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China’s electric vehicles go global: Protectionism won’t work

BYD Seal

Electric vehicle (EV) imports from China will account for 25% of EV sales in Europe in 2024.

Now China-based EV and battery firms are on the verge of coming to North America and there is no such thing as batteries without content from China.  This is the context for U.S. protectionist legislation.

What follows is a most comprehensive plethora of reasons on why 1) protectionism won’t work and 2) North American and European EV manufactures are vulnerable to disruptive market threats from inexpensive Chinese EV alternatives.

China green shift global impact greater than COP

Expectations for COP29 in Azerbaijan, based COP28 in the United Arab Emirates?

The light getting in though the cracks is few countries are immune to competition with China’s sweeping expeditious green transition.

China’s brisk energy transition intentions are three-fold, decarbonization of its economy, domination of global clean tech manufacturing and reduced dependence on imported fossil fuels.

Renewables

The COP28 final statement calls for a tripling of renewables capacity by 2030.  China had an objective to triple renewables capacity by 2030 too, but China will meet its 2030 renewables target in 2025. The country will continue to increase capacity sharply thereafter.  By 2030, the forecast is for China is to hit 3.9 terawatts (TW).  The aforementioned COP28 global ambition was for 11 TW by the end of the decade.

According to the IEA, China now accounts for 60% of global renewables capacity installed in 2023 and this will carry over into 2024.  The expansion of capacity is outpacing rising demand.  For 2023, China investments in renewables will attain the summit of US$177 billion.

For 2023, BloombergNEF projected China solar capacity additions to reach 208 gigawatts (GW), twice the entire U.S. solar capacity.

China’s new wind and solar capacity installations for 2023 may amount to 300 GW, astronomical compared to the global capacity increase of 338 GW in 2022.

By September 2023, total installed wind and solar capacity was 400 GW and 520 GW, respectively.  To put this in perspective, Hydro-Québec, one of the largest utility companies in North America, has a total production capacity of 47.5 GW.

All together, China is installing 20 GW of wind and solar per month.

By the third quarter of 2023, 53% of China’s power sources were wind, solar, hydro and nuclear.  That’s a giant leap from 2011 when coal accounted for 80% of the country’s power supply.

The scale of some of the renewables projects is staggering.  The Golmud Solar Park in Qinghai, the world’s largest solar park, has a capacity of 2.8 GW with 7 million solar panels spread over sands.  Even that is just the beginning.  The plan calls for expanding this park 6-fold in the next 5 years.

In 2022, plans were announced for 500 GW of onshore solar and offshore wind projects for Gobi Desert across Xinjiang, Inner Mongolia, and Gansu provinces.

To transport gargantuan new capacity, ultrahigh-voltage (UHV) lines projects are eye-popping.  State Grid Corp of China, the country’s largest State-owned utility, has started construction on 13 UHV lines covering 30,000 km.

China catapults economy-wide electrification

China is electrifying its economy at a mind-boggling rate, with 1.1 million electric buses and trucks; two-thirds of the global market for light EVs; electric subways and light rail; and 42,000 km of electric high speed passenger and freight rail.

Consequently, China’s Sinopec, a large petroleum refiner and distributor, anticipates peak gasoline will occur in 2023.

Coal

China’s electric power carbon emissions will peak in 2023 or 2024, ahead of the 2030 target, plateau for a while, and then enter an exponential decline.  This is attributable to mindboggling increases in renewables capacity, and an uptake in hydro capacity.

True, China has the world’s largest coal power plant fleet.  Yet, the opening of 2 coal plants per week or 106 GW of new power plants in 2022, responds to peaking requirements only.  While China reached 1,100 GW of coal power plants functioning in 2022, 775 GW of operational coal plants were shut down or were projects that never made it to construction.

Consequently, coal plants in China on average run 50% of the time.  Carbon Tracker has divulged that 40% of China’s coal plants are losing money.  The 5 major state-owned coal power plant companies are also experiencing heavy losses.

The capacity usage will fall further to 25% over the next two decades.

These contradictions are largely the result of provincial governments supporting their local coal enterprises and jobs.

A forthcoming plateau in infrastructure projects translates into less coal for cement production, a 2.7% reduction in 2023 and 61% reduction by 2036.  Likewise, petrochemical and aluminium production drops will contribute to lower demand for coal.

