When it comes to damaging our planet, the fast-food industry has much to answer for. The attractions of cheap burgers and drive-thru coffee are all too often sullied by allegations of poor working conditions, animal cruelty and the cost to the environment of mountains of paper, foam and polystyrene waste.

So McDonald’s deserves a round of applause for its recent pledge to use renewable, recyclable or certified materials for all packaging by 2025, and to put recycling bins in all 37,000 Golden Arch restaurants around the world.

“Our customers have told us that packaging waste is the top environmental issue they would like us to address,” said Francesca DeBiase, McDonald’s chief supply chain and sustainability officer. “Our ambition is to make changes our customers want and to use less packaging, sourced responsibly and designed to be taken care of after use.”

The fast-food giant, based in suburban Chicago, has pledged to work with leading industry experts, local governments and environmental groups to improve packaging and recycling practices. Together, it said, “they will work to drive smarter packaging designs, implement new recycling programs, establish new measurement programs and educate restaurant crew and customers.”

McDonald’s previously set a goal of sourcing all fibre-based packaging from recycled or certified sources with no lasting damage to forests by 2020.

Tom Murray, vice-president at the Environmental Defense Fund, said in an email that the latest moves are noteworthy not only because the 100 per cent recycling goal “closes the loop” at the end of the useful life of packaging materials but, equally important, because McDonald’s is addressing the design and nature of those materials even before they are used.

The company’s global reach, including its vast supply chain, makes it a potentially powerful agent of change. As Murray sees it, “when McDonald’s asks for a change, their suppliers deliver, creating a ripple effect across the entire supply chain.”

He added that “sustainability leadership means that companies need to set ambitious goals that extend far beyond their own walls, addressing their supply chain and the entire impact of their products and packaging. These goals do that by committing to engage on issues beyond McDonald’s direct control – like consumer behaviour and municipal infrastructure.

“Any time a company ups the ante on sustainability leadership and reports progress against its goals, it creates competitive pressure and an incentive for others to step up. That’s a good thing!”

Zero:

The U.S. Energy Department was not amused last year when one of its photographers leaked a picture to the media showing Energy Secretary Rick Perry in a warm hug with Robert Murray, founder and CEO of Murray Energy, the U.S.’s biggest privately-owned coal producer.

The department placed the photographer, Simon Edelman, on administrative leave and seized personal items in his office, the Washington Post reported.

Edelman is now seeking whistle-blower protection on the grounds that there was “something improper” about the close similarity between Perry’s proposals to prop up coal and nuclear plants, and Murray’s own preferences, contained in a confidential memo that he submitted to the new administration last March.

A New York Times article about Murray’s 16 proposals carried the headline: “How a coal baron’s wish list became President Trump’s to-do list.”

The list included cutting the staff of the Environmental Protection Agency by at least half, scaling back the Labor Department’s oversight of mine safety and eliminating numerous restrictions on greenhouse gas emissions.

The Times reported in January that “the White House and federal agencies have completed or are on track to fulfil most of the 16 detailed requests.” The cozy relationship was underscored when the White House nominated a Murray Energy lobbyist, Andrew Wheeler, to the No. 2 job at the Environmental Protection Agency.

Like Trump, Murray has denounced climate change as a hoax. He told The Economist in January that it has been perpetrated by “developing countries of the world to get American dollars … [by] radical environmentalists … liberal elitists [and] Hollywood characters. I don’t refer to them as ‘people.’”

While Murray Energy’s lobbying may sway Trump, it will likely do little, if anything, to reverse the coal industry’s declining fortunes. The U.S. Energy Information Administration estimates that coal’s contribution to U.S. power generation slipped to 28.2 per cent in October 2017, from 31.7 per cent a year earlier and more than 50 per cent at the start of the millennium.

Utilities have announced plans to either retire or convert 163 of the U.S.’s remaining 706 coal-fired power units, amounting to 18 per cent of coal-fired capacity, according to the Union of Concerned Scientists, a science advocacy organization. The group estimates that coal-fired electricity capacity could shrink by more than a third over the next 15 years.

Murray, 78, told The Economist in January that if coal use falls below the current 30 per cent mark, “the lights will go out and Grandma will freeze in the dark.”

The post Heroes & zeros: McDonald’s and Murray Energy appeared first on Corporate Knights.

This view, once ubiquitous, is being increasingly challenged by central bankers, investors worried about long-term risk exposure, a restless general public and governments straining under the pressures of growing inequality. And by corporations themselves.

