How might a municipality such as Terrace usefully and profitably participate in the shift away from the old order of coal mining, oil and gas?
Despite the inevitable squeals and groans of the old order (coal mining, and oil and gas industries), most global powers understand that long-term survival of a technically sophisticated, financially integrated, and socially productive society will demand a smooth but rapid transition away from carbon fuels and toward clean alternatives.
That being said, the changes that are required will be massive even in Terrace. After all, we practice a local economy pretty much in step with the rest of the world.
The world currently contains an automotive fleet worth about $20 trillion, and changing over from an oil driven fleet to one that is dominantly electric, hydrogen or fuel cell driven will be a huge challenge.
Besides, cars are dramatically underutilized assets, extremely wasteful, because about 95 per cent of the time they’re simply parked somewhere. We need to shrink our fleet without significantly reducing our transport efficiency, all while changing its energy base, to free capital for other more productive uses. Most Terrace families have between $20,000 and $100,000 invested in this money-losing asset.
In European cities it is very easy to get around using their integrated rapid transit and bus systems, and according to Wikipedia many European nations have a lower density of private vehicles per thousand inhabitants than the United States, for example.
In 2012 about 63 per cent of world electricity generation was powered by coal and gas, both significant greenhouse gas sources. Shifting away from these will be another huge task.
Currently in the USA, buildings account for nearly 40 per cent of CO2 emissions. Given Terrace winters, the portion is probably higher here. Laudably, carbon footprint standards for new construction are continually being raised. In Terrace, the potential for an expanded, profitable retrofitting industry for current building stock is appealing.
Terrace and its citizens can make improvements in transport, in power generation, and in buildings’ energy efficiency provided we are willing to make the investments. The question is how?
In a recent interview from the Wharton School of Business at the University of Pennsylvania, the CEO of the nonprofit Coalition for Green Capital argues that banks dedicated to green investments could be used to transform the energy sector within little more than a decade.
It’s a brave forecast but he has compelling examples. The rapid electronics shift from analog to digital, a huge transformation, took a little less than twenty years. The incentive to change was the promise of better, more efficient products.
His green bank will not make any loan “unless the net present value of the savings is greater than the amount of money invested.” They won’t lose money, and neither should we.
He is critical of the money-losing feed-in tariffs that have characterized Germany’s and Ontario’s green shifts (and huge subsidies like those going to run-of-river projects here in BC), even though these shifts have achieved significant success at moving away from fossil fuels.
Given trends (e.g. an 80 per cent drop in the cost of solar panels over the past four years) consumers will find tremendous incentive to do building overhauls and change energy sources because it will be both cleaner and cheaper.
Today distributed solar generation is about 1 per cent of the market share of energy production. With innovative financing models (for example, Solar City’s leasing out of rooftop solar panels – BC Hydro could offer this), this share could double annually.
Terrace and its citizens could profit by moving toward these models. Imagine solar panels charging batteries on street lamp poles. Imagine three or four wind turbines on the industrial park. Imagine BC Hydro and Pacific Northern Gas funding building retrofits and home solar installations to be paid back through monthly billing (essentially green banking).
Retired English teacher Al Lehmann lives in Terrace, B.C.