These factors should result in a decline in coal demand by 2024, as alluded above.  Not only many coal plants permitted up to 2023 will never get built, but also many existing coal plants will become stranded assets.

In China, likewise for Europe and India, 90% of coal plants will be uncompetitive by 2025.

EVs

The BloombergNEF Electric Vehicle Outlook 2023 reported that EV growth rates for 2022 were 62% world-wide and 95% in China.

In 2022, China had 600,000 electric buses on the road, at least 99% of the world total.  That year, it manufactured 138,000 e-buses for the domestic market.

There were 400,000 electric trucks on China’s roads in 2022.

China’s rate of light-duty EV growth is 4 times that of the U.S.  Total EVs sold in China are greater than in the rest of the world.  For the end of 2023, it is projected plug-ins will have reached 38% of sales.

Too, China is now the world’s largest exporter of EVs.  For 2022, exports from China acquired 11% of the European market.  An irony of sorts, Tesla’s Shanghai factory is China’s largest EV exporter.

North America is vulnerable to an invasion of EVs from China too.  China’s BYD will soon launch the BYD Seal in North America to compete with the Tesla Model 3.  Other Chinese EV brands are planning international expansion.  By contrast, North American EV and battery investments related to the U.S. Inflation Reduction Act and Canada’s Budget 2023 await production start-up dates.

Fascinating is the electrification of the three-wheelers for which China and India account for 90% of the global fleet.   There were 117 million 3-wheelers on the roads in the world by 2022, 70% of which were electric, though most with lead-acid batteries.  That jumps to 300 million if two-wheelers are included.

The 3-wheeler sales in 2022 were over 12 million units encompassing a major migration to lithium-ion batteries.  For the short-term, it is the two- to three-wheelers that will generate a noticeable decline in oil consumption.

The global share of EVs in two- and three-wheeler sales increased from 34% in 2015 to 49% in 2022.

Clean tech manufacturing

China has 9 of the 13 largest solar manufacturers in the world and 7 of the top 10 global wind manufacturers are in China.

Solar panels production was 310 GW in 2022; were about 500 GW for 2023; and 1000 GW in 2025, the latter 4 times the output worldwide.

Energy storage battery capacity to accommodate intermittent renewables power will go from 550 GWh in 2022; to 800 GWh in 2023, and 3,000 GWh in 2025.

By early 2022, China accounted for 80 percent of global battery production capacity.

China had 125 battery factories in 2022 and more than double are in the planning or construction phases  This despite, China having only 10% of lithium raw material, while Australia has 50%.

Lower battery prices give China an EV edge in global markets.  The average price of a Chinese EV battery is US$26,500.  That is one third of the transaction price in Europe and half that of the U.S.

An astonishing next generation battery head start is that of China’s BYD breaking ground in January 2024 for the first sodium-ion gigafactory, a technology still in the development stage for most. Sodium-ion batteries are composed of abundant iron and sodium, free the more expensive lithium plus nickel, cobalt and graphite.  This technology replaces lithium cathode material and can be combined with hard carbon anode.  It is less vulnerable to cold weather.  BYD will initially use these batteries for scooters and micro-vehicles.

Also, China’s leadership comprises a long-term view, having issued rules that all battery powered vehicle manufacturers must be responsible for battery recycling.  The policy also directs that the design of batteries facilitates recycling.  China is experimenting with a battery recycling framework.

Decarbonization

By far, China dominates global industrial production, 61% of global steelmaking, 57% aluminium manufacturing and 52% cement output, collectively more than half of global production.  The chemical and paper sectors represent 40% of the global share in these sectors.

China’s wide array of state-owned enterprises (SOEs) are pillars for backing a decarbonization goal under the umbrella of China’s 14th 5-year plan.  Under this plan, carbon neutrality will be accomplished by 2060, CO2 emissions will peak by 2030 and 50% of increased energy consumption will stem from renewables by 2025.

As for energy SOEs, they are immune to the straitjacket of oil and gas companies, incapable of changing their increased fossil fuel trajectories.   In this regard, SOEs are diversifying their portfolios, with a strong push for renewables and massively investing in research and development and innovation of clean technologies.