Even in the heart of Wall Street, the world’s largest investment firm (with US$6.3 trillion under management) recently sent a letter addressed to the CEOs of each corporation it invests in, encouraging them to make smarter business decisions.

“Society is demanding that companies, both public and private, serve a social purpose,” BlackRock CEO Larry Fink wrote. “To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers and the communities in which they operate.”

This includes everything from skyrocketing CEO pay to water scarcity to the careful reconsideration of corporate supply chains. Concerns raised by activists and civil society about modern-day slavery have led to regulations such as California’s 2010 Transparency in Supply Chains Act, pushing firms to begin launching corporate-led initiatives of their own (see here for more).

But it’s not only the largest companies in the world that have an impact on society – it’s small and medium-sized enterprises (SMEs) as well. Beyond employing the vast majority of Canadians in the private sector, they’re also responsible for almost one-third of the country’s GDP. SMEs will be front and centre if Canada is going to successfully transition to a more prosperous, low-carbon society, but the challenges faced by the sector are unique.

Corporate Knights is now in our fifth year of measuring the country’s medium-sized enterprises through our Future 40 Responsible Corporate Leaders in Canada ranking, and decided to narrow the scope of eligible companies to ensure a level playing field. Private or publicly listed companies headquartered in Canada with revenue of under $1 billion will now be considered, down from $2 billion last year.

Companies impacted by this change will be eligible for the 2018 Best 50 Corporate Citizens in Canada ranking, scheduled to be released on June 8.

This year’s top company in the Future 40 ranking is the Saskatchewan Research Council, a provincial treasury board crown corporation that conducts applied research, development, demonstration and technology commercialization (see profile here).

It is followed closely by the Canadian Broadcasting Corporation, a demonstrated leader in board and management diversity. London Hydro came in third, followed by First Capital Realty and Investissement Québec.

Corporations headquartered in five of Canada’s provinces made the list this year, largely hailing from the population centres of Ontario, Québec, Alberta and British Columbia.

Click here to go back to the ranking landing page.

The post Just right appeared first on Corporate Knights.

The post 2018 Future 40 results appeared first on Corporate Knights.

Then, earlier this decade, the provincial Crown corporation realized it had overlooked one key stakeholder in its mission to improve environmental performance – itself.

“It was a laugh/cry moment a few years ago when we realized we should be applying some of these tools to ourselves,” says Laurier Schramm, president and CEO of the SRC, one of Canada’s leading applied research, development, demonstration and technology commercialization organizations. “We decided that we couldn’t be all that we could be if we weren’t conducting our own business in a responsible manner and if our communities and partners didn’t perceive us to be doing that.”

Today, the company is diligent about improving, tracking and reporting its own environmental performance. It works continuously on reducing its energy use across its operations and has been stepping up recycling of everything from cardboard and computers to the hazardous waste used in some of its research projects.

“Our desire has not just been to comply with environmental rules and regulations … but to do better,” says Schramm, whose organization earned the top spot on this year’s Corporate Knights Future 40 Corporate Leaders list. It’s the fifth time the SRC has made the list and the first time it has landed in first place, due in part to a change in methodology (see here for more).

Being a better corporate citizen isn’t just the right thing to do, but also helps to attract workers who care about the environment and want to know their employer is doing its part, he says.

SRC received high marks on the Future 40 list for its low employee-turnover rate, which Schramm says has been in the 8-10 per cent range for about a decade and “a massive blessing.”

Schramm doesn’t think the SRC provides any special perks when compared to other companies but follows best practices from other organizations on how to attract, retain and develop talent, including building a culture of trust and inclusiveness on the job. Employees also believe in the work, which helps keep them there.

“Believing or buying into the company’s mission is one reason people tell us they are still here,” says Schramm. “They like what we are doing and the feeling of seeing the work produce positive impacts, whether it’s economic, social or environmental. It helps us all, I think, myself included, feel like we are doing something worthwhile with our work. Most of us have worked at other companies before coming here and know it’s not always like that.”

SRC currently employs about 360 workers at its offices across Saskatchewan, including its head office in Saskatoon and locations in Regina, Prince Albert and seasonal location in Uranium City in northern Saskatchewan.

Most of its work happens in the province and, while it receives some government funding, most of its revenue comes from contracts with about 1,500 clients across Canada and in 20 countries around the world.

About half of its workforce is women, which has been the norm for decades. The company has also been working to diversify its board and executive team. One of its six board members is female (as of late February). Schramm says the number is low right now due to some recent retirements and the organization usually has about nine to 11 board members. “It’s normal for about one-third of the board to be made up of women and we’re still on that journey of trying to extend that further,” he says.

