Green Transition or Greene Transition? Climate Policy in NL

For all the talk about a future transition to green energy and our ‘clean’ economy, Newfoundland and Labrador avoids tackling climate change.

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On May 6th, 2021, Moya Greene, chair of the Premier’s Economic Recovery Team (PERT), addressed the people of Newfoundland and Labrador in a briefing which coincided with the release of the PERT’s report. From her home in England, Greene pitched her vision of the province’s future, our Big Reset : “we have to drive economic growth by becoming a leader in what is the global challenge of our generation, the transition to a green economy”. 

The PERT’s report suggests investing in alternative energy sources, like hydrogen and hydroelectricity. It presents climate change as an issue that can be solved solely through the creation of new technology, as long as that technology happens to be profitable. This investment, though, must be financed through the increase of oil and gas production, no matter what climate regulations we must ignore to get there. Economic growth will be considered above all else. Similar suggestions can be found in the report of the Newfoundland and Labrador Oil and Gas Industry Recovery Task Force, released on April 29th, which provides more in-depth recommendations directly influenced by industry stakeholders. 

The 2021-2022 Provincial budget, entitled “CHANGE starts here” released on May 31st, offers no real solutions to the climate crisis. It makes use of the individual burden narrative, pushing consumers to change their individual habits. $1 million is set aside to transition homes relying entirely on oil to electricity, and half a million will go towards electric vehicle adoption, promising a $2,500 rebate to consumers who complete the transition or buy an electric car. The average price of an electric car in 2021 is between $35,000 and $50,000. It’s safe to say that most Newfoundlanders wouldn’t come closer to affording this expense even with the $2500 rebate. 

Despite being billed as a way out of debt, these reports and their recommendations uphold the interests of fossil capital, using vague language promising “change” to conceal their true intentions. 

“Envisioning energy futures in the North Atlantic oil industry,” a paper in the journal of Energy Research and Science by Mark C.J. Stoddart, Patrick McCurdy, Natalie Slawinski, & Cory G. Collins, describes Newfoundland’s approach to climate change as an “avoidance orientation.”

“Climate change is peripheral to the field,” they write, “while energy futures are vague and disconnected from larger debates about climate change or low-carbon transitions that are going on in national or international political spheres.” 

The Greene Report, the Oil & Gas Industry Recovery Task Force Report, and the budget give us insight on how the province will continue avoiding climate change over the next 30 years. For all the talk about our future transition to green energy and our ‘clean’ economy, Newfoundland and Labrador is on track to continue—even strengthen—its avoidance orientation.

The government foregrounds the potential prosperity of our province’s green energy sector in debates surrounding climate catastrophe, ignoring the elephant in the room: the social, political, and environmental impact of 20+ more years of unabated oil and gas production. 

Reaching net zero 

Newfoundland and Labrador is echoing the vague promises of the federal government that they will reach net zero greenhouse gas emissions (GHGs) by 2050. Put forward by the UN’s Intergovernmental Panel on Climate Change, net zero by 2050 pushes real action just far enough away that unobservant citizens can continue to live their lives under the assumption that the government has a concrete plan, or even a concrete desire, to reach such a target.  

A recent report by the International Energy Agency concludes that to complete the path to net zero by 2050, creation of clean energy must begin immediately. Their report emphasizes that net zero by 2050 hinges upon ‘an unprecedented clean technology push to 2030’. All possible clean and efficient energy technology must be deployed immediately and in large numbers. 

The oil and gas report’s energy transition road map shows natural gas development continuing into the 2030s, and the provincial budget’s economic report expects the Hibernia oil field to continue crude oil  production until “at least 2040”.

Image: the Newfoundland and Labrador Oil and Gas Industry Recovery Task Force.

Despite its track record with energy investments, the provincial budget boasts about proposals currently pending environmental assessment. Proponents of these projects are many of the richest oil companies in the world: Equinor Canada, ExxonMobil, Husky Oil, Suncor Energy, BP Canada, Chevron Canada, China National Offshore Oil Corporation, and BHP petroleum. Combined, up to 133 wells are set to be drilled in the next 10 years. These are to be exploratory wells, meaning they will drill to see if oil could be extracted. The actual oil extraction would begin much later. 

In order to transition to renewable energy sources, the Greene report suggests the Provincial government diverts its efforts to seek investment from “well-capitalized energy corporations that are trying to reduce their carbon footprint”. Most importantly, we must be responsive to the needs of the private sector. 

