Net zero? Not that easy

Opinion

Hey there, time traveller!
This article was published 19/01/2024 (630 days ago), so information in it may no longer be current.

Net zero will be a challenge for Manitoba.

Beethoven farted … a lot. In addition to progressively impaired hearing, Beethoven also suffered from debilitating digestive upset. Some musicologists even suggest that the second movement (pun intended) of Symphony No. 8 is an ode to the pops, whistles, and groans of his intestines. Beethoven was not net zero.

Boldly, the newly elected Manitoba government moved the goalposts to reach a net zero electricity grid from 2030 to 2035. The minister stated that “all options are on the table,” which is the stock answer politicians use to convey purpose but have little idea of what to do. This is understandable because reaching net zero is a “wicked” problem with no easy solutions.

The goal for net zero electricity is more modest than many advocates desire, namely net zero across the board for all energy generation and consumption. The federal government has signalled it will reduce some subsidies to the fossil fuel industry. It also stated that all cars and trucks sold in Canada by 2030 must be battery-electric (BEV) or plug-in hybrids (PHEV).

Eliminating subsidies to fossil fuels is sensible. However, mandating that all sales of new cars and trucks in 2030 must be electric will not get Canada to net zero. Although EV sales worldwide will continue to grow, forecasts are that this will only represent 15 per cent of all vehicles worldwide. The percentage will likely be lower in Canada with its distances and colder climate.

One little-known issue with EVs is their lifecycle costs. Both the materials in the vehicle and especially the battery include a host of metals that require massive amounts of energy to process. Just to illustrate, an EV car may appear far more fuel-efficient and cleaner than a diesel truck. However, when the emissions in manufacturing and driving are included, the EV becomes more efficient than the truck after both vehicles reach 80,000 kilometres.

The real weakness in the plan to move Manitoba Hydro to net zero is the reliance on wind, solar and geothermal energy. Setting aside geothermal, which will likely remain a niche energy source, renewables such as wind and solar are available about a third of the day. This means you need the ability to immediately deploy alternative sources when the wind dies or on cloudy days.

In other words, we need fossil fuel-based generation on standby or massive battery backup. Hydro cannot rescue us because there will be no new dams.

Investing in wind turbines and solar panels requires massive investment. The deep irony is that China has a lock on the technology, manufacturing, and raw resources needed to construct the infrastructure Manitoba needs to reach net zero for electricity. Meanwhile, China increases its consumption of coal, some of which Canada happily supplies, used to manufacture the hardware used to get to net zero.

Another crucial issue for wind power is its land intensity. It takes up a large swath of land compared to a nuclear plant. Of course, farming around a wind turbine is possible. However, Manitoba Hydro has established a precedent of generous payments to farmers and other landowners to compensate for transmission lines. This will add to the cost of investing in renewable infrastructure.

Nuclear power is often touted as the solution, and some have argued in its favour, especially small modular reactors or SMRs. Setting aside the issue of nuclear waste, which is manageable, the SMR industry has just received a serious blow. NuScale, a pioneer in SMR technology, has shelved its latest project due to regulatory delay and accelerating costs. Not that nuclear was ever on the radar for this government, but this collapse has removed an important net-zero tool.

If the government pursues net zero for Manitoba Hydro, customers and taxpayers must send massive sums to Chinese manufacturers. I am certain Manitobans would prefer fixing health care.

Manitoba can do very little to accelerate the adoption of net zero technologies. However, it can reverse the myopic policy of cancelling the green tax. This tax needs to increase predictably every year, with a rebate going to low-income households, as we do with the GST rebate. It could also adopt time-of-day pricing, where costs rise during peak periods. Smart meters can charge different prices based on the time of data, and phone apps inform customers about the current price of electricity.

These modest moves reflect Manitoba’s limited fiscal capacity and Manitoba Hydro’s requirement to maintain low electricity rates.

Finally, in 2028, a new government can simply move the net zero target five years to 2040. There, problem solved!

Gregory Mason is an associate professor of economics at the University of Manitoba.