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It’s the scientific breakthrough that’s been decades in the making. On Tuesday, researchers studying nuclear fusion managed to create more energy than they used — a crucial milestone that could one day pave the way to an almost limitless supply of cheap, clean energy. As U.S. Energy Secretary Jennifer Granholm said, “This demonstrates that it can be done.”

The big question now is how long we’ll have to wait before “it” can be done at scale. For Canada’s oil and gas industry, though, it raises a very different question: how long until business is permanently disrupted? Nuclear fusion, like the growing supply of wind and solar power around the world, is part of a future in which oil and gas are far more marginal players in the global energy mix. And that future is coming faster than they might like to admit.

As the International Energy Agency’s most recent World Energy Outlook noted, “A profound reorientation of international energy trade is underway… Many of the contours of this new world are not yet fully defined, but there is no going back to the way things were.” Oil and gas markets, which fossil fuel proponents like to pretend are stable and predictable, have instead been turned into geopolitical weapons over the last year by everyone from Russia’s Vladimir Putin to the OPEC cartel led by Saudi Arabia. “In contrast,” said Sepi Golzari-Munro, the Global Wind Energy Council’s energy transition director, “renewables provide the opportunity for nations worldwide to benefit from homegrown, secure, and sustainable energy on their own terms.”

Germany, which is bearing the brunt of Russia’s weaponization of oil and gas exports (as well as its own foolish decision to rely on them), is learning that lesson quicker than most. Yes, it spent the summer importing as much liquefied natural gas as it could in preparation for the winter heating season, and it will do the same over the next few years. But it has already announced an acceleration of its transition away from fossil fuels, one it now intends to complete in just over a decade by aggressively embracing wind, solar and demand-side measures.

That could happen faster than anyone expects — including most people in Germany. A May 2022 paper by a quartet of energy economists laid out a path to “Freedom Energy” by 2030, one that could help Germany rapidly displace not just Russia’s fossil fuel imports but all of them. As co-author Nafeez Ahmed wrote in an op-ed: “Not only will Germany not have to build any new fossil fuel, nuclear, hydrogen, hydropower or geothermal power, but after 2035 it will never need to import fossil fuels again.”

It may not be alone. For the first time ever, the IEA’s World Energy Outlook predicted a peak or plateau for fossil fuel demand in all of its scenarios — including the least ambitious one. “As governments inevitably do more to accelerate the energy transition,” Canadian Climate Institute research lead Caroline Lee tweeted, “the outlook for fossil fuels will not become any rosier.” In the net-zero emissions scenario, for example, oil demand plummets to 75 million barrels per day by 2030 on its way to less than half that by 2050, while in the “announced pledges” scenario, it peaks in the mid-2020s.

Here in Canada, though, that message has yet to really sink in. In an October op-ed for the Globe and Mail, former Scotiabank CEO Brian Porter suggested now is the time for us to ramp up our fossil fuel exports. “We recognize the importance of working, over time, to reduce carbon emissions, and our domestic ambitions on the climate front are well-intentioned,” he wrote. “But we cannot act as if nothing has changed in the world over the past year. Positioning ourselves to be the preferred supplier of responsibly produced energy to the world is good for our allies and good for all Canadians.”

A month later, at COP27, the head of Canada’s largest oil and gas lobby made it clear she wasn’t buying the IEA’s forecast, either. “As global demand for natural gas and oil will remain strong for decades, Canada has a role to play in providing safe and lower emission resources to the world’s energy mix,” said Lisa Baiton, president and CEO of the Canadian Association of Petroleum Producers.

In other words, Canada’s oil and gas industry and its proxies in the banking sector are betting the world will not live up to its existing promises on climate change and net-zero emissions, much less make new and more ambitious ones. This, along with their desire to extract as much in subsidies and support out of the federal government as possible, explains why they’ve been moving so slowly on their much-touted commitment to building new carbon capture and storage projects.

Note to Alberta: nuclear fusion may still be decades away, but the global energy transition away from fossil fuels is going full speed ahead, @maxfawcett writes. #opinion #NuclearFusion #FossilFuels #ableg

But ragging the puck like this only works if the score is in your favour — and the game is within your control. If the world gets serious about decarbonization, or at least lives up to its current promises, that game is already over. As University of Calgary professor and Pembina Institute board member Sara Hastings-Simon tweeted, “The biggest impact policy can have in the next few years on Alberta’s oil production/value of that production is not the policies in Alberta or Canada but the policies everywhere else.”

In other words, we are not masters of our destiny here in Alberta, no matter how many sovereignty acts our government signs into law. Nuclear fusion may still be decades away, but the global energy transition away from fossil fuels is only going to pick up speed in the months and years to come. The longer we wait to respond, the further behind we’re going to end up.

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Fawcett: "Canada’s oil and gas industry and its proxies in the banking sector are betting the world will not live up to its existing promises on climate change and net-zero emissions, much less make new and more ambitious ones."

Did anyone seriously believe that the fossil fuel industry and its financial backers were committed to climate action? Winding down operations and sidelining itself?

