Whoever thought that buying a car could not only be fun, but convenient, too? Take it from me... Tesla doesn’t need stores to sell and deliver their game-changing line of automobiles.
You may have heard that Tesla recently announced that they are closing some of their retail stores. To the uninitiated, this news may sound unsettling.
It's not... at all.
Tesla's decision to close a number of its retail stores is actually good news for Tesla and for both current and future Tesla buyers. I say this for three reasons. First, regardless of the presence of retail stores, all Teslas were already ordered online. Second, the cost savings achieved by closing these retail stores will allow Tesla to not only deliver the Model 3 at it's long-awaited base price of $35,000.00, but also to shift resources over to its service centres. Third, the closing of Tesla stores represents yet another dramatic example of the profound advantage that Tesla has over its competitors: namely, Tesla does not need to protect an existing line of legacy gas cars, and it does not depend upon a worldwide network of franchise dealerships to sell its products. While there may be those who would like to spin Tesla's decision to close storefronts as foreboding news, the only people quaking in their boots at this moment is Tesla's competition. They were already struggling to deliver competitive products at competitive prices, and now they have woken up to the news that the world's leading EV manufacturer will no longer be bearing the weight of brick and mortar shops to facilitate its sales.
I suppose it would be fair criticism to say that's all just my opinion, but here are some first-hand facts that I can share about my own experience with the Tesla ordering experience. Perhaps this account will give future Tesla buyers some valuable insight into why Tesla just doesn't need a network of retail stores to sell their ever-growing line of products.
Our Tesla Purchase Story
In the summer of 2018, after 13 years of saving for an EV, my wife and I decided to finally buy a Tesla Model X. We had considered many options, and over the years, we had test driven everything from the Nissan Leaf, the BMW i3, the Kia Soul, to the Chevy Volt.
Eventually, however, we settled upon the Tesla Model X. With a single phone call, a sales rep drove a Model X to our house, took our whole family out for an extended test drive - kids included - giving both my wife and I a chance to drive the car. He let the kids play around inside and out, experimenting with any buttons they could get their tiny little hands on, playing with the electronic seats, the touch screen, and, of course, the falcon wing doors.
Then the sales rep capped it off with a garage fitting to make sure that the rather large Model X could not only fit in our garage, but that the falcon wing doors could actually open up inside the garage as well.
We were absolutely thrilled with the car. The next day, we phoned our sales rep and said we would like to go ahead with the order. He then advised us to simply order the car online using our Tesla account. (I had already registered my Tesla account back in January of 2017 when I became a reservation holder for a Model 3.)
The buying process was simple, convenient, and the online account provided clear updates and confirmations every step of the way. After registering a Tesla account online, you just select a Tesla model, choose your configuration (i.e. 5, 6, or 7 seats in the case of the Model X), and then indicate any options you might want. A deposit is made using your credit card, and voila... your car is ordered.
Tesla provides three days to either cancel or make adjustments to your order, after which the order is locked. Then begins the waiting period for your car to be built and delivered. Everyone who has ever ordered a Tesla will tell you that this period of time - regardless of how short it may be - will test anyone's patience. However, Tesla makes this time period fun and informative, as your online account allows you to monitor the status of your car as it gets assigned a VIN, moves through production, awaits transport, and then ships from Fremont, California to your house, your local Tesla store, or a local delivery event. Tesla also makes productive use of this time period by asking purchasers to upload copies of their driver's license and insurance slips to their Tesla online account. This allows Tesla to get the cars outfitted with license plates ahead of delivery. They also share orientation videos as well as the car's owner's manual over the online account, thus allowing purchasers to become acquainted with the operation of their automobile long before it is even delivered. I made good use of this time as well, cleaning up my garage and getting an EV charger installed in preparation for our Tesla's arrival.
In our case, this entire process took only two months from order to delivery, but I'll admit... it felt like a year. Finally, a Tesla delivery specialist informed us that our delivery date was drawing near.
Then came the big day. Our car was scheduled to be delivered as part of a mass delivery event at a local convention centre. Some family friends excitedly picked us up and drove us out to pick up our car. The event was shockingly well organized. We showed up at our designated time, and made ourselves hot drinks in Tesla's comfortable and well-appointed lounge. After only five or ten minutes, we were called in to sign our paper work. Then we were taken around a large wall of curtains into a huge indoor lot full of shiny new Teslas... what a beautiful sight it was.
We were walked to our car and provided a general orientation of the vehicle and its various systems. Of course, all of this takes place indoors because electric cars make absolutely no noise or fumes. After our session, the delivery specialist drove the car outside to the parking lot for us. I noted that the only noise you could hear was the squeaking of the rubber tires against the cement floor whenever the front wheels were turned. That's it. These cars are eerily quiet.
Within only an hour after we had arrived, we were driving off with our brand new car. We were finally Tesla owners. The whole thing seemed unreal.
