bases of their climate change
policies.
class=”MsoNormal”>In summary, while the U.S. midterm
elections have not removed lingering uncertainties regarding
climate and energy policies both in Canada and the United States -
with the possible bright light being the clean technology sector -
neither do they means the end of progress in these
areas.
class=”MsoNormal”>What we seeing is a change in the
pattern of leadership, which is coming from the sub-national levels
of government, i.e. at the state, provincial and even municipal
levels, and from industry.
class=”MsoNormal”>In fact, this is one area where the
business community seems prepared to move forward, leading rather
than following government policy.
class=”MsoNormal”>John D. Wiebe
class=”MsoNormal”>President and CEO
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