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As Trudeau Cracks Down, the Left Drives Protesters Into the Arms of the Right Once Again

Published by Anonymous (not verified) on Fri, 18/02/2022 - 5:07am in

OTTAWA – If you were Canada’s prime minister, what would you be prepared to do to enforce Covid restrictions on large swaths of your population? No one need ask that question any longer. Now we know the answer.

For the first time in the country’s history, Justin Trudeau has invested his office with sweeping and undemocratic powers under the 1988 Emergencies Act in a bid to stop the so-called “Truckers’ Protests” against Canada’s pandemic restrictions. But, as one might expect, Trudeau has promised to use those powers briefly and sparingly – at least, until he decides otherwise.

His government can ban protests, seize protesters’ income and property without court oversight, and effectively appropriate many millions of dollars raised by supporters on crowdfunding sites to finance the protests. That isn’t a theoretical danger. Even before the current emergency powers were invoked, the Canadian government did just that. Almost certainly under federal pressure earlier in the month, GoFundMe withheld some 10 million Canadian Dollars donated by protest supporters.

Trudeau has brought Canada as close to martial law as he dares without drafting platoons of soldiers onto the streets of Ottawa and Toronto and having the army seize control of the TV stations.

And paradoxically, he has responded to protesters, whose rallying cry is that the Canadian government is using the pretext of Covid to accrete more powers and behave undemocratically, by actually accreting more powers and behaving undemocratically. Trudeau behaves as though this will dampen down tensions. Or maybe he is simply pandering to his electoral base.

A wiser approach has been taken by Ontario’s premier, who started lifting some of the largely redundant restrictions in his province this week as a way to take the wind out of the protesters’ sails.

 

Draconian measures

But let us stand back from Canada’s drama for a moment and consider both the purported and actual reason for the declaration of a state of emergency – a peacetime equivalent of Canada’s earlier War Measures Act.

The truckers’ protests have been largely peaceful – at least in the sense that there have been very few arrests and relatively minor criminal damage. The protesters have caused inconvenience but only of the kind that is inevitable in any civil disobedience campaign.

Emergency powers have been invoked because the protesters have refused to disperse and because officials warn of some future scenario of potential violence – exactly the sort of accusation leveled against any unwelcome mass protest.

However, the more pressing reason is that the truckers’ actions have impeded cross-border deliveries from Canada to U.S. factories, such as car plants. That has started to have a damaging impact on the U.S. economy, and President Joe Biden has been making his view on the matter only too clear to Trudeau.

It is worth considering a comparison to see how draconian and dangerously unreasonable Trudeau is being. Over several years, protests in the U.K. by the environmental action group Extinction Rebellion have repeatedly caused similar levels of disruption – and similar levels of antipathy from sections of the British public. Protesters have blocked highways, railway lines, and airports. Some have been arrested and fined.

But despite all of this, even the right-wing government of Boris Johnson has not suggested going as far as Canada’s current state of emergency.

 

Pull the rug

To put the gravity of Trudeau’s decision – and the flimsiness of the justification for it – in proper perspective, consider what the Canadian prime minister needs to do to put an end to the truckers’ protests compared to what would be required of Johnson for Extinction Rebellion’s climate emergency protests to be brought to a halt.

Johnson would have to radically overhaul the entire British economy, quickly ending its reliance on fossil fuels, while abandoning his entire political ideology of individualist, dog-eat-dog capitalism and replacing it with the far more collectivist approach inherent in a Green New Deal. That is a tall order indeed. Should they spread, Extinction Rebellion’s protests really could become an emergency for Johnson.

Trudeau, on the other hand, could easily pull the rug from under the truckers’ protests – as Ontario officials are trying to do – with nothing more than a decision to relent on many of the most grating restrictions, especially mandated vaccines for some professions and the requirement on unvaccinated truckers to quarantine for 14 days on their return from the U.S.

That would not touch Trudeau’s political program. It would not cost the Canadian taxpayer a penny. It would not require a reorganization of Canadian society.

So why has he chosen this particular hill to make his stand?

Those who are still singularly focused on the dangers of Covid presumably think that Trudeau is right. But with the highly infectious and much milder omicron variant, hospitalization and death rates are plummeting worldwide, as the virus, after spreading like wildlife, starts to burn itself out.