Of the eight-member senior executive team, there are two women and one aboriginal member. “It’s still a work in progress,” Schramm says of the makeup of the board and executive team. “I wouldn’t say we are satisfied with where we are yet but are happy we are continuing to make progress.”

SRC received a perfect score in the Future 40 ranking for its zero lost-time injury rate –which it has had for past three years. That’s considered an achievement given some of the hazardous materials it handles in its science and engineering labs. The SRC also operates the Slowpoke-2 nuclear research reactor.

“I have a little bit of a reputation for being obsessed with [safety],” Schramm says. While the company has always been focused on health and safety, he has made it a top priority, including changing the culture to ensure employees know they never have to be involved in an unsafe work environment, even if it means giving up projects.

It also helps to maintain a culture of trust. “People are used to it, taking care of each other,” Schramm says. “For some, that’s also an important reason to stay.”

Click here to go back to the ranking landing page.

The post Top company profile: Saskatchewan Research Council appeared first on Corporate Knights.

But that’s about to change.

Many leading jurisdictions around the world (including Ontario) have set bold climate change targets. A key part of meeting these involves mandating the disclosure of energy use by large buildings, which helps the building industry identify retrofit opportunities as well as attract top-tier tenants and show governments they are pulling their weight in the climate challenge.

Mandatory energy use disclosure works because when building owners and tenants understand how their building compares to those of their peers (or other options for a tenant), they are motivated to improve its performance.

In the U.S. and now Canada, there exists a common standard and tool available called the Energy Star Portfolio Manager, which building managers use to calculate their energy footprint.

This year’s Green Tower Ranking invited Canada’s major property firms to submit their top performers (100,000 square feet or bigger) to allow us to shine a light on the seven greenest towers in the nation, as well as the three most improved over three years when it comes to energy performance.

We hope to shine this light across the entire building ecosystem in future years as Canada’s building entrepreneurs compete in a race to the top on energy performance.

Methodology:

To determine the greenest towers in the country, Corporate Knights surveyed 12 of the largest property firms and asked them to submit their top building according their Energy Star score. The Energy Star score from Energy Star Portfolio Manager represents the energy performance of a building adjusted for (i) climate (30-year weather averages), (ii) variations in weather (for the reporting period), (iii) energy sources, and (iv) other building condition factors (including occupancy, operating hours, different space types).

In addition to the best energy-performing buildings, we also wanted to identify which buildings have made the most progress in reducing their energy over the past three years. To determine this, we asked the same cohort to submit their top building in terms of per cent reduction in its normalized energy use intensity from calendar year 2015 to end of 2017. Normalized energy use intensity from Energy Star Portfolio Manager represents the energy performance of a building adjusted for variations in weather according to its local climate zone.

Top performing:

Most improved:

The post The 2018 Green Tower Ranking appeared first on Corporate Knights.

Europe is not alone in exploiting this carbon loophole. The United States’ 6 per cent increase in domestic emissions since 1990 ticks up to a 15 per cent increase when trade is included, according to the online database Global Carbon Project. As of 2015 Canada’s emissions have increased 22 per cent over 1990 levels, but if imports are included, that increase jumps to 26 per cent.

“They’re kind of hiding the carbon,” said Matt Lewis, communications consultant for ClimateWorks and an author of the report. Globally, more than 20 per cent of greenhouse gas emissions escapes regulation because it is traded internationally.

Now, some forward-thinking governments in North America are beginning to close that loophole for one economic sector: industrial materials used in government-funded projects.

Take California

Last October, California Governor Jerry Brown signed into law the Buy Clean California Act, possibly the world’s first legislative effort to address carbon emissions in the supply chain.

The law requires the state’s Department of General Services to set a maximum “acceptable lifecycle global warming potential” for different building materials, including steel, glass, insulation and certain types of pipes. Only products with embodied emissions below the threshold it sets can be considered for state-funded projects. The law takes effect in July 2019.

Setting baselines in this way allows the state to make big-picture comparisons among potential suppliers, said Rajinder Sahota, assistant chief of the industrial strategies division at the California Air Resources Board. Decision makers will be “looking at relative footprints across the contracts” submitted, she said.

Buy Clean California was championed by a surprising coalition of industrialists, environmentalists and labour. They were triggered to act when the new Bay Bridge connecting San Francisco and Oakland, which opened in 2013, was built with steel from a carbon-intensive Chinese factory rather than cleaner steel from California. That decision had significant climate implications, according to testimony from the BlueGreen Alliance, a labour-environmentalist partnership. Local steel would have used 180,000 fewer tons of carbon dioxide, equal to taking 38,000 U.S. cars off the road for a year.