If there is one thing I can say about Tesla, it is that they absolutely know how to sell and deliver cars. The experience is nothing like the tense cat and mouse game played in traditional car dealerships. With Tesla, the customer and the corporation are united in their mutual desire to do their part for sustainable transportation.
Yes, there was certainly a time when Tesla stores served a critical purpose in exposing the brand to the public and educating potential buyers about the Tesla line of products. However, as Tesla is quickly becoming one of the most popular automobile manufacturers in the world, they really don't need to maintain a large network of stores: especially since all Tesla orders were invariably made online anyway. The stores simply provided sales reps to help walk customers through the process of registering an online account and placing their orders.
Today, the ever-growing community of Tesla owners, the rapidly-expanding network of charging stations and service centres, and the company's website and online ordering platform provides everything the modern car buyer needs to confidently order a Tesla. Add to that the company's 24-hour / 1,000 mile satisfaction guarantee (which is extended to seven days if a buyer never had the opportunity to take a test drive), backed by a full refund, and you quite simply have a suite of advantages with which no other car manufacturer, in my opinion, can compete.
I know Tesla's mission is to "to accelerate the advent of sustainable transport" but, at this rate, it would appear that they are both willing and able to do the entire job themselves.
"The concentration of carbon dioxide in the atmosphere is approaching 410 parts per million. That has already driven global temperatures nearly 1 ˚C above pre-industrial levels and intensified droughts, wildfires, and other natural disasters. Those dangers will only compound as emissions continue to rise." (Temple, 2019)
How often have you read statements like the one presented above and wondered, "How on Earth could a 1°C increase in temperature cause wildfires?!"
Well, if you have, you're not alone.
Plenty of people think that a mere 1°C of warming sounds pretty nice. After all, a 23°C afternoon is lovely... but a 24°C afternoon is simply glorious!
So what's all the fuss about?
In a nutshell, here's the issue. The warming that climate scientists discuss, debate, and set as targets is presented as an average amount of warming observed over the entire planet across an entire year.
Now... if you've lived long enough, you already know that averages do not occur at average rates. As an example, my hometown of Newmarket, Ontario receives approximately 1.5 cm of rainfall, on average, per day. However, nobody would ever imagine that we literally get 1.5 cm of rain each and every day. No. That rain comes in much larger amounts, spread out sporadically across just a few months of the year. That means that we get quite a bit of rain on some days, but probably no rain at all on most other days of the year. Nonetheless, our structures, streets, creeks, sewers, and drainage systems must all be able to handle our peak amounts of rainfall - not the rather innocuous sounding average amount of rainfall.
It's the same thing with heat. The 1°C mentioned in the quote at the top of this article is not for a moment referring to a daily increase in temperature. It's an average temperature that is spread out across the entire planet, over an entire year. Now, just like rainfall, that average will not present itself at average rates. Rather, that heat will come in waves of peak events, and it's those peak events that do all the damage, like melting glaciers, releasing methane from permafrost, causing droughts, and producing the conditions necessary for forest fires to occur. Unfortunately, all of these things lead to an ongoing feedback loop that drives even more warming... but that's another story.
Right now, let me demonstrate the deceptively dangerous, subtly disarming nature of average temperature increases. As a simple example, I thought I would use an extreme temperature that many people could probably relate to around Thanksgiving time: the temperature required to roast a turkey!
And I'm not going to waste your time talking about some small bird, either... no sirreee, Bob. I'm going to use an example of a 20 lb., fully stuffed turkey!
According to the chart illustrated above, such a turkey would require 8 hours at 325°F (163°C) to be perfectly roasted.
Fair enough. So, just to illustrate my point, let's take that amount of heat and spread it out evenly across an entire year. We can do that by dividing 163°C by 365 days. (You will note that I am using the Celcius temperature scale because that is the scale used in climate science.)
Okee dokes. That gets us approximately 0.45°C per day. However, we don't need 24 hours to cook this bird. Nope. We just need 8 hours, or one third of a day. So then, lets divide the 0.45°C daily temperature by 3 to get us just 8 hours of cooking time. That gives us a temperature of 0.15°C.
So, to bring this example all together:
But it is alarming.
The alarming issue is hidden in that one little pesky fact about averages: averages do not occur at average rates. It's the peak events that do all the damage.
Now, of course, we don't get peak events that are nearly as dramatic as the example that I've outlined above... thank God! If we did, we would have all perished long ago.
To be sure, temperature increases on the planet do not occur over just one day. However, the point remains the same: while our temperature increases do not occur over a single 8 or 24-hour period of time, they do not get spread out evenly amongst all the days of the year, either.
Reality is somewhere in between... but that "somewhere in between" is still a very dangerous predicament. Experiencing an average temperature increase of just 1, 1.5, or 2°C, concentrated within a number of peak events that are spread throughout the entire year will still wreak havoc across the globe. And, as I mentioned before, the even scarier issue is the fact that temperature increases give rise to even further temperature increases.
That is precisely why the recent IPCC Report on Global Warming of 1.5°C (IPCC, 2018) suggests that we have just eleven years to get climate change under control.
