Elizabeth May’s work as an environmental activist and leader of the Green Party of Canada has coincided with the rise of climate change as a planetary threat, public concern and policy priority. John Kidder started as a cowboy and a range manager, and became a technology developer and a student of disruption. Elizabeth and John were married in 2019. Their deep expertise on the science and politics of climate change is reflected in their co-authorship of the 2022 primer Climate Change for Dummies, and in this exploration of where we are in the policy and politics of the clean energy transition.

Elizabeth May and John Kidder

Over the next few decades, the world’s economies will be transformed as they abandon fossil fuels. It is not going to be easy or painless. But we can make the necessary possible, and the possible will become inevitable.

Disruption is the displacement of an industry – cars in the early days, cellphones, digital photography, we all know the stories. It is always more rapid and more widespread and always creates more opportunities than anticipated. It is always resisted by incumbents. It is the “creative destruction” that Joseph Schumpeter said is the engine of modern economies, the “dilemma” that Clayton Christensen said caused the end of great companies.

Disruption of the fossil fuel industry is happening now. The direct and (so far) externalized costs of fossil and nuclear energy are continuously rising, while those of renewable energy are continuously decreasing. The curves have already crossed. Canadian governments are attempting to resist the inevitable, to square the circle of progress and political expediency. We think the better choice is to get ahead of the curve.

In December 2015, at the 21st Conference of the Parties of the United Nations Framework Convention on Climate Change in Paris, Canada committed to do its share to hold global average temperature increase to as far below 2 ºC as possible and strive to hold to 1.5ºC above pre-industrial levels. On April 4, 2022, the Intergovernmental Panel on Climate Change (IPCC) issued its clearest warning yet that worldwide greenhouse gas (GHG) emissions must peak before 2025, “at the latest,” and decline sharply — by about 50 percent — by 2030 to have any chance of holding to 1.5 ^oC or 2 ^oC. On April 14 2023, the G7 announced new assertive climate targets, forecasting “an overwhelmingly decarbonised power system in the 2030s”. The G7’s announcement from Sapporo included some couching, including (our emphasis): “accelerating the phase-out of unabated fossil fuels”, “investment in the gas sector can be appropriate if implemented in a manner consistent with climate objectives”, and other qualifiers. But the agreement does seem to represent a long-overdue recognition of the need for speed, and we hope against hope that the G7 governments will maintain their new intentions when they get back home and face the political and business lobbies.

Because of the political power of the fossil sector, Canada’s progress towards decarbonization has been dead last among the G7. Our fossil fuel production and our emissions have been rising, not falling. Our “targets” are less ambitious than the European Union or the US. And we are failing to meet even them.

The use of the word “targets” is unfortunate. It sounds tactical and is greeted with skepticism. We need to be explicit about our real goal: the fossil fuel business must be reduced to as close to zero as possible in the shortest time possible. Obviously, this can’t happen overnight. But we can no longer pretend that we can continue expanding fossil fuel use. If we are to keep functional societies and governments – preferably democracies – capable of protecting humanity, emissions must stop growing and start dropping before 2025, and be cut in half by 2030.

This is the world’s “moonshot”. We think Canada should set a great example – a large exporter and consumer of fossil fuels moving intentionally to transform its economy.

The policy instruments favoured by Canada don’t attempt this. Fossil fuel incentives undermine other actions. Often the carrot hand doesn’t seem to know what the stick hand is doing. Tough-but-necessary decisions like a scheduled exit from fossil fuels are not yet on the table.

Much of Canada’s crude is bitumen from the oil sands. We citizens are spending $30 billion to double the TransMountain pipeline, solely to export diluted bitumen, so committing to oil sands expansion. We are boosting natural gas fracking for LNG exports. Fracked gas has emissions like coal – it releases large quantities of methane for which we have only rudimentary monitoring and measurement. And we are opening up new areas for fossil fuel expansion. The IPCC and the International Energy Agency think expansion is directly opposed to right action. The UN Secretary-General says simply that expanding fossil fuel production is “moral and economic madness.”

