Saturday 7 January 2017

Why should Africa be made to suffer by western anti-fossil-fuel hypocrites?



As this is my first post in the new year, I take this opportunity to wish all readers a blessed 2017.

I was struck recently by a short article in the National Post  entitled simply “Nota Bene.”  When I checked the online version at


I found it carried the title of this post. The article--an excerpt from, “The World Needs More Energy”, by Steven Lyazi from Uganda, raises major concerns about the consequence of Climate Change policies and reminds us that economic policies have costs as well as benefits.

Consequences for poor countries

 

Lyazi  notes that for most of history, the only energy available was “human or animal muscle, wood and animal dung, water power, and plant or animal oil”. Then, almost suddenly, we began to use coal, then oil, natural gas, hydro-electric and nuclear energy creating undreamed of prosperity in many countries. However, many countries lagged far behind, and many still do. These countries are “held back condemned to continued energy poverty—and thus to real poverty and the diseases, malnutrition, and desperation that go with the absence of modern energy.”

While Lyazi admits this is partly due to corruption and incompetent leadership, it is, according to him, also because

Callous, imperialistic people in rich countries use exaggerated, imaginary or phony environmental concerns and fake disasters to justify laws, regulations and excuses not to let poor countries use fossil fuels or nuclear power of develop their economies.

While most of the developed world only uses a little renewable energy, “they” want the poor countries to use only renewable. While he supports clean energy and a clean environment, he writes, “But that does not mean we should accept more poverty. It does not mean these rich, powerful people should be able to take away our right to live”.

The Paris Climate Change Agreement


Now Lyazi may be overstating his case. The 2015 Paris Climate Change Agreement which recently received the necessary ratification does make some provision for the poorer countries. It’s preamble, for example, “Further requests the Green Climate Fund to expedite support for the least developed countries and other developing country Parties”[1] Article 4 provides thatParties aim to reach global peaking of greenhouse gas emissions as soon as possible, recognizing that peaking will take longer for developing country Parties[2]…and “Developing country Parties should continue enhancing their mitigation efforts, and are encouraged to move over time towards economy wide emission reduction or limitation targets in the light of different national circumstances”.  And “Support shall be provided to developing country Parties for the implementation of this Article. The least developed countries and small island developing States may prepare and communicate strategies, plans and actions for low greenhouse gas emissions development reflecting their special circumstances” Moreover, Art. 9 provides that “Developed country Parties shall provide financial resources to assist developing country Parties with respect to both mitigation and adaptation in continuation of their existing obligations under the Convention”.  

Thus developing countries are allowed to implement policies at their own speed and are to receive financial assistance.  Canada, for example, has committed $2.65 billion to this purpose by 2020[3]. However, does anyone have any idea how much assistance will really be necessary and how much of that has so far been promised? Do we really believe that most developed countries will meet their own climate change targets as well as assist developing countries to the extent necessary? In any case, many developing countries have a very long way to go before they can match the level of prosperity in developed countries. Can this development really occur without further fossil fuels? Will renewable such as solar and wind really become so inexpensive as to meet the increasing needs in poor countries?  Will electric cars become so cheap that the average person in the third world can afford one? Even China is still building numerous coal-fired electric generating plants and has agreed only to stop increasing its emissions in 2030! What can we then expect from smaller, poorer countries? Our climate change policies must, obviously, continue to keep the consequences on poor countries in mind.

Progress through Industrialization


In fact, we must recognize that for these countries the environmental impact will first become worse as pointed out by Dylan Pahman in another article that caught my attention recently.[4]  In commenting on Pope Francis’ message on the World Day of Prayer for the Care of Creation, Pahman argues

What seems to be lost on these hierarchs[5] is what to do about the problem. The pope praises the UN’s Sustainable Development Goals and the Paris Agreement, but similar statements have not proven effective in combating climate change. What has proven effective? Industrialization and free markets. Really.

Although Pahman agrees that “Wastefully harming the environment is bad stewardship”, he posits that we do not have to choose between the plight of the poor and the plight of the planet.

