Energy & Infrastructure
Natural resources are, and will continue to be, a crucial component of the economic well-being of British Columbians. To advance BC's prosperity, we must responsibly develop new forms of energy resources and build the necessary infrastructure to connect them with global markets. The Council’s work supports the efforts of businesses and governments to develop resource projects, energy systems and transportation networks in a way that minimizes the environmental impacts and maximizes economic benefits for communities and BC’s job creators.
Some Reflections on the Global Energy Transition
Is the world in the midst of a rapidly accelerating migration away from fossil fuels, toward a much greater reliance on carbon-free sources of energy? If one takes seriously the speeches of Environment Ministers or the content found on the web sites of many well-known environmental advocacy organizations, the temptation is to answer “yes.” The reality, however, is more complex.
In this edition of Environment and Energy Bulletin, Jock Finlayson analyzes the recent projections of three well-respected sources - the International Energy Agency (IEA), the United States Energy Information Administration (EIA) and British Petroleum (BP). He concludes that for the world as a whole, there is certainly evidence of an incremental move away from fossil fuels as a primary energy source, in favour of low/no-carbon forms of energy. However, looking out over the next two decades, the trend-lines point to a real, but far from revolutionary, energy transition, one that is unlikely to entail an absolute reduction in the quantity of fossil fuels produced and consumed globally by 2035 or 2040.
Jock Finlayson Presentation
Does Canada have an Economic and Environmental Carbon Bubble?
Presented to the Eco-Pragmatism Summit, Vancouver, June 15, 2015
On June 15, 2015, Jock Finlayson participated in a panel debate with Jeff Rubin focused on energy and the economy. Jock's presentation included a review of the top global oil producers, Canada's place as an energy exporter and global energy consumption trends. He also looks at energy transitions and some implications of lower fossil fuel prices.
D'Avignon Op-Ed: Great News for British Columbia
Remember June 11and 12, 2015. We will look back on this 24 hour period years from now as a point in which B.C. started to see a material change to its economy. Specifically, it was when some $44 billion worth of investment decisions were made in two separate projects that will strengthen B.C. as a significant player in two global sectors: energy and shipbuilding.
Finlayson Op-Ed: Canada flirting with recession (Troy Media, Business in Vancouver)
The latest economic growth report from Statistics Canada casts a cloud over the country’s economic outlook for 2015. Real gross domestic product (GDP) fell at a 0.6 per cent annualized rate in the first three months of the year, considerably worse than even forecasters of a pessimistic bent were expecting. Digging into the details, it is clear that the slump in global oil prices is taking a measurable toll on Canada’s energy-centric economy.
Non-residential investment plunged by 15 per cent in Q1, led by sharp cuts in capital-spending by the oil and gas industry. In recent years, the energy sector has accounted for more than one-third of all non-residential investment, as well as for roughly one quarter of Canada’s merchandise exports. So the epic downturn in oil and natural gas markets is dampening overall private sector capital outlays and weighing heavily on Canada’s export receipts.
Harsh winter weather also played a role in the gloomy Q1 report -- consumer spending came in below consensus, as many Canadians apparently decided to stay indoors.
Economists define a “recession” as two consecutive quarters of declining real GDP. We are half way there, and some recent economic data signal further softness into the second quarter.
Rethinking Social Licence to Operate -- A Concept in Search of Definition and Boundaries
This edition of Environment and Energy Bulletin, guest authored by David Bursey, a partner with Bennett Jones LLP, examines the evolution of Social Licence to Operate (SLO) in the approval of resource development projects and its recent rise in popular use. It then considers how the concept relates to political governance and law. Finally, it assesses the implications of how SLO is being applied – for good and for bad, but most often without a proper context..
Ken Peacock presentation to Construction Council of Vancouver Island
Building BC for the 21st Century
On May 13, 2015, BCBC Chief Economist Ken Peacock presented to the Construction Council of Vancouver Island's first annual Capital Project Forum in Nanaimo. In his presentation, Ken makes the case for increased infrastructure investment due to its strong economic impact and the role infrastructure plays in enabling access to foreign markets and improving quality of life. With the current climate of low interest rates, now is an opportune time to borrow capital in order to finance essential infrastructure projects. The presentation also looks at a variety of financing options from both the private and public sector, and notes the need for a long term infrastructure development strategy to ensure we keep pace with the global economy and our shifting demographics here at home.
This presentation is based on the Business Council's November 2014 whitepaper on infrastructure policy and financing, Building BC for the 21st Century, authored by Ken Peacock and Jock Finlayson.
Whitworth Op-Ed: Liquefied Natural Gas is a Generational Opportunity (Vancouver Sun)
The debate about the future of liquefied natural gas in British Columbia is generating plenty of heat, but often too little light. A casual observer can be forgiven if he or she is just a bit confused about whether LNG will come to B.C.
Strip away the rhetoric, however, and a truth remains: In a growing world economy hungry for cleaner forms of energy, the market for B.C.’s natural gas remains strong.
As CEO of Seaspan ULC and chair of the British Columbia Business Council, I think it is important we remember this when considering LNG’s potential to shape our province for the better.