Belt and Road Initiative (BRI)

BRI is by far the most ambitious global economic development program involving over 115 countries.

From 2013 to 2022, fossil fuel infrastructure accounted for two-thirds of BRI power sector investments.

In September 2021, China announced it will not support new coal plants abroad, though not all new coal projects were shut down.

China has since established the BRI International Green Development Coalition with 134 international partners.  UN Environment will facilitate BRI recipients to achieve UN Sustainable Development Goals including green finance and energy, plus energy efficiency.

For the first half of 2023, 56% of the US$12.3 billion in BRI energy investments were allotted to renewables.  Colour coded prioritization of projects favours green ones. 

China emissions to-date 

There are those who suggest China must act first before their own countries take action on climate change and China is addicted to coal.  China is acting first, leaving no excuses for the climate naysayers.

Granted, China emitted 31% of global emissions, 11,397 metric tonnes (Mt) in 2022.  This is more than twice as much as the U.S. for 2022 at 13.6%, with 5057 Mt.

This does not tell all.  On a per capita basis, China’s emissions are half that of the U.S.  Since 1751, China is responsible for  half the cumulative emissions as the U.S.

But this is history, China is migrating into a green transition quicker than most can assimilate.

The takeaway

The U.S.$369 billion Inflation Reduction Act (IRA) which is spurring a tsunami of investments in clean tech plus manufacturing of EVs and batteries is largely about closing the green economy gap with China.  One year after the IRA passage, in August 2023, private sector investment announcements in U.S. clean tech projects totaled up to US$278 billion and 170,000 jobs.

The domino effect on the European Union is such that it is exploring how to close the clean tech investment gap with the U.S.  The EU “lost” its solar industry in favour of China, European wind manufacturers are struggling to compete with lower cost Chinese turbines and 11% of the European EV market is represented by Chinese imports.

China’s march to dominate the green economy suggest a green transition will become a global competition imperative.

China will change the course of the global energy geopolitical titanic.

By contrast, the inclusion of reducing fossil fuels in the COP28 final statement is not a milestone.

Shell, two CEOs, two cultural shifts: Green transition to business-as-usual

Updated, October 27, 2023

New vison, clean tech acquisitions and fossil fuel divestments

Under the leadership of Shell CEO, Ben van Beurden, 2014 to 2022, it really seemed that Shell was taking climate change seriously.  In 2017, Ben van Beurden purported that the “biggest challenge” for the company was to acquire public acceptance.  He asserted “If we are not careful, broader public support for the sector will wane.”

Perhaps, the most astonishing component of the new orientation was the Ben van Beurden plan to divest of US$30 billion of assets.  Amazingly, Shell had decided to sell its US$8.5 billion in assets in Canada’s oil sands.

Likewise encouraging, Shell assured it would comply with the Paris Agreement; concluded peak oil would occur in the next few years; set a goal to cut its carbon emissions by 20% by 2035, 50% by 2050, issued a joint statement with lead investors for Climate Action 100+  representing US$32 trillion in assets, to deliver on the Paris Agreement; withdrew from the far right climate denial organization, the American Legislative Exchange Council; and advised the Canadian Association of Petroleum Producers (CAPP) that the CAPP climate and energy-transition-related policy positions constitute a “misalignment.”

The flip side to the disavowal of traditional paths was the awesome pro-active Shell clean tech firms investment spree, entailing clean tech acquisitions, mergers and partnerships.  Many on the lengthy list of new clean tech can be found in my 2019 article.

In 2018, Martin Westelaar, then head of Shell’s gas and new energy division, described Shell’s green transition as one of modestly beginning with a budget of US$1-2 billion year up to 2020, to prepare the case for shareholders to get on side for a doubling of such investments to US$4 billion annually after 2020.

In 2019, Westelaar gave reason to believe that the Shell acquisition of First Utility, the largest electricity supplier in the UK, was a steppingstone for entry into a global solar market, presuming solar would become the biggest source of low carbon energy.

Westelaar had exclaimed “electrification is the biggest trend in energy … it’s easier to grow in growing markets”.  And Shell wants to play a lead role in the new energy landscape to become “largest electricity power company in the world in the early 2030s.”