Our government, like democratic and autocratic governments around the world, processes climate policy within a choice architecture skewed by the fallacies of the status quo ante, dominated by oil, and resistant to a paradigm shift.

Among such fallacies, we only count emissions from what we burn in Canada, as if we were not the world’s fourth-largest exporter. The planet as a whole is on a carbon budget. We are rapidly exceeding that budget. To hold to 1.5 ^oC or even 2 ^oC requires all the world’s economies to stop adding to our emissions and start subtracting, immediately.

In approving drilling off Newfoundland at Bay du Nord, Environment and Climate Change Minister Steven Guilbeault stated the obvious: offshore oil is less carbon intensive than bitumen. But he did not suggest reducing bitumen production to make room for new emissions. He announced in Question Period that where the additional billion barrels gets burned is not our concern. As Tom Lehrer sang, “Once the rockets go up, who cares where they come down? That’s not my department, says Wernher von Braun.”

To justify new fossil fuel production, we pretend as well that “carbon capture and storage”, “CCS”, can generate net benefits by reducing the amount of carbon generated in producing bitumen. The argument suggests that a newly produced CCS barrel is a good barrel, of net benefit to the world. Two fundamental fallacies here: first, of course, a barrel of CCS bitumen is still just a barrel of bitumen: the only difference is that it was produced more efficiently. It’s still a net addition to the problem. Second, we export that barrel, and while we don’t bother to count its emissions when it’s burned somewhere else, the worldwide carbon budget does. Wernher von Braun again.

Canada has continued for years to increase fossil dependency and to boost emissions. We’ve knowingly been going in the wrong direction. Our 2021 emissions were 19 percent higher than in 1990. In 2021, 14 percent of Canada’s total exports were fossil fuel products, and about 72 percent of domestic primary energy came from fossil fuels. Both those lopsided ratios are rising. Our per-capita use of fossil energy is among the highest in the world, and our emissions targets and performance are the worst in the G7.

How should Canada, given high domestic energy demands and increasing dependence on fossils for export revenues, meet its international commitments?

The disruption of fossil fuels will come from worldwide electrification using renewable energy. Canada needs to prepare for the day when its expensive crude oil will not be competitive in world markets. How will Canada adjust to lower export revenues, reduced industrial activity and jobs when its fossil reserves become uneconomical and “stranded”? Policy here will need to react to exogenous change.

The domestic issues, on the other hand, will need active intervention by governments to maximize new opportunities for households, industry and labour. Policy here will need to encourage endogenous change.

Both sets of policies must acknowledge that disruption is the goal, not the enemy. Shifting export focus from commodities to value-added services and manufacturing has been a Canadian goal for decades. And now that we export so much bulk carbon, the need is even greater. Expanding renewable energy, encouraging industrial shifts to electricity, renovating residential and commercial construction, building an electric vehicle fleet, and as a necessary condition, building the national grid – these will accelerate the transformation, make the economy more productive, and provide solid, local, jobs for tradespeople and union members now in the oilpatch and service companies.

Everyone wins except fossil-fuel company owners, executives and bankers. Most of the industry is owned outside Canada, so the domestic impact will be substantially reduced. The disruption will require more workers than the oilpatch has ever hired. Some support companies will move into the new businesses. Some will fail. This is the latest of Canada’s periodic conversions from one staple export to another – from fish to furs to timber to grains to minerals to oil and now to renewables. We’ll survive.

Experience in Europe is illuminating. Solar, wind and other ‘green’ sources contributed 21.8 per cent to the EU’s total energy in 2021 . As the war in Ukraine cut off conventional supplies, solar power generation in Europe grew by 24 percent in 2022, and wind by 8.6 percent, according to the World Economic Forum. An annual growth of 24 percent implies doubling in less than three years, an eight-fold increase over 11 years, unstoppable domination of a market.