Fawcett: "This, along with their desire to extract as much in subsidies and support out of the federal government as possible, explains why they’ve been moving so slowly on their much-touted commitment to building new carbon capture and storage projects."

Not to mention that carbon capture and storage (CCS) for fossil fuels is a fraud.
CCS is not a climate solution. CCS is a delaying tactic. Not just doomed to fail, but designed to fail. Its primary purpose is to provide political cover for O&G expansion and new projects. CCS spells business as usual for oil and gas.
CCS captures a tiny fraction of emissions at high cost — only from large emitters. Viable, if at all, only for large CO2 streams. Not economic where sources are many, small, and diffuse. E.g., oilsands mines. Methane leaks. Tailpipes.
Capturing upstream emissions does nothing to reduce the 80–90% of emissions generated from a barrel of oil downstream at the consumer end. CCS does not capture other pollutants.
Subsidies for CCS and SMRs undermine carbon pricing. Carbon pricing is intended to make it more expensive to emit carbon. CCS subsidies offset companies' higher carbon costs, blunting the financial incentive.
CCS will be essential ONLY in sectors difficult to decarbonize. Processes like steel and cement. Not for the fossil fuel industry, where energy alternatives are readily available.
Expensive, inefficient, and energy-intensive, CCS for O&G simply perpetuates the fossil fuel regime. CCS means fossil fuels for longer. More emissions, not less. A plan to "green" fossil fuels, not get off them. CCS keeps us dependent on fossil fuels — not a transformative solution.
If CCS is effective, efficient, and economic (it isn't), hugely profitable O&G companies can pay for it. CCS is a plan to fail at taxpayers' expense.

"Lessons from Australia show CCUS is about capturing public opinion and public finances, not carbon" (National Observer, April 6th 2022)
"The principal purpose of CCUS has never been to tackle the climate crisis. Instead, CCUS serves to align public opinion and government policies with the fossil fuel industry's plans for unrestricted expansion under the cover of 'net-zero by 2050' rhetoric."

The Pembina Institute acknowledges that in the oilsands sector "most CO2 is emitted in low concentration streams, and the efforts to capture it will be challenging and expensive."
CCS does not solve our climate problem. As long as oilsands production increases, CCS will not significantly reduce even grossly under-reported emissions in the oilsands.

Well, people who believe in mainstream neoliberal economics might. One of the sort of articles of faith of centrist economic doctrine is the idea that everything is almost completely fungible, so investment can just freely slosh around to different places. So if you have an oil company and you get the news that in a while, oil is going to stop being a thing, you can just reinvest the capital and do something else; tomorrow the company can have switched to being a solar power company.

I mean, sure, intellectually in some corner of their minds they know that isn't really true . . . but it's one of a sizable group of truths about the real world that mean efficient-markets math doesn't have any relationship to how the real world actually works, so efficient-market boosters don't want to think about it. I mean, even the most ridiculous mainstream economists will grant that efficient markets aren't exactly a real thing--but they want us to run economies AS IF it was true, or at least PRETEND to run economies as if it was true, at least in all the cases where doing so is convenient to the very wealthy. So they'd like to think as if huge capital-intensive corporations with massive sunk costs and entrenched corporate cultures and masses of people with particular sets of hard-won expertise who have grabbed a niche with distinctively sweet profit margins, could just wave a fairy market wand and reorient to whatever just became rational.

The fact that they won't, and pretty much can't, do that pivot on a dime, for a host of reasons to do with the stubborn intractability of the physical world, is actually kind of a crushing rebuke to mainstream "efficient-market-lite" ideas.

Sigh. So much "fusion" anticipation. This may still never happen. It relies on lasers that waste 95% of the energy input, and generates only heat, of which only 40% can be turned into electricity, so you need another 40-fold improvement in results to actually make net energy.

The joke now is that "nuclear fusion plants in 30 years" is, for the first time, no longer a joke. But, bluntly, even 30 years is speculative.

What is absolutely true, is that the "Wright's Law" curves for renewables and storage are still in their "exponential increase" stage, though they may be only five years, maybe ten, from bending over so that improvements are just gradual.

But even that 5-10 years of improvements as fast as the last 10-15, spell doom for oil and gas. I really think we'll see "peak consumption" of oil in this decade. And since Alberta's oil has the least payback on Earth, it'll be the first source shuttered. The oil sands shutdowns in the 2030s strike me as inevitable.

The public reaction is particularly odd because we already have a fusion reactor, one so proximate and powerful a good look at it would burn out your eyes. It’s been showering us with energy for a very long time. We can harness the rays it delivers and the winds they generate, cheaply and at scale. And yet power from that original sun is often a subject of derision not salvation.

Fusion in the future poses no threat to fossil fuels today. In fact, the prospect of techno-solutions over the horizon is a key narrative in the new climate denial — predatory delay.
-Excerpt from: C. Hatch, Zero Carbon

It should be noted that Germany is scheduled to stop building, importing or exporting internal combustion engines for road transport in the 2030s. Without gas tanks, liquid fossil fuels will be greatly diminished through government policy and demand destruction. The EU is already beefing up similar policies.

So much for the CIBC's rose-tinted outlook on Canadian fossil fuels.

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