In April 2019, Brian Davis, formerly Global Vice President, Energy Solutions from 2016 to 2020, vaunted the Shell vision of a global transition to electrification, including electric vehicles, batteries, microgrids.   

February 11, 2021 press release officializes green transition

Boasting Shell’s new vision as an oil and gas industry energy transition leader, in a Shell February 11, 2021 media release, Ben van Beurden, is quoted as saying “Our accelerated strategy will drive down carbon emissions and will deliver value for our shareholders, our customers and wider society.”

This announcement indicated Shell that Shell’s corporate-wide carbon emissions peaked in 2018, its oil production peaked in 2019 and the firm would pursue divestments averaging US$4 billion a year.  Doing so, he portrayed Shell becoming less vulnerable to oil and gas prices.

Ben van Beurden, depicted the Shell makeover crystal clear in the dispatch: “We must give our customers the products and services they want and need – products that have the lowest environmental impact.  At the same time, we will use our established strengths to build on our competitive portfolio as we make the transition to be a net-zero emissions business in step with society.”

Accordingly, the communiqué implies the integration of environmental and social ambitions.

This integration proposal comprises linking 10% of the bonuses of directors to lowering carbon emissions; US$2-3 billion annually for Renewables and Energy Solutions to become a world leader in clean power as a service; and 500,000 charging stations by 2025.

New CEO, “ruthless” transition to oil and gas prioritization and clean tech fire sale

All changed when Wael Sawan became the CEO of Shell in January 2023.

Beginning June 2023, Wael Sawan implemented corporate reorganizational changes to put the emphasis on the “ruthless” approach to maximising value, specifically “absolutely committed to our upstream business.”  This new approach entailed a shift priorities in favour of oil and gas production and scaling back renewables.  Sawan prescribed a ‘fundamental cultural shift” critical to re-establish investor confidence.

That meant that only green power projects with high returns or in sync with the value chain of Shell would get corporate support.  Sawan even had the audacity to declare that these changes would benefit schoolchildren in countries like Pakistan!

To greenwash  the environmental consequences of the makeover, Shell announced it had not abandoned its goal to becoming a net-zero company by 2050.

But the bluffing in that message became obvious in September 2023 when news broke out that Shell aimed to divest its majority or all shares in Sonnen, a major competitor with Tesla in the energy storage sector.

Just prior to the revelations on Sonnen, Shell sold Octopus Energy, a German and UK retail energy business, meaning 1,800 employees were no longer with Shell. 

Flurry of resignations

In June 2023, Thomas Brostrom, who had been the Shell, VP for renewable generation, and head of offshore wind, quit after his position was downgraded to a new regional role.  Brostrom had been Ørsetd North America wind chief until joining Shell in 2021.  The Danish Ørsetd is the world leader in offshore wind development.

Also in June 2023, Shell’s power trader, Steffen Krutzinna resigned over what for him was “heart-breaking,” to the effect that Shell was putting short-term profits over social and environmental responsibilities.  He posted on LinkedIn “I perceive that as a pivotal shift in corporate values.” “I don’t want to be part of that, so I’m out.”

Not long after in July 2023, Melissa Reid, who had been Shell’s UK offshore wind manager chief, left too.  She had led Shell’s successful bid for the ScotWind seabed license.

A year earlier, Caroline Dennett, a consultant for an independent agency Cloutt, terminated her working relationship with Shell with an open letter to Shell executives and its 14,000 employees regarding Shell’s “double-talk on climate.”  Expressing her disgust, “…they are not winding down on oil and gas but planning to explore and extract much more.”

Aside from the aforementioned resignations, anxieties of Shell staff still with the company were reflected in posts by employees.

Virtual “A Conversation with Wael”: Staff pacification

Responding to internal anxiety over Shell’s recentering Shell’s goals, Wael Sawan planned a virtual meeting with staff,  “A Conversation with Wael” for October 17, 2023.  The advance promotion advised the meeting would “deepen our conversation on the opportunities and dilemmas we face as we position Shell to win in the energy transition.”

The Wael Sawan October 17, 2023 message confirmed Shell believes in “urgent climate action” notwithstanding the about-face.

Sawan assured Shell staff that Shell is simply modifying the strategy delivery.

He explained this second cultural shift as the challenge of the affordability of clean tech.

These are lies.