“If you measure and charge for carbon on your own domestic industries but not on imports, then your own industries are at a disadvantage,” said Phil Northcott, CEO of C-Change Labs, a Vancouver-based startup that develops greenhouse gas accounting and pricing software.

As general manager of a Gerdau Steel manufacturing facility in Rancho Cucamonga, California, Mark Olson lobbied hard for the Buy Clean California Act. Now, he’s managing two plants in Ontario and working with Canadian governments on similar programs. “There’s a cost to producing clean products. And as long as we’re all playing on the same level playing field, we’re OK with that cost,” said Olson. “It’s when we’re not… that it becomes very challenging for us.”

Because California spends about $10 billion (U.S.) a year on infrastructure projects – bridges, highways, government buildings, universities – this new law has the potential to shift markets, said Lewis of ClimateWorks. Manufacturers “don’t make a different factory for private sector and the public sector. So governments can leverage their purchasing power to achieve transformation across the industry.” California has done this successfully several times already, he said, pointing to renewable energy targets and efficiency standards for appliances, cars and buildings.

Washington state is considering a bill similar to California’s, said Ryan Zizzo, technical director of Zizzo Strategy, a Toronto-based consulting firm and author of a report on governments’ efforts to account for embodied carbon. Washington, though, is aiming to cover a wider swath of construction materials than California – including concrete, notably excluded from California’s law thanks to industry lobbying.

Europe leading, Canada following

Trained as an engineer, Zizzo was a green building LEED consultant in Canada for a decade before spending three years in Finland. There he was introduced to the idea of embodied carbon. Several European countries have policies to account for it when constructing new buildings, he said. Standouts include Switzerland, which requires lifecycle assessments for new government buildings and sets targets for embodied carbon for some types of buildings. And Sweden now requires large transportation infrastructure projects such as roads and rails to calculate and report embodied carbon, with incentives to reduce it.

By contrast, Zizzo says, as a LEED consultant in Canada, “I was working on the greenest buildings in the country, but no one was talking about embodied carbon or applying that to projects.”

That’s beginning to change now, he said, with policies such as the Treasury Board of Canada’s greening procurement program, Ontario’s Ministry of Infrastructure long-term infrastructure plan, British Columbia’s Ministry of Environment greening procurement program and Québec’s Wood Charter. But much in these policies is more or less voluntary at this time. The few requirements that exist apply to a very small proportion of the construction taking place.

Counting challenges

The policies of California and Europe require manufacturers to prove their products’ footprint with Environmental Product Declarations, or EPDs, which are certified by independent, third-party auditors who look at the lifecycle of individual materials and the types of energy sources used in manufacturing them. The lifecycle assessment requires adding up all the energy used in mining materials, manufacturing the product, shipping it and recycling or disposing of it at end of life.

These analyses are important because the same material can be made with different manufacturing processes that may have dramatically different carbon footprints. Consider steel, which caused 7 per cent of global greenhouse gas emissions in 2012. Making steel has traditionally been extremely energy intensive because coal is an ingredient and high heat is required in multiple steps. But increasingly, manufacturers are making steel from recycled scrap in electric arc furnaces, which can be 24 times more efficient. Also, manufacturing uses electricity, which is cleaner in California, where 36 per cent comes from renewables, 36 per cent from natural gas and just 4 per cent from coal, versus, say, China, where 26 per cent comes from renewables, 3 per cent from natural gas and 65 per cent from coal.

But when using materials from a place that doesn’t regulate carbon, data for that particular product may be unavailable. That leads project managers to fill in the blank with data from another jurisdiction, said Zizzo.

“The classic example is North American manufacturers and building designers using data from Europe,” he said. Because Europe regulates industrial emissions, facilities there have to report their actual emissions under the European carbon trading system. U.S. facilities do not. So “there’s a lot more data available for, say, how much carbon is in steel from Europe than from North America. But we very have different energy systems, we have very different energy policies,” he said, which can make the European data pretty inaccurate as a proxy for U.S. steel.

Some software programs use averages for materials that lack data, said C-Change Labs’ Northcott. “If you use an average for people who aren’t reporting, it means the bad actors get a free ride,” he said. “And we can’t afford to give people a free ride.” To counteract that pitfall, his software assumes a high value for carbon intensity for any material that is not declared. It’s an incentive to factories unregulated by their governments to declare their emissions, he said. “We assume that anyone who does not declare is one of the worst.”