Costs keep dropping – the US National Renewable Energy Laboratory reports that the price for solar photovoltaic modules has dropped by 85 percent in the last decade, and unsubsidized utility-scale (100MW and up) solar installations will soon provide energy at less than 3 cents/kWh. Such prices have already been reached elsewhere: in April 2021, in Saudi Arabia, a 300 MW renewable energy project was inaugurated at an investment cost of US $320 million. The project is contracted to provide power at a record-breaking tariff of US 2.4 cents/kWh. This country with enormous resources of low-cost sweet crude is hedging by investing in the future of solar energy. Canada could do the same.

With such growth in renewables, even with growing energy demand, most fossils will be displaced. This is the wholesale replacement of the old industry that our common future requires.

Some observers — including real scientists like Vaclav Smil and others such as the Fraser Institute — don’t think this rapid transformation is possible. They see how long it took for fossils to dominate, and conclude that the shift to renewables will take too long. They think that the variability of wind and solar energy mean they cannot support a dependable grid. They think the amount of resources used to produce renewable energy will make the transformation infeasible.

These and similar objections are examples of trying to drive forward while looking in the rear-view mirror. It did take a century for fossils to transform the world’s industrial base – but that time included the discovery of fossil fuels, the development of uses from tiny amounts for lubrication and medicine to larger amounts for lighting, to making steel and powering steam generation, through to the invention of the internal combustion engine. These uses or markets existed at relatively tiny scales or not at all before fossil fuels came on-stream. And development was controlled and centralized — Standard Oil and Royal Dutch Shell were created to manage distribution from numerous small producers, to maintain high prices even in cases of over-supply (there is nothing new about OPEC — the locus of control has simply shifted from New York to Saudi Arabia).

The transition away from fossils is driven not only by costs, but by an existential planet-wide threat — this should telescope the transition timeline. Energy project analysts should use a negative discount rate, to value returns in the future more highly than costs in the present.

In contrast, electricity is ubiquitous globally, is already less expensive than fossil fuels for new power, and can be generated at distributed facilities without central monopolies. Overall renewable costs continue to fall at around 15 percent per year, solar costs are dropping 22 percent for every doubling in output, the deployment of smart grids and the efficiency of use of electrical power in industrial, domestic and transportation applications increases steadily. Conversion from fossil energy to renewable electricity will be much more rapid than developing the fossils from scratch.

The transition away from fossils is driven not only by costs, but by an existential planet-wide threat — this should telescope the transition timeline. Energy project analysts should use a negative discount rate, to value returns in the future more highly than costs in the present.

Utility monopolies will be disrupted – no more $30 billion Site C’s, no more Muskrat Falls. Massive central generation is no longer optimal. Smart grids make local generation, load buffering and shedding efficient and reliable. A nationwide grid would deal with supply variability, be backed up by hydro reservoirs for pumped storage, be connected to thousands of fixed batteries and tens of thousands of vehicles that become part of the grid when they’re plugged in, and to thousands upon thousands of buildings with rooftop solar. The grid must be the first priority for money freed from subsidizing fossils.

Material requirements are dropping. Current wind generators use large rotors — newer technologies like vortex generators and vertical turbines use less material and are more efficient. Solar technologies have likewise moved beyond older types cited by the Fraser Institute– MIT’s solar thin film gives a 14-fold increase in power per kilogram, and could be applied on almost any surface without significant infrastructure costs. Technology disruption is self-accelerating.

None of this denies larger points made by Vaclav Smil, by Bill Rees of the University of British Columbia, and by many others. Humans cannot continue to devour the Earth without coming to unavoidable binding limits. Transformation to a less consumptive society will be more difficult than solving energy issues. But solving the energy issue is a necessary condition for everything else.

We no longer face a choice between some sketchily imagined “just transition” and an “unjust” disruption. The world is in polycrisis, says Thomas Homer-Dixon. Climate change is a poly-issue of security, justice, and current and intergenerational equity. Disruption is a necessity and an inevitability. Our task is to manage it as best we can.

Elizabeth May and John Kidder co-authored “Climate Change for Dummies” (Toronto, John Wiley and Sons, 2020). May is the Leader of the Green Party of Canada and MP for Saanich-Gulf Islands. Kidder was a range ecologist and technology entrepreneur, is now an amateur student of disruptive technologies.