Major job cuts in low carbon unit, not strategy tweaking

The Wael “conversation” sequel on tweaking the strategy, came quickly, on October 25, 2023, when Shell announced that it will cut 200 jobs in its low carbon solutions unit, originally known as Shell New Energies.  Some of these jobs will be transferred to other corporate divisions, and an additional 130 position roles are “under review” in 2024.  Ergo, anxieties among employees will go up many notches.

Ideological shift, not clean tech affordability or potential, nor belief in urgent climate action

Renewables are now the least expensive sources of power and 90% of the sources of global annual newly installed electrical generation capacity has been renewables since 2022.

Sawan conveniently ignored the growth curve of electric vehicle (EV) sales to-date, EVs having reached an inflection point.  EV sales in China and EU may reach 50% of the market in 2025.  In North America, there is an ongoing tsunami of investments in EV and battery production facilities because EV demand exceeds supply.

Most automakers are committed to a full transition of their respective lineups to electrification.

This is the backdrop for the year 2022 being an historic year.  For the first time ever, investments in the green transition, US$1.7 trillion, exceeded those unabated fossil fuel supply and power at US$1 trillion.

Since 2021, the growth of investments in clean tech have outpaced those of fossil fuels three-to-one

The greenwashing is self-evident.

The takeaway

1) It is possible for a fossil fuel company to become a diversified energy company committed to the Paris Agreement.

2) The old guard fundamentalists remain in denial and, guided by the rearview mirror, believe the future must be like the past.

3) Powerful shareholders having the characteristics described in item #2, plus addiction to quarterly reports, are among the biggest hurdles to a fossil fuel firm migration to clean tech.

Ukraine green reconstruction: Global model opportunity

Updated July 20, 2023

Many stakeholders from Ukraine, the European Union and around the globe, including just-in-time working groups, international financing institutions and the private sector, are currently engaged in “Made in Ukraine” green reconstruction agenda.  The challenges are colossal.

Half of Ukraine’s power generation infrastructure has been destroyed or badly damaged.  It makes little sense to reconstruct a tangled web of centralized energy distribution networks.  Rather the emerging consensus among key players is for decentralized area-specific clean energy solutions that can be built quickly, secure energy independence and offer less vulnerability to attacks by aggressors.

Equally important, energy inefficient buildings have been destroyed beyond repair in many entire cities and/or districts.  Interdisciplinary international groups are in place to plan the rebuilding of communities respecting circular economy and energy efficient criteria and Ukrainian architectural history.  These strategies call for using up to 90% of the rubble to minimize emissions during the construction process and the manufacturing of building materials.

Regarding farming equipment and practices, drones conceived, manufactured and precision operated in Ukraine, along with imports, positions Ukraine to be a world leader in applying drones for agricultural tasks without the need for heavy equipment and airplane dust spraying.

As well, green steelmaking, critical minerals and many other possibilities will be integrated into the transition.

No guarantees, but all pertinent players are readying in sync for the humongous tasks ahead.

Electric vehicles and equipment for mining decarbonization

MacLean Engineering Transmixer electric vehicle

As with most environmental solutions, electric mining equipment (EME) offers opportunities for reducing capital and operating expenditures, while providing a host of solutions to address risks. These lower risks include decarbonization; curtailment of colossal ventilation expenses to evacuate fumes, particulate matter and heat from diesel engines; and improved employee health and working conditions.  Higher profits, diminished risks and enhanced social acceptability associated with EME, are hard to beat.

Canada’s new plastics strategy falls far short of expectations

On a global scale, less than 10 percent of plastics are recycled.  Plastics are ubiquitous, meaning regulating its use is especially complex.  While Canada has only banned a half dozen of single-use plastics, the European Union and China are engaged in a holistic multi-year incremental approach to manage plastic production, distribution, consumption, recycling, disposal and substitution. Accordingly, the actions of these latter jurisdictions will influence global innovation and standards. By comparison, Canada’s plastic initiatives are symbolic greenwashing.

Investing responsibly, in the Canadian green economy, not easy: Policy solutions

Canada compares poorly in buttressing clean tech firms.

Reliable standards for environmentally sound investments do not exist and very few Canadian clean tech firms are listed on a stock exchange.  Too often, Canadian clean tech firms must go outside Canada for financial support and/or to enter the stock market.  This article presents solutions for investors and clean tech companies alike, but these solutions require government action. 

