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Auto workers an unexpected ground zero for climate transition risks

Shift Storm newsletter—September 2023 edition

October 31, 2023

8-minute read

The following is a re-print of the September 2023 edition of Shift Storm, the CCPA's monthly newsletter which focuses on the intersection of work and climate change. Click here to subscribe to Shift Storm and get the latest updates straight to your inbox.

The automotive industry is supposed to be one of the big winners of the transition to a cleaner economy.

It now seems inevitable that zero-emission vehicles (ZEVs) will fully supplant internal combustion engines (ICEs) in the coming decades through a combination of government policy and shifting market forces.

Many countries, including Canada and the UK, have committed to a regulatory phase-out of ICE vehicles while major automakers like Ford and Mercedes have promised to stop producing gas-burning cars and trucks by 2040. But the auto transition is not only occurring in the Global North. China already produces more electric cars than anyone else and India is one of the fastest growing markets for ZEVs worldwide.

Altogether, this shift means huge investment in the auto sector at every stage of the supply chain.

That should be good news for auto-producing economies like Canada’s and for the thousands of workers who generally enjoy good, unionized jobs in the sector. But as the ongoing negotiations between auto unions (Unifor in Canada and the United Auto Workers in the U.S.) and the Big Three automakers highlight, there are tensions between the green growth agenda and the well-being of workers.

The problem is not, despite the automakers’ claims, that producing zero-emission vehicles is unprofitable when paying union wages. Electric vehicles are already cheaper than comparable ICE vehicles on a lifetime basis and demand continues to outstrip supply. Indeed, U.S. environmental groups have come out in strong support of the UAW’s ongoing strike despite the alleged risk to Biden’s electric vehicle agenda. These environmentalists recognize that labour disruptions in the short term will win greater support from workers for the climate transition in the long term.

The real problem is that all of the new investment pouring into electric vehicle manufacturing provides an opening for companies to build and operate new, non-union facilities. For example, many battery plants are being built as joint ventures that are not necessarily covered by established master bargaining agreements. Moreover, Tesla and other upstart electric vehicle manufacturers are famously anti-union, and the legacy automakers are using that fact as a weapon in their ongoing negotiations with workers.

The better solution, of course, is not to undermine unionized workers but rather to unionize the competitors. Unifor plans to organize the new Volkswagen battery cell factory slated to be built in St. Thomas, Ontario. The UAW has Tesla’s American workforce in its sights. The Canadian and U.S. governments could also do more, through regulation or incentive, to reward companies that pay their workers well.

UAW should be encouraged in its strike by the recent deal struck between Unifor and Ford. That three-year contract includes major raises and improved benefits, as well as a set of targeted income security measures for workers at Ford’s Oakville factory as they prepare for a major retool in 2024 to build new electric vehicles. Ford also agreed to hire auto parts workers displaced by the shift away from ICE vehicles.

Despite these wins for workers, we should acknowledge that zero-emission vehicles are no climate panacea. Simply replacing all our ICE vehicles with electric alternatives is prohibitively resource-intensive and far less efficient than investing in walkable, transit-linked communities. So while ZEVs have an important role to play in our transportation future—and for our economy writ large—they can’t be the only priority.

In this month’s newsletter we turn our sights abroad as the global community grapples with its progress (or lack thereof) on emissions reductions since the Paris Agreement. As is often the case when it comes to climate policy, we are generally moving in the right direction. We’re just not moving fast enough.

Storm surge: this month’s key reads

The world is not on track to meet its Paris pledges…

Signatories to the Paris Agreement are currently undertaking the first global stocktake, which is the process of inventorying countries’ progress toward achieving the Paris climate goals. The process will conclude at COP28 later this year, but at the recent UN Climate Ambition Summit the UNFCCC released a Technical dialogue of the first global stocktake. It summarizes discussions between the parties to date and synthesizes the relevant research.

The good news is that, if all parties follow through on their commitments to reduce emissions, including long-term net-zero pledges, we may be able to limit global warming to 1.7–2.1°C. That’s not far off the Paris Agreement’s aspirational goal of limiting warming to 1.5°C above pre-industrial levels, which would help us avoid the worst impacts of climate change.

The bad news, perhaps unsurprisingly, is that actual emissions are not in line with those commitments. Most countries, including Canada, are simply not delivering on the reductions they’ve promised. And without a “radical decarbonization of all sectors of the economy,” those goals are increasingly out of reach.

The report puts a welcome focus on holistic solutions that would not only reduce emissions but also poverty and inequality. There is a growing recognition that a cleaner global economy can and should be a more inclusive economy.

All eyes are now on countries to respond at COP28.

…or the Sustainable Development Goals

Alongside the Climate Ambition Summit, the UN hosted its latest Sustainable Development Goals (SDG) Summit. The SDGs are not without their flaws, but in general they lay out a broad agenda for global social progress.

So, how are we doing? According to a new report from the World Meteorological Organization and a host of UN agencies, United in Science 2023, only 15 per cent of the SDGs are on track globally. The WMO report is specifically concerned with how climate change is imperiling many of the goals.

Many other groups weighed in before or during the summit. The International Labour Organisation released Transformative change and SDG 8, which documents the sorry state of progress toward full employment and decent work on a global scale. The ILO recommends countries pursue strong industrial policies that put social justice first. Pursuing multiple development objectives is both possible and necessary in a decarbonizing global economy.

