Business·Analysis

Premiers meeting shows national energy policy is 'a mess'

If Canada wants a strategy about energy, it should be about much more than crude, analysts say.

Critics say the agreement is vague and lacks a clear focus

At this week's premiers meeting in St. John's, Saskatchewan Premier Brad Wall, left, and British Columbia Premier Christy Clark spent a great amount of time discussing a unified energy policy. (THE CANADIAN PRESS)

Canada's premiers may have just agreed on a national energy strategy, but whether it will actually make any practical difference remains an open question.

When former Alberta premier Alison Redford toured the country in 2011 promoting a Canadian energy strategy, her vision was straightforward: come up with a national policy on exports of oil, gas and other forms of energy.

Redford hit one key point: Canada has a diversity of energy production. 

But that variety does not seem to have produced a range of new ideas by the premiers this week. In public, at least, the discussion at the premiers meeting in St. John's was mostly about who is for and who is against bitumen-filled pipelines.

Trying to build consensus among the premiers on a national energy strategy is a tall order. Even oil powerhouses Alberta and Saskatchewan couldn't agree. 

Alberta Premier Rachel Notley criticized Saskatchewan Premier Brad Wall's aggressive approach to negotiations. Wall had criticized Notley for allegedly giving Quebec veto power over future energy pipelines, something she denied.

"Other premiers can do a little bit of showboating," said Notley in an interview with CBC, later suggesting it's best to be mature and collaborative in this process.

A longstanding challenge

The strategy has always faced challenges and detractors, dating back to when former Natural Resources Minister Joe Oliver said there was no need at all for such a policy by the provinces.

"It's a real mess. No one has really articulated what they mean by national energy strategy," said Frank Atkins, a research chair with the Frontier Centre for Public Policy and a former economics professor at the University of Calgary.
Construction continues in northern Alberta's energy sector, including this Enbridge pipeline in the area between Fort McMurray and Conklin. (Kyle Bakx/CBC)

"I suspect if you took individual premiers aside and asked, 'What's your view on a national energy strategy?' and compared all the views, they would be completely divergent."

Atkins sees a "great disconnect" between the provinces. There are differing views about fracking for oil and how to address carbon emissions, for instance, let alone the different economies of the "have" and "have not" provinces. 

This week's clash over pipelines and emissions was expected, but for critics, a much bigger disappointment is that the strategy hasn't spurred much discussion outside of exporting oil. 

"If you're going to have a true national energy strategy, you can't limit it to just oil and gas," said Atkins. "Look at electricity – why aren't people talking about the concept of a national electricity grid?"

His sentiments are echoed by Joe Arvai, the Svare Chair in Applied Decision Research at the University of Calgary.

"I'm quite disappointed. It's the same thing over and over again. Not much discussion about climate," he said. 

Opportunities lost?

With the election of Rachel Notley in Alberta, Arvai hoped the discussion on the national energy strategy would make some serious headway on carbon emissions. An opportunity lost, he said, for the premiers to get serious about climate change regulations.

Arvai says the discussion should include pipelines, but questions whether they should be central to the strategy.

"I don't see China's economy flying right now, so I don't see them as a big customer for oil. The U.S. is a net exporter of oil; I don't see them wanting Canadian oil," said Arvai.

​When it comes to exporting oil using pipelines, he said, "We can build this stuff, but I'm not convinced we will see the economic windfall from it that other people are predicting."

Analysts have suggested the oil industry will lose $100 billion in the next 15 years without any new pipelines.

Stephen Poloz, the governor of the Bank of Canada, highlighted how the oil and gas industry represents about 10 per cent of the economy, a number that doesn't include spin-offs. The plunging price of oil is the main reason Canada is expected to have been in a recession in the first half of the year.
This week's discussions about the country's energy policy included, from left, Perry Bellegarde, national chief of the Assembly of First Nations, PEI Premier Wade MacLauchlan, Quebec Premier Phillipe Couillard and Alberta Premier Rachel Notley. (The Canadian Press)

"If we are going to be moving oil across the country, pipelines are the safest and most efficient way to do it, bar none," said Arvai. 

"On the other hand, no one has showed me a convincing argument what the economic benefits of moving oil by pipelines will be as compared to using the money used for large pipelines for new initiatives such as developing renewables or developing new ways of getting the oil out of the ground."

Provincial strengths

Arvai's suggestion for a national energy strategy is to see what every province brings to the table, whether it's liquified natural gas in British Columbia or hydroelectricity in Manitoba and Quebec.

Every province could list its energy strengths and weaknesses to see what it can contribute to meet Canada's economic, social and environmental goals. Then the evaluation could take place, identifying which projects will bear fruit.

"How do we think each will perform? What will be the outcomes of economic performance? Will it meet our environmental goals? [This scenario could become] a living process for making decisions," said Arvai.

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