On May 1st, the Standing Committee on Natural Resources considered the issue of “Energy Security of Ukraine and the Rest of Europe”. Government MPs likely picked this topic because they were expecting the export of Canadian oil and gas to be the “solution” to Europe’s challenge.
What they learned, however, was unexpected. What was the most realistic way to promote energy security in the Ukraine and Europe? Energy efficiency!
Let me explain. First of all, the Natural Resources committee has transformed into a bitumen sands cheering section. For example, another topic being considered now is the “cross-Canada benefits of developing the oil and gas industry”. When Chief Allan Adam of the Athabasca Chipewyan First Nation tried to bring up the importance of environmental protections before the committee, he was scolded to only talk about the “benefits”. The latest topic is a crass attempt to promote fossil fuel sector interests in the wake of the complex geo-political and humanitarian crisis unfolding in Ukraine.
The committee asked how Canada could help Ukraine become less reliant on Russian energy sources. The witnesses poured cold water on the idea that Canadian oil and gas was the answer.
Each witness explained that the prospect of exporting oil and gas introduced a number of complications. First, Canadian fossil fuels would have to be sold at a premium. Europeans would either pay more for energy or Canadians would have to subsidize their own exports. Secondly, it would take at least a decade to replace Russian fossil fuels with Canadian sources because of the need to build up heavy infrastructure. Even the most hawkish witness on the potential for fossil fuel exports (a national oil & gas sector analyst from Deloitte) argued that Canada could export its knowledge and technology on energy development much easier than the raw resource itself.
These complications demonstrate the vulnerable position Canada creates for itself when it tries to chase down demand for its fossil fuels on international markets. To serve the European market, Canada would need to install high-cost infrastructure, which could become useless if political and economic conditions change.
The more attractive solution, according to witnesses, is to export Canadian expertise in energy efficiency. Anders Aslund from the Peterson Institute for International Economics noted that Ukraine was one of the least energy efficient countries in the world and consultant Michael Edwards pointed out that Ukraine could meet its own energy needs if it became as energy efficient as the rest of Europe.
Energy efficiency is an obvious solution because it is quick, portable, abundant, and cheap. Unlike pipelines that take years to build, energy efficiency efforts can be ramped up within months. Efficiency can also be improved anywhere energy is being used, which means expertise is immediately exportable to Ukraine or anywhere else. Efficiency is an abundant resource. Since 1971, Canadian improvements in energy productivity have saved more energy than the total of all energy supply resources combined (eg oil, gas, coal, wind).
What's more, energy efficiency is almost always cheaper than other forms of energy supply. A recent American survey found that electric efficiency only cost 2.8 cents/kwh, and natural gas efficiency cost 35 cents per therm, which is lower than the average price of gas at 39 cents per therm.
Finally, energy efficiency can deliver more enticing economic benefits than over-dependence on oil and gas. A report by Blue-Green Canada estimates that a $1 million dollar investment in energy efficiency would create 14 jobs compared to only 2 jobs in oil and gas extraction for the same investment.
So does Canada actually have efficiency expertise to share? Yes, but it could certainly further develop its energy efficiency industry. Canada has global industry players such as LED Roadway Lighting, as well as novel energy efficiency organizations such as Quality Urban Energy Systems of Tomorrow and Efficiency Nova Scotia.
Given Canada’s geography, it makes a lot of sense that we would develop energy efficiency expertise. In fact, the first Passive House (a house so efficient you can heat it with a toaster) was constructed in Saskatchewan in 1977 with researchers from the National Research Council and Saskatchewan Research Council. Unfortunately, Canada lost interest while Europeans mastered the approach.
This episode before the Natural Resources committee highlights two issues. First, the Conservative government is blinded by its obsession with fossil fuels. Quicker, cheaper, and more abundant energy solutions are available. Second, it begs the question of what role Canada should play in the world. Do we want to hook our national economy to the export of fossil fuel resources responsible for global climate destruction?
Developing expertise in energy efficiency is not only the right thing to do from an environmental perspective. It might also let Canada actually help countries facing problems of energy insecurity and energy poverty.