Climate Haunted by Canadian Regulators Oil Sands Financial Crisis – Is It Rising Because of It?
Guest essay by Eric Worrall
Demand for fossil fuels will fall over the next few decades, according to Canadian regulators, raising the specter of a resource sector default.
Alberta oil company could face lending crisis as financial regulators worry about climate change risks
February 3, 2022 5.36 am AEDT
Robert L. (Bob) Ascah
Research Fellow, Parkland Institute, University of Alberta…
The Bank of Canada and the Office of the Director of Financial Institutions (OSFI) of Canada recently released pilot study examines how prepared Canadian financial institutions are in understanding and managing climate change risks. Research shows that the prestige level of oil and gas producers will drop dramatically over the next three decades.
As a political economist, I have been studying climate change regulation for several years. The conflict that arose between Ottawa and Alberta is also playing out around the world.
Financial resilience
Financial regulators – including Financial Stability Boardan international patronage group consisting of central banks and bank supervisors, and a newly formed group Green network of financial system, which includes 31 central banks and regulators from around the world – are increasingly concerned about the creditworthiness of borrowers against the risks of climate change. These regulators are concerned that as climate change worsens, the financial system could become more unstable.
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Implications for Alberta
Federal jurisdiction over federally incorporated banks and insurance companies means that federal regulators can influence how much credit flows into Canada’s oilfields.
The oil industry in Calgary is dependent on bank loans and the sale of bonds and stocks, which makes the industry dependent on Canadian banks. This fact has not been lost on environmentalists.
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But Alberta has steadfastly defended its jurisdiction, and the Alberta Securities Commission is expected to slow progress toward standardizing the disclosures for oil and gas corporations it regulates.
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The idea that fossil fuel demand will decline over the next few decades is a myth.
Even if the world really works to reach net zero, the production of all solar panels and wind turbines will require itself. an amazing amount of fossil fuels and other minerals for many decades to come.
Producing silicon for solar panels consumes a large amount of carbon, which is supplied in the form of coal or natural gas. Carbon isn’t just for heating and smelting ore, much of it is consumed by a chemical reaction that separates oxygen from sand to create silicon metal, the main raw material for solar panels. Bonus points for figuring out what happens to all that carbon. The process is very similar to how a traditional blast furnace consumes coal chemicals or natural gas to produce iron and steel.
Wind turbine blades are even more ridiculously dependent on fossil fuels – they’re made of plastic.
A persistent decline in demand for fossil fuel products is not going to happen anytime soon, no matter which way the world chooses.
But until governments and regulators officially accept this trash economy, climate mania poses a real and present danger to the manufacturing sectors of the Canadian economy, like oil and gas.
Canada’s self-destructive fossil fuel industry will do nothing to reduce global consumption. Other manufacturers will respond to price signals and ramp up foreign production, filling the void left by Canada leaving the sector. As George Monbiot of The Guardian once noted, we won’t run out of oil anytime soon.
The only people affected by this plan to sabotage the green bureaucracy are the Canadian people themselves.
So I guess Canada has a choice. They can play the green game, tell themselves they really love all that disgusting but nutritious insect protein, live smaller and try to stay warm in the winter using energy. solar quantity. Or they can weed out the climate lunatics that are holding back their economic opportunity, and leave the same pool of resources that have enriched the quality of life they enjoy for their children and grandchildren.
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