Oiling our Future. Why Doha failed.

My optimism of 24^th November was short-lived.  The Doha climate conference (COP18), as I suspected deep-down, was a failure on par with the series of conferences to which it belongs.  Something is seriously wrong when 16000 people from 194 countries manage over two weeks to accomplish the bare minimum.  They agreed to extend the Kyoto Accord (now minus Canada, Japan and Russia and covering just 15% of GHG emissions), promised to work hard next year towards developing the ‘binding treaty’ needed for 2015 (the one that is supposed to fix our problem, beginning in 2020), agreed to continue talking about the idea of wealthy countries providing some money to assist developing countries in adapting to climate change.  Wow.  I’m speechless.  Such progress….

Applauding delegates at close of Doha COP18.  China’s chief negotiator front and center

But wait, I am clearly missing something.  The organizers applauded at the close of the meeting last Saturday.  Fahad Bin Mohammed Al-Attiya, the Chairman of the Organising Sub-Committee for COP18 gushed that he “shared the joy of having come on a long journey to this historic day”.  He went on to say, “We showed the world that when it comes to substance, we can deliver. So it is absolutely something that I and many of my colleagues around this room feel extremely proud, to be part of the team that produced COP18/CMP8 Doha, and share part of that success going forward.” Christiana Figueres, the UNFCCC Executive Secretary, was slightly more reserved, saying “This was a historic COP”, but adding “What needs to change now is political will”.  I wondered at first whether she meant COP-OUT, but she was clearly being optimistic and commented that the significance of the Doha agreement was that it was a bridge between the original Kyoto Protocol, which was drawn up in 1997 and expires at the end of this year, and the next protocol, which was agreed in principle in Durban (the Durban platform) last year and is due to be signed in 2015.  And yet, would you venture out on a bridge between something that is finished and something that has not yet been built, except in principle?  Adrift in the ecstasy of mega-conference overkill – that’s where Ms Figueres and Mr Al-Attiya were.

COP18 – a bridge to nowhere? (Image © neuroskeptic.blogspot.ca/2012/06/bipolar-disorder-bridge-to-nowhere.html)

Meanwhile, the science continues to prove disturbingly accurate.  As Nature said in its editorial in the 12^th December issue, “Away from Doha, here is another statement on climate change: average global temperature will rise by 0.7–1.5 °C between 1990 and 2030, with a best estimate of 1.1 °C. That is derived from the very first report of the Intergovernmental Panel on Climate Change in 1990. In many ways it is the first consensus prediction of climate change. We’re now more than half way through the period covered by that prediction and so far, at least, it is bang on.”

The World Bank’s chilling report, Turn Down the Heat.  Why a 4^oC warmer world must be avoided, released about a week ahead of Doha, tells us that even if all the current pledges on climate mitigation are met, the world faces a 20% chance of exceeding 4^oC of warming by 2100.  If they are not met, 4^oC could be reached by 2060 and rises in excess of 6^oC in the coming centuries.  It goes on to state, “The effects of 4°C warming will not be evenly distributed around the world, nor would the consequences be simply an extension of those felt at 2°C warming. The largest warming will occur over land and range from 4°C to 10°C. Increases of 6°C or more in average monthly summer temperatures would be expected in large regions of the world, including the Mediterranean, North Africa, the Middle East, and the contiguous United States.”  It provides equally grim information about ocean acidification, sea level rise, rainfall, and the availability of fresh water, and stresses the increased unpredictability and severity of weather events.  This is a document worth reading.

Another document just out, OECD’s Development Co-operation Report 2012: Lessons in Linking Sustainability and Development, advises that we are on a collision course with nature and must alter our economic model in which rapid growth has come at the expense of the environment and many of the world’s poorest people.  What is needed is a commitment to green growth which provides a return on investment in the form of tangible and sustained benefits for people AND the environment.  The report argues for:
a) reform of our current fiscal systems to provide long-term incentives for sustainable production, consumption and investment decisions;
b) appropriate price signals that capture the critical role played by environmental resources and services so that households, the private sector and decision makers can better balance the full costs and benefits of their actions; and
c) new measurements to gauge our progress – beyond the traditional measurement of GDP – that take into account changes in human well-being, equity, natural capital and the environment.

This report also deserves careful reading – I may comment further at a later time, but I find it interesting to see the growing frequency with which multinational political agencies are admitting that our current relatively loosely regulated capitalism may not be the economic model for a successful future.  Inevitably, of course, when we think about climate, we come back to fossil fuels and the growth of GHG emissions.  The IEA’s World Energy Outlook for 2012, released last month, made it very clear that current trends are taking us to a very bad place.  By 2017 we will be producing enough fossil fuels to guarantee a 2^oC temperature rise, even if we never increased production beyond that level. The development of fracking techniques for extracting shale oil and gas has radically altered the status of world fossil fuel reserves, has made the USA able to become energy independent (but still using fossil fuels) by 2030, has altered any calculations regarding peak oil, and has ensured that if we actually burn all the hydrocarbons that the energy companies have on their books as proven reserves we are up a very nasty creek without a canoe, never mind the paddle.  Forget 2^oC.