Plunging Oil Price Good for the BC Economy in 2015…
The rapid and steep decline in world oil prices has prompted a fair amount of commentary on the accompanying economic impacts. For Canada, much of the analysis points to modestly negative economic implications, stemming from reduced business investment, lower corporate revenues, a decline in the value of exports, and diminished job creation in the oil patch. Lower oil prices also translate into a decline in revenues flowing to the federal government and to provinces like Alberta and Newfoundland.
An Updated Look at BC’s Inventory of Major Capital Projects
In this issue of Policy Perspectives, we provide a summary of capital spending on “major” projects in British Columbia.
Finlayson: Low Interest Rates make this a great time to invest in infrastructure
Ottawa has the fiscal room to invest in infrastructure projects
A Note on Infrastructure Investment and Government Debt
The Business Council recently published a white paper on infrastructure policy and financing in British Columbia. One of the points made in the paper is that investing in certain categories of infrastructure assets – particularly transportation, communications and energy infrastructure -- can help to strengthen the foundations for prosperity by boosting productivity, expanding the economy’s ‘supply side’ capacity, and improving the competitive position of local industries engaged in global commerce.
Release: Business Council of BC White Paper and Nov.7 Summit focus attention on BC infrastructure needs and issues
VANCOUVER, BC (Nov. 5, 2014) - With the economic prosperity of British Columbia and Western Canada relying increasingly on global trade and our ability to deliver goods to foreign markets, the Business Council of British Columbia (BCBC) today released Building BC for the 21st Century: A White Paper on Infrastructure Policy and Financing in advance of its second annual BC Business Summit (Building BC for the 21st Century: Innovation in Infrastructure), to be held on Friday, Nov.7 at the Vancouver Convention Centre.
Building BC for the 21st Century:
A White Paper on Infrastructure Policy and Financing
This paper is about infrastructure in BC. It reviews what infrastructure is, the importance and benefits of infrastructure and some of the external and internal factors that are shaping the demand for infrastructure services in the province. It also reviews infrastructure that has been built in the province over the past decade. Despite BC having made substantial investments in large public assets that have served the province and its citizens well, we conclude that additional infrastructure investments are necessary to support residents’ quality of life and improve BC’s competitive position.
Reducing Greenhouse Gas Emissions - The Costs Vary By Industry
Policy-makers in a growing number of jurisdictions are committed to taking steps to reverse – or at least slow the growth of – greenhouse gas (GHG) emissions that are believed to contribute to global warming.
Climate Progress in BC
If you read the recently released 2014 Progress Report on Climate Action in BC and some of the related commentary, one would think BC is doing really well on meeting its climate objectives. It’s not surprising to see the government pat itself on the back, but the self-congratulation is overdone in the context of the 2020 33% legislated reduction target that was put in place in 2007. We have only run 2.4 km of a 40 km marathon race. It was clear in 2007 that the government of the day was too ambitious in adopting the 33% goal, and the latest data confirm this.
The LNG Opportunity in BC: Separating Rhetoric from Reality -- Part II
In Part I of this two-part series, we reviewed the main economic critiques of LNG development in British Columbia, concluding that while there are risks and economic uncertainties with respect to LNG in the province, the critics are largely off base with their professed economic concerns. Here in Part II, we address the more analytically challenging environmental issues that have been identified by various commentators who doubt the benefits of LNG.
Metro Vancouver’s Transportation Choices: How the Mayors got it right and wrong at the same time
Last week the Mayors’ Council, representing 23 local governments in Metro Vancouver, released their long term vision for the region’s transportation system. On many aspects of transportation planning the Mayors’ proposed blueprint moved the region closer to a comprehensive vision that could, conceivably, pass the muster of a regional referendum. To their collective credit, the Mayors for the most part resisted the temptation to play politics with the priorities - the investment side of the plan displays a degree of reasonableness that has often been lacking in transportation debates in the region.
The LNG Opportunity in BC: Separating Rhetoric from Reality -- Part I
At the same time as China and Russia signed a massive 30 year, $400 billion natural gas trade agreement, the BC government continued its push to establish an LNG industry with a (successful) global LNG conference in Vancouver. The May event came on the heels of Premier Clark’s fifth trip to Asia promoting, in part or full, LNG opportunities in the province.
The China-Russia agreement is emblematic of the changing energy supply landscape; it also speaks to the size of the potential opportunity for jurisdictions like BC considering the contract constitutes only 29% of China’s future import requirement.
Closer to home, critics continue to question whether BC can develop the LNG sector in a responsible and economically sensible manner that will deliver the benefit set expected by government.
In this two part Energy and Environment Bulletin, we assess the validity of arguments suggesting BC is making a mistake in seeking to advance LNG and that the province would be wiser to halt, slow down or significantly change its approach to LNG development.
What will $48 Trillion get you?
The strong correlation between energy use, economic growth (GDP) and improving standards of living is well documented. All societies that have significantly improved quality of life have relied heavily on energy and energy systems to do so.
BC Ports and Shipping Industry are Global Leaders
The shipping industry is one of the oldest in the world but is not well known -- even though many immigrants arrived by boat to North America. Settlers relied on ships to move supplies to the New World from the Old World. Today, shipping is still a fundamental means of conducting trade and transporting goods from place to place. In Canada, shipping represents the dominant mode of bulk deliveries for both exports and imports to and from markets other than the United States.