I spent many years consulting in the oil industry. I am very proud and impressed by what engineers have achieved (hitting an oil reservoir with a drill from 8km away in 1km of seawater is impressive). I’m also a free market capitalist. I invest and trade in the stock of companies including oil companies, pipelines and utilities that burn coal. In general, capitalism is great: it creates innovation, wealth and choice. But there’s a problem…
Actually there are two problems:
- Capitalism does not seem to work well when it’s allowed to exploit public assets (oil, potash, water,…). Canada has been incapable of creating a royalty and tax regime that provides a fair share of income to Canadians. Put simply, we are allowing private companies to profit from public assets (the oil in the ground belongs to Canadian citizens) without charging them a fair price for raw materials.
- What are we going to do when oil and coal are used up? Where is our long-term (100yr+) national energy plan?
So what’s the solution? I think it’s simple:
- Establish a fair royalty and tax regime for companies that mine fossil fuels.
- Take ALL royalty and tax monies from fossil fuels (i.e. the windfall that Canadians have received from our natural resources) and invest it in alternative energy R&D.
This will create a generation of alternative energy experts in Canada (I’d like my kids to have a job) and it will create post-fossil energy solutions so we don’t have to sit in the dark when the oil runs out.