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Natural Resources Minister Joe Oliver says Canada clearly needs 'a more national approach' on a range of energy issues. (Della Rollins for The Globe and Mail/Della Rollins for The Globe and Mail)
Natural Resources Minister Joe Oliver says Canada clearly needs 'a more national approach' on a range of energy issues. (Della Rollins for The Globe and Mail/Della Rollins for The Globe and Mail)

National energy strategy gains clout Add to ...

The Harper government has endorsed the need for a national energy strategy in the face of growing calls from provinces and industry groups that the sector's vision of a new era of global growth is too critical to be governed by piecemeal planning.

The government's backing of the idea of a national energy strategy marks a substantial shift from its previous public position. The Conservative government had long been cool to calls for a national strategy, fearing it would get dragged into areas of provincial jurisdiction with demands for financial support.

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But with a majority government safely in hand, the Conservatives are now signalling their support for a national policy. The Alberta government has urged Ottawa to lead the effort for a national energy strategy, arguing the country must work together if it is going to achieve Prime Minister Stephen Harper's vision of an "energy superpower."

A national energy strategy would provide a road map for Canada's energy sector as it sets out on a pivotal phase of growth, spurred by the vast reserves in the oil sands, new discoveries of major natural gas resources, and opportunities for hydroelectric development. Oil and gas producers see a grand opportunity to supply energy to new markets, such as the U.S. Gulf coast, where they hope to displace imports from overseas, and Asia, where demand is growing quickly as economies boom.

But challenges abound, and tackling them requires a cohesive approach, say industry proponents of a national energy strategy. A planned pipeline expansion in the United States faces stiff resistance from environmentalists and regulators; proposed moves in Europe to reduce carbon emissions in the transportation sector could target production in Canada's oil sands; and potential Asian customers remain unsure about Canada's commitment to building the infrastructure needed to make major exports a reality.

Federal and provincial energy ministers are scheduled to meet later this month in Kananaskis, Alta., and will hear from a number of speakers - including environmentalists - who are urging governments to forge a common strategy.

The ministers hope to emerge from their meeting with agreement on a process and a "statement of principles," though some proponents say Mr. Harper needs to be visibly committed to it to give it momentum.

Federal Natural Resources Minister Joe Oliver said in an interview the country clearly needs "a more national approach" on a range of energy issues - including access to new markets; environmental rules, including on climate change; research and development; and consumers' use of energy.

"We have an interest in a pan-Canadian collaboration, certainly," he said.

Federal-provincial collaboration would include an effort to improve the regulatory process for pipeline projects to ensure Canada's oil and gas industry can diversify its export market beyond the United States, he said.

Ministers will be considering a "guiding document" that will focus on the broad headings of energy supply, economic prosperity, energy use, and innovation.

Mr. Harper remains unlikely to support a plan that would dramatically expand the role of government - particularly the federal government - in the energy marketplace.

But Ottawa is already heavily involved in the energy sector - from negotiating international agreements and approving foreign investment, to regulating environmental standards and permitting pipelines, to funding research and infrastructure projects. And proponents argue that a national strategy would help guide those efforts and align them with provincial and private sector actions.

It remains to be seen what impact such a strategy would have - whether it will be simply a high-level discussion paper that gathers dust, or precipitates real change in regulation and funding priorities.

In the past few years, several groups have formed to debate and lobby for a national energy strategy, including energy industry executives, environmental activists and representatives from think tanks.

While there is broad support for a strategy, the details are being hotly debated. Business groups want regulatory clarity and only modest action on climate change, while environmentalists argue the ministers should adopt as a starting point Canada's need to reduce emissions by 80 per cent from 1990 levels by 2050.

In a paper to be released Monday, the Canadian Council of Chief Executives is calling for ministers to adopt a national strategy that would reflect the country's immense energy potential, while addressing the sector's environmental challenges.

The council - which represents 150 of Canada's top executives - urged ministers to "outline a vision of one national approach to energy that maintains our commitment to market principles and seeks to maximize the opportunity inherent in the country's incredible diversity of energy resources."

The business lobby group reiterated its four-year-old call for a joint federal-provincial "carbon price" to address climate change, saying business investment is impaired by a balkanized approach.

"It should be readily apparent that Canada is not well served by the current patchwork of differing federal and provincial climate change targets and often conflicting policies and timelines," it said.

The CCCE's call for a national climate policy echoed similar arguments from a number of oil industry executives, including recent statements by Shell Canada Ltd. president Lorraine Mitchelmore.

Former TransCanada Inc. CEO, Hal Kvisle, served as co-chair of the committee that produced the council's report and said the industry needs clear and consistent rules so it can make long-term investments.

"There's some room for some central planning here," Mr. Kvisle said. "Not in the Communist sense of the word, but somebody has to come up with a game plan."

Mr. Kvisle said the Prime Minister can't leave the issue to the energy ministers, but needs to show leadership to deal with a myriad of issues - from environmental regulations to native affairs - that fall outside the scope of the ministers.

Alberta Energy Minister Ron Liepert has been leading the charge for a national energy strategy, saying the country needs an "overall framework" that will guide all policy and regulations.

Alberta has released its own report from the Premier's Council for Economic Strategy, which argues the province can't be complacent about its resource wealth but needs determined leadership from government to maximize its benefits for Albertans and all Canadians.

Mr. Liepert said in an interview the strategy would encompass the entire energy sector: oil and gas; electricity; renewables; and consumers' end use. But the Alberta minister clearly has some concerns about the hurdles faced by the oil industry in getting approval for new pipelines to the U.S. Gulf Coast and to the Asian market via British Columbia.

"Ultimately, I would hope a strategy would put in place some parameters around major projects going forward," he said. "Because frankly, if we're going to be a major energy superpower, there are going to be an awful lot of projects being proposed over the next 20 years."

His federal counterpart, Mr. Oliver, sounded a similar theme.

"Diversifying and expanding the global market for Canadian energy products and services is absolutely fundamental," he said.

He cited Enbridge Inc.'s $5.5-billion Northern Gateway pipeline as "one manifestation" of the need to expand infrastructure to secure access to new markets. That project is now before a joint review panel of the National Energy Board and the Canadian Environmental Assessment Agency, and faces staunch opposition, including from many First Nations' communities along the pipeline's route.

 

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