After that, there will be little chance of regaining any control at all over the roasting oven that we like to call the planet Earth.
Temple, J. (February 27, 2019) One man’s two-decade quest to suck greenhouse gas out of the sky:
Klaus Lackner’s once wacky idea increasingly looks like an essential part of solving climate change.
MIT Technology Review. URL: https://www.technologyreview.com/s/612928/one-mans-two-
IPCC, 2018: Global warming of 1.5°C. An IPCC Special Report on the impacts of global warming of 1.5°C
above pre-industrial levels and related global greenhouse gas emission pathways, in the context of
strengthening the global response to the threat of climate change, sustainable development, and
efforts to eradicate poverty [V. Masson-Delmotte, P. Zhai, H. O. Pörtner, D. Roberts, J. Skea, P.R.
Shukla, A. Pirani, W. Moufouma-Okia, C. Péan, R. Pidcock, S. Connors, J. B. R. Matthews, Y. Chen, X.
Zhou, M. I. Gomis, E. Lonnoy, T. Maycock, M. Tignor, T. Waterfield (eds.)]. In Press.
A recent support article posted on Tesla.com quietly reads, "After September 16, 2018, full unlimited Supercharging will go away..." The article goes on to state that, as of that date, "owners will be able to give friends one year (underlining added) of unlimited Supercharging."
This development essentially represents the end of an era in terms of Tesla's general marketing strategy - a strategy that has, by most accounts, been incredibly successful for both Tesla and for the promotion of Elon Musk's vision for sustainable transportation. While the free lifetime supercharging incentive has traditionally been provided only to people who purchased a Tesla using an existing Tesla customer's referral code, virtually all Model S and Model X buyers do in fact "use referral codes and therefore... access Supercharger stations for free" (Lambert, 2018).
The Tesla Model 3, with a base price of $35,000.00, was not initially eligible for free lifetime supercharging. This incentive has traditionally been made available only for the more expensive Model S and Model X vehicles. However, the free lifetime supercharging incentive was recently extended to the "performance" version of the Model 3 (Alvarez, 2018). Sadly, as with the Model S and X, this offer is only available until the September 15th deadline.
It is well worth noting that all Tesla vehicles, regardless of incentive eligibility, can charge on the ever-expanding Tesla charger network. However, Tesla's that do not qualify for free lifetime supercharging need to pay a fee. The fee differs from jurisdiction to jurisdiction based on electricity rates and energy regulations, but, as a general rule of thumb, the charging fee is approximately half the price of gasoline for the equivalent number of miles driven.
A common question people have regarding the Tesla charging network is how exactly users are billed. People note the simplicity of the charging stations: no attendants, no card readers, no buttons to push. Just an open charging station that easily plugs into a Tesla's charging port. So how does it work? In fact, Tesla chargers recognize each and every Tesla vehicle as soon as it is plugged in. "Supercharging history is automatically populated in your Tesla Account showing the credits used or, if applicable, the amount billed" (Supercharging). It is important to understand that Tesla has repeatedly made it clear that they do not seek to earn a profit from their charging network, stating plainly that, "Tesla is committed to ensuring that Supercharger will never be a profit center" (Supercharging).
Tesla has pulled their free lifetime supercharging incentive before, but then reinstated it soon afterward (Loveday, 2017). Thus, not everybody is completely convinced that the incentive is gone for good. However, many do agree that the free lifetime supercharging incentive could not last forever, and, thus, the incentive may very well be going away for good this time.
While it is sad to see this era come to an end for new Tesla customers, the move does telegraph a shift in the scale of Tesla's sales and success. The company still seems to enjoy unwavering demand for its line of electric vehicles, and Tesla will probably continue to sell their Model S, Model X, and Model 3 vehicles to anxious and exhilarated customers who have come to accept extensive waiting periods before taking delivery of their long-anticipated vehicles. At the end of the day, this paints a picture of a company that simply cannot produce their products fast enough to meet their burgeoning demand, even when producing 7000 vehicles a week (Hanley, 2018). I suppose it would be trite to say that, as corporate problems go, this is a rather nice problem to have.
It's not too late:
In the final analysis, if you have been considering the purchase of a Tesla Model S, Model X, or a Performance Model 3, I would remind you that it is still not too late to get in on the free lifetime supercharging incentive. Until September 15th, you can still use an existing Tesla owner's referral code to lock in this highly compelling incentive.
Status Report on Limited Green Neighbour Incentive
All purchasers using the Green Neighbour referral code will lock in free supercharging for life on the Tesla charging network. In addition, purchasers will win the prize indicated below.
