Energy divestment deprives Indigenous Canadians of attaining a standard of living enjoyed by affluent city-dwelling environmentalists

Joseph QuesnelOrganizations across Canada choosing to disengage from the energy sector need to acknowledge that their actions could inadvertently impact the prosperity of Indigenous communities. It is important to realize that opposing the energy sector equates to opposing the primary source of income for many of these communities.

Currently, activists are exerting pressure on private corporations, universities, and public pension funds, urging them to divest from fossil fuel-related projects. Unfortunately, many of these activists seem to overlook or simply disregard the fact that divestment could potentially sabotage initiatives aimed at alleviating poverty within First Nations communities.

To put it simply, endorsing divestment equates to opposing the financial well-being of Indigenous communities.

energy divestment indigenous
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In April this year, students at the University of Toronto staged a sit-in at a university building, demanding that the institution divests from its minor investments in fossil fuels. Rather than bombarding these privileged students with data and statistics to show why divestment is a silly way to address climate change, perhaps the university should be shown images of the families and children from Indigenous communities that stand to lose significantly if resource projects cannot secure financing from traditional lenders.

Across Canada, particularly in the West but also in other regions, First Nation and Metis communities are forming alliances with energy companies. These partnerships bring substantial economic and social benefits to the communities involved. They offer employment and business opportunities to some of the most disadvantaged communities in our country. In fact, the energy sector is one of the largest employers of Indigenous people in the private sector, offering some of the highest-paying jobs for Indigenous Canadians.

Energy projects allow Indigenous communities to actively participate in the projects, making them active partners rather than passive recipients. Last year, 16 B.C. First Nations signed an agreement with Coastal GasLink to secure equity ownership of the pipeline. Several First Nation groups are working towards partial or full ownership of the Trans Mountain pipeline. Additionally, other Indigenous groups are planning to build natural gas export terminals.

Activists and government policymakers need to recognize that the concept of Indigenous economic reconciliation means nothing if First Nations are deprived of financing for projects that could generate prosperity within their communities. First Nations must acknowledge that their environmental aspirations and climate change concerns could potentially come at a cost to themselves.

A case in point is the Wôlinak Abenaki band council in Quebec, which signed a joint economic development agreement with Questerre Energy in February 2022. The project would transform the traditional Abenaki territory into a gas production hub, offering significant economic benefits to the Indigenous community. However, the project was hindered by a law enacted in 2022 that banned energy exploration and activity in Quebec.

Consequently, the Indigenous community’s ambitions to partner with an energy company and secure benefits for its community were stymied by a law supported by wealthier, non-Indigenous activists in Quebec’s cities. This demonstrates a form of class-based elitism that allows development and progress for me, but not for thee.

Affluent city-dwelling environmentalists, many of whom enjoy a comfortable lifestyle thanks to resource wealth, are often beneficiaries of reliable energy produced from abundant and affordable fossil fuels. However, some of them wish to deny impoverished First Nation and Metis communities access to energy projects that could uplift their communities to the living standards they enjoy. They claim that these projects conflict with their alarmist views on climate change.

We can see this ‘class-based’ agenda played out elsewhere.

The federal government has attempted to impose expensive and unreliable renewable energy projects on First Nations, often overlooking the voices of these communities that envision a more prosperous future with oil or natural gas projects.

It’s imperative that activists, governments, and businesses rethink and ultimately abandon their misguided divestment campaigns. If they gave it serious consideration, they would understand that divestment neither addresses global energy demand nor prevents energy production in other jurisdictions.

But most importantly, divestment poses a direct threat to the economic prosperity and self-determination of Indigenous communities. This message should be communicated loud and clear in corporate boardrooms and legislative buildings.

Joseph Quesnel is a Senior Research Associate with the Frontier Centre for Public Policy

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