Reliable data is also elusive because actual emissions are always changing, said Zizzo. Factories are upgraded, or the source of electricity in the mix changes. Monitoring emissions and updating the data must be an ongoing effort to ensure accuracy.

Despite these challenges, laws like Buy Clean California are a step toward helping jurisdictions that care about reducing their climate impact to regulate not just what they make, but also what they use.

Said Northcott: “We can only control what’s inside our borders and what we buy. But what we buy is an enormous power. And as long as we use that buying power in a nondiscriminatory way [so as not to draw the ire of the World Trade Organization] we can make carbon have value in China.”

The post Closing the carbon loophole appeared first on Corporate Knights.

A price on carbon is not the only pillar of the plan, despite the flurry of protest and punditry that it has triggered. It also promises to wean the country off of coal-based electricity, revise building codes and accelerate the uptake of electric vehicles. The Pan-Canadian Framework was followed by the Mid-Century Long-Term Low-Greenhouse Gas Development Strategy, which began a national conversation about what a long-term transition to a low-emissions society might look like, with transformative targets of an 80 per cent reduction in emissions by 2050.

In a communiqué issued by First Ministers on the day the Pan-Canadian Framework was adopted, it was noted that clean technology and a focus on innovation are central to the success of the plan, including the creation of new and better jobs in a more resilient economy.

It is clear that ambitious steps must be taken, in addition to pricing carbon, to reduce emissions through all other remaining avenues. Building retrofits, enhancing public transit infrastructure and shifting homes away from natural gas (see here) will be central to these efforts. If a parallel goal, however, is to create new and better jobs in a resilient, carbon-neutral economy, then it will become increasingly important to understand and engage with the small business sector.

Small and medium-sized enterprises (SMEs) in Canada employ 90.3 per cent of workers in the private sector, play a proportionally large role in job creation relative to their larger corporate counterparts and produce approximately 30 per cent of Canada’s gross domestic product.

Yet despite promising stories of social innovation and sustainability leadership, recent research suggests that the majority of SMEs have little interest in facilitating accelerated transitions toward environmental sustainability. The business case for the implementation of sustainability-oriented changes in business operations, for instance, remains a significant challenge.

The caricature of the reactive, conservative SME misses a key opportunity for engagement: Is it possible that when some SMEs tackle sustainability, they can do it with greater agility, ambition and creativity than is possible in a larger firm shackled by complex organizational hierarchy and shareholder demands? Rather than dwelling on the evidence that SMEs give short shrift to sustainability, municipal, provincial and federal policymakers would benefit from a better understanding of the tools at their disposal that could both build a business case for sustainability among SMEs while strengthening the resilience and prosperity of communities.

To overcome the reactive nature of SMEs and the skepticism with which they may view voluntary action to improve environmental performance, established, tested solutions can be shared both within and among sectors. SMEs tend to rely on relevant examples of best practice showcasing traditional and proven solutions. Management systems and toolkits which are familiar to SMEs and which are perceived as easy to implement have shown higher degrees of participation. Some experiments have taken place, but the potential for such projects to scale up to a greater number of businesses and broader geographical swathes remains largely untapped.

We have a relatively strong understanding of the resource, capacity and motivational barriers faced by some small businesses, but little is known about the internal characteristics of SMEs that might yield the dramatic reductions in greenhouse gas emissions and other sustainability metrics through technical and social innovations we’re aiming for.

A recent survey that we at the University of Waterloo’s Sustainability Policy Research on Urban Transformations Lab administered to nearly 1,700 Canadian SMEs gives us some inkling of the important ways that decision-makers should reframe their efforts to engage SMEs and accelerate sustainability innovations.

More than eight out of 10 SMEs viewed sustainability as very important to their business – the smaller the business, the more important sustainability became. Also striking was the importance of cost reductions over subtler, socially motivated reasons for making progress on sustainability.  While the general story is that businesses are first and foremost rational profit maximizers, we found that SMEs viewed an enhanced reputation in their community as a stronger motivator than cost reductions.

SMEs may also be making more significant progress on sustainability, especially on its many and varied social dimensions, than their larger corporate counterparts. For example, nine out of 10 businesses reported that they actively foster employee well-being, seven out of 10 said they are engaged in creating an inclusive work environment and participate in community outreach, and five out of 10 businesses said they actively support social justice.

Sustainability presents a constellation of challenges: It often requires holistic, long-term thinking in order to consider the ripple effects of decisions. For example, how can incentives for active transportation reduce health care costs, increase employee productivity and even minimize the burden on urban infrastructure by getting cars off the road? How can a compelling vision of the role that a company plays in sustainability improve employee retention and build the company’s brand to entice new customers?