Alvarez, S. (August 1, 2018). Tesla offers Model 3 Performance buyers free unlimited Supercharging in latest referral program update. Teslarati. URL: www.teslarati.com/tesla-model-3-performance-free-unlimited-supercharging-referral-program/
Author Unknown (Accessed August 12, 2018). Referral Program. Tesla.com. URL: https://www.tesla.com/en_CA/support/referral-program
Author Unknown (Accessed August 12, 2018). Supercharging. Tesla.com. URL: https://www.tesla.com/en_CA/support/supercharging
Hanley, S, (July 1, 2018). Tesla Produces 7,000 Cars In 7 Days. CleanTechnica. URL: https://cleantechnica.com/2018/07/01/tesla-produces-7000-cars-in-7-days
Lambert, F. (July 18, 2018). Tesla extends free unlimited Supercharging for Model S and Model X with referral program. Electrek. URL: https://electrek.co/2018/07/16/tesla-free-supercharging-referral-program-extension/
Loveday, Eric. (June 23, 2017) Tesla’s Free Lifetime Supercharging Policy Gets New December 31, 2017 Deadline. Inside EV. URL: https://insideevs.com/teslas-free-lifetime-supercharging-policy-gets-new-december-31-2017-deadline
There is no Planet B: Why Ontarians need to make an informed decision in the upcoming provincial election
As the saying goes, there is no Planet B. This is something that Ontarians have to think long and hard about when deciding how to cast their ballots in the Ontario provincial election on June 7th.
Indeed, Ontarians have some very weighty decisions to make in this particular election, as they will be forced to decide between a government that has been actively committed to reducing carbon emissions (Ontario's Climate Change Action Plan, 2016) and a party that would dismantle Ontario's climate action plan (McKitrick, 2018).
Climate change is not a myth, and it's not some weird conspiracy created by hippies and solar panel manufacturers. Climate change is real, and it's having a very real impact on the planet (Consequences of Climate Change, NASA). Carbon dioxide alone accounts for a 30 percent increase in radiative forcing since 1990 (Climate Change Indicators, US EPA)
I understand that voters are upset by Ontario's growing public debt, and I have already made my own feelings about escalating public debt very clear (see: Understanding Canada's Federal Debt, 2015). While I certainly do not like public debt... at all, I fear that just one term of a conservative government in Ontario would not only pull us off an important carbon emissions track, it could potentially pull our province so far off our emission-reduction targets that we might never recover.
The fact of the matter is carbon pricing is working in Ontario (Grinspun, 2018), and green energy now creates more jobs in the world than oil. Sadly, Canada, one of the most progressive countries in the world, has been missing out on the green energy revolution (Tencer, 2016).
As a case in point, when it comes specifically to the electric power generation workforce, renewable energy now employs far more people in the United States than oil, gas, and coal combined.
Figure 12: Electric Power Generation Employment by Technology, Q2 2015 - Q1 2016, from page 30 of the 2017 US Energy and Jobs Report.
The 2017 Energy and Employment Report produced by the US Department of Energy states that, "Solar technologies, both photovoltaic and concentrating, employ almost 374,000 workers, or 43 percent of the Electric Power Generation workforce. This is followed by fossil fuel generation employment, which accounts for 22 percent of total Electric Power Generation employment and supports 187,117 workers across coal, oil, and natural gas generation technologies" (see: US Energy and Jobs).
Moreover, renewable energy isn't restricted to just those areas of the world that have oil or gas reserves: everyone can take part in this new boon to the world economy (Renewable Energy and Jobs, 2018). In fact, Ontario's educated work force and highly developed manufacturing and transportation infrastructure place it in a prime position to participate in and benefit from the growing renewable energy sector (Getting FIT, 2016).
Given the issues on the table, voting in this election will not only impact today's generations, but many generations to come. If you are going to vote on June 7th, please be sure you make an informed decision.
Climate Change Indicators: Climate Forcing. United States Environmental Protection Agency. Retrieved from https://www.epa.gov/climate-indicators/climate-change-indicators-climate-forcing
The consequences of climate change, NASA. Retrieved from https://climate.nasa.gov/effects
Grinspun, D. (2018, April 26). Carbon pricing is working in Ontario, so hands off. Retrieved from https://www.thestar.com/opinion/contributors/2018/04/26/carbon-pricing-is-working-in-ontario-so-hands-off.html
Lightstone, A. (2015, January 30). Understanding Canada's Federal Debt, 2015. Retrieved from https://www.youtube.com/watch?v=kwUeivsG2M8&feature=youtu.be
Mckittrick, R. (2016, March 28). Doug Ford is about to change climate change policy for the whole country — and it's about time. Retrieved from https://business.financialpost.com/opinion/doug-ford-is-about-to-change-climate-change-policy-for-the-whole-country-and-its-about-time
Ontario’s Five Year Climate Change Action Plan, 2015-2020. (2016). Retrieved from http://www.applications.ene.gov.on.ca/ccap/products/CCAP_ENGLISH.pdf
Tencer, D. (2016, June 13). Renewables Now Employ More People Than Oil, But Canada Is Missing In Action. Retrieved from https://www.huffingtonpost.ca/2016/06/13/canada-oil-renewables-energy_n_10441636.html
Recently, Michael Enright, the host of CBC Radio's The Sunday Edition, politely struggled through an interview with Catherine McKenna on the contradiction at the heart of Canada's current energy policy. This contradiction, as Enright points out, is that Canada is committed to reducing our carbon emissions under the Paris Agreement, while we are at the same time expanding Alberta's oil production. Not only that, but we are actually building new pipelines to get that oil to markets in the Pacific.
