What are your views on Canadians possibly losing their energy options for their homes and cars?
What are your views on Canadians losing choice over how they heat their home? What are the risks with directing Canadians to use only electricity for their heating, and also their cars, with proposed bans on internal combustion engines? What does history tell us about scenarios like this?
Choice is an essential element of so many public policy debates. From the heating of your home to the medical care you receive most people want to have more than a single path to pick. While that is not always possible it should be more often than not.
Sometimes I guest host a radio program in Newfoundland and Labrador on the historic radio station VOCM. The program is called “Openline” and dates back decades. As the name suggests the lines are open to all manner of subjects. A hot talker, as it is called in radio, is the cost of home heating.
Many people in my province, including my own mother, heat their home via oil burning furnaces. And believe you me whenever the price of furnace oil increases the lines light up. Higher prices mean greater costs, and that means other purchase options are limited for people. Turn on any stream of media these days and you’ll get quick confirmation that inflated cost of goods is punishing people.
“Choice is an essential element of so many public policy debates.”
In Newfoundland and Labrador there isn’t a plethora of options yet for home heating. As Canada moves towards 2030 and trying to achieve climate targets and lessen its reliance on oil and other heavy emitting commodities anxiety grows among people about how they will heat their homes. More specifically, despite challenges with oil price fluctuations, will that option be taken away from them and if so what new costs will have to be incurred as individuals are directed to alternatives?
A popular current advertising campaign on the Rock now is one being run by the Conservative Party of Canada. Many would describe it is an “axe the carbon tax” rallying cry. While the Conservatives are not shooting the lights out in political polling in the province, anecdotally and practically this campaign is having some traction. For example in the fall an NL Liberal MP voted with Conservatives on a motion they put forward calling on carbon price relief for Canadians.
In NL the “axe the carbon tax” campaign is sliding into the frame about choice. How? It connects to the traditional cultural stigma that NL doesn’t gets to choose how its resources will be developed and get a bigger piece of the pie of resource revenue. Equally it speaks to the rural urban lifestyle divide. In rural areas you still need gas to fill your vehicle to get where you are going and fewer options on how you heat your house.
Choice in energy options will continue to heat up, pardon the pun, across the country as people feel their options are limited and that impacts the cost of things – already a potent subject. Follow what is happening in Newfoundland and Labrador and you’ll see both the political and practical consequences.
Tim Powers, is the Chair of Summa Strategies Canada and the managing director of Abacus Data, both headquarters are in Ottawa. Mr. Powers appears regularly on CBC’s Power and Politics program as well as on VOCM in his home province of Newfoundland and Labrador.
What are your views on Canadians losing choice over how they heat their home? What are the risks with directing Canadians to use only electricity for their heating, and also their cars, with proposed bans on internal combustion engines? What does history tell us about scenarios like this?
The proposition that Canadians are losing choice in how they heat their homes or being forced to adopt electric-powered home-heating is both unsubstantiated and most often articulated in support of short-term partisan objectives. The proposition only has merit as a strategy to increase cost-of-living anxieties with Canadian voters in the hopes of ensuring governments remain politically wary of policies that truly facilitate a phase-out of natural gas home-heating.
Governments across the world are promoting the continued electrification of our economy and are supporting the phase-out of home-heating sources like oil and diesel, which remain expensive, carbon intensive, and the only choice for rural and remote communities unconnected to cleaner and more affordable options, like natural gas. Financially supporting those homeowners and small businesses in adopting transition fuels or electric options is a commonsense approach to supporting both carbon reduction and overall affordability.
But the reality is that our economy and our civilization is in the process of wholesale decarbonisation. It won’t happen overnight. It won’t even happen fast. But it will happen. More than government policy, global investment capital is driving this transition and forcing businesses to shift towards net-zero strategies for the decades ahead. Surely, there are marquee government policies moving business in the same direction — including the federal government’s electric vehicle mandate cited in the proposition or historic spending on industrial decarbonization incentives — but these voter-centric policies are mere window-dressing compared to the vast movement of capital towards green energy, electrification, and decarbonisation.
“What industry needs to ask itself is: how can we position ourselves to maximize profits from this transition and ensure the longer-term sustainability of our industry?”