Small businesses, while often facing significant capital constraints and human resource challenges, hold enormous potential to produce radical technical and social innovations that may lead us along the pathway to a fundamentally sustainable future. Government, civil society groups and informed citizens will play a crucial role in unlocking this potential.

Sarah Burch is a Canada Research Chair in Sustainability Governance and Innovation out of the University of Waterloo.

The post Triggering sustainability transformations appeared first on Corporate Knights.

Things change. The accelerating energy transition to low carbon alternatives, coupled with low-cost crude producers like the Saudis protecting their market share by playing with the taps, means we are living in a whole new world of cheap oil – “lower forever” in the words of Royal Dutch Shell CEO Ben van Beurden. Today, even building 50 new pipelines would not spur major capital investment in the oil sands because the economics don’t justify it.

Just ask Suncor CEO Steve Williams, who said as much on a recent analyst call.

This doesn’t mean that existing projects will be mothballed; many of them will continue to employ people and churn out cash for years to come. That’s because although a high oil price of $50-$70 is necessary to justify investing billions into a new oil sands project, the variable costs of getting a barrel of oil from existing operations are much lower (as low as $10 for steamed oil and low $20s for mined oil).

What would new pipelines mean for the Canadian economy? There is no doubt that the current hefty discount on Western Canadian Select (WCS) to West Texas Intermediate (WTI) is hurting us to the benefit of U.S. refiners including the Koch brothers, at a price of up to $7 per barrel on average according to the Alberta government. However, it is an underappreciated point that most of any pipeline dividend would flow directly to foreign shareholders, who own 76.8 per cent of oil sands companies on a market cap weighted basis, according to Bloomberg’s Shareholdings Database (note: the actual foreign shareholdings may be slightly lower due to some peculiarities in Bloomberg’s methodology).

Depending on whose numbers you believe, relieving the current price squeeze on WCS with new pipelines could add up to $30 million a day to the Canadian economy. But this number is likely inflated, according to economist Robyn Allan, who estimates that only 10 per cent of the crude actually faces the discount because producers use vertical integration with refineries, upgrading, long-term shipment contracts for pipelines and the futures market.

It’s true that any pipeline dividend would boost provincial and federal government coffers, but less than you might think due to corporate tax loopholes and a 1 per cent royalty rate for most oil sands producers when oil prices are low. To illustrate, Alberta collected just $827 million in royalties on oil sands company sales of $120 billion in 2016 (note that this figure also includes downstream revenues). In a low oil price world, with the rosiest assumptions possible (i.e., 100 per cent of the high end of the market access discount is eliminated, all of the pipeline dividend flows into taxable profits which are paid at the full 26.6 per cent rate and an average royalty of 10 per cent), a pipeline dividend could mean an additional $2.6 billion in annual corporate income tax and royalty revenues. A more realistic estimate would be a quarter to half that figure.

Beyond a few thousand jobs during construction, new pipelines such as Trans Mountain probably wouldn’t do much for new jobs (or new payroll taxes) either, since they would not spur significant new upstream investment at current crude oil prices.

What would building new pipelines mean for the environment? Unless you believe the energy transition is not for real, there would be minimal impact on greenhouse gasses since new pipelines are not likely to change oil sands economics enough in a low price world to spur significant new investment. Oil tanker spills would likely become a bigger risk with any pipelines that go to west coast tidewater. But if you accept Prime Minister Justin Trudeau’s assessment, the biggest risk factor at play is losing Alberta’s support for the national carbon pricing plan and its ensuing collapse if no pipeline gets built.

Alberta’s United Conservative Party leader, Jason “No Carbon Taxes – Ever!” Kenney, sees things differently, which could be a problem as he is expected to win the provincial election next year. Regardless, delivering on new pipelines would certainly be seen as a good faith gesture in Alberta and Saskatchewan. When a region is hurting economically, emotions run high, so feelings should not be discounted.

So, new pipelines may not matter much for the environment or the economy, beyond maybe a couple billion dollars a year for governments and padding the pockets of mostly foreign shareholders in existing projects. The main potential upside for Canada is the improved acceptance of a national carbon plan. But while it is uncharitable to describe building pipelines to fight climate change as a “crock of shit” or “Orwellian logic” – as David Suzuki and economist Mark Jaccard, respectively, have done – it’s by no means certain that it will achieve a national climate consensus, which has eluded governments since that of Brian Mulroney.