The other day, I decided to find out something about major energy companies.  I found PFC Energy’s list of the top 50 global energy companies based on 2011 performance.  Largest on the list is Exxon Mobil with a market capitalization of $406 billion.  The top 20 include five US companies, three Chinese, two each based in Russia, France and UK, and six from other countries, including Suncor from Canada.  Five, including PetroChina, Petrobras (Brazil), Gazprom (Russia), Total (France), and ENI (Italy) are the largest corporations in their home country.  Others, like Suncor (2^nd largest in Canada) are among the top five companies in their home countries; all have multinational interests.  Together, these 20 corporations had $2.6 trillion in market capitalization in 2011.  They are big entities with plenty of wealth and lots of power.  In addition, there are some equally big companies engaged in oil trading, such as Koch Industries ($100 billion), Cargill ($108 billion), and Archer Daniels Midland ($62 billion).  They also are powerful and wealthy.

Alberta tar sands development (Image from http://waterdefense.org/content/tar-sands)

The extraction of fossil fuels requires substantial investments with payoffs uncertain and a decade or more out.  Powerful corporations do not risk money foolishly; they expect to get most of those payoffs.  In other words, they expect to mine and sell the hydrocarbons they have discovered.  Those not yet mined discoveries are the proven reserves – the ones that just jumped because of the advent of fracking.  And, like all good corporations they work to achieve a profit, not for the good of the world.

(As an interesting example of working to achieve a profit, consider this.  The success of fracking in yielding natural gas in the US over the last year or so has led to a glut in the US gas market.  The US does not export gas and its prices are not tied to the global gas market.  Consequently gas prices within the US have fallen steeply.  Oil production from shale, via fracking, is now growing significantly faster than analysts predicted because companies, seeing the drop in gas prices have been pulling their rigs out of gas fields and using them instead in locations where oil is a greater proportion of the product extracted.  At a time when a shift away from oil towards gas would be desirable as part of GHG mitigation (because gas yields less CO₂ when burned), the exploration companies are deliberately moving away from gas towards oil because the profits are greater.)

China’s state-owned CNOOC, which was just given permission by Canada’s wise Prime Minister Harper to buy Nexen, has stated that one of the main attractions of the Nexen purchase was gaining access to fracking technology.  Fracking is going to grow, reserves are going to increase, and energy producers are going to want to realize the profits from extracting those reserves.  (I have nothing more to say about the Nexen purchase except to note that Canada is now ‘a little bit pregnant’ – Harper said that he was determined that Canada not be sold off to foreign governments, but in saying so, he sold $15 billion to China and $5 billion to Malaysia.  Guess I should start learning Mandarin, while watching for Chinese laborers entering Canada as temporary workers to run Nexen’s operations (that’s already happening in a British Columbia coal mine).)

Given the fact that there are numerous large, powerful corporations engaged in the fossil fuel industry, it should not be a surprise to learn that the total of government subsidies paid to the fossil fuel industry to help them turn a profit now amounts to $523 billion in 2011, up 30% from 2010.  The subsidies do not come as cash in brown paper bags handed over to oil company executives, but as subsidies to consumers of energy obtained from fossil fuels.  Keep the price low so people go on burning it!   Two examples, the crazy low price of gasoline in the US, and the even crazier low price in Qatar, scene of COP18.  The extent of these subsidies makes trivial the subsidies to alternative energy producers ($88 billion in 2011).  No wonder it is so difficult to get alternative energy sources to be competitive – the oil companies are being subsidized.  Why, you ask, do large energy corporations give funds to political campaigns?  I wonder.  Does this only happen in the US?  Do you think Canada or Australia have politics that are immune to influence from deep-pocketed corporations?

And so we come to lobbying for political action to stymie progress on climate change.  The Union of Concerned Scientists published an important document on this topic in May 2012.  In its 72 pages, A Climate of Corporate Control paints a compelling picture of the wide range of activities and the considerable sums of money spent by the fossil fuel companies to influence attitudes and policy developments within the United States.

The Koch Brothers – not a new blues band.  Photos © John Chiasson/Liaison; Robin Platzer/FilmMagic

We can be sure that similar campaigns are waged in other countries where production of fossil fuels is a significant part of the economy.  This document is well worth reading, but it is not the only source.  The claim that the oil companies have taken a page from big tobacco in delaying action that would deprive them of future profits is very well founded.  No wonder Doha was so ineffective.  We have a major part of the global economy making sure that the delegates do lots of talking and make few if any decisions, other than to meet again next year.

Canadians must understand that the energy corporations have a tremendous influence on our current government.  Actions to reduce environmental monitoring, remove the need for environmental impact studies when the new initiative is tied to the fossil fuel industry, claims that we MUST ramp up production in the tar sands even if it means we must use Chinese government funding to do it – these are not the actions of a government working for the people, but of one working for its real masters, the multinational fossil fuel industry.  Barbara Yaffe put it well in the Vancouver Sun last week: Canada would rather adapt to climate change than lead on cutting greenhouse gases.  And David McLaughlin, former President of the National Roundtable on the Environment and the Economy (abolished in the last budget omnibus bill), put it well in an Op Ed in the Edmonton Journal this week. After talking of the considerable future cost to Canadians of the environmental damage that will come with climate change, he wrote, “Canada, the oilsands and the pipelines don’t need more public relations to vaccinate them from angry public opinion; they need a good dose of public policy to cure the disease”.  If only our wise Prime Minister could see the mess being left for his children and grandchildren to clean up.  Maybe the siren call from the likes of Suncor, ExxonMobil or CNOOC would be better resisted.

We who live in developed countries do not yet see very much of the impact of climate change.  Even when disasters strike in the form of floods, droughts, cyclones or hurricanes, we have sufficient wealth, mostly, to buy our way out of difficulty.  That is not the case for the majority of poor people in developing countries.  These people went to Doha hoping for real progress.  Our delegates went there to obfuscate and delay; and in so doing they were working for the fossil fuel industry, not for us.