Here's an excerpt from Enright's introduction to the topic ahead of his interview:
There does seem to be broad consensus in this country that climate change is real, that it's a problem, and that governments should do something about it.
If you're like me, then you are wondering how on Earth the federal government intends to reconcile reducing carbon emissions while expanding its single largest source of these emissions. Naturally, I listened with great interest to Enright's interview with our Environment Minister. I was listening for some sort of technical explanation. Even a cheap, silly explanation may have sufficed. I partly expected McKenna to say something like, "Well... we're just exporting the oil... we won't be the one's actually burning it, so, in the end, at least Canada will meet our targets." To her credit, McKenna did not stoop that low.
However, McKenna's responses to the inherent contradictions within Canada's current actions on climate change still scare the heck out of me, and they should scare the heck out of you, too. Here's why.
McKenna basically had an open mic on our national broadcaster for just over 30 minutes. She had plenty of time to explain the apparent contradictions within the Liberal government's actions on climate change. But, alas... she did not.
Instead, our Minister of the Environment and Climate Change dodged, redirected, pontificated, name-dropped, told stories, passed the buck, and threw around banal platitudes and tired clichés like they were cigarette butts at a Las Vegas smoker's convention.
I was so incensed... so outraged at McKenna's sly and slippery responses to the increasingly direct and pointed questions put to her by Michael Enright that I decided to produce a Malarkey Matrix to analyze McKenna's responses. I categorized the Minister's statements into one of two rows, each under one of two columns. The rows were labelled as either Pro-Oil or Pro-Environment. The columns were classified as either Fact or Malarkey.
It is important to understand that "malarkey" does not mean lies. The standard definition of malarkey is something to the effect of "meaningless talk" or "nonsense." That, my fellow Canadians, is exactly what I feel Catherine McKenna treated CBC listeners to for just over half an hour on the CBC's March 18, 2018 issue of The Sunday Edition.
To help make my point, I have presented the results of my malarkey analysis below.
The statements presented within the above matrix are all direct quotes from Enright's interview with McKenna. Invariably, the choice of quotes and the placement of these quotes within the four quadrants of the matrix are subjective in nature. However, I think I have presented a fair and balanced summary, and I think the summary does a sufficient job of highlighting a profound lack of substance behind the Minister's defence of the federal government's current actions on climate change. It is precisely this lack of substance that should give all Canadians, and, indeed, all citizens of the world, great pause regarding Canada's current course of action on climate change.
My general assessment of McKenna's position on climate change would be that she is attempting to drive a car by looking in the rearview mirror. She is making decisions based on where we have been, as opposed to where we need to go. She points out that most Canadians still drive gas cars, therefore we need to expand our production of oil and gas... expand it!
McKenna points out that transitions make people uncomfortable, but, in truth, it's not the transition that makes me uncomfortable: it's the lack of transition. Specifically, it's the current federal government's clear and unapologetic investment in a carbon-based future. McKenna talks gleefully about a new light rail transit system in Ottawa while glossing over the fact that we are making huge investments to expand Alberta's oil sands operations: Canada's largest and fastest growing contribution to greenhouse gases. I hate to quote Bill Cosby at this particular time in history, but I can't help but think of his famous quote: "I don't know the key to success, but the key to failure is trying to please everybody."
It seems to me that the federal Liberals are trying to please all the stakeholders in Canada's current oil economy, while at the same time engaging concerned Canadians with a lot of shallow talk about the environment and climate change. The problem with all this, however, is that climate change is real: climate change is not some political shell game that can be exploited for political gain, corporate profits, or photo opps. Climate change is happening. Climate change will not wait.
I have said it before, and I'll say it again. The world cannot wait for governments, NGOs, or private enterprise to address climate change. We must all, as individuals, take decisive and meaningful action on climate change, and we must take this action now. Yes, it would be especially helpful if governments would join the fight, but if they're not willing to, then the people will just have to go this one alone.
People everywhere, please take this to heart: you have more power than any government, organization, or corporation on Earth. Never forget that.
It is the people of the world who depend of this planet, and it is the people of the world who can shape the future of this planet.
So... know this:
Corporations can produce all the oil they want, and governments can even help them do it... but nobody, absolutely nobody, can MAKE US BUY IT!
Thanks for getting in touch with me.
I've looked around at a number of hybrids and full electric cars, and a recent event made me all the more determined to get completely away from anything that burns oil or gas. A spark plug quit on me over the holidays, and it ended up costing me over $400.00 in servicing. For me, that represented the final nail in the coffin of the gas car.