Even if vaccine mandates are enforced, few of the unvaccinated will manage to get both doses before they are exposed to the virus and develop natural immunity anyway. Omicron has made the already dubious need for vaccine mandates and quarantines largely moot. The evidence suggests natural infection provides – for the vaccinated and unvaccinated alike – stronger and longer-term immunity of the kind the vaccines have so far failed to deliver.



Even the argument that vaccines should still be insisted upon in case omicron mutates into another nastier variant is looking decidedly weak. Infection with omicron will provide a much closer immunity match to any future variant derived from omicron than vaccines based on the now-distant original variant of Covid.

 

Veil of democracy

In other words, Trudeau has ostensibly chosen to grab for himself autocratic powers, undermining Canadian democracy, for the sake of a pig-headed commitment to mandate and quarantine rules that no longer fit the science or help with the pandemic. Rather than back down in the face of changing circumstances, he has invoked extreme powers to enforce those rules.

Remember, Trudeau considered, but did not invoke, the Emergencies Act when the pandemic – a genuine emergency – hit Canada at a time when the country had no tools, such as vaccines, to deal with it. Is the need to impose vaccine mandates now really more of an emergency than the need to deal with the outbreak of Covid was two years ago?

For that reason, we all ought to be deeply troubled by what Trudeau has done. He has shown how power works and whom it benefits by stripping off the veil of democracy. As a result, Canada is in a state of emergency entirely of Trudeau and Biden’s making.

 

‘Shock’ experiments

Those sympathetic to Trudeau’s action, or ready to turn a blind eye to it, especially on the left, have failed to absorb the lessons of Naomi Klein’s book “Shock Doctrine.”

Klein explained back in 2007 that in the post-war period, the United States military, political and economic elites had effectively carried out a series of full-spectrum “shock” experiments on developing countries, especially in Latin America. First, Washington began encouraging, financing, and arming violent coups and sponsoring military regimes like Augusto Pinochet’s in Chile, and then exploited the resulting psychological trauma and sense of dislocation among the general population.



The goal was to dissolve social solidarity and traditional ideas of fairness and graft on to a weakened, more pliable society the most predatory kind of free-market capitalism. That paved the way for newly emerging transnational corporations to commit economic rape and pillage, backed by what were already becoming neoliberalism’s global agencies, like the International Monetary Fund and the World Bank.

Following the fall of the Soviet Union at the start of the 1990s, the U.S. was able to extend this approach to the former eastern bloc countries through a series of “color revolutions.” And since the early 2000s, U.S., British and Gulf-backed invasions and proxy wars – and an extinguished Arab Spring – have brought the “shock doctrine” in full force to those parts of the Middle East that have not previously submitted to U.S. hegemony.

 

Crisis of legitimacy

Now the danger is that the “shock doctrine” wheel may be coming full circle. Global capitalism is facing global crises. A planet with finite resources is testing the limits of capitalism’s ingenuity both to extract yet more wealth and to prey on new markets. Meanwhile, the consequences of the historic and continuing over-extraction of resources are being felt in the form of a planet-wide shock, from toxic overload (pollution) to a rapidly changing climate.

Capitalism and its technicians – the West’s political, business, media, and technocratic elites – are facing their own crisis of legitimacy, as the system they oversee and for which they serve as propagandists begins its gradual collapse. There is only so long capitalism’s demise can be blamed on supply-chain problems and “bounceback” from the pandemic.

Western elites understand all of this only too keenly. They know far more than they, or the corporate media, let on. Knowledge is power, and they are in power. Their task is to stay in power. And that can only happen so long as they remain ahead of us, so long as they manipulate us, so long as they control us, so long they turn us against each other.

 

Gain of function

Here a Covid analogy may be helpful.

For many years the United States has been investing large sums of money in medical research called “gain of function.” Anthony Fauci, the U.S. president’s chief medical adviser, is one of the main proponents of gain of function. Its supposed aim is to experiment on cold and flu viruses to see how they might evolve into more lethal strains so that cures can be found ahead of time, in the form of vaccines and drug treatments. (One plausible theory of how we ended up with Covid-19 is that one of these Frankenstein viruses leaked from the lab in Wuhan, where the U.S. was funding gain-of-function research to avoid a U.S. embargo. For more on that, see here.)

The ostensible purpose of gain of function is to pre-empt the emergence of a more deadly virus, or at least to devise ways to treat it more efficiently. (Another possible purpose, of course, is to create bio-weapons against an enemy.)

