B.C. Beer Blog

The who, what, where, when, why, and how of B.C. craft beer

Relocalization: Globalization Peaking?

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With the convergence of climate change and peak oil (never mind the peaks of other non-renewable resources, such as metals), the cost of goods is increasing quite dramatically. This is being felt throughout the brewing industry, reflected in the price of grain, hops, packaging, energy and transportation — all ultimately passed onto the consumer.

To what extent, then, can our current system of globalized mass-production, dependent on cheap labour and energy, be sustained? It will depend on how successful we are in minimizing our reliance on petroleum and other fossil fuels, reducing the concentration of CO₂ in the atmosphere, and lessening the effects of extreme weather or rising sea levels on food production.

Considering how long it took to develop the petroleum infrastructure that provides the foundation of our society, I think it is safe to say that we won’t have an ubiquitous, cheap alternative any time soon unless the government declares a state of emergency and puts the country on a war-like footing with a massive investment of resources devoted to a transformation. The state of denial at the federal level, however, is profound. The band plays on at the Alberta petroleum party and the prospects of oil & gas extraction in an ice-free Arctic are whetting insatiable appetites. Consequently, direct economic pressure on businesses is spurring them to reduce all fossil-fuel energy costs to the greatest extent possible.

In B.C., a significant proportion of our greenhouse gas emissions comes from transportation. If we can minimize transportation, we reduce costs and the impact on the environment. That can mean sourcing inputs from as close as possible, like what Crannóg Ales does by using water from their own well, growing their own hops and fruit, and buying their malt from Gambrinus Malting down the road in Armstrong. Their zero waste farm brewery system also eliminates standard waste management costs.

Another way of reducing transportation costs is by serving a market as close to your production facility as possible. The best option is serving your customers inside your production facility, i.e. a brewpub. Consequently, there’s no packaging and delivery costs. A further benefit to customers is that the beer is as fresh as can be. Nevertheless, it then comes down to the skill and creativity of the brewer to create a satisfying beer. (Sadly, I’ve had fresh, insipid beer in a brewpub.)

Microbrewers serving a local market are starting to explore alternatives to gas-powered vehicles. For example, Iron Springs Pub and Brewery in Fairfax, California, powers its delivery vehicle — a converted ambulance called the “Ambrewlance” — with used vegetable oil from its kitchen deep fryers. The Alibi Room’s Nigel Springthorpe uses bio-diesel in his truck. Given our hydroelectric wealth in B.C., electric vehicles would seem to be a promising avenue. However, government regulation currently prevents widespread adoption. Transport Canada only recently legislated use of low-speed electric trucks. However, these are currently restricted to institutional and industrial settings.

Going further back in the supply chain, another area where petroleum-related costs can be reduced is in agriculture. I watched The World According to Monsanto on Wednesday. One of the things it makes you realize is how much industrialized agriculture depends on oil. Not only is it used in farm machinery, but it also in fertilizers, herbicides, and pesticides. Continuous production of a monoculture requires intense application of all three. Organic farming eliminates much of these.

In conclusion, the move to local and organic is a response not only to the environment but to the bottom line. Increasingly, we are seeing that the cost to natural capital cannot be externalized. It can only be reallocated for someone else to pay, usually consumers and taxpayers. As the cost to the environment is more fully accounted for in the cost of doing business and borne by companies through regulatory mechanisms such as carbon taxes, the true cost of a product will be more accurately reflected in its sticker price. Less and less will it pay to pollute.

It will be interesting to see if local beer, in a more level marketplace, becomes cheaper, or at least comparable in cost, than imported industrial lager. We may see the local food movement extend to beer. I think that would be a good thing.

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