What Canada needs is a different “grand bargain,” which may or may not include new pipelines but most definitely requires a step change in boldness to create winning conditions for all parts of the country in a low-carbon world. This new bargain will include making the most of the hydrocarbon reserves in the Athabasca Basin, while building a bridge from the old-energy economy to the new-energy economy – a combination that could unite as much pan-Canadian support as Sir John A. Macdonald’s railway.

The good news is we have the ingredients to do it.

While the sun is setting on the “rip and ship” model of oil extraction in Fort McMurray, there could be a new dawn of prosperity if we can “pump and polish” or “mine and shine” our abundant oil and gas feedstocks. A silver lining of a lack of pipeline capacity is that it creates a greater itch for game-changing downstream innovation. Low prices are not good news for upstream energy producers, but they are a boon for the downstream energy sector, which can transform low-value feedstock into high-value products.

This includes “bitumen beyond combustion” in forms such as ultra-low carbon plastics, non-combusted petrochemicals and carbon fibres, demand for which is growing in Asia and other markets. We would create many good-paying jobs for Albertans in the process, as Alberta’s Energy Diversification and Advisory Committee points out in a major new report. But this opportunity is not going to just fall into our lap.

The single most important obstacle to this opportunity is capital costs, which are 10 to 15 per cent higher in Alberta than in competing jurisdictions.

The obvious options are federal measures to help bring those costs down and expedited approval for green power corridors from B.C. to Alberta and from Manitoba to Saskatchewan.

The federal government could also provide support to attract the investment capital needed to foster passed-over super-cluster themes such as smart agri-food and sustainable and resilient infrastructure; and for accelerated clean-resources innovation in the most energy-transition-exposed provinces. Alberta Innovates and the Saskatchewan Research Council would be natural partners in this work.

The prime minister has often said the environment and the economy go together like paddles and canoes. The above measures might just get the entire country paddling in the same direction.

The post Beyond pipelines appeared first on Corporate Knights.

Yet federal and provincial policymakers these days are actively promoting so-called “net zero energy” homes, which use enough renewable and passive energy to cancel out the consumption of non-renewable sources.

So the question is, how should we go about weaning ourselves of our dependence on natural gas for space and water heating?

Climate and energy experts point out that this transition will be neither easy nor quick. After all, over the past two decades or so, energy regulators have created a policy environment that encouraged a vast investment in natural gas distribution infrastructure, at least in part to encourage homeowners to switch from dirtier sources, like home heating oil or inefficient electric heating (e.g., baseboards).

“Natural gas is the default from a policy point of view,” observes Greenpeace Canada energy strategist Keith Stewart.

The other hurdle, adds energy consultant Chris Caners, is price: Natural gas remains a very abundant and therefore inexpensive fuel (Canada is the world’s fourth largest producer, with 5 per cent of the global market). In other words, the transition hinges on the emergence of alternative technologies that will eventually be cost competitive with natural gas. That process will take time.

To that end, The Atmospheric Fund (TAF), Ontario’s energy industry regulator and the federal government late last year launched a large-scale pilot project, dubbed TowerWise, which is designed to demonstrate energy savings in older apartment buildings and townhouses that convert to so-called gas absorption heat pumps as a heat source. The $15 million venture, to be implemented in several buildings in Toronto and Hamilton, involves extensive energy efficiency retrofits, but turns on the deployment of heat pumps to replace old-style baseboard heaters.

According to Bryan Purcell, TAF’s director of policy and programs, the sponsors will monitor the energy savings over three years to determine if the combination of new technologies can yield a 40 per cent reduction in emissions.

Heat pumps use refrigerant gases to gather very low levels of ambient heat from outside air. Condensers then concentrate and thus increase the gas temperatures, with the resulting heat pumped into interior spaces. They can function with air temperatures as low as -35 C.

Ground-source heat pumps function in a very similar way, except they draw low level heat from the ground through a series of buried pipes. Both of these types of devices, which are commercially available, use electricity to function, but are far more energy efficient than baseboard heaters.

The prices, however, remain high. University of Toronto geographer and climate change expert Danny Harvey says the top models can transform a unit of electricity into four units of heat, but the payback period can run to 20 or 30 years.

The TAF project, moreover, doesn’t supplant natural gas heating per se; the buildings will simply see their electric space heaters replaced. But Purcell notes that the objective, in part, is to boost the overall market for heat pumps. “In doing these projects, we’ll help create market capacity.”

