Interview: Gordon Laxer on Big Oil, Rachel Notley and a greener future

Paul Weinberg

April 13, 2016 - When Rachel Notley's NDP came to power last spring in Alberta, Gordon Laxer's book, After the Sands: Energy and Ecological Security for Canadians, on ecological renewal and Canadian petro-politics was already at the publisher. And so, he was given a week to do some major rewriting because he had not foreseen this political earthquake in the making.

A year later on a book touring engagement here in Hamilton, the author figures he got it right in the last minute haste to be current.

Laxer predicted just months after Notley and her cabinet were sworn into office that they would both focus positively on issues like inequality, but also unfortunately "snuggle up" with the energy companies and become a more "effective" advocate of their interests. 

In the wake of the NDP convention, Laxer couldn't have been more right.

Rachel Notley and Alberta environmental politics

"Everybody knew that the Conservatives were in the pocket of Big Oil, whereas clearly Notley is not in the pocket of Big Oil. The problem is she is intimidated by Big Oil, and there is almost no difference in outcome and policies [from the previous Alberta Conservative governments]."

In addition to being the founder of the progressive Parkland Institute and a professor emeritus in political economy at the University of Alberta, Laxer is a long-time member and supporter of the NDP. Premier Notley was a student of his in university. 

Ultimately, Laxer says he relied "more on the head than the heart" in his analysis that we must follow the scientists' advice to keep 80 per cent of existing fossil fuels in the ground including the carbon intensive bitumen in the Alberta "sands" -- Laxer prefers this "neutral" term to oil sands or tar sands -- in order to save the planet from over heating from excessive carbon in the atmosphere. 

The author has also broken with the traditional demand of the NDP and the Alberta Federation of Labour for fresh investments by the province in the billions to refine extracted bitumen in Alberta versus shipping it raw elsewhere and outside Canada -- which up to now is what energy companies have done.

The nationalist solution of making commodities more value-added may not make sense in face of a climate change emergency if it just keeps you producing more carbon fuels, he says.

Laxer predicts that the cost involved in building and operating a refining infrastructure will result in a further dependency by Alberta on the full productions of bitumen over 30 years in order to pay off the money spent. 

He warns that a set of workers and communities would be established -- much like Fort McMurray, the ground zero centre for sands oil extraction today -- with a vested interest in maintaining such a refinery operation for the same type of fossil fuel.

Furthermore, Laxer argues that the goal of the G8 countries, including Canada, to cut carbon emissions by 80 per cent in 2050 (first promoted by Jack Layton) cannot be met if the Alberta NDP government continues on its current trajectory of existing sands oil extraction and support for proposed pipelines such as Energy East and Kinder Morgan that would primarily transmit this dirty carbon to overseas markets.

All of this may appear contentious in Alberta, which economically is reeling from the dropping price of oil. Some people are already saying it is also creating new political barriers for the Trudeau Liberal government to meet Canada's modest climate change promises on carbon emissions.

Notley was vocal at the NDP convention about her province's economic suffering and insisted that a transition to a greener economy should be a long-tern goal, not an immediate objective, tacitly criticizing the LEAP manifesto.

Our country agreed to do its bit to meet the aspirational but voluntary goals of the Paris Climate Change conference which aims to ensure that world temperatures do not rise beyond 1.5 degrees Celsius in global warming.

But Laxer does not feel like an outlier from his home province where bitumen is sacred.

He is in fact very relaxed in expressing his core message that Canada should transition itself over a 15-year period into a low carbon future by relying on finite reserves of less polluting conventional, non-fracked and non-sands oil reserves dug up in solely in Canada. Laxer stresses that our dependence on fossil fuels is too deep to warrant anything faster than this.

Pipelines, tankers and oil

Laxer not wants only to keep sands oil buried in the ground for environmental reasons -- extraction is also pummelling Alberta's northern boreal forest region and over using its water -- but also sees no need for any of the current pipeline construction pipeline proposals, all of which are being challenged by Indigenous people at the forefront of environmental activism, he notes.

Energy East is designed to eliminate the odd situation where eastern Canadians have historically relied on imported oil for energy and home heating needs while western Canadians have access to domestic fossil fuels. 

Laxer prefers the transmission of remaining non-sands oil from the west to Ontario and Quebec in existing pipelines and the sharing of conventional Newfoundland oil with the rest of Atlantic Canada via tankers -- a cheaper and less polluting solution than a pipeline funnelling carbon to the Saint John port in New Brunswick for export.

The Energy East model proposal from TransCanada and Enbridge that Laxer opposes is being sold ironically on a nationalistic basis by successive Conservative and Liberal governments in Ottawa. 

Neither in past, argues Laxer, has demonstrated much interest in maintaining a secure supply of energy for domestic requirements in Canada.

One plausible scenario would be the withholding of imported oil for home heating or gasoline for vehicles by the Americans if an international crisis in the Persian Gulf disrupts supplies.

We are apparently one of the few countries in the world without what is internationally called strategic petroleum reserves, says Laxer.

He writes that American oil analysts have warned Canada that any U.S. government in power will focus on its domestic needs first and foremost. Energy independence has been a policy plank among politicians south of the border. "We'd shut you off. We don't have an SPR big enough for us," Matt Simons, an American energy investment banker told Laxer.

Big Oil and its political and business allies in governments in Ottawa and the oil producing provinces have always supported massive selling of our oil and gas -- two-thirds of our output is exported -- to the energy hungry American market.

This explains, says Laxer, the acquiescence by negotiators in Ottawa to provisions in free trade agreements like NAFTA and FTA under Brian Mulroney to Jean Chretien which stipulate that "Canada must make available its current share of energy exports to the U.S., even if Canadians are freezing in the dark."

These agreements would potentially undermine a Canadian government's ability to conserve conventional non-sands oil and gas for domestic purposes for his proposed 15-year transition period to a low-carbon future.

The only way this can happen is if Canada takes the admittedly "bold" step of NAFTA's six-month opt-out provision that would allow us to abandon this straight jacket of a trade agreement.

Climate change and carbon pricing

Laxer tackles other climate change issues and says that policies promoting massive conservation and de-growth offer a more substantial impact, in terms of reducing carbon levels in the atmosphere, than a sole reliance on carbon pricing and renewal non-polluting energy sources such as solar and wind. 

It is not that Laxer is especially opposed to either solution. But, he notes, a carbon price, for example, that is high enough to punish a profligate use of fossil fuels by the wealthy and powerful might also hurt the rest of the population.

"If you put it up high enough, lower income people are not going to be able to drive or heat their homes. So, you have got to have something that is fairer than that."

Laxer likes what he calls a fairer British system of personal tradable national energy quotas where every person in the country would pay for carbon energy much like credit card transactions.

Cap-and-trade systems, in contrast, are "top-down" government-inspired boondoggles that allow polluting industries to do their dirty work under certain circumstances, he asserts.

For more insight into climate change and Canada's transition to a low-carbon future, read Gordon Laxer's book After the Sands and read selected experts right here on rabble.

Paul Weinberg is a Hamilton-based freelance writer who can be reached at