Green economy: Financial sector zigzags

Green financing improves but has a long way to go

BlackRock, the world’s largest investment firm, has indicated that those that don’t tackle climate change will lose money in 5 years. Some financial institutions have made multi-trillion commitments from now to 2030 to invest in the green economy while still focusing the majority of investments in fossil fuels. Canadian banks are among the global top fossil fuel investors.

Fossil fuel sector contrasts: Green transition engaged, but not enough

Not all fossil fuel companies the same

Not all Big Oil firms are alike. Some are engaged in a rapid green migration, many are sitting on the fence and others are still in climate denial. Meanwhile, the value of fossil fuel assets are declining but the industry is camouflaging this by selling assets and debt financing to keep shareholders happy.

Global clean tech opportunities abound, just not in Canada

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Global developments suggest a Canadian migration to a green economy is critical to competitiveness. However, if one tries to find Canadian clean tech manufacturing/innovation companies listed on a stock market, one will likely come up with nearly zero, while the number of Canadian-based oil and gas firms offering stocks is seemingly infinite.

Canada has got its priorities wrong.

In the era of fossil fuel’s global decline, why is Canada hanging onto LNG?

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Liquified natural gas (LNG) is being promoted as a green transition option to replace dirtier fuels. But when renewables are coming in cheaper than new gas- and coal-fired plants for two-thirds of the world, why is this the case?

LNG’s economic prospects are waning because renewables price declines are having a bigger impact than anticipated, and there is an LNG global market glut. The shale gas industry is also experiencing more costs than revenues, and greenhouse gases (GHGs) in the LNG supply chain may be as bad as coal.

But, as with the case with oilsands, Canada chooses to ignore the signs of a global evolution to a green economy at its own peril while heading toward stranded assets.

Yet the Government of Quebec is now promoting an LNG facility north of Quebec City and a pipeline to bring in Alberta shale gas using the same clean energy transition export messages as those used for the LNG Canada facility in Kitimat, B.C. and the Coastal Gaslink shale gas pipeline.

Newfoundland offshore drilling: a case of bending environmental impact rules

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Covid-19 has fixated world attention. And what attention is focused on fossil fuels is mostly tuned to Trans Mountain and Keystone XL oil sands pipelines that have made it back into headlines. But there is another Big Oil story in Canada that has fallen through the cracks. This other story is about a shocking bending of all the rules regarding an environmental assessment for fossil fuel offshore exploration on the Newfoundland coast.

On March 4, 2020, Minister of Environment and Climate Change Jonathan Wilkinson authorized a derogation of the Impact Assessment Act (IAA) to allow exploratory, offshore oil-and-gas drilling on the Grand Banks of Newfoundland, pending an online consultation process. Originally, this was to be a 30-day consultation process terminating April 3, 2020, but has been extended due to the Covid-19 pandemic.

It has been estimated that the area to be explored has a potential to produce 650,000 barrels per day.

Yet public information about the online consultation, in particular the derogation of the IAA, has been well-hidden from the radar screen of those likely to be concerned about the Grand Banks project. The only portrait I found on the political machinations is in a Le Devoir article from March 23.

Oil was doomed before the pandemic

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Oil’s brief dip into negative values this month was the result of fear that storage space would run out and buyers would have nowhere to put their oil amid the current pandemic. While widely reported, this sudden plunge is a distraction. Prices are now back above zero, but futures contracts (the price of oil delivery in the coming months) are expected to linger at unprecedented levels.

What’s important to take away from this sensational plunge in value is that the COVID-19 crisis has placed the fossil fuel sector in such a precarious state that it may accelerate the arrival of peak demand for all fossil fuels. This provides an opportunity to plan a Canadian transition to a green economy within upcoming recovery initiatives.

The plight of coal has shown us that once demand drops, clean tech alternatives fill the vacuum.

Canada should invest in electric vehicle transition post COVID-19

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Following the COVID-19 pandemic, governments around the globe will be massively investing in, and defining policies for, economic recovery. With all fossil fuel sectors in decline, what better time to make the transition to a green economy?

And what better time for the federal government to develop an electric vehicle (EV) national strategy?

