The energy singularity: A hopeful and optimistic look ahead to the 2020s

Canadians are simply too innovative, entrepreneurial, and progressive to allow a few curmudgeons to hold back an entire country

The energy future looks amazing – electric, efficient, low-carbon and low-cost, hydrocarbons used for non-combustion purposes – thanks to a plethora of new energy technologies that have been slowly creeping up the adoption curve for decades. Will the energy singularity arrive during the new decade?

EV adoption forecast, Rocky Mountain Institute.

Futurists describe singularity as the moment when new technology becomes the lowest cost option and zooms up the hockey stick part of the curve, changing everything in its wake. Many new energy technologies appear to be at the heel of the hockey stick’s blade, ready to begin their ascent. For example, according to the latest Lazard levelized cost of energy estimates, new wind and solar are cheaper than new coal and gas power generation and competitive with existing coal and gas. Lithium-ion battery costs have fallen to the $100 to $120 per kilowatt per hour range, the threshold at which electric cars achieve sticker price parity with gasoline-powered cars.

No wonder transitioning from fossil fuels to electricity generated by low-carbon technologies like wind and solar is considered inevitable by the experts interviewed by Energi Media during 2019.

The energy transition, after all, is driven by the forces that have driven every economic transformation for centuries: science, new technologies, capital, markets, but most of all lower-cost and higher-value choices for consumers. Now we can add to the list humankind’s commitment to fighting climate change. The energy transition’s momentum is far too great for it to be stopped.

Singularity may be difficult to predict, but surveying the energy technology landscape, it sure feels imminent. If ever there was a time for hope and optimism, now is that time.

Yet, the Canadian energy conversation appears anything but hopeful.

The old warhorses of the oil and gas industry have mounted one last campaign to fight back against the heresies of the energy transition and climate science. They backed the United Conservative Party to an April election win in Alberta but failed to replicate that success with the Conservative Party in the October federal campaign, guaranteeing at least four years of acrimonious wrangling, if not more.

Kenney promised to gut the robust energy and climate policies of Rachel Notley and the NDP, and he delivered. The province-wide carbon levy was axed, the large emitter carbon pricing was watered down, the industry-supported bitumen partial upgrading program was inexplicably ended, energy efficiency programs abandoned, and a $30 million propaganda mill ignominiously called the Canadian Energy Centre was created to try to drag the national narrative back into the 20th century.

This regressive effort is doomed. Alberta can “fight back” – a favourite phrase of the Premier’s – all it likes but it cannot opt-out of the grand march of progress.

In the short-term, the battle will be fought over Canadian climate policy. As I argued in a post-federal election column, all roads to Canada’s Paris emissions targets run through Alberta.

Over the next few years, Canadians can expect Kenney and his allies to continue fighting against the national carbon tax, presumably all the way to the Supreme Court of Canada, judging by comments from Alberta attorney general Doug Schweitzer. On another climate policy front, Ottawa will introduce draft regulations for the clean fuel standard – opposed vehemently by the hydrocarbon sector, which is seeking an exemption for upstream production – in early 2020 with implementation in 2021, so Canadians can expect plenty of wailing and gnashing of teeth from the usual suspects.

These two examples suggest there will be other skirmishes fought over other climate policies. While political friction may capture our attention, Canadians should keep their eye on the larger trends, including singularities in key industries.

Source: Rocky Mountain Institute.

For example, the first few years of the decade will see the big automakers like Volkswagen and GM roll out their first full lineups of electric vehicles. EVs are about to become competitive while a few years from now, electric buses and other work vehicles will gain price parity with their gasoline and diesel-powered competitors. The electrification of transportation has begun in earnest thanks to plunging battery costs and rising energy density.

The forces transforming how humans move about are also working on other sectors of the economy – buildings, industrial processes, power generation and distribution. According to analysts like Wood Mackenzie, change will arrive in developed economies first and spread unevenly but inexorably to other countries.

Given Canada’s developed economy, ours will be one of the countries that benefit from the energy transition, but how and how much we will benefit is still an open question. Will Canada fully grasp the opportunities that accompany disruptive transformation or will the regressive forces represented by the hydrocarbon old guard fatally slow our pivot to the low-carbon future?

The decade of the 2020s will see that question answered. Energi Media is optimistic our response will be in the affirmative. Canadians are simply too innovative, entrepreneurial, and progressive to allow a few diehard curmudgeons to hold back an entire country.

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