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Governments shouldn't count on predictable response to carbon taxes
Written By: Stewart Muir Published: Affordable Energy (www.affordableenergy.ca)
The night before British Columbia’s carbon-dioxide emissions tax was implemented in February 2008, I was surprised to see lineups at gas stations. Some motorists apparently believed that the end of affordable gasoline was nigh and they better fill up, because at midnight they’d start paying an extra 2.5 cents a litre.
The world didn’t end, and over the next year, B.C. recorded a small drop in the amount of gasoline sold for road-transport use. From 1,107 litres a person in 2007, consumption fell by four per cent.
Since this coincided with the 2007-2009 “great” global recession, there has always been some question whether it was carbon pricing or alternatively a reduction in general economic activity, that accounted for the drop. B.C. registered barely any economic growth in 2008. In 2009, its economy shrank.
Ten years later, it’s often claimed that the B.C. carbon tax has brought about a long-term, 10-per-cent decline in fuel consumption. That’s simply not true. In fact, consumption of gasoline and diesel went up — not down — on a per-capita basis from 2008 to 2017. The most striking correlation was how closely the consumption of liquid road fuels (mostly gas and diesel) tracked the ups and downs of the economy.
As Canada prepares to embark on a much broader carbon-pricing adventure, once again we’re locked in a numbers game. Those experts squabbling over who has the most elegant economic model have gotten way ahead of themselves. A most basic question is being overlooked: Will a carbon tax cause fewer hydrocarbons to be combusted or won’t it?
The major overlooked fuel story of recent years has been how consumers reacted to ever-increasing efficiency from technology.
In 2007, before B.C.’s carbon tax came in, the Honda Civic was the country’s most popular new car. In those days, for every sedan or hatchback sold in B.C., one truck or SUV was sold.
Then something unexpected happened.
As the global economy emerged from recession, buyers suddenly wanted more pickup trucks and SUVs. By the summer of 2018, the ratio was 2.7 new SUVs and light trucks for every new car. It’s the same trend across Canada. Today, the Ford F-150 is the country’s most popular “light” vehicle.
The most economical Ford F-150 available in 2007 ran on a 4.2-litre engine that produced 25 per cent more CO2 emissions than the average vehicle. One decade later, Ford’s basic model today has a 2.7-litre engine that’s smaller than the average light vehicle engine and delivers just slightly-below-average GHG performance. Greenhouse gas emissions from consumer vehicles available to B.C. buyers fell 17 per cent in the decade to 2017, in part because engine size generally decreased.
Further innovations meant that a new Toyota Camry for sale last year burned 8.3 per cent less gasoline than a 2007 model with the same sized engine.
It turns out that as more performance (energy) is squeezed from a litre of gasoline, people tend to rationalize the purchase of a bigger vehicles. Whether or not there is a $20, $30 0r $50 a tonne carbon tax to pay — on top of all of the other fuel taxes — seemed not to be much of a consideration over the past decade.
The long-faced carbon experts may wish to treat these trends as a sideshow, but the behaviour of wily consumers under low-dose carbon pricing looks more like the main stage.
Governments can flip a switch on carbon taxes, but will that produce the intended result? It didn’t in B.C. We’ll see what happens elsewhere. But for most families, commuting and home heating are part of daily life, not a luxury.
Meanwhile, any talk of proven measures — more innovation by the Canadian oil and gas sector, improvements to traditional vehicles (now predicted to double today’s fuel economy by 2040), and zero-CO2 nuclear energy — is deemed to be politically dangerous, drawing accusations about having no plan, or worse.
Such is the parlous state of the Canadian energy debate in 2018. We are on track to soon repeat, at a national scale, the lacklustre British Columbia experience of carbon pricing.
— Stewart Muir, founder and executive director of Resource Works, was business editor and deputy managing editor of The Vancouver Sun when British Columbia implemented its carbon tax. He writes for Canadians for Affordable Energy.
Originally posted on April 13th, retrieved from: http://energynow.ca/shells-bet-on-gas-underscores-big-oils-push-to-replace-coal/
BP Plc coined the slogan “Beyond Petroleum.” The new industry mantra might be “Beyond Oil and Into Gas.” Oh, and while we’re at it, “Down With Coal.”
Consider Royal Dutch Shell Plc’s recent $70 billion acquisition of BG Group Plc — clearly a huge bet that natural gas will prove to be its cash cow of the future.
The petroleum industry’s move toward gas is hardly new — the hydraulic fracturing shale revolution is in its second decade, after all. Still, Shell’s move is an emphatic confirmation that some among the Big Oil family firmly believe gas will play a growing role in meeting the energy demand of emerging countries such as China and India that are trying to move away from dirtier coal.
“Gas will likely overtake coal as the world’s second fuel by the late 2020s,” said Jonathan Stern, head of the natural gas program at the Oxford Institut…
Written By: Heather Douglas Published: Energy Processing Canada Magazine (www.northnstar.ab.ca)
"Whomsoever controls the volume of money in any country is absolute master of all industry and commerce and when you realize that the entire system is very easily controlled, one way or another, by a few powerful men at the top, you will not have to be told how periods of inflation and depression originate." James Garfield (1831-1881), 20th President of the United States, serving from March 4, 11881 until his assassination later that year.
Unfortunately, those who control the money -- that fuels investment in industry and commerce -- are often aided and abetted by those who draft the legislation and devilishly assault its very existence. The federal Trudeau government has proposed what it claims are "well-intentioned policies to rebuild public trust and advance indigenous reconciliation" while "advancing good projects to ensure energy resources get to markets respons…
Prelude The interpretation and opinions expressed here are the
authors' ideas on related science that interests us and affects us.Some members have quite different
interpretations of this science and the editorial committee actively welcomes
other articles from other perspectives on this and other interesting topics
“We all know that
human activities are changing the atmosphere in unexpected and in unprecedented
ways.” George H.W. Bush
“To be absolutely
certain about something, one must know everything or nothing about it.”Henry Kissinger
passionate about climate change, and they may feel that the climate concerns discussed
in this paper are either overblown or understated. Some may feel that climate
change due to man-made greenhouse gases (GHGs) is not a valid scientific
hypothesis at all, while others may think the world is facing an existential and
imminent climate catastrophe. We find no scientific basis for either of these