September 29, 2014

The Cargill Pool grain elevator in Buffalo, NY.

Statoil, a Norwegian oil and gas company, announced on Thursday that it will postpone a multi-billion dollar oil sands project in Fort McMurray, Alberta, for at least three years. The company cited “limited pipeline access” as the primary reason for the delay, meaning the company is lacking certainty that it can actually get the oil to global markets.

The project was supposed to produce 40,000 barrels of crude oil each day, making this a significant victory for environmental and climate activists.  Statoil listed other issues, such as rising labour and material costs, as reasons to delay the project, but environmentalists see this as “tangible proof that delays in pipeline projects like Keystone lead to real reductions in tar sands investment and associated carbon pollution.”

This strengthens Todd Hirsch’s case in today’s Globe and Mail for economic diversification in Alberta, which relies heavily on oil sands revenue. While climate change is an obvious threat to future generations, he says, Albertans are “hardwired” to think first about short-terms problems, such as paying for schools, hospitals and roads. He cautions against short-term thinking, saying Albertans must consider what kind of economy their kids will inherit.

Environmentalists in the U.S. have another reason to celebrate now that Cargill, the largest privately-held American company, has announced that it will implement a “no deforestation” policy across its entire supply chain, including palm oil, soy, beef, sugar and cocoa. The company, which is responsible for over $134 billion (U.S.) in annual agricultural sales, made the announcement last week at the United Nations Climate Summit in New York City.

Meanwhile, environmentalists in the E.U. fear that parliament is taking a turn for the worst as new appointments to top environmental posts are being reshuffled, apparently in favour of business groups. The person who is up for the role of environment commissioner is a businessman from Malta, Karmenu Vella, who has been criticized for failing to stop the illegal hunting of birds. Meanwhile, the energy and climate commissioner spot is going to a former oil firm president, Migual Arias Canete. According to the BBC, environmentalists and business groups both say they believe these changes signal “a shift in priorities from the environment to job growth.”

Ending on a high note, the International Energy Agency (IEA), which has historically underestimated the potential of solar energy, says solar photovoltaic and thermal power systems could be the single-largest generator of the world’s electricity by 2050. The IEA report released on Monday says this shift is largely due to falling manufacturing costs for equipment, making it the fastest growing source of renewable energy worldwide since 2000. The report says China will likely be responsible for the lion’s share of solar expansion, followed by the U.S., Africa, India and the Middle East.

Latest from CK Weekly Roundup

current issue