The question is: Have our elites been carrying out similar “gain of function” research on us, treating us as the equivalent of a virus that may over time become more lethal to their narrow interests of maintaining wealth and power for themselves in a system facing imminent collapse? Have they been learning from their experiments in Latin America, the former eastern bloc, and the Middle East to understand how better to control us, to curb our protest and dissent, to prevent revolution?

The answer is simple: they would be incredibly foolish or naïve, and astoundingly relaxed about their own self-preservation as a class, had they failed to do precisely this. We have had brief glimpses via the Snowden revelations of how they have been preparing for the endgame of capitalism. Western intelligence agencies have been systematically spying on their own populations.

 

Splintered left

In a sense, there is nothing especially sinister or conspiratorial about any of this. As new technologies have given Western elites new tools for surveillance and monitoring of our conversations, our thoughts and moods (welcome to the Metaverse), our movements, our financial dealings, and now our bodily autonomy and health, it was inevitable that elites would turn these tools against us in preparation for the moment when their own privileges were in danger.

In fact, the conspiracy paradigm misses the point entirely. Structures of power are organized to maintain power. Those power systems simply have been responding, as they are designed to respond, to opportunities for protecting or accreting power, like a leaf initiates photosynthesis when it is exposed to light. It is an instinctive reaction more than strategy or plot.

The elites’ social – as opposed to medical – gain-of-function research has highlighted to them an age-old lesson: that divide and rule, the cultivation of tribalism, is an insurance policy against successful dissent and the threat of revolution.

Which is why every time ordinary people take to the street in protest at the accretion of more power by the technocrats, or to oppose more propaganda and mind manipulation from the corporate media, the left fractures and splinters further.

Large sections of the left always find a reason to object to those taking to the streets. The Occupy Movement, the Yellow Vests in France, the Black Lives Matter Protests, the January 6th Rally, the Extinction Rebellion Blockades, the Trucker Protests. None of them are worthy. Their motives are not pure enough. The messages are too vague. The chants are too noisy. The anger is too alienating and the populism too discomfiting. And the participants are from the wrong tribe.

The longer this disdain for protest lasts, the more the protesters’ alienation from the corrupt power-elites evokes fear rather than solidarity, the more the left itself is paralyzed into inaction, then the more certain it is that these protests will be captured by the right, by the Donald Trumps and the Tucker Carlsons. The more we insult the protesters by calling them rightwing, Nazis, anti-worker, dangerous, Trumpists, the more we ensure they become what we accuse them of being.

And in the meantime, by default, we have given our support to the technocrats who are destroying the planet, who are issuing a death sentence to our children – all in the name of civilization, progress and science.

Before we know it, we have become Justin Trudeau.

Feature photo | A man wearing an American flag walks by police guarding the Canadian parliament building from demonstrators protesting the country’s COVID-19 restrictions, Feb. 16, 2022, in Ottawa, Ontario. Robert Bumsted | AP

Jonathan Cook is a MintPress contributor. Cook won the Martha Gellhorn Special Prize for Journalism. His latest books are Israel and the Clash of Civilisations: Iraq, Iran and the Plan to Remake the Middle East (Pluto Press) and Disappearing Palestine: Israel’s Experiments in Human Despair (Zed Books). His website is www.jonathan-cook.net.

The post As Trudeau Cracks Down, the Left Drives Protesters Into the Arms of the Right Once Again appeared first on MintPress News.

Trudeau and the "Freedom Convoy" Wrestle over the Means of Incompetence

Published by Anonymous (not verified) on Thu, 17/02/2022 - 8:47am in

Tags 

Canada

image/jpeg iconfreedom-convoy.jpg

The growing significance of the “Freedom Convoy” demands an analysis with respect to the position and outlook of the working class.

The working class must view itself as an independent force with its own interests, as opposed to both the “Freedom Convoy” and the Canadian state. Neither of the latter are able to posit a competent or coherent solution to the pandemic.

Klasbatalo

read more

Canadian Protest Comments

Published by Anonymous (not verified) on Tue, 15/02/2022 - 6:12am in

Tags 

Canada


I have seen a large amount of bad takes on the protests in Canada. This article covers concrete issues as briefly as possible before turning into political analysis. I divide the article in three parts — economic impact, some background points that many seem unfamiliar with, and then the political side. Unless something radically changes, I do not see much of an economic impact at the national level.

Economic Impacts

I divide the protests into four groups, and discuss in turn.

