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Into the Future: The Confluence of Arctic Warming and Energy Demand

By Erica Dingman

In recent years, the confluence of Arctic warming and rising global energy demand has drawn the region further into the processes of globalization. In the last decade alone, human activity rose by 400 percent attributed to an increase in shipping, mining, and energy exploration, in addition to the comparatively benign activities of commercial fishing and tourism. As old actors articulate with greater clarity their strategic interests in the region, new commercial ventures are likely to continue unabated, driven by an appetite for new opportunities.

The convergence of local and global energy demand must now be balanced with the regional and global aspiration for environmental sustainability. Are there solutions to this paradox as it applies to the Arctic? How can the people who live in the Arctic benefit from increased commercial activity while ensuring a sustainable future? Today, Arctic warming is ushering in new commercial development. And fossil fuel exploitation isn’t going away without political will.

These concerns have spurred the governments of Arctic nations to develop coordinated strategies that address the long-term implications of increasing commercial activities. Two joint Arctic statements between the U.S. and Canada and the U.S. and Nordic countries articulated their commitment to implementing the Paris Agreement and clean energy development. As the flurry of bilateral statements and memoranda of understanding in the immediate aftermath of COP21 suggests, Arctic nations recognize that northern communities living at the epicenter of climate change require measures that support improved livelihoods, sustainable economic growth, and most notably, development of renewable energies.

But what followed COP21 also made clear that deep-seated dependencies on the global fossil fuel economy could easily deter, if not derail, aspirations of a green economic future. A recent study reported that fossil fuel subsidies in the G-20 countries are so great that they effectively undermine government policies on climate change. Moreover, the U.S. Energy Information Agency’s International Energy Outlook 2016 projects that if all rules and regulations remain as they are today, fossil fuels will supply more than 3/4 of world energy use in 2040. Yet for sub-national governments, fossil fuel extraction is often tied to economic security. Alaska’s state budget depends on the revenues from oil and gas. For Greenland, fossil fuel extraction and mining is the clearest path to achieving financial independence from Denmark.

On the other hand, communities throughout the Arctic can benefit greatly from the development of locally sourced renewables. Beleaguered by the high cost of imported diesel, renewables provide a reliable and cost-effective energy and heating source. Cash that would otherwise flow to outside corporations would stay in the community, providing additional funds for local needs.

Sealaska Native Corporation provides a compelling example of forward-thinking strategy. The largest of the 13 Alaska Native Regional Corporations, Sealaska aligns economic growth with environmental protection and the cultural values of the more than 22,000 shareholders who are primarily of Tlingit, Haida, and Tsimshian descent. Endowed with 279,000 acres of forest, the corporation manages a sustainable timber operation, which contributes to CO2 sequestration. Wood residue from logging and sawmill operations is used for wood-pellet biomass, a source of fuel. Though wood-burning fuel may substantially contribute to air pollution, if properly managed, pellet-based energy is a reliable low-carbon alternative to fossil fuels. Sealaska aims to upscale biomass production by developing a large-scale wood-pellet facility and supply chain. These operations are a financial investment into the community, creating jobs that reduce outmigration and helping to maintain intergenerational social cohesion for years to come.

But the path to a green economy is mired with challenges and tradeoffs. To varying degrees, the production of energy including solar, wind, and hydro encounter adverse environmental consequences, economic barriers, and the possibility of community resistance. Arctic communities face additional hurdles; often remote and sparsely-populated, they lack a critical mass and energy facilities must function in extreme weather conditions, further hindering investment in the development of locally sourced renewable energy.

Greenland is a prime example of a region confronting the paradoxes of development. Hydro provides power to 50 percent of Greenland’s population, but because of the great distances between communities—many of which cannot be connected to a central grid—a significant portion of energy and heating requirements still depend on fossil fuels. Greenland’s landscape and climate also mean that heating, transportation, and energy emissions per capita are relatively high. At the same time, Greenland aspires to economic independence from Denmark, and aims to attract foreign investment into the development of presumed mineral and fossil fuel deposits. In 2007, the government of Greenland signed an agreement with Alcoa to build an aluminum smelter. While aluminum prices have remained low and the project has stalled, the finished smelter would be powered by a large hydro facility. Aluminum smelting plants are a known cause of pollutants, but the venture could provide an additional source of clean energy and employment to nearby communities.

We have yet to solve the worldwide dilemma of coordinating energy demand, economic growth, and environmental protection. Most likely, a solution will require a radical shift from the current drivers of economic growth to support a sustainable future and a strategy of disruptive thinking to accept new and innovative solutions.

Answers may be found in the Arctic, which could prove to be an invaluable backdrop for bringing fresh ideas to fruition. In the spirit of COP21, we should hold governments accountable to the promise of applying “world-class environmental standards” by requiring new ventures to power and fuel their commercial activities with renewable energy. If 100 percent renewables seems like too steep a requirement, why not a hefty percentage that makes a significant impact? We should build solar panels and wind turbines in the Arctic and establish the region as a premier source of microgrid knowledge and technology. For those who live in the Arctic, providing the tools—education, broadband, and healthy communities—to fully participate in a sustainable future necessitates inclusivity and a willingness to push beyond institutionalized limitations.

Just as popular hyperbole portrays the Arctic as a pristine environment, let’s shift that idealistic vision to imagining the Arctic as a showcase for sustainability done right.

*****

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Erica Dingman is a senior fellow at the World Policy Institute and director of Arctic in Context. 

[Photo courtesy of Bernt Rostad]

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