Energy Perspectives

Canadian Energy at a Crossroads? Part 4

In this post I want to address the role technology may play in our energy future. Surprisingly, truly transformative technological change in energy is actually kind of rare.

Since about 1900 we have seen enormous numbers of incremental technological changes that have made energy cheaper, more accessible, more reliable and cleaner. But we heat ourselves, move ourselves and light the way pretty much as we did 100 years ago.

The interesting question is whether the multitude of incremental technological changes that we are witnessing today will generate more fundamental change in our energy systems overall and if they do, what that will mean for Canada’s energy industries.

Some possibilities:

• Much higher end use efficiency and even slower demand growth

• Cleaner combustion including carbon management – which among other things could make Canadian hydrocarbon production no more and maybe even less carbon intensive than much of the competition – but also more costly.

• More cost competitive and reliable renewable sources

• More distributed energy - in the sense of being managed at the demand end as well as involving local sources. This last set of developments may prove to be the most transformative of all.

Who knows what pathway energy technology will actually take.

It is a fair bet that energy commodities, the ones we have in abundance in Canada, the ones that contain carbon and that consumers burn to produce greenhouse gas emissions will be with us for a long time to come.

But the long trend is pretty clear. The combined effects of normal technological change as in all other industries, cost management, pollution management, GHG management and public resistance to traditional energy developments will tend to work in one direction. As we see in the decline of energy intensity and in the emergence of renewable sources, local or otherwise, the energy service package will derive ever more from capital, technology, and know-how and less from primary commodities.

All in all these combined forces create many opportunities and many more challenges for the energy industry and for policy makers in Canada.

As we think about what to do about this we need to be just a little bit humble.

Reconciling our energy and climate aspirations will involve the biggest change in our energy systems in over 100 years. But the electricity and internal combustion engine revolutions just kind of happened, driven largely by market forces. Public policy helped out but no-one in the public really paid much attention or, if they did, citizens and consumers saw myriad benefits, not new costs.

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