Last week, TD Canada released a new report on Canada’s energy transition and how it could negatively affect oil and gas workers. The report notes that due to the reduction in North American demand for oil and gas products, hundreds of thousands of workers could be out of their jobs if the government does not support them through a transition.
TD estimates that 50-75% of the current energy sector workforce could be at risk with an energy transition in North America. This means that up to 450,000 families just like yours could be affected due to government policies towards an energy shift.
Most reports including the International Energy Agency and OPEC show that oil and gas demand is, in fact, increasing globally in non-OECD developing countries. World population growth is also expected to reach 10 billion in 2050, the majority of which will be in those same non-OECD regions. Winding down Canada’s oil and gas workforce through policy initiatives to drive down demand in North America will not change demand abroad. Initiatives taken domestically will only impact domestic operations.
Providing reliable energy and making sure impacts are as low as possible is one of today’s biggest challenges. To meet this challenge, will require responsible energy producers like Canada with the highest Environmental, Social, and Governance standards. However, these transition policies could end up shooting Canada in the foot if proper measures are not taken to ensure we can meet this growing global demand. If we cannot, then countries with worse environmental records and less socially conscious producers will take our place.
Research has shown that Canada has an advantage in the production of resources with lower carbon emissions. With the global shift to reduce the impact of emissions, Canada could leverage this advantage and take a global approach. We can help support the development goals of non-OECD countries by providing responsible energy far better than our competitors.
If Canadian policymakers want to encourage cleaner or lower-carbon forms of energy domestically, they should recognize the benefits of the oil and gas industry in producing technology. Using existing resources and infrastructure as Canada lowers its carbon emissions within oil and gas seems like a good bet. From carbon capture to hydrogen production from natural gas, Canada’s oil and gas industry has extensive knowledge of just what it takes to keep driving down emissions.
By encouraging policy that supports infrastructure projects like Trans Mountain or Coastal GasLink, governments can ensure the diversification of Canadian market access to service growing overseas demand and ensure workers can continue using their skills. This will help ensure that any drop-off in employment will be minimal.
Another issue that needs to be addressed is the push for green jobs, which could end up shifting employment to countries better suited to produce the materials needed for transition.
There’s evidence to suggest that these “green jobs” are often created overseas, rather than domestically. A significant portion of jobs in an energy transition are mining jobs, processing jobs, and manufacturing jobs. Giving up jobs on the Homefront sounds like a reckless policy move, considering the millions who became unemployed over the last year due to a lingering pandemic and economic shutdowns.
North America and Europe might be wrapped up in a debate about what type of energy they want to save the world with, but for billions, there is no debate. They need it to be cheap and reliable. Canada has an opportunity to carve its path as an energy leader on all fronts by producing low carbon energy at home and exporting it to those countries just trying to get by.
As a bonus, by capitalizing on this opportunity, government policies can support those 450,000 families just like yours and keep our experienced workforce in the oil and gas industry rolling.