Politics·Analysis

How the pandemic gave Trudeau an energy policy both the oilpatch and environmentalists could applaud

Since the pandemic began, Prime Minister Justin Trudeau has been under pressure to either abandon measures to fight climate change or double-down on efforts to move to a post-carbon economy. His Friday policy announcement split the difference.

The prime minister is under heavy pressure to abandon climate policies in the face of an economic meltdown

A pumpjack works at a well head on an oil and gas installation near Cremona, Alta., Oct. 29, 2016. (Jeff McIntosh/The Canadian Press)

"Just because we're in a health crisis doesn't mean we can neglect the environmental crisis," Justin Trudeau said on Friday morning.

You could read that statement as a painful reminder of the fact that even once we've made it through the anxiety, stress and sacrifice of a global pandemic, there will still be the monumental task of confronting and combating climate change.

But the prime minister more likely meant it as a statement of intent and a message of reassurance for those voters worried that the fate of the planet might fade from view in the scramble to buttress the economy against the spread of a deadly virus.

Trudeau actually made that declaration in the middle of announcing a series of measures to support the oil and gas industry and those who work in it. Some of those measures had a complementary goal of addressing serious environmental concerns.

The ultimate future of the oil and gas industry will remain a significant question for this country, just as it was before the pandemic's arrival. But Trudeau might have hoped that Friday's package would appease both those who want to see short-term assistance for an important domestic industry and those who would prefer to keep the focus on the long-term problem of global warming.

Temporary allies in a trying time

As it turned out, Tzeporah Berman, one of Canada's most vocal environmentalists, and Alberta Premier Jason Kenney (two people who probably like to imagine that they have nothing in common) both found something in Trudeau's announcement to applaud.

Granted, their interpretations of Friday's announcement differed substantially. Berman seemed to think the federal measures were in line with her goal of winding down the oil and gas industry — but for a prime minister who likes to say that the environment and the economy must go "hand in hand," success probably looks like both sides coming away with something to be happy about.

On top of the global economic freeze precipitated by COVID-19, Canadian oil producers have suffered a collapse in global markets brought on by a clash between Russia and Saudi Arabia.

So anticipation of new supports for the oil and gas industry has been building for weeks — particularly since Finance Minister Bill Morneau suggested on March 25 that such aid could be just "hours" away. In the meantime, environmentalists campaigned against a "bailout" for a sector whose existence they view as antithetical to the goal of cutting greenhouse gas emissions.

'The other crisis'

If Trudeau was hoping to look like a champion of climate action on Friday, his case likely was bolstered by the leak of a wish list recently submitted to the federal government by the Canadian Association of Petroleum Producers. In the interests of helping producers get through the twin crises of a global pandemic and a collapse in the oil market, CAPP was asking the Trudeau government to suspend, delay or roll back a smorgasbord of environmental regulations and policies.

"Just because we are in one crisis right now, doesn't mean we can forget about the other crisis," Trudeau said on Friday when he was asked about CAPP's requests.

Prime Minister Justin Trudeau addresses Canadians on the COVID-19 pandemic from Rideau Cottage in Ottawa on Friday, April 17, 2020. (Sean Kilpatrick / Canadian Press)

But one of the measures announced on Friday — a $750 million fund that will primarily provide repayable loans to resource companies — is intended to address the challenge of meeting new regulations on methane emissions at a moment like this, he said.

"We recognize that … moving ahead with the methane regulations is something very difficult for companies right now in the oil and gas sector," he said.

In normal times, this sort of assistance might have provoked complaints. But the reaction from environmental groups on Friday was mostly positive.

Along with that fund, Trudeau announced $1.7 billion to help clean up abandoned and inactive oil wells. Concerns have been raised about using public funds to clean up private industry's messes, but Trudeau suggested those concerns had been heard and the Alberta government would be working to strengthen the "polluter pay principle."

Economic crises tend to crowd out all else

Commitments of $750 million and $1.7 billion to deal with environmental concerns probably make it harder for anti-oil activists to complain about the third step Trudeau announced on Friday: expanded credit support through Export Development Canada and Business Development Canada for medium-sized energy companies.

The end of 2019 saw what seemed to be a warming trend in public and political support for policies to deal meaningfully with climate change — but the durability of that concern was always going to be tested by the next economic downturn.

More than a decade ago — in 2008 — there was a brief moment when it seemed like climate change had finally broken through as a significant political issue. It was around then that Stéphane Dion, leader of the Liberal Party at the time, first proposed a federal carbon tax. Then the global financial system crashed and the threat of a warming planet was put aside to deal with more immediate concerns.

As long as environmental regulations and levies seem like "extras" — green extravagances rather than basic necessities — it will be tempting for critics to argue that such policies should be set aside whenever there's economic trouble to deal with.

A few weeks ago, for instance, the Conservative Party was arguing that the planned annual increase in the federal carbon price should be cancelled as part of the government's efforts to assist Canadian households (revenue from the federal tax is returned to Canadians through a rebate and independent analysis has shown that most households should receive more than they pay).

Not a bailout ... not yet

So far, it seems, Trudeau has resisted any push to retreat significantly from the agenda that was supposed to be front and centre for his government before this global health emergency began.

Environmentalists might be happy that Trudeau has stopped short of a "bailout" for the oil industry — at least for now. But he also has not embraced suggestions that this is an opportune moment to talk about a "transition" away from fossil fuels. In the midst of so much uncertainty and anxiety, this might actually be the worst time to promote even more change.

But the big questions about how this country might get to net-zero emissions by 2050 will still be there for Trudeau to grapple with once the threat of COVID-19 has been sufficiently contained.

Whenever we emerge from this profound challenge, there will be another one demanding our attention.

About the Author

Aaron Wherry

Parliament Hill Bureau

Aaron Wherry has covered Parliament Hill since 2007 and has written for Maclean's, the National Post and the Globe and Mail. He is the author of Promise & Peril, a book about Justin Trudeau's years in power.

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