Finally, an independent group of scientists appointed by the UN Secretary-General released Times of Crisis, Times of Change as “an invitation to embrace transformations” in the face of failing incrementalism. The international community is so far off track on both the SDGs and their climate targets that small changes are no longer sufficient. The good news is that there are “more synergies than trade-offs” when it comes to sustainable development. Echoing the ILO, this report finds that a greener economy can also be a more inclusive one.

Is it too late for Canada to meet its Paris target?

For its part, Canada still has a long way to go to achieve its climate promises. The Net-Zero Advisory Body (NZAB), which offers independent climate policy advice to the federal government, is currently in the process of collecting expert feedback on how we might yet meet our Paris goals. Marc Lee and I contributed a set of recommendations on behalf of the CCPA, which are summarized over on the CCPA blog.

In short, we face two big obstacles to achieving both Canada’s near-term and long-term emissions reduction commitments. The first is the oil and gas industry, which is not only the largest source of emissions in the country but also the most powerful political obstacle to meaningful climate action.

The second is a growing focus on “negative emissions” in place of actual emissions reductions. Why bother burning fewer fossil fuels when we can just suck up the pollution instead? It’s an alluring idea, but a flawed one, and unless we place limits on what counts as valid “carbon management” it will continue to be used as an excuse for delaying and avoiding necessary changes in the economy.

As a new report from the International Institute for Sustainable Development makes clear, many carbon capture technologies are simply not viable without large public subsidies that could be better spent on actual emissions reductions. Co-authors Katrin Sievert, Laura Cameron and Angela Carter also draw an important distinction between carbon capture in the energy sector, for which we have zero-emission renewable alternatives, and carbon capture in other heavy industries, like steel and cement, which may yet be necessary for achieving decarbonization—even at a high cost.

The CCPA’s recommendations to NZAB offer a number of paths forward focused on public investment, Indigenous leadership and a people-first workforce development agenda, but ultimately we can only achieve our climate targets by tackling those two elephants in the room.

Research radar: the latest developments in work and climate

A policy framework for a successful sustainable jobs agenda. The Pembina Institute has released part one of its Sustainable Job Blueprint, which was developed in partnership with the Canadian Labour Congress. It came in a bit too late for a deep dive in this newsletter, but I’ll be unpacking this important work in more detail next month. Part two is slated for a November release.

New U.S. climate corps a big win for climate campaigners. President Joe Biden announced a New Deal-style American Climate Corps, which had been championed by the Sunrise Movement and has its echoes in the Canadian campaign for a Youth Climate Corps. At a glance, the substance seems a bit thin—it will employ only 20,000 people across the entire U.S.—but it’s a good starting point for building a youth-focused training and employment program and opens the door to more ambitious programs in the future.

Low-wage workers left out of just transition consideration. A new report from Scotland’s University of Strathclyde, Understanding the impact of the transition to net zero on low paid jobs, finds that government just transition plans to date have focused on high-wage, high-skill jobs and left out more vulnerable low-wage workers. Zaee Deshpande and I reached similar conclusions in the Canadian context in Who is included in a just transition?

Offshore wind a viable alternative for offshore oil and gas workers in UK. Meanwhile, Robert Gordon University, also in Scotland, released Powering up the Workforce, which discusses the high transferability of offshore oil and gas workers’ skills to the offshore renewables industry. The total number of new jobs in offshore wind and related industries could more than offset losses in fossil fuels, but it will require supportive public policies.

Scotland works through the specifics of a just transition. And elsewhere in the land of lochs, the Scottish Just Transition Commission released two briefs. The first, Can We Reduce Car Use Fairly?, recommends that the strategic wind-down of personal vehicles be complemented by free public transit. The second, Scotland's Retrofit Workforce, criticizes the country’s lack of a long-term strategic vision for buildings, without which workers and communities are having a hard time planning for the transition to a greener local economy.

Decarbonizing transportation systems requires workforce development plans. The European trade union IndustriALL and the European Transport Workers’ Federation released Building a Just Transition towards a Smart and Sustainable Mobility. The report assesses the maritime, aviation, road and rail systems in Europe independently, but in general it finds that a just transition is possible across the transportation sector as long as there is clear policy direction and forward-looking workforce development.

UK studies highlight economic benefits of decarbonization. The business-focused Aldersgate Group released Economic benefits of industrial decarbonisation, which finds that failing to decarbonize the UK’s industrial sector will ultimately cost more than £224 billion per year by mid-century.

Scramble for critical minerals fueling human rights abuses in Africa. A sobering report from Amnesty International, Powering Change or Business as Usual?, documents the forced dislocation of communities in the Democratic Republic of the Congo by industrial miners. Among its many recommendations, the report calls on the home states of mining operators—of which Canada is notoriously among the most common—to engage in greater legal oversight of companies operating abroad.

Upcoming events in Calgary and Ottawa. Two important conferences are on deck for those concerned about climate and energy policy in Canada. On October 26th, the Pembina Institute is hosting the Alberta Climate Summit in Calgary. Register here. Then, on November 9th, the Canadian Climate Institute and NZAB are hosting the third annual pan-Canadian climate conference in Ottawa (with an option to follow along online). Register for that one here.

Webinar: Tackling false climate solutions from an Indigenous perspective. If you can’t make it to Calgary on the 26th, you would do well to attend Indigenous Climate Action’s webinar series on “The Colonial Urge to Commodify the Climate Crisis.” Part one will tackle false climate solutions and present Indigenous-led alternatives. Register here.

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