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By David Yager
July 12, 2022
The forward-thinking actions of a deeply concerned municipal government should never be underestimated.
Following a municipal plebiscite supported by 76% of those who voted, in 1989 Red Deer declared itself a Nuclear Weapons Free Zone.
It worked. In the past 33 years Red Deer has not developed or tested atomic bombs, constructed nuclear missile launch or storage facilities, or been attacked by weapons of mass destruction.
Signs were installed signs to assure visitors that they would be safe. They were later taken down.
Municipal governments are often at the forefront of politically motivated motherhood statements, probably because there’s so many of them. One crusade that started in Melbourne, Australia in 2016 then went global is the climate emergency declaration.
It’s website – https://climateemergencydeclaration.org – proudly proclaims that as of July 2, 2022, there have been, “Climate emergency declarations in 2,118 jurisdictions and local governments (that) cover 1 billion citizens.”
While most are municipalities, 23 countries have signed on. The only major hydrocarbon producer is Canada. The list includes Maldives, Vatican City, Andorra, Singapore and Malta.
Late to the party but determined not be left behind is one of the world’s great oil capitals, Calgary. The morning after Jyoti Gondek was elected mayor last October, she announced that one of her first orders of business was to have Calgary city council ratify a climate emergency declaration.
This was never mentioned during the campaign. Gondek’s main pitch was inclusion, consensus and uniting Calgarians in the pandemic recovery. Declaring the city’s major industry a menace to the future of the world was hardly congruent with these lofty platitudes.
Oil people like me were stunned. In an interview with Danielle Smith, this writer assumed the new mayor just mentally exhausted after an arduous election campaign. Like I was when I failed to become a Wildrose Party MLA in 2012. Never slept a wink the night I lost.
But no, Gondek was serious. It had obviously been quietly planned all along.
On November 16, 2022, it was official. City council also committed to Calgary having net zero emissions by 2050 (NZE50). One of the proponents of the motion, councillor Raj Dhaliwal, cited the terrible hailstorm of 2020 telling a reporter, “Why isn’t the city doing more on climate change? Why are we kicking the can down the street? My kids or their kids, they don’t want to see this again in their lifetime.”
Municipal government pronouncements have kept Red Deer free of nuclear weapons since 1989. Why could they not improve the weather in Calgary in 2022?
The next step was the $87 billion NZE50 plan which was passed July 6. Councillor Dhaliwal put the same passionate spin on the decision in a media interview. “When I was leaving my house, my 12-year came to me and said, ‘Dad, for my sake and for my generation, please vote Yes because you owe it to us, because we are running out of time’.”
The world has been sensitive to the concerns of children on climate change since 2019 when Greta Thunberg became famous at age 16. Scared young people add a lot of emotion to an issue that is far more complex than thinking and saying the right things.
The 2013 flood was added to the list of severe weather events that could possibly be prevented by the actions of Calgary city council.
Called Calgary Climate Change Strategy – Pathways to 2050, the program reported the cost would average $3.1 billion annually. Of course the city wouldn’t have to pay for all of it. Funds would also come from Ottawa, Edmonton and the private sector.
Assuming, of course, there was nothing else more pressing going on. Like a world turned upside down by energy and food shortages, inflation, rising interest rates, massive public debt, labor shortages and war between Russia and Ukraine.
Gondek said the $87 billion was “…simply a way for administration to demonstrate there is a significant investment needed.”
Which is code for this isn’t really likely to happen. But the right words were spoken. And the 12-year can sleep better because Dad delivered at City Hall.
When council’s $87 billion NZE50 plan was unveiled in June, it was greeted with the same incredulity as the mayor’s undisclosed climate emergency declaration.
Looking at the program and the numbers, the Calgary Construction Association put some math to what it would take for all new and existing structures to become net zero emitters by 2050.