  1. The bridge at Windsor to the United States. This bridge is critical for international trade. The Canadian government entered into a treaty with the United States that led to the integration of auto production. This was not a free trade deal — it was a managed trade deal that had an objective of ensuring that Canada would have domestic auto plants. Cutting access to the bridge last week was greatly disruptive, and ensured a response by the Ontario government — which had previously did nothing useful about the protests (snowmobiling weather was too good). It seems very likely that bridge will be kept open during the week — when there are few protestors. It is entirely possible that protestors can disrupt access on the weekend, as there are more people able to drive to the protest in small vehicles. However, given that the police are starting to impound vehicles, it is unclear how much stomach there is for such protests.

  2. Border Crossings on the Prairies (Alberta, Saskatchewan, Manitoba). There have been other border crossings cut in those provinces, but the economic pain is more contained, and smaller in the context of the economy. The Premiers of those provinces followed the policy of giving the protesters what they want — a strategy commonly known as “appeasement.” We shall find out in the coming weeks how successful appeasement is as a strategy.

  3. Ottawa. The protest in Ottawa has taken over an area popular with tourists, and forced the closure of businesses in the area. The economic impact is local. Given that everyone is used to working from home, governmental functions are not even close to disrupted. The locals have taken to blockading protestors in their vehicles, so this protest may end up with a few dug in locations. This protest is a political issue, discussed below.

  4. Other Political Protests. There have been protests in other cities, mainly provincial capitals. Since none of the local police followed the example of the Ottawa police force, these protests are not of particular importance.

In summary, there will be a small hole blown into trade data courtesy of auto plant shutdowns, but unlikely to be any different than the effects of a big snowstorm.

Background

I will just give some point form notes.

  • Most Canadians (including truckers) are vaccinated. From the polling I saw, the lowest support for vaccine mandates was in Quebec — a province where the protests were largely laughable. The most optimistic take on the polling I saw was that maybe 20% of Canadians had some sympathies to protests about vaccine mandates — but support for the “truckers” themselves is weak.

  • The protesters consist of a small nucleus of organisers and some drivers of large trucks, but most of the protests are people in passenger vehicles. This cloud of protesters are obviously mad about vaccine mandates (etc.) and/or the Liberal government, but are less dedicated and show up on the weekend.

  • Canada is a confederation of provinces. The Federal government has almost no vaccine mandates for the public — the one for truckers entering Canada from the United States is one. (The United States imposes a vaccine mandate on Canadian truckers entering the United States.) That is, most of things people are complaining about are done at the provincial level. Those controls are being dismantled as the population has now largely received booster doses, and the Omicron wave is fading. At best, the protests accelerated the easing of restrictions by a couple of weeks.

  • There has been a lot of unhappiness around the lack of action by the Ottawa police. This can be explained by the belief — for which there is no publicly produced evidence — that elements within the protest are heavily armed. (Canada has gun control laws.) Although some weapons charges have been laid against some people attempting to join the protest, there has been no charges of laid against the protests, nor any evidence of guns on social media. This can be explained by the fact that the protestors have set up camps away from the main protest near Parliament, and those camps do not broadcast any images. Furthermore, guns are not necessary to cause problems. Things like propane canisters and large trucks can be used as weapons. The end result is that police have not meaningfully attempted to confront the protesters.

  • Policing lies in the hands in the provinces. The Trudeau government cannot directly intervene (unless some areas explicitly under Federal control are invaded). At the time of writing, there is a movement for the Federal government to get more directly involved in providing support, but we are unlikely to see uniformed military personnel involved (barring a firefight breaking out).

Politics

An observation that makes many people mad is the fact that many of the protest organisers are tied to Canada’s extreme right. Various flags flown at the protest confirm their presence.

The Canadian extreme right has links to its American counterparts, and are similarly well-armed. All of them showing up unarmed at the protest would be more of surprise than some showing up with weapons. However, since displaying weaponry would be illegal — and politically toxic in Canada — they would not be visible to the public even if present.

Since the protest was “largely non-violent” (incidents without weapons have been alleged), the reaction of the authorities is to just watch the proceedings carefully. The protests are increasingly unpopular, and so if the authorities do not trigger anything, the protesters will be eventually worn down. As it is, protesters can expect to be trapped for hours at a time inside cars while surrounded by counter-protestors.

