"A man is rich in proportion to the number of things which he can afford to let alone.”

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Oil Dependent or Oil Addicted?


 By Eric Rempel

No doubt Canada is extremely dependant on oil. Ours is a cold climate, and we need to expend more energy than most countries just to keep warm. Also our country is sparsely populated and because of this we need to travel greater distances just to remain in touch with one another and to move goods between different parts of the country. There is a good reason for our dependence on oil, but are we addicted? I submit we are addicted! Hear me out.

So on the demand side we need to acknowledge that Canada, by its very nature, is a country that needs and will always need more energy than many countries if it is to prosper.

But, it seems to me, our addiction goes further. What oil and gas we have we want to export, we want to sell outside of Canada as rapidly as possible – why? In order to maintain some sort of prosperity that we don’t really need.

On the supply side, Canada’s proven reserves of natural gas are modest compared to the reserves in Russia or the oil states such as Saudi Arabia, Iran or Qatar. Canada’s proved reserves of oil are substantial, but before we get ecstatic about that we need to remind ourselves that this oil sand oil is not free. It is tied up in the oil sands, and no one knows how much of that oil can be extracted. Many experts say that most of that oil will never be extracted because it will take as much energy to get it out as is embedded in that oil.

Fortunately we are also well endowed with other energy resources. The most notable is our hydro-electric resource, but there is also wind and solar.

It seems to me that if we were not addicted, but merely dependent, we would be very conscious of the fact that our dependence on non-renewable resources is not sustainable. We would be consciously trying to move away from our dependence on these non-renewable resources. We would be applauding every action of our government that moves us in that direction. That’s only rational!

That’s not what we Canadians are doing. Although it’s true that our domestic consumption of oil has levelled off, it is not yet going down. And natural gas consumption in Canada continues to go up. And we continue to promote the export of oil and gas.

If we were a rational people, a non-addicted people, as soon as we realize that we are becoming dependant on non-renewable resources, we would begin to take steps to reduce that dependency. Fundamentally, we would be doing two things. First of all we would want to do something to discourage this dependence on these non-renewable resources. We would want to encourage the frugal use of these resources, minimizing waste. I can think of only one efficient, effective way of doing this in a market economy and that is to artificially raise the cost of this resource. In essence, this is what a carbon tax does. As a nation we have barely begun any creation of incentives to reduce consumption. For some reason we are comfortable with a tax on income and profit, but reluctant to tax the consumption of non-renewable resources. Go figure!

The other step we would take to reduce our dependency on this non-renewable resource is to look for alternatives and provide incentives to move to alternatives. In this regard we have done significantly better. LED light bulbs and electric cars are significant steps in the right direction.

It is not enough that we deal with our addiction as individuals, no, we need to move in that direction corporately. We need political leadership in effecting the necessary changes. In this regard the Trudeau Liberals have said they want to reduce oil consumption, but have instituted only a weak carbon tax, and more than offset this by purchasing a pipeline [to promote oil consumption]. The Scheer Conservatives have no plan. Just a bunch of ideas. Total addiction within these two parties.

If we seek leadership in moving away from our addiction to oil, we will need to look to the NDP and the Greens.

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