 In the short run, of course, industrialization is the problem. A quick glance at a global pollution map reveals that newly-industrialized China and India are some of the worst offenders. However, so long as we truly care about the poor, we must not overlook the fact that these countries are where the greatest progress in overcoming poverty has happened since the 1970s. Hundreds of millions of people have escaped crushing poverty through the industrialization and increased liberalization of their economies.

Nevertheless,

 As a recent study in the journal Nature on environmental care from 1993-2009 notes, “while the human population has increased by 23% and the world economy has grown 153%, the human footprint has increased by just 9%.” Economic growth is compatible with care for creation.
                                    …….
“Encouragingly, we discover decreases in environmental pressures in the wealthiest countries and those with strong control of corruption.” In particular, “environmentally improving countries are characterized by higher rates of urbanization, human development (a composite measure of health and education) and control of corruption.” To clarify, they also note, “Most encouragingly, these countries are net exporters of agricultural and forestry products, and by this measure are not simply exporting their demand for food and fibre (and the associated local pressures) to other countries.”

Pahman recognizes that”

We will need to accept the fact that in the short run things will need to get a little worse for the environment, as they start to get better for the poor. Each nation must climb an initial “hump” during which it makes more aggressive use of resources, to attain a widespread level of general human well-being. Once that’s attained, significant mass support for environmental protection has emerged in every developed country.

Counting the Cost

 

How long it will take to get over this “hump” is not clear. In any case, developed-world climate change policies must recognize this trade-off between fighting poverty and fighting environmental degradation.  This short-run trade-off is not limited to developing countries. Also developed countries must be fully aware of the consequences of their policies. In Ontario, we have seen major increases in the price of electricity, at least in part, due to subsidies for solar and wind (“feed-in” prices of three times market rates) and the forced closing of all coal generating plants. Consumers are up in arms and some people are said to have to choose between paying their electricity bills or putting food on the table. In response, the Ontario government has now introduced subsidies for the poorest electricity users[6]. However, manufacturers are also complaining and threatening to move elsewhere—to locations with lower power rates. Ontario companies are becoming uncompetitive internationally.

Meanwhile, Alberta and B.C. have introduced carbon taxes amidst a major down-turn in the price of oil causing many oil producers to shut down with major employment effects. Quebec and Ontario are implementing “Cap-and  Trade”  while the federal government has just set a minimum national price for carbon of $10 a tonne to be implemented in 2018, rising to $50 a tonne by 2022.

On the other hand, Canada’s largest trading partner (and the world’s largest polluter, the U.S. has elected Donald Trump, a climate change denier, as president and will be going full-steam ahead in developing its oil and gas resources. While Canada’s LNG (liquid natural gas) projects are bogged down in the regulatory process, the U.S. has its first such export project up and running and others close to completion. U.S. shale oil production is increasing again after cut-backs due to lower oil prices. In fact, the U.S. is set to become a net exporter of oil and gas in 2017! Meanwhile, Canada still lacks adequate pipelines to take advantage of these export markets. At the same time, China, the world’s second largest polluter can emit as much as it wants until 2030

Now our Prime Minister may argue that Canada needs to be a leader in the climate change field and that leadership will put us in the forefront of renewable fuel technology and create plenty of new jobs. Personally, I have strong doubts that such will be the case. I also doubt whether the price in jobs lost is worth paying. Canada’s total emissions are only about 1 percent of the world’s total.  Let’s slow this process down until the U.S. decides to actually implement further climate change initiatives. The economic consequences of further Canadian measures will most likely be too much to bear. Let’s drop the planned increases in our carbon taxes for now.


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Topical Index of Posts



[2]  Emphasis added
[4] Calling climate change a sin won't help the planet -- or the poor”,. Acton Commentary, http://www.acton.org/pub/commentary/2016/09/21/calling-climate-change-sin-wont-help-planet-or-poo
[5]  The pope and Orthodox Ecumenical Patriarch Bartholomew
[6]  By the way, subsidizing the purchases of the poor of polluting products is also questionable policy. If an item really needs to be taxed then the poor should also be forced to make the necessary tradeoffs. They should be recompensed in ways which do not depend on the amount of the polluting product they use. Increasing income tax credit for lower income is a better way.

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