Oil Sands Watch | Pembina Institute


Overcoming U.S. Oil Addiction

Published in Edmonton Journal (Feb 13, 2006)*

By Dan Woynillowicz, Director, Strategy and External Relations, Pembina Institute

"America is addicted to oil," American President George W. Bush said in his recent State of the Union address. He then again pledged to reduce American reliance on oil imports from the increasingly unstable Middle East.

The question now becomes how?

While the President did not specifically mention Alberta's oil sands, there exists an increasingly popular myth - even accepted by the U.S Department of Energy which, in a report to be released later this month, maintains that the oil sands could help halve American dependence on overseas oil within two decades - that Alberta's oil sands represent the "silver bullet" that will allow America's oil addiction to be prolonged.

The numbers, however, tell a different story. The Canadian Association of Petroleum Producers (CAPP) projects that oil sands production will grow from about 1 million to 2.7 million barrels per day by 2015. However, during the next decade American oil consumption is also projected to soar. Surprisingly, if Alberta exports every last drop of the increased oil sands production to the United States (and this is not likely given growing foreign interest in the oil sands) it would represent only 10.9 per cent of American demand - which is just a smidgeon more than the 10.6 per cent currently met by Canadian oil imports.

Hopes that the pace of oil sands development might accelerate further are also misguided. The pace of new oil sands development already exceeds expectations, and the governments of Alberta and Canada are struggling to catch up. Beyond the likely constraints of labour, infrastructure and rising development costs that preclude oil sands developing any faster than already projected, there will be limits to the rate at which oil sands development can grow if it is to be balanced with the levels of environmental protection expected by Albertans and Canadians. As the Pembina Institute reveals in its book Oil Sands Fever: The Environmental Implications of Canada's oil Sands Rush, the environmental and climate implications of this oil sands boom are significant. Already, oil sands production is the single fastest growing source of new greenhouse gas emissions in Canada.

The hard truth of the matter is that America's insatiable demand for oil currently sucks oil from most corners of the globe and, unless President Bush takes dramatic steps, America's energy dilemma will continue to fester.

So if not the oil sands, then what?

President Bush's State of the Union commitment to the Advanced Energy Initiative, which will focus clean-energy research on how Americans can change the way in which they power their homes, offices and automobiles, is a step in the right direction. But history has shown again and again that simply funding research and development will not result in the behavioural shifts that are needed if America is to shake its oil addiction.

That addiction will only be overcome by tackling another sacred cow: the flagging North America car industry that finds itself in trouble partly because it is producing the wrong vehicles for the times. The abysmal fuel-efficiency of North America's SUVs, trucks and cars has actually declined since 1986.

According to the U.S Environmental Protection Agency, North American cars and trucks require, on average, 11.2 liters of gas for every 100 kilometres driven, while European cars and trucks only require 7.4 liters for every 100 kilometres. That's an astonishing 30 per cent difference in efficiency.

Using 2004 figures from the U.S Department of Energy, this means the simple action of imposing fuel efficiency standards in the U.S could save an estimated 17 million gallons of gasoline per day!

Like the U.S, Canada is one of the most energy-intensive countries in the industrialized world and, like our neighbours to the south, lacks a regulated fuel-efficiency standard.

As an emerging energy superpower, Canada should also focus its attention on energy efficiency and conservation, renewable energy and technological advances to become a post fossil fuel superpower. With even a small amount of vision, Alberta and Canada could build the economy of the future.

Canada could start by immediately adopting its own fuel efficiency standard. Besides the consumer cost-savings and environmental benefits, this simple step nudges North American carmakers towards products that just might help them compete in the world.

Canadian leadership would both re-enforce and support President Bush's efforts to break America's oil addiction - a legacy we all could be proud of.

Dan Woynillowicz is a senior policy analyst with the Pembina Institute and the author of Oil Sands Fever: The Environmental Implications of Canada's Oil Sands Rush. The book is available online at www.oilsandswatch.org.