Jason Kenney is in combat mode: if he wins the upcoming election in Alberta, he says he’ll “fight back hard” against the “anti-oil activists” and he is calling on CEOs from the oil patch to join him. They should resist. Driving an even deeper wedge between climate change and the oil patch is a really bad idea; and industry is likely to be the biggest loser.
CEOs might start by reminding themselves of the First Ministers Meeting in December. None of the premiers disagreed that climate change is real, largely man-made, and a growing threat to people and animals. Serious politicians no longer deny these things. The question now is over how governments should respond.
Having slammed the door on a carbon tax, conservatives like Kenney, Doug Ford, Scott Moe and Andrew Sheer are looking to Australia for an alternative – and that’s the other thing industry should resist.
Australia’s ‘Direct Action’ Approach
In the late 2000s, Australia was in a severe drought. Climate change was on people’s minds and the Labor government was working furiously to develop an effective carbon reduction scheme, largely with the support of conservatives. Legislation was finally proposed in 2010, but when conservative opposition leader Malcolm Turnbull agreed to support it, hard-liners in his party revolted and he was forced to resign.
His successor, Tony Abbott, set the new tone for debate by savaging Labor’s use of a carbon tax. After winning the 2013 election, he promptly dismantled the system, much as Doug Ford has done in Ontario. Abbott’s alternative, Direct Action, is the model Ford and other Canadian Conservatives are now turning to as an alternative to the carbon tax. Basically, it uses a carrot-and-stick approach:
- The Carrot: Abbott created a $2.5 billion fund to pay organizations to take actions that reduce emissions, from planting trees to carbon sequestration.
- The Stick: The conservative government set standards to limit GHG emissions from big emitters.
Ideally, these two components work together: on one hand, the fund promotes new carbon-friendly practices; and, on the other, strict standards reduce the amount of GHGs industries can emit.
In fact, the scheme has been a dismal failure. There are several reasons, but one stands out: lack of political will. Setting effective standards involves difficult choices about which sectors should be subject to which standards. This gets very complex very quickly – and that creates tension and disagreement. It also makes it relatively easy to smuggle in exceptions, set weak standards, or fail to implement parts of the plan, which is just what conservatives have done.
In hindsight, Direct Action has been a smokescreen that let the government avoid action by obfuscating and stalling on rigorous standards, while still claiming to address climate change.
Thus, current prime minister Scott Morrison insists Australia is on course to reach its targets under the Paris Agreement even though experts agree it will fall far short of them. Indeed, so far, only 16% of the announced 191.7 million tons of emissions reduction have been delivered.
As for the fury conservatives directed at Labor’s carbon tax, well, a direct-action approach is no easier on Australians’ wallets. It too must be paid for by the public, either through taxes or a levy on industry (which is in fact a carbon tax) that will be passed onto consumers.
After six years, the jig is up; Direct Action has run its course and the Morrison government has effectively abandoned it. As conservatives head into an election, they are deeply divided, they have no coherent policy, and no progress has been made on climate change.
Meanwhile, Labor, which is comfortably leading in the polls, has proposed a $15 billion climate change plan, including a 45% economy-wide emissions reduction target. The climate change debate in Australia looks about to come full circle.
The Lesson for Canada
So, why are Canadian conservatives like Doug Ford and Scott Moe modelling their approaches on Direct Action? Obviously, not because of its stunning successes. More likely, they too find the complexity appealing. It’s a very untransparent system, which allows for inaction and obfuscation, while claiming to be engaged. And that works for them.
If so, they’re in for a rude surprise. Unlike Australian conservatives, they won’t get to drag this out for a couple of mandates. The policy environment has changed. Evidence around climate change is now pouring in, the public is increasingly aware and concerned, and the clock is ticking.
The question now is over the seriousness of the issue. People want to know how real the danger is: How advanced is climate change? What are the consequences of inaction? What kind of targets do we need to avoid disaster? What are the timelines for meeting them?
This is the debate Canadians will have over the next five years. The kind of obfuscation Australians have been living with won’t be tolerated. There is too much at stake, reliable information is too available, and there are too many articulate and informed spokespersons, which brings us back to industry.
Kenney may be right that some environmental groups are implacable enemies of the oil industry who will oppose development, no matter what; and he is surely right that lots of Albertans are furious over their opposition to the pipeline. But most Canadians are moderates who are not looking to shut down the oil patch. They want governments to find a workable balance.
A war with hardline environmentalists will do nothing to advance this. On the contrary, it will further polarize debate and force those in the middle to choose sides. This is not a fight industry can win – probably not even in the short-term.
Albertans need a climate change plan that is in step with the best science, the province, the nation, and the industry. If Kenney wants to help the oil industry, he will abandon the military posture and start looking for an effective way to provide moderates with a more influential voice. Right now, Alberta needs a charismatic diplomat, not a bellicose general.