I like the idea of pure electric vehicles because we get to drop so much weight from the car (engine, gas tank, exhaust system, cooling system, alternator, transmission), not to mention the wear, tear, and maintenance associated with all those moving parts.
Knowing that longer-range electric vehicles are coming onto the market in 2018, I don't think it would be prudent to buy a low-range EV at this time, knowing that they will surely depreciate massively once longer-range EVs become available. In fact, this appears to be happening already. (See: http://www.greencarreports.com/news/1108058_deal-of-the-year-used-fiat-500e-electric-cars-at-6500)
For this reason, I just put a deposit on a Tesla 3. I know the Tesla 3 won't be available for quite some time, but I've learned that no other comparable cars will be coming out in the near future either. I learned from my local Nissan dealer that the 2017 Leaf is not much different than the 2016 model, and I learned from my local Chevy dealer that all of the Chevy Bolts that will be made available for Canada this year are already spoken for. Thus, I'll have to wait until 2018 anyway, so I might as well wait for the Tesla 3 (where I can at least make a deposit and get my name on a waiting list.)
Maybe this information will help GM gain an insight into the thinking process of a prospective, ready-to-buy consumer. I'd like to buy a new electric car, but with such great offerings coming down the pipe next year, how could I commit myself to anything that isn't at least comparable to these anticipated products?
Thanks again for getting in touch, Daniel. I wish you all the best in 2017.
Shop around the notion of climate change strategies, and you will quickly come across a lot of people who put a great deal of faith in carbon taxes. However, just as inflation has failed to quell the world's thirst for oil, carbon taxes won't either.
Carbon taxes, or taxes on fossil fuel, are a Pigovian tax (otherwise known as an effluent fee) meant to force producers and consumers to internalize the external costs that arise from the private transactions between these two parties.
Generally, when someone buys gas from a gas station, the surrounding society pays a third-party "price" associated with pollution and climate change. A Pigovian tax, however, would make the purchaser of the gas pay an added fee, which, ideally, would force the purchaser to internalize what would have otherwise been the external cost incurred by society. From the seller's point of view, such a tax will raise prices and hurt sales. Moreover, the tax itself must be passed on to the government, which essentially acts as an increased cost of production - further hurting the seller's bottom line. The idea here is that that both consumers and producers will make different consumption and production decisions if they have to bear what otherwise would have been the external costs arising from their private transactions. Consumers would buy less, and producers would sell less. Simple enough. Or is it?
In theory, a carbon tax should work. However, there are four critical reasons why carbon pricing does not tend to alter consumption or production patterns to any degree that would effectively combat climate change. These reasons can be summed up as herd behaviour, political backlash, climate change skepticism, and the Green Paradox.
One would certainly think that a carbon tax would dampen consumer thirst for oil. Sadly, the data just does not support such a conclusion. In actual fact, higher prices for oil and gas have not historically had much effect on the consumption of oil and gas (Gasoline prices, 2014). If we plot a correlation between the relative price of gas (for example, the price of gas compared to average incomes) then we find that consumption of oil and gas has actually increased with price. We must, of course, bear in mind a few variables while considering this trend, not the least of which is the increased demand associated with both greater populations and greater economic output. However, another variable occurring at the same time also includes greater energy efficiency. Thus, even though vehicles, furnaces, and energy-consuming electronics have all become more efficient over the years, the world is still consuming more oil and gas, even as the price goes up. (More on that issue under Green Paradox below.) Just a quick glance at the cars on the road today will confirm the fact that consumers have not responded in a typical fashion to higher gas prices. We have actually seen far more vans, SUVs, and trucks sold in the last decade than we have ever seen before (Why are SUVs so popular?, 2014), and yet, relative to household income, gas is at a percentage that we have not seen since the 1980s (U.S. household expenditures for gasoline, 2013).
When it comes to fuel prices - and climate change in general - the world's population has tended to behave much like the allegorical frog that has been placed in a pot of tepid water. As the allegory goes, if the temperature of the pot is turned up slowly, the frog will not jump out... it will just stay in the pot until the pot is eventually boiling. It's actually hard to say if people are truly acting like the frog in the pot. This is because gas prices have not tended to increase at a constant rate. Prices tend to go up a little, then down a little, then up a lot, then down a little, etc., etc... thus, memories of gas prices from yesteryear fade, and the long-term trend becomes obscured. If gas prices did tend to increase in a linear fashion, then perhaps more people may indeed have opted long ago to take public transit, car pool, or ditch their old gas car for a shiny new electric car. Sadly, whenever oil companies perceive a growing animosity amongst the oil-consuming public, they tend to open up supply and cut prices drastically. (More on that issue under Green Paradox below.) Thus, the public seems to be somewhat oblivious to the increased percentage of household income now directed toward fossil fuel, with that percentage doubling from 2% to 4% from 1999 to 2013 ("U.S. household expenditures for gasoline, 2013). Not so many years ago, we would have viewed $1.00 per litre of gas as being more than reason enough to kick our gas-burning cars to the curb. Today, we see it as a bargain.