Who pays?

Although we’re riddled with debt, we must offer tax incentives to multi-billion dollar energy corporations. The funds taken from education and healthcare could help us “modernize the regulatory regime” and “incentivise exploration” from private stakeholders. In practice, this  means more cash handouts and manipulating policy loopholes so the sector is more inviting to billion dollar companies. 

The Oil and Gas Task Force calls for reinstatement of the Atlantic investment tax credit (AITC), which has offered other developing sectors up to a 10 percent tax incentive. It also recommended ensuring investors that they won’t have to pay the possible 1-7 % royalties pursuant to the United Nations Convention on the Law of the Sea (UNCLOS), which aims to prevent exploitation of ocean resources. We must also write off the royalty costs of any unsuccessful exploration, giving companies the incentive to drill anywhere and everywhere with less financial risk. The implementation of such recommendations will only accelerate efforts to cut through any policy which could slow down or stop the production of oil and gas. 

Environmental impact

The PERT also hints at the abolition of marine protected areas (MPAs), so that we can “harness our full potential” by exploring the area for viable oil wells. MPAs exist to preserve unique marine environments by closing them off to any recreational commercial fishing, mining, or oil and gas activities. In particular, the Greene report mentions the Laurentian Channel MPA, which is about 25% larger than the Avalon Peninsula. The Laurentian Channel MPA is home to at risk and endangered species like the leatherback sea turtle and the North Atlantic right whale, and contains vital migration grounds and feeding routes for sea life around the Gulf of St Lawrence. 

In recent years, both the provincial and federal government have lobbied for the removal of ‘regulatory hurdles’ which slow the process of oil and gas project development. Last June, federal Natural Resources Minister Seamus O’Regan guaranteed oil lobbyists that offshore drilling in Newfoundland and Labrador will now be excluded from federal environmental impact assessments. 

The provincial and federal government did publish a Regional Assessment (RA) in June of 2020 ahead of future exploration. According to the 2021 provincial budget, the RA, which is mandated under the Impact Assessment Act, will “strengthen environmental performance and operational safety, and improve sector competitiveness”. The impact assessment act is meant to preserve and protect fragile ecosystems, not to ‘improve sector competitiveness”. 

Ecojustice, Canada’s largest environmental law charity, believes that this RA was not conducted properly. Backed by the Sierra Club Canada Foundation, World Wildlife Fund Canada and Ecology Action Centre, Ecojustice’s lawyers are pursuing legal action in which they accuse the federal government of “failing to properly assess the impact of exploratory drilling for oil and gas on ecosystems off the coast of Newfoundland and Labrador”, and for the government’s attempt to “exempt all future exploratory drilling from assessments”. They reference previous incidents, like the 2018 White Rose oil spill, in which all 250,000 litres of oil leaked was never recovered. Incidences like this will only multiply as the industry continues to grow. 

Ecojustice’s conclusions offer an exemplary glimpse into our deregulated future: The 2020 Regional Assessment is acting as a catch-all exemption for future projects. It fails to address the complexity of varying ecosystems, and sets a precedent for future unregulated resource extraction. The use of this RA only confirms what we already know: the government has no interest in preserving biodiversity, and neither do the companies seeking to cut corners to increase profit. 

Our “clean” future 

Current climate change projections paint a grim picture for 2050. Along with the rest of the world, we’re not on track to stay within our minimum emissions targets. Temperatures across the province are set to increase between 2.4-3 degrees Celsius. A 1-in-100 year storm (in terms of length and amount of precipitation) today is projected to be a 1-in-5 to 1-in-10 year storm by mid-century. The Liberal government argues that our effort to reach net zero by 2050 must be “more broad-based and faster,” without giving any explanation of what that might look like, except for future investments in renewable energy—which are subordinated to further fossil fuel development offshore. It continues to uphold the misunderstanding that the climate crisis can be fixed without removing its root cause: extractive capitalism. 

The next ten years are vital in order to stop a worldwide climate catastrophe. The province’s current plan to expand the offshore oil industry will lead to increasing GHG emissions, in numbers far beyond previous estimates. Rising tides and severe storms will disproportionately affect impoverished and minority communities, while the rich will pay their way to safety. As austerity measures increase in order to finance offshore exploration, the province is repeating the same narrative it has been for years: that soon enough we will reap the rewards of our offshore investments, we just have to wait a little bit longer.

We’ve been waiting a long time.

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