What industry needs to ask itself is: how can we position ourselves to maximize profits from this transition and ensure the longer-term sustainability of our industry? Will we learn the lessons of history — of horse-drawn carriage makers and taxi license holders that refused to innovate? Or will we leverage a moment of change to our benefit? Changes in the political party in government may offer the near-term sense of victory when unfavourable policies are rolled-back, but they will do nothing to offer long-term profitability against the changing economic tide.
Natural gas can play an important and inevitable bridge-fuel role in this transition, as it — and all Canadian energy fuels and technologies — are increasingly well-attuned to the opportunities of this moment in history. Canadian energy players need to adopt business strategies and invest to position themselves to leverage unprecedented government spending and build sustainable models for the road ahead. Energy is, after all, an industry that thinks in decades, not quarters. So, strategies that are sensitive to this reality better serve the interests of long-term growth, rather than short-term political comfort.
Dan Moulton is a Vice President at Crestview Strategy in Toronto. He specializes in building strategies that win public opinion and secure policy victories. Dan leads Canada’s largest corporations through periods of change, turmoil, and reputational risk. Based in the Toronto Office, Dan’s practice focuses on consumer-centric companies, disruptive technology, and energy.
What are your views on Canadians losing choice over how they heat their home? What are the risks with directing Canadians to use only electricity for their heating, and also their cars, with proposed bans on internal combustion engines? What does history tell us about scenarios like this?
If you talk with everyday people on the street these days, you are much more likely to hear talk of the high prices they’re paying for energy, food and other family essentials than anything about the future of internal combustion engines. Which leaves politicians scrambling to figure out what they can do to help as high interest rates drive up mortgage payments and wages continue to lag behind inflation.
Of course, governments must balance multiple policy priorities. Canada cannot play ostrich with its head in the sand when it comes to the urgent challenge of fighting climate change. Nor can we ignore the pressing need to respond to the massive new investments being made in the U.S., and so many other jurisdictions, in new clean technologies.
Our governments must position Canada’s economy to succeed in the coming global transformation. But this isn’t about taking away choice. It’s about making sure Canadian consumers have sustainable choices and Canadian workers have good, family-supporting jobs in the coming global clean economy. This is what we are seeing in the U.S. with policies that reduce emissions and lower costs while creating good union jobs. And this is how we can hit the public policy sweet spot here in Canada to make life more affordable, fight climate change, and build a sustainable economy.
Governments across Canada are looking to incentive-based policies to shift consumers to lower emitting heating and transportation options. While some communities have seen high profile bans put in place, generally governments have steered away from prohibitions.
At the end of the day, the best way to change behaviour is by enticing people to make better choices, both for themselves and our country. This starts with affordability. If there are incentives to move to zero-emissions, we’ll take them. Instead of temporary measures to reduce gasoline taxes — like we saw in Alberta and Ontario — we need long-term fixes that alleviate the high costs people face commuting.
“The shift to electrification must be carefully planned. …[I]n many rural and remote areas our electrical grid still relies on combustible fuels. So the transition for both home heating and vehicles will…require different policy solutions.”
The shift to EVs is happening at a faster pace in regions where the climate, charging stations, and the cost of fuel has made the economics of this transition make more sense. Even in Ontario we are seeing new investment poured into the auto industry’s shift to zero-emissions vehicles and battery charging technology, actions needed if we are going to compete with accelerating changes to the America’s auto industry next door.
The shift to electrification must be carefully planned. We know that in many rural and remote areas our electrical grid still relies on combustible fuels. So the transition for both home heating and vehicles will, of course, require different policy solutions.
But failing to act is not an option. Time and again history has taught us that countries who fail to act in the face of rapid technological change put future prosperity at risk for workers, families, and businesses. Canada must embrace this transition and prepare for growing consumer demand for emissions-free products — or risk our economy falling behind in the coming global shift to a low-carbon economy.
Kathleen Monk is Principal Owner at Monk + Associates, an independent public affairs firm. She appears regularly on CBC News Network’s Power and Politics and sits on the board of CIVIX, a non-partisan charity dedicated to building engaged citizens.