There is no reason to be too panicked about this situation (at least if you do not live near the protest). Even in the worst case, you need to ask — what is their plan? Canada is a nation of tens of millions of people, spread across multiple time zones. What exactly can dozens of unpopular yokels holed up in tents in the winter in the plain view of law enforcement agencies do?

This protest has already taken out one Conservative Party leader, and by all accounts, the leadership fight is going to be a mess. This protest is a political problem, but not for the parties drawing the ire of the protesters.

Email subscription: Go to https://bondeconomics.substack.com/ 
(c) Brian Romanchuk 2022

The Minister of Housing’s Mandate Letter

Published by Anonymous (not verified) on Tue, 11/01/2022 - 12:56am in

On 16 December 2021, mandate letters for Canada’s federal ministers were made public. The letter for Canada’s Minister of Housing and Diversity and Inclusion contains an important set of marching orders.

I break it down in this ‘top 10’ blog post: https://nickfalvo.ca/the-minister-of-housings-mandate-letter/

The Minister of Housing’s Mandate Letter

Published by Anonymous (not verified) on Tue, 11/01/2022 - 12:56am in

On 16 December 2021, mandate letters for Canada’s federal ministers were made public. The letter for Canada’s Minister of Housing and Diversity and Inclusion contains an important set of marching orders.

I break it down in this ‘top 10’ blog post: https://nickfalvo.ca/the-minister-of-housings-mandate-letter/

Interest Rate Policy Versus Alternatives

Published by Anonymous (not verified) on Tue, 23/11/2021 - 3:45am in

Tags 

Canada, Housing, MMT

One of the ongoing arguments about Modern Monetary Theory (MMT) that I run across is the general disdain for monetary policy among MMT proponents. (At one extreme, Warren Mosler argues that interest rate policy works in a way that is backwards versus the consensus.)

Interest Rate Policy Ineffectiveness

The MMT position is straightforward, yet critics seem incapable of framing it correctly. Although Mosler is not alone in his views, many academics have a more nuanced position: interest rate policy has mixed effects, and is much weaker than the mainstream assumes is true. (This is in line with many post-Keynesians, although post-Keynesians are all over the map in terms of specifics. I believe it is safe to say that some post-Keynesians have views about monetary policy that are extremely hard to distinguish from conventional ones.) Whether or not MMT proponents’ policy prescriptions have merit, the argument that interest rate policy is largely ineffectual is a stand alone area of debate.

To quickly recap Mosler’s argument, a good portion of it relies on the basic accounting fact that raising interest rates increases the interest payments on government debt. Funnily enough, if you spend any time looking at the incoherent mess that is neoclassical analysis of fiscal policy, this actually should not be controversial. Neoclassicals love warning about “debt spirals” and “fiscal dominance” — which is what Mosler argues, except that they present it in with the maximum amount of obfuscation possible. The obvious explanation for the obfuscation is that this observation blows a hole in the conventional logic about interest rate policy. The neoclassical view is that increasing interest rates lowers inflation — except when it doesn’t.

However, the interest rate expense channel is not the only thing driving the economy. This is where the “mixed effects” comes in. In my case — which may or may not reflect other MMT proponents — I am sensitive to the housing market in the “anglo countries,” and the housing market is interest rate sensitive.

The problem for analysis is that the housing market is indeed a market. Neoclassicals love setting up models with “step/impulse responses” (as per control systems), and so they can make scientific-y statements like “a 25 basis point rate hike lowers the inflation rate by 7.3547 basis points in the following quarter.” The problem with the housing market is that nobody would treat such a statement seriously. House prices act like other risk assets — they typically march up steadily, until they drop like a rock. At best, one can hope for the Goldilocks scenario of a “soft landing.” (When you are describing your policy outlook using a character from a fairy tale, it is a safe bet that you are not working with a settled science.)

Canadian Example Canadian Construction Employment %

The situation in Canada offers a good example of the box that New Keynesian central bankers constructed around themselves. Construction employment (figure above) has marched to high levels relative to past history — despite somewhat sluggish population growth. Admittedly, there was considerable under-investment in infrastructure in the 1980s and 1990s in Canada, and there has been a catch-up effect in non-residential construction. Nevertheless, residential construction is perky, and a major driver of economic growth.

 Canadian Household Debt Service Burden

I was never too happy with publicly available Canadian house price data, but by all reports, house prices have been taking off like a rocket. This is not entirely an accident, as interest rates have being confounding the bond bears and steadily marched lower for decades. The chart above shows total debt service expenses for Canadian, mortgage and non-mortgage. (I am working from memory, but I believe that lines of credit are in the non-mortgage service component, but the only reason banks are so generous with them is that they know that borrowers have housing assets.)