Canada does have a significant electric vehicle sector, primarily lin Quebec, and the beginnings of an EV segment in the Ontario auto industry. The current Canadian EV sector covers the entire ecosystem, such as EV school buses, trucks, urban transit buses, powertrains, batteries and raw materials, and charging infrastructure. This is backed up by world-class research capabilities.

But the piecemeal, one project at-a-time approach doesn’t make any sense when we are up against 400 electric vehicle technology manufacturers in China. In Quebec, there are 147 EV firms, which collectively employ 6,000 people.

Wet’suwet’en: The canary in the Canadian fossil fuel cage

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Ad nauseum, mainstream media have focused on the economic consequences of the blockades in support of the Wet’suwet’en Nation. Equal media attention has been dedicated to the complexities of Indigenous ancestral rights in unceded territories and who has the right to speak for the Wet’suwet’en. Rare are those who characterize the impasse as a clash of two economies, the resource-based economy and the green economy.

Jason Kenney got it half right in saying that the standoff is a “dress rehearsal” for future major fossil fuel projects.

Canada falling short in fossil fuel divestment

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Environmental liabilities are the most prominent global investment risks, according to a World Economic Forum (WEF) 2020 report.

This report’s short-term risks classified four of the top five hazards as being environmental — extreme heat waves, destruction of ecosystems, pollution’s impact on health and uncontrolled fires.

The five most significant long-term perils are also environmental, the WEF reports, with the latter list comprising extreme weather, biodiversity loss, climate-action failure, natural disasters and human-made environmental disasters.

The global investment community is increasingly internalizing these concerns such that in 2019 investors representing US$11 trillion in the assets from 1,100 financial institutions have committed to divest from fossil fuels.

As electric vehicles proliferate globally, the U.S. Big 3 are idle

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Electric vehicles have been around for some time, but global automakers have been reluctant to migrate because doing so represents the biggest technological revolution since the Ford Model T.

This revolution entails scrapping a century of incremental investments in the internal combustion engine and replacing it with a 100 per cent different set of propulsion technologies, along with all the requirements to design their vehicles differently. This means it would take many years for automakers to recover their investments in electric vehicles (EVs), all while there are big profits to be made on conventional pick-ups and SUVs.

While North America’s automakers have been sluggish to respond, manufacturers elsewhere are prepared to comply with Chinese and European Union requirements for a migration to zero- and low-emission vehicles.

Batteries not included: Canada unprepared for demise of fossil fuel era

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The federal election results suggest that the first priority of the NDP must be electoral reform to bring to an end the politics of fear and the strategic vote, which favours the Liberals and Conservatives alike.

The second priority must be to engage Canada, for the first time, in an urgent migration to a green economy. The Liberal record on shifting to clean technologies is nothing short of insignificant, one of the worst records among developed countries. Meanwhile, China, and to a lesser extent, the European Union and California, are changing global economic, energy, and transportation paradigms.

Canada lags far behind China and the EU in energy and transportation transition

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The next federal government mandate will determine whether Canada complies with the Paris Agreement and makes the transition to a green economy. We must move quickly. As a former federal government “green” employee, I know government staff can deliver an effective climate change action plan within three months.

A green economy is one in which economic and sustainable development are fused together. A plethora of measures are required by way of annual budgets, legislative initiatives, policies and other agendas. The Liberals and Conservatives want us to believe that a price on carbon is a ballot question, but a carbon price is not a climate change action plan any more than buying a child winter clothing is a strategy for raising the child.

Want to invest in Canada’s clean economy? Good luck

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As of last year, close to one thousand institutions with three per cent of global savings under management have engaged in some form of divestment from fossil fuels.

In June 2019, Norway’s parliament unanimously voted in favour of directing its $1.06 trillion Government Pension Global Fund (GPGF), the Norges Bank, to divest more than $13 billion from fossil fuels while dedicating more investments to clean technologies.

The caveat is that this will apply only to companies that are exclusively in the business of upstream oil and gas production and some coal sector investments. The GPGF is Norway’s sovereign fund derived from oil industry revenues to assure Norway has a steady source of revenues in the post-oil world.

Shell has expressed concern that the growing fossil fuel divestment movement could impact on the company’s performance.