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Economist makes the case for renewable fuels

by Mark Sabourin
EcoLog, 4/7/2017 1:02:00 PM

Carbon pricing alone could, but likely won’t, bring about the economic transformation needed to avert climate catastrophe, says Simon Fraser University Economist Mark Jaccard. What’s needed is a combination of carbon pricing and flexible regulations, including regulations that support a transition to renewable fuels, because carbon pricing alone would exact too high a political cost.

Jaccard first made the point in a paper published in September 2016, and expanded upon it in an April 6, 2017 Conference Board of Canada webinar he shared with former Environmental Commissioner of Ontario Gordon Miller.

Jaccard took on several myths about renewable fuels, myths that he said may have had merit 30 years ago, but that no longer apply.

The technology is here, he said. Vehicles that run on 85% ethanol (E85 vehicles) have long been commercialized. Electric vehicles are no longer anomalies on our roads. Biodiesel trucks are also now in commercial production.

Electricity is clean or becoming cleaner. There is no longer any merit to the argument that wide adoption of electrically-powered vehicles will only lead to increased consumption of coal to generate additional power.

Ethanol and biodiesel production may once have been an energy-intensive process, but that is no longer necessarily the case. Technology now allows for near-zero commercial scale ethanol and biodiesel production.

“There are plants now producing ethanol and biodiesel where, if we look through the full cycle, we can get at least an 80% reduction in full-cycle greenhouse gas emissions,” he said.

Change can happen, despite the heavy investments already made in fossil-fuel infrastructure. Brazil converted 50% of its fleet to ethanol in 10 years, he said. Over 10 years, Sweden converted 70% of its public transportation system to biofuels. Even Ontario succeeded in replacing its coal-fired electricity generation, representing 25% of capacity, in 10 years.

The conversion will come at a cost, but the cost of not converting will be higher, he promised.

“If we ignore the destruction of the planet, I do believe that fossil fuels can be really cheap,” said Jaccard, labelling it a silly argument and one under which renewables can’t compete. But a transition to renewables won’t break the bank, he argued. Critics often advance an “all or nothing” argument, citing the cost of replacing all gasoline with biofuels in one fell swoop.

“That’s not really how it would play out if we were serious about this,” he said.

Biofuels might optimally replace 30% of Canadian gasoline, he said, because there would be other transformations taking place simultaneously, such as wider adoption of electric vehicles, greater efficiency, transportation mode shifts and declining demand. Under that scenario, Jaccard said there would be very little impact on land use or on food prices.

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