The debt service burden has been stable. This is the result of interest rates dropping, as well as the reality that only a small percentage of the housing stock turns over in a given year. Anyone who bought housing years ago is in much better shape than new buyers.

The concern is that Canadians (unlike the Americans) cannot lock interest rates for 30 years. The de facto maximum rate lock period is 5 years, after which the interest rate terms of the mortgage needs to be rolled over. A secular increase in interest rates would make the debt service chart ugly. This means that the “pick a policy rate level out of thin air” — very popular among the commentators that I ignore — guesses about interest rates (e.g., 6%) tend to end up much higher than realised outcomes.

What are the Alternatives?

MMT critics love picking out MMT statements about taxes from primers, and assume that the only policy lever available is tax policy. This means that if Canada wanted to cool the economy, a tax hike is allegedly the only option.

This is not even remotely correct. The Canadian housing bubble was launched by monkeying around with the Canada Mortgage and Housing Corporation (CMHC) limits on mortgage insurance. (Under Canadian law, any mortgage with a loan-to-value greater than 80% must get insured.) If policymakers wanted to cool the housing market, all they need to do is move the mortgage insurance limits back to more sensible levels. (They did make steps in that direction, which helped slow housing in the 2010s).

Such a policy has obvious risks, but so would rate hikes. Meanwhile, adjusting lending standards would be a fine-tuned policy aimed exactly at a problem area within the economy.

To what extent it matters, my view is that inflationary pressures are largely transitory, and so I am unconvinced about the need to tighten policy. The housing market is overheating, and it is probably time for responsible adults to dunk that market in cold water. As noted, we do not need interest rate policy to do that. A broad-based tax hike would only be needed to deal with widespread inflationary pressures, which I am unconvinced about.

Email subscription: Go to https://bondeconomics.substack.com/ 
(c) Brian Romanchuk 2021

More supportive housing for semi-independent seniors

Published by Anonymous (not verified) on Sat, 13/11/2021 - 5:09am in

The Canadian Centre for Policy Alternatives asked me for a ‘big idea.’

I wrote about the need for more supportive housing for semi-independent seniors.

Here’s my submission: https://nickfalvo.ca/more-supportive-housing-for-semi-independent-seniors/

A 13-city scan of homelessness planning

Published by Anonymous (not verified) on Thu, 21/10/2021 - 12:11am in

I’ve just written a 13-city scan of homelessness planning across Canada.

A summary of the report is available here: https://nickfalvo.ca/innovation-in-homelessness-system-planning-a-scan-of-13-canadian-cities/

Green party’s housing platform

Published by Anonymous (not verified) on Fri, 17/09/2021 - 6:00am in

With Canadians headed to the polls next week, I’ve written a 650-word overview of the Green Party’s housing platform.

Here’s the link: https://nickfalvo.ca/ten-things-to-know-about-the-green-partys-housing-p...

Affordable electricity Decarbonization in OECD countries? Part I

Published by Anonymous (not verified) on Tue, 14/09/2021 - 12:56pm in

After eight extensive posts about the Ontario electricity sector, I am expanding my geographic coverage to look at the electricity sectors in selected OECD countries. My focus will be on the historical and relative performance of each country’s sector with respect to decarbonization and prices. As in the case of Ontario, whole volumes could and have been written about each of these countries, and the electricity sector in general, including with respect to current and future reliability and technologies and preferred vs. feasible future decarbonization pathways and other matters. To keep this manageable, my analysis will be a high-level data-driven overview of past and current generation technology mix, sector emissions and prices only, all based on internationally-comparable data from reputable sources. Interested readers should check out my earlier posts and other writing as to why my focus on the question of affordable decarbonization. In this blog I start with Canada, France, Germany and Japan. Future editions will cover additional countries.