Global News published a detailed story June 13. According to council’s plan, 57 per cent of emissions come from the energy required by homes, commercial and industrial structures for heating, cooling and powering everything from lights to appliances. To comply, Calgary would have to retrofit 19,000 homes and 317 commercial buildings a year for the next 30 years.
The association figures this is 52 home retrofits every day, seven days a week, and almost one commercial building each day. These daunting figures were shared with planners while the program was being developed. But it didn’t change anything.
Association President and CEO Bill Black said, “We were concerned that the volume of retrofits that they were quoting was insurmountable…issuing permits at that rate, finding the resources, the labor, the materials, never mind convincing 19,000 homeowners per year to be able to do that.”
Global News also quoted a specialist who said that a “deep energy retrofit” for a detached home is expensive, costing between $100,000 and $200,000. This is everything from re-insulating to changing the primary heating system, appliances, solar panels and battery storage.
Another comment from the Sustainable Calgary Society was that for this plan to be serious, the city should halt growth of more suburban neighborhoods which would require roads, vehicular traffic and public transit.
But new residential housing construction on the fringes of Calgary to deal with the rising costs of housing and rents continues. For many, affordable housing is a far more immediate problem than Calgary’s long-term climate strategy.
Because local climate crusaders never acknowledge that the biggest single obstacle to materially reducing global GHG emissions is persuading China and India and other parts of the developing world to quit burning coal. The city of Calgary could disappear entirely and the impact on global emissions would be undetectable.
But municipal governments soldier on, banning natural gas heating and appliances in new homes, narrowing roadways and installing bike lanes to discourage vehicular traffic, or demanding that the municipal electricity supply be devoid of fossil fuels at the earliest possible date.
Early this century, Ontario’s Liberal government was an early adopter of replacing fossil fuels with renewable energy. Starting in 2005 the province bet big on shutting down coal fired powered generation while trying to make an industry out of manufacturing solar and wind electricity generation equipment.
It was a colossal economic failure that resulted in skyrocketing electricity costs which some still blame for a significant migration of Ontario’s manufacturing industry to lower cost energy jurisdictions like the US. Billions of dollars of Ontario’s future power purchase agreements were buried in the provincial debt. The Liberal party that conceived it was all but wiped out at the polls in the 2018 election.
But the legacy of big governments, big taxes and big ideas lingers. Richard Lyall is the President and CEO of the Residential Construction Council of Ontario. In an interview he explained what years of layers and layers of municipal taxes and climate policies have done to the cost of housing.
Lyall says that Ontario already had “one of the leading climate sensitive building targets in North America,” but local governments that have passed climate emergency declarations keeping driving up costs. Like Calgary, first they declare their intentions, then they hire consultants to develop a strategy.
One of key elements for new construction is what Lyall calls “the electrification of everything.” But there is no thought where the power will come from. He figures that in the absence of capacity this will require more natural gas for backup, which only moves the emissions from the furnace and stove in a dwelling to the generating facility. Nor is any homework done into the capacity of the grid, electricity’s growing infrastructure challenge. This is somebody else’s problem.
Lyall calls many of the ideas that emerge “delusional.” He said, “When something doesn’t fit with the narrative, they just ignore it or attack you.” When builders raise issues with planners over the realities of costs, affordability and energy supplies, the default response too often is accusations of being a climate change denier.
When cornered, resort to fear and disaster.
At the same time, municipal levies keep rising. His association figures that in Toronto, development fee increases and parkland dedication fees now total $156 per square foot, as much as 25% of total construction costs. Lyall says that for a new condominium in downtown Toronto that costs $1 million, $156,000 is municipal fees alone.
He said part of the problem is that the three levels of taxation – federal, provincial and municipal – are not synchronized. Each level grabs funds where they can. Because development and property costs are handled at the municipal levels, these governments can materially impair the affordability of new housing with no regard to what has been done at the provincial and federal levels in terms of disposal income and purchase price affordability.
Rising prices for new housing drive up the costs the cost of existing housing. And rents.