As with previous renewable or low-emission energy technologies, the chicken-and-egg problem can be formidable, with utilities or consumers slow to adopt because of uneconomical prices that reflect slim demand. In the case of heat pumps, a 2016 TAF study on heat pumps identified 1970s-1980s vintage multi-unit apartment buildings as ideal early adopters. But the study also concluded that property managers were mostly unfamiliar with the technology and lacked awareness of the benefits in terms of energy usage in their buildings.

Heat pumps don’t represent a potentially viable alternative to natural gas heating in every part of the country. Those provinces that rely mainly on hydro or a combination of hydro and other low-emission technologies like nuclear plants (British Columbia, Manitoba, Ontario, Québec and Newfoundland/Labrador) hold out the possibility of using clean electricity to replace gas. But in jurisdictions without an abundance of low-cost hydro, the cost issues present a steep hurdle.

Purcell points out there are market openings in regions where homeowners and property owners aren’t connected to the natural gas grid and still rely on fuel oil or propane, such as parts of the Maritimes, where heat pumps have made inroads.

Ontario poses a challenge because it has a surplus of renewable energy capacity and costly electricity. But, Purcell says, it’s possible to develop smart hybrid solutions that optimize the use of high-performing heat pumps and intermittent renewable sources, such as solar and wind. “That could be a smart system that can reduce electricity system costs and carbon and build a business case to get more heat pumps into buildings,” he predicts.

Yet none of this will happen without shifts in energy regulation that provide incentives both for building owners who want to switch away from natural gas and developers who want to build structures that don’t rely on gas for heating. “You need the provinces to clear the way,” says Stewart.

Regulators, Caners says, need to increase financial incentives for natural gas distributors to offer their customers the option of switching, as is already the case with measures meant to promote high-efficiency gas furnaces. “We have to incentivize consumer choice. There has to be a significant centralized response. At present, there are no economic incentives for people to remove natural gas.”

Provincial and federal building codes represent another important policy mechanism. Although stricter in terms of emissions, the next-generation versions of the building codes, Caners and Harvey argue, should provide for alternatives to natural gas-based heating systems, as well as encourage heat conservation features like insulation and passive design approaches. “There should be nothing less than triple-glazed windows and 95 per cent efficient furnaces,” says Harvey.

In fact, Purcell points to projections that a very large proportion of buildings estimated to be in use by 2050 don’t currently exist, and all that future construction represents a vast new market for heat pumps. Though building codes weren’t initially established to promote conservation, policymakers and energy efficiency experts have come to recognize that they can be used, as is done in Europe, to drive initiatives such as the move to net zero buildings. “There’s great potential there.”

The adoption of provincial incentives to promote alternatives to natural gas would, in turn, allow municipalities to step up with their own policies, such as zoning and land-use planning regulations that encourage, for example, clusters of homes or entire subdivision projects to be heated with centralized geothermal or ground-source heat pump systems, much in the way that district heating or cooling systems currently function.

Finally, the full emission impact of natural gas may be further mitigated with the advent of new sustainable biofuels that can be combined with natural gas to produce a lower-carbon energy source.

Ultimately, the goal of substantially reducing building-related emissions, which account for about 40 per cent of Canada’s carbon output, rests on carbon pricing and levies that render low-emission technologies, like heat pumps, economically viable.

“At some point, the whole grid needs to be carbon free,” says Harvey. But, he adds, “getting to zero is really hard.”

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“A truckload [of plastic] is entering our oceans every minute, causing untold damage to our marine environment and ultimately humanity – since we all depend on the oceans for our survival,” wrote Walker in a letter to customers. “The onus is on retailers, as leading contributors to plastic packaging pollution and waste, to take a stand and deliver meaningful change.”

The private company, which specializes in frozen foods, will replace plastic packaging with paper-based trays in all its 1,400 product lines over the next six years. The ultimate goal is to phase out all plastic food packaging throughout the store, although no concrete timeline has been set for that step. No major global retailers are currently plastic-free.

Part of the reason Iceland was able to take this step, explained Walker, is because the company is privately held and thus better positioned to plan for the long term. Consumer sentiment is also favourable, with polling commissioned by Iceland finding that 80 per cent of the general public support the move.

British Prime Minister Theresa May issued a 25-year green plan in January that included a call to end all avoidable plastic waste by 2042. The UK alone uses 3.7 million tonnes of plastic a year, with large grocery retailers responsible for 800,000 tonnes.

May also promised to extend the plastic bag tax to smaller shops, as well as explore a charge on single-use plastic containers. Other ideas floated included plastic-free supermarket aisles, research and development investments in alternatives and targeted foreign aid to help developing countries deal with their plastics.

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