I look at data from 1990 to 2019/20 to ensure to ensure I capture trends in the sector, which, because of its capital intensity, tend to be relatively slow-moving. I look at electricity generation mix by country based on International Energy Agency (IEA) data. I present it in seven groups: nuclear, hydro, non-hydro renewables (this includes wind, solar), natural gas, petroleum products, coal products and biomass and waste. To control for aggregate generation changes over time within a country and for country size differences, I present these in percentage terms. But these technologies are just means to an end, which is sector decarbonization – I source sector emissions directly from the respective country National Inventory Reports (NIR) submitted annually to the Secretariat to the United Nations Framework Convention on Climate Change (UNFCCC). The UNFCCC format combines emissions from public electricity and heat, which is the same combined manner that the IEA presents emissions data. Ideally, we would only include public electricity emissions but relative few countries present this on a stand-alone basis. Public heat provision, generally in the form of district heat systems, is generally a few percentage points of public electricity. To control for differences over time and country differences I present sector emissions intensity (kg CO2/MWh). From an accounting perspective, so as to not “double count”, the UNFCCC does not allocate emissions from the generation of electricity from the combustion of biomass to electricity (the Energy Sector), but rather to the Land Use, Land-Use Change and Forestry (LULUCF) sector. For this analysis, given that I am focussing on the electricity sector only, and not the economy as a whole, I include emissions from the generation of electricity from the combustion of biomass to the electricity sector. Lastly, I source household electricity prices from the IEA, which include base prices, plus any consumer-oriented or taxes and specific levies, in USD(PPP)/MWh. After I provide an overview of the countries I present some initial comparative analysis, which I expect to fine tune as I cover more countries in future blogs, including with more sophisticated multivariate regression analysis.

Country Overviews: Canada, France, Germany & Japan

Starting close to home, Figure 1 shows that the technology mix in Canada has been relatively stable over the last 30 years, with a high percentage (ranging between 70% to 80%) of generation coming from zero-emissions technologies (nuclear, hydro and non-hydro renewables). This has resulted in relatively low emissions intensity over the study period, with three phases: a decrease from the displacement of coal by nuclear and hydro from 1990 to 1996; an increase as some nuclear generation went off line from 1996 to 2003; and a steady decline from 2004 to 2019 as nuclear comes back on line and non-hydro renewables are introduced and expand to 6%, which together with gas increasingly displace coal. Household prices increased moderately during almost the entire period, but started to increase in 2015, primarily due to the increase in high-contracted-priced non-hydro renewables in Ontario (see my earlier blogs).

Crossing the Atlantic, Figure 2 shows that the technology mix in France has also been relatively stable over the last 30 years. France has had an even higher percentage (around 90%) of generation coming from zero-emissions technologies, resulting in relatively very low emissions intensity over the study period. Like in Canada, changes in emissions initially relate to the addition/subtraction of zero-emission technologies, but starting in the mid 2000’s there was also substitution away from higher-emitting coal to lower emitting gas. Household prices were stable until about 2009, after which they increased by about 6% per year in the ten years to 2020.

Moving north-east in Europe, Figure 3 shows that the technology mix in Germany has been much more dynamic over the last 30 years. For the period from 1990 to about 2016 Germany had a relatively low percentage (between 30% to 40%) zero-emission generation, resulting in relatively very high emissions intensity. This is specially given the case that its largest emitting generation was coal. Emissions decreased from 1990 to about 1999 as nuclear and hydro increased and gas displaced some coal and then stabilized over the next decade until the large policy-driven decrease in nuclear (in reaction to the Fukushima accident) in 2011 resulted in a large spike in emissions that were not bright back to trend by fast-increasing non-hydro renewables until 2015-16, which by 2020 accounted for 31% of generation. Household prices in Germany were stable until about 2000, after which they increased by more than 8% per year for 13 years to 2013, after which they increased moderately at 1% per year to 2020. As in Ontario, who modeled their Green Energy Act (GEA) on the Energiewende, the increase in prices in Germany are primarily due to the increase in high-contracted-priced non-hydro renewables.

Heading to Asia, Figure 4 shows that the technology mix in Japan has also been relatively dynamic. For the period from 1990 to about 2010 Japan had a relatively low percentage (between 30% to 40%) zero-emission generation, resulting in relatively high emissions intensity. It was lower than Germany, however, because it relied on relatively lower-emitting gas and oil and less on higher-emitting coal. Emissions decreased from 1990 to1999 as nuclear increased and then increased moderately as nuclear decreased slightly until 2010. As a policy matter in reaction to the Fukushima accident in 2011, however, Japan took most of its nuclear generation offline. This decrease resulted in a very large spike in emissions, as zero-emission generation dipped to only 10%. Emissions decreased moderately to 2019 as some nuclear was brought back on line and non-hydro renewables increased to 9% of generation. By 2019 zero-emission generation, at 21% was only half of what Japan had achieved in 1998. Household prices increased moderately until after 2011, when they increased at 4% per year to 2019.