The bottom line is this: humans, by nature, operate on two principles that are highly resistant to change: i) we tend to do what the herd is doing, and ii) we tend to do what we have always done. If people are given the option to do the wrong thing, then many of us are more than happy to do it... just as long as enough other people are doing it, too.
The fact is, a good deal of the price that we pay for gas in Canada is in fact tax. From the year 2000 to 2012, taxes on gasoline in the United States comprised between 30% to 12% of the price paid at the pump (What Makes Up the Cost, 2013). "In 2012, taxes in Canada represented on average 39.3 cents per litre, which is approximately 31% of the pump price" (Gasoline taxes Across Canada, 2013). However, if you take a good close look at the percentages over time, you can see two clear trends: i) gas taxes have not really altered consumption patterns, and ii) gas taxes have declined as market price of gas has increased.
The problem with taxes is that they are more than just a revenue tool: they are also a political tool. Governments will happily institute a tax halfway through a mandate, but come time for re-election, they either lose heart, or they lose an election to the party that promised to lower taxes.
Climate Change Skepticism
The other issue that impacts the effectiveness of carbon taxing is skepticism. Despite the overwhelming evidence, many people are still skeptical about the existence of global warming and the influence that human activity has on it (One in Four, 2014). In fact, a 2015 report from the National Surveys on Energy and Environment found that, currently, there are barely a majority of Republicans - just 56% - who now "believe that there is solid evidence of global warming" (Energy and Environmental Policy, 2015). Even more interesting to note from this report is the fact that people's alleged "scientific" beliefs seem to be highly influenced by their "political" ideology.
Thus, there are still many people in the world who can both afford gas and who are not the least bit afraid of using it. From a policy-making standpoint, it would seem altogether unacceptable to allow individuals to carry out harmful behaviour just because they do not believe their actions will cause harm. To be sure, we would certainly not allow a person to jump off a building just because he believed he could fly. In the case of climate change, however, we are dealing with actions that are poised to have a catastrophic impact on the entire planet - not just the individuals who are carrying out the harmful actions. Climate change is, after all, the most profound and destructive example of a negative externality the world has ever known.
The Green Paradox
The "Green Paradox" refers to a number of unintended, somewhat paradoxical effects wherein efforts to reduce the consumption of a .given resource will actually encourage greater consumption of that very resource. In economic terms, the Green Paradox is comprised mostly of Jevons Paradox, otherwise known as the "Rebound Effect."
Jevons Paradox gets its name from English economist William Stanley Jevons, who, in 1865 wrote a book entitled The Coal Question. Jevons studied England's consumption of coal in the 1800s, and he observed that the country's consumption of coal actually soared after James Watt introduced the Watt steam engine. The Watt engine greatly improved the efficiency of the traditional coal-fired steam engine that had been used up to that point in time. Watt's innovation, however, made coal far more cost effective, which, naturally, lead to the increased use of steam engines. As one might expect, this increased the overall market demand for coal.
Therefore, efficiency improvements (generally prompted from either a naturally occurring innovation in the private sector or a government imposed policy - such as carbon taxes and other types of Pigovian taxes) do not tend to actually reduce consumption of a given resource because higher efficiencies inspired by these phenomenon will lead to gains in affordability, and those gains will in turn increase both demand and consumption.
Beyond the primary impact of Jevons Paradox, there is a secondary impact of something we might call the "Growth Effect," wherein cheaper energy will lead to faster economic growth. Thus, "improvements in energy efficiency eventually lead to higher energy depletion rates and usage" (Efficiency, 2011). Sadly, we can see blatant evidence of the Green Paradox in the world's energy consumption patterns since the signing of the Kyoto Protocol, wherein CO2 emissions "accelerated from 1.3% per year in the 1990s to a staggering 3.3% per year from 2000 to 2006" (Fölster et al., 2010).
Beyond the rather predictable impact of effects such as Jevon's Paradox, there is the complex issue of how the fossil fuel sector will respond when governments and private industry attempt to nudge fossil fuels out of the market. The fossil fuel industry is probably the world's largest and oldest multi-billion dollar industry, and it will not go quietly. Evidence of this can be seen in 2014, when electric and hybrid cars started to pose a genuine and affordable alternative to gas-powered automobiles. What did the oil producing countries do in response? "In late 2014, OPEC started a price war, and prices have fallen drastically since then, putting short-term prices very near 1972 lows and below 1947 and 1931 lows" (Inflation Adjusted Gasoline Prices). The resulting lower prices not only dampened sales in electric vehicles, but actually enticed EV buyers back into the gas engine market. In fact, Edmunds observed that "about 22 percent of people who traded in their hybrids and EVs in 2015 bought a new SUV" (Hybrid and Electric Vehicles Struggle).
Sadly, Jevons Paradox (aka the Rebound Effect) and the Growth Effect show us that efforts made by governments, or even some individuals, to decrease consumption of a given resource will often encourage the majority to increase their consumption of that very resource. The net effect leaves us absolutely nowhere.