Lyall wrote in the Toronto Sun July 8 that Toronto’s population is actually declining for the first time in history. He said people want to live in “ground-related” housing, not condominium skyscrapers. And that’s the only housing that is permitted and affordable. So they are leaving.
In municipal governments, the departments of climate protection, urban planning and housing affordability are often just down the hall from each other. With impenetrable communication barriers in between.
At the same time, the growing size and cost of Canadian governments is driving up the cost of everything. Worker shortages affect wages and inflation.
Economist Jack Mintz wrote a National Post commentary July 8 titled “Why all the job vacancies?” Mintz puts much of the blame squarely on the shoulders of growing governments which are distorting private sector labor markets.
Mintz blamed three major factors for the worker shortage; “…population aging, mismatching of jobs and skills, and government spending crowding out the private sector.” On the last problem Mintz wrote, “…governments employ only a fifth of the workforce but account for 84 per cent of employment growth since February 2020 (last pre-pandemic month), with 418,000 new public employees. This has reduced the number of workers available to the private sector.”
Mintz continued, “High government spending also crowds out private-sector investment by pushing up interest rates and eventually business taxes to cover deficits. This can weaken business incentives to improve worker activity.”
Mintz describes how governments offer employees early retirements, job security and benefit plans millions of Canadians can only dream about.
The data is clear. If there is actually a post-pandemic employment recovery taking place, it is primarily in the public sector. Following is the Statistics Canada national employment data comparing February 2020 to June 2022. The figure are in thousands of workers.
Statistics Canada Table 14-10-0288-01
Governments are not only busy telling everyone how they must their lives, but they are hiring hundreds of thousands of employees to help execute their ambitious and expensive plans.
Efficiency or accountability is never mentioned. There is no evidence that the 10.7% increase in the number of government employees in the past 28 months has resulted in a 10.7% increase in the quality of public services. In the key area of health care, it is going the wrong way.
There is, however, relentless pressure on tax increases at all levels with the possible exception of Alberta’s provincial government which is enjoying an unexpected windfall in oil and gas royalties.
Meanwhile, in the rest of the world life is increasingly grim as the Russia/Ukraine war and climate-influenced policy decisions take their toll on ordinary people.
European governments are already rationing heat and electricity to store more gas for next winter anticipating Russia will continue to squeeze gas supplies. Sri Lanka, an early adopter of organic farming as recommended by climate central planning, is experiencing the collapse of its economy and government. Businesses are squeezed or closing in Europe. Countries are firing up their climate-mothballed coal-fired electricity plants out of necessity. Thirty-four countries are building new coal plants. Food prices are rising globally. Concerns about famine this year and next are growing.
US President Joe Biden is visiting Saudi Arabia in part to secure an increase in oil production. He has already tried relaxing sanctions on international human rights pariahs Iran and Venezuela to get more oil. The Trudeau government is talking about increasing oil production and LNG exports after nearly seven years of creating obstacles. The enthusiasm for ESG investing is falling with stock markets. The only major asset class in which investors have enjoyed positive returns this year is fossil fuels. A major rethink of the fossil fuel divestment movement and the energy transition is underway everywhere.
Except in Calgary. It is the only political jurisdiction with access to world class energy information and intelligence that has decided to board the climate emergency/NZE50 train ten months after it left the station.
Like many of the really big things done by governments in the name of climate in recent years, there’s no need to take is seriously. Calgary’s $87 billion NZE50 grand plan will never happen.
Particularly frustrating is that in terms of actually reducing global emissions, Calgary’s contribution is meaningless.
But the costs of trying are very real.
David Yager is an oil service executive, oil and gas writer, energy policy analyst, and author of From Miracle to Menace – Alberta, A Carbon Story. Find the book to www.miracletomenace.ca. He is President and CEO of Winterhawk Well Abandonment Ltd. which has commercialized a new casing expansion technology for improving annular wellbore integrity.
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