Roadblocks abound for a national energy strategy
Christy Clark isn't the only obstacle supporters of the idea must overcome
British Columbia Premier Christy Clark’s refusal to work with her provincial colleagues on developing a national energy strategy is another indication of the long road that lies ahead for supporters of the fledgling idea.
Those supporters include Clark’s current sparring partner – Alberta Premier Alison Redford – as well as industry heavyweights like Suncor Energy Inc., Encana Corp. and Canadian Natural Resources Ltd. But despite the powerful political and corporate players who are bullish on a pan-Canadian energy strategy, much stands in the way before it becomes a reality.
The issue won’t be going away, however. Not with the energy potential Canada has. But each province has different resource gifts and energy goals. Quebec has an abundance of hydro potential and it wants to develop a portfolio of projects that would add 4,500 megawatts of hydroelectricity capacity to the provincial grid. Nova Scotia must have 40 per cent of its power come from renewable sources by 2020. And B.C. has designs on becoming a major exporter of liquefied natural gas.
But the planning and development often happens in silos. Supporters of a national energy strategy contend Canada isn’t getting the full benefits from its gifts with this approach. “There is real potential for Canada to play a significant role as an energy provider,” says Roger Gibbins, the retired president and CEO of the Canada West Foundation. “[Canada] has the endgame, but no strategy on how to get there.”
Gibbins and the Calgary-based policy think tank he used to lead have long promoted the idea of a strategy. But now that the concept is gaining some traction – thanks in large part to the efforts of Redford – the question now is how to make it happen. An encouraging development occurred when Canada’s premiers met in July for their annual Council of the Federation meeting.
In Halifax they agreed (minus B.C.’s Clark) to set up a working group to build on the council’s 2007 energy strategy. If you weren’t aware a national energy strategy existed, you’re not alone. The initiative has gone nowhere. What makes this time different?
One difference is it now has an enthusiastic champion in Redford, who since becoming premier in October of 2011 has been stumping for a strategy. Her ardor isn’t hard to figure. With production from the oil sands alone projected to grow between now and 2030 by 3.4 million barrels per day, the province is keen to get political leaders onside with developing the controversial resource and building the pipelines that will send it to lucrative new markets.
However, that could prove difficult to achieve. Parochialism reigns in provincial-territorial politics. Clark has refused to participate in the process until Alberta agrees to negotiate how B.C. can receive a “fair share” of the fiscal and economic benefits from transporting heavy oil from Alberta to the West Coast. Central to that demand would be B.C. receiving a share of royalties from oil sands production. Redford says there will be no negotiating on that matter.
Another big threat to developing a national energy strategy is the suspicion that only Alberta will benefit from it. “The country has to be convinced this is not a way to line the pockets of rich Albertans,” Gibbins says.
At Memorial University in St. John’s, Newfoundland and Labrador, political science professor Christopher Dunn says Atlantic Canadians are wary of getting swept up in a movement dominated by the interests of bigger, richer provinces. “This would be a national energy strategy with quotation marks around it,” Dunn says. “It would be an Ontario-Western Canada type of policy, and it would be petroleum-orientated.”
Of course, Newfoundland and Labrador is no stranger to the oil and gas business. Industry activity there has turned the province from an economic backwater to a “have” jurisdiction. The province was producing an average of 85,696 barrels of oil per day from its offshore fields, according to the latest figures.
But Dunn says the province also has designs on developing more hydroelectric projects and exporting that power to other markets. It also would like to settle a boundary dispute in the Gulf of St. Lawrence with Quebec. Dunn says a national energy strategy would have to address those issues, and others that affect the energy ambitions of Atlantic Canadians.
Yet another roadblock on the road to such a strategy is the fact that Prime Minister Stephen Harper has shown no indication his government wants to develop national policies that stray into matters of provincial jurisdiction, and energy is a provincial jurisdiction. Could 13 provinces and territories work out a national energy strategy without the participation of the federal government in the process?
Some experts think that’s unlikely, although the Council of the Federation’s decision to form a national energy strategy working group shows the provinces and territories are willing to give it a try. At the Calgary-based Energy Policy Institute of Canada, a non-profit group formed by businesses like Suncor and Encana, president Doug Black says the issue is too important not to pursue.
Canada isn’t an energy superpower yet, but with a national energy strategy, Black thinks it could be. “We can’t be dealing with one-offs, whether it’s the Northern Gateway, Labrador power issues or wind energy issues,” Black says. “As a nation we need to ensure prosperity. We’ve got to have a plan to maximize our resources.”