What to write for your inaugural post on a site that is based around sustainability when you don’t really know all that much about sustainability? I decided on the idea of, “You don’t need to be a tree-hugger to love renewable energy.” This basically describes my feelings when talking about solar-, wind-, and hydro-based energy strategies. I’ll be quite honest, I have no idea who to believe on the reality of just how bad burning fossil fuels are for the environment. I have read so much propaganda coming from both sides that I’m not certain who to believe, or to what extent anything is true. I do know this much however, our fossil fuels will “soon” (soon being a relative term) be depleted. There are various estimates, but most people agree that by 2030-2040 much of the world’s oil reserves will be drained.
You could fill a library with all the material that has been written about the scenarios that might occur when we begin to run out of oil, but the basic idea is that it will likely change the way we live, and whomever has the energy infrastructure needed to replace the precious liquid gold is going to be quite wealthy.
Renewable Energy – The Great Uniter?
So we want to have the infrastructure in 20 years, on that most people can agree. I would argue that we should want it right now. The energy industry in Canada is our bread and butter (as in, “Without the energy industry we couldn’t afford bread and butter”). About 40% of the entire TSX is energy companies. The fact that this industry has a finite lifespan is a little scary.
If you are a country other than Canada and have a trade imbalance when it comes to energy, then there should be even more motivation there to alter that obvious structural drain right? The fact we are so dependent on oil for so much of our infrastructure is a very scary fact just from an economic, or even security-based viewpoint.
It stands to reason that developing as much of a self-sustaining energy infrastructure as possible would be in the best interests of countless countries. Yet instead we argue about how much effect fossil fuels have on global warming, I don’t mean to belittle the issue, but it is actually pretty irrelevant to a pragmatist like myself. I want renewable energy to ensure my living standards stay nice and high (nothing like selfish capitalists and hippy tree-huggers coming together for a lovefest eh?) for the foreseeable future. If I happen to positively affect the climate on some level as well, great.
No One Ever Called The Government Efficient and Nimble
So where do we begin? Environmentalists would have us believe that we simply need to pump government tax dollars into subsidies for solar power technologies programs and place large taxes on gasoline, and the problem will fix itself. I don’t believe this is true at all. Absolutely any time the government tries to mess with the free market it ALWAYS ends up doing it inefficiently and wastes a lot of money. Yet I’m not sure if waiting for big businesses to pass on the increased cost of fossil fuels over the next two decades is an effective method either.
In the recent book, That Used To Be Us authors Thomas L. Friedman and Michael Mandelbaum explain that China has already built a lead in certain areas of renewable energy. They realize that their dependence on something as essential to their growth as energy is not a good thing, and they have the ability to massively act on that realization. Friedman and Mandelbaum then go on to explain that ceding the innovative edge to other countries will be extremely costly for the USA.
No Wammy, No Wammy, STOP!
Canada would actually be hit by a double wammy in twenty years if we don’t start looking down the road. Our fossil fuel-driven economy would cool down fairly quickly and we would need to start importing technologies from other countries to set up our new infrastructure. This could result in a huge hit to our trade balance and GDP. On the other hand, we have a massive energy-gobbling neighbour to our south who would assuredly buy any surplus energy of any kind we can produce (Keystone XL aside). We have seen the benefits of this with hydroelectricity in my home province of Manitoba.
Is Renewable Energy Worth It?
But the question remains, at a time when economies are sputtering, and the Western World is dealing with a shrinking of their power is relative terms (if not absolute terms), is an investment in green energy worth it? I believe it is. The advantages to be gained from being in on the ground floor of new technologies are too numerous to be discussed here, but they are definitely considerable to say the least. While the benefits may look miniscule right now, the consequences of not having some sort of clearly defined energy policy are even more scary in my opinion. It doesn’t matter if you look at it from an economic, self-defence, or environmental standpoint, there are many disadvantages to sticking our proverbial head in the sand on this one.
Aren’t We Supposed To Be Good At This Stuff?
As some general ideas going forward I think Canada should leverage some of our energy expertise in order to springboard our research going forward. We have some great hydroelectricity programs, our research in safe models of fossil fuel extraction must have some crossover potential in other areas. We should also look to work and trade ideas with our traditional allies. As a counterbalance to Keystone XL, wouldn’t a headline-generating proposal about a joint project on hydrogen-based vehicles make a lot of sense on so many levels? If we want to guarantee the level of prosperity we currently enjoy for the next generation, we must address the issue of energy production and do it quickly. In case no one noticed, the Middle East isn’t getting any more stable, Venezuela isn’t looking so hot either, and apparently our oil is suffering from a case of the PR flu. We need to accept this reality before we are trampled by it.
What are your thoughts about developing renewable energy technologies?
TM writes about all things personal finance over at My University Money. He intends to continue his quest for lifelong learning and hopefully help others along the way.