Canada's energy policy is a MESS, and rare is the government that has sorted it out.
MESS is an acronym coined by Prof. Monica Gattinger, a political scientist interested in energy policy at the University of Ottawa. Each letter of MESS stands for an important element of any energy strategy: markets, environment, security and social acceptability (or licence).
Governments invariably stress one or perhaps two parts of MESS, and pay less attention to the others. Increasingly, it's clear that all of most of the four parts of MESS have to be pursued simultaneously. If not, either nothing happens, or happens only with great difficulty, as Canadians are seeing with energy projects at home.
The oil industry and its political boosters, such as those in Edmonton and Ottawa, start from M, market. No market, no production, no transportation, no jobs, no revenues. Market forces are their favourite paradigm.
For decades, it was assumed M would be always easy to locate. Oil and gas pumped in Canada would be snapped up by the United States. More recently, Asia was added as a sure-fire market. Within North America, the same was true for hydro. Build capacity and the Americans will buy. The market would prevail.
When M was considered a sure bet, thinking about the environment and social licence came along as afterthoughts. Yes, yes, market-oriented promoters said, these were important, but not as important as the critical question of M, securing markets and getting product to them.
That's why TD Bank deputy chair and former New Brunswick premier Frank McKenna was lamenting recently about all the lost national income from delays in building pipelines to get Canadian bitumen to market. He's not the only one. Federal ministers echo this warning almost every time they open their mouths on energy policy. So, of course, do oil and pipeline executives.
Some tension will likely always exist between markets and the need to get product there, and environment and social licence, the other parts of Prof. Gattinger's MESS