At this critical juncture, there are absolutely no technical barriers preventing us from driving electric vehicles or relying on 100% renewable energy in our homes. The only barriers to this reality are psychological, attitudinal, and economic. Once the world makes a commitment to go electric, it will not likely be going back to oil, and the oil companies know this very well. That is why the world can expect stiff competition from an existing fossil fuel industry that now finds itself backed into a corner. This is precisely why the world needs true leadership from our governments on climate change, and that means instituting an outright ban on the production, sale, transportation, and refinement of oil. Once this is done, the green energy sector - which already employs more people than oil in countries such as the US and China (Renewable Energy and Jobs, 2016) - will take off... virtually overnight.
However, until oil and gas become banned substances, then any potential headway that might be made from carbon taxes will simply be undermined by basic human lethargy, climate change skepticism, a number of paradoxical economic effects, and stiff competition from an oil industry that has absolutely nothing left to lose.
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Fölster, Stefan, and Johan Nyström. "Climate policy to defeat the green paradox." Ambio 39.3 (2010): 223-235.
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Right now we have food, energy, resources, and time... in the future, we won't. As the world's climate heats up, more of the world's resources will be directed toward providing for the world's increasing demand for food, while at the same time the world itself will become less capable of supplying this food (Impact of climate change on food, 2016). People will have less disposable income, less nutrition, and all around lower levels of physical energy, strength, and stamina.
Harnessing the collective power of world's population today may be our best chance to fight climate change and to avert what may be the most challenging positive feedback loop the world has ever known.
Positive Feedback Loops and Climate Change
A positive feedback loop is a sequence of events that give rise to subsequent events that then further promote the very events that set the loop into action. Thus, a positive feedback loop will tend to grow unabated until something external to the loop reverses or extinguishes the sequence of events (What are climate change feedback loops?, 2013). As the world's climate heats up, permafrost in the north will melt, releasing vast amounts of heretofore frozen methane into the Earth's atmosphere. At the same time, arctic ice will continue to melt, further diminishing precious hectares of the Earth's historically reflective white surface. As this all happens, the world becomes hotter, and the cycle continues (Impacts of a Warming Arctic, 2014).
Notwithstanding the vast number of the world's population that barely eek out an existence, the world does find itself with the largest population of healthy, wealthy, educated, and resourceful human beings that it has ever known (World is healthier, richer than ever before, 2011). Harnessing the vast potential of this population within an coordinated and effective framework may represent the world's best chance of fighting climate change.
Of the 196 countries in the world today, 162 have submitted Intended Nationally Determined Contributions (INDCs) to the United Nation's Framework Convention on Climate Change (INDCs, 2015). More countries will be adding their action plans in the near future. All of these governments will be scrambling to find the funds to support their respective contributions to fighting climate change. Now is the time for action: not just from governments, but from us... from you and me. Now is the time for the people of the world to say, "I don't need to be paid to save my planet." Send your governments this clear message of hope, today. Lobby your local and national governments to establish Climate Action Volunteer Centres in your region, and then start volunteering your time, energy, and talents to fighting climate change. You can do this in just a few seconds by tweeting your governments one of the following messages:
Right now we have food, energy, resources, and time... in the future, we won't. Establish a #ClimateActionVolunteerCentre today.
Today we have food, energy, resources, and time: in the future, we won't. Establish a #ClimateActionVolunteerCentre today.
Today we have food, energy, resources, and time: in the future, we won't. Volunteer at a #ClimateActionVolunteerCentre today.
Alternatively, you can tweet out any message using the hashtags #ClimateActionVolunteerCentre or #ClimateActionVolunteerCentres.
Climate Reality Project Canada, a charitable organization serving as the Canadian component of the global Climate Reality Project, has made some progress in this area. Climate Reality Project Canada is currently establishing "Community Climate Hubs" in cities across Canada. It's great to see that these hubs are getting established. However, the critical gap that these hubs still need to bridge is the connection between awareness and action. At the moment, most of their activity is geared towards education, raising awareness, and lobbying municipal governments. To be sure, the Community Climate Hub Handbook does include a goal of developing action plans. We just need to see a point where plans and volunteers can meet in an effort to produce tangible impacts on climate change. Hopefully, we will see these hubs become accelerators of genuine climate action in the very near future.
As is the case with most things, together we are stronger. I hope you will consider devoting some of your time and energy to fighting climate change, today. For more ideas on how to make a difference to climate change within your own home, please take a moment to examine some lifestyle changes you could implement today.
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"U.N.: World is healthier, richer than ever before - Salon.com." 2011. 23 May. 2016 <http://www.salon.com/2010/11/04/un_un_world_development/>
"What are climate change feedback loops? | Environment | The Guardian." 2013. 23 May. 2016 <http://www.theguardian.com/environment/2011/jan/05/climate-change-feedback-loops>
When it comes to the environment, we are all neighbours.