Comparative Analysis and Discussion

Figure 5 shows the emissions intensity for the four countries from 1990 to 2019. It confirms that due to their large legacy zero-emission generation grids of 70%-80% for Canada and 90% for France these are the countries that have already deeply decarbonized their electricity sectors, both hovering around 100 kgCO2/MWh in 2019. After relatively stable but relatively very high emissions for most of the study period, Germany finally broke through the 550 kgCO2/MWh threshold in 2015 and has reduced emissions intensity by 6% since then to reach 420 kgCO2/MWh in 2019. Japan had been unable to make much progress from 350 00 kgCO2/MWh before 2011, after which emissions spiked and have since slowly been reduced to about 400 kgCO2/MW.

Figure 6 plots emissions intensity against the % of zero-emission generation for every year and country in the study. To give a sense of the direction of the movement in this two-dimensional space, I identify years 1990, 2000, 2010 and 2019 for each country. The strong negative correlation (downward sloping trendline) confirms the almost linear tradeoff between the amount of zero-emission generation and emissions. The time progression, with the exception of Japan, is from higher emission down and to the right. I am interested in seeing whether this linearity holds for the USA, a country for which much of the decarbonization has been attributed to the switch from higher–emitting coal to lower-emitting gas. Stay tuned for future blogs.

Figure 7 shows household prices for the four countries from 1990 to 2020 and confirms our earlier observation that while all prices have increased after a period of relative stability, the prices in some countries began increasing earlier and faster than in others. Germany is the outlier in this respect, where prices have almost tripled since 1990.

I am interested in exploring affordable decarbonization. From this perspective, both Canada and France had already achieved this by 1990 and so the process of decarbonization, and whether it was affordable, would involve looking further back in time. For Canada that may be 1960s to 1980s when many of current large hydro-electric projects and nuclear generation stations came online to displaced emitting technologies. For France it would be from the mid 1970’s to 1990 when its nuclear fleet displaced fossil technologies. In both cases, however, given that both countries started the period as the two lowest-priced countries in the sample, it is reasonable to assume that the transition was likely affordable, and certainly no less unaffordable than the approaches adopted in Germany and Japan prior to 1990. After that year and specially for Germany from 2000 and the coming into law of the German Renewable Energy Sources Act (EEG) and the introduction of high-contracted-priced non-hydro renewables, we see very significant price increases to 2015 but no reductions in emissions until that year because, as discussed above, Germany was in parallel reducing nuclear generation.

In these last two figures I start an initial correlation analysis, which I expect to fine tune as I cover more countries in future blogs, including with more sophisticated multivariate regression analysis. In my previous blogs I have discussed studies showing that any increases in electricity prices have been mostly due to the introduction and growth of non-hydro renewables, due to their higher-than market contracted prices and broader integration costs. This is certainly the case in Ontario, Canada and Germany. I am interested if this holds in other countries and what is the likely scale of the impact. I begin with the simple correlation analyses in Figures 9 and 10.

Figures 9 and 10 separate out zero-emission generation into dispatchable nuclear and hydro and intermittent non-hydro renewables and plots them against prices to examine any corresponding correlation. To also provide a sense of the direction of the movement in this two-dimensional space, I identify years 1990, 2000, 2010 and 2019 for each country. Figure 9 shows a generally negative (downward sloping) correlation, indicating that nuclear and hydro are correlated with lower prices. Figure 10, on the other hand, shows a generally positive (upward sloping) correlation, indicating that non-hydro renewable are correlated with higher prices. Based on prior studies, we knew that for Canada (via Ontario) and Germany this non-hydro renewables/higher price association had been shown to be stronger, of statistical significance suggesting causation, but it is good to replicate this via a simple correlation analysis. Looking at Figure 9 and 10 together, this correlation also holds for France and to lesser extent Japan. Note to my inner econometrician – there could be some time effect in the last decade or two (for example the introduction of liberalized electricity markets) that could separately be contributing to higher prices and thus could be a confounding variable to the simple non-hydro renewables/higher price association… That statistical question to be resolved down the road once I review a larger number of countries.

Next Steps

I am expecting to be able to cover four other OECD countries in the edition of this series, hopefully to come out in a few weeks, time permitting. I am aiming to include the USA, either Australia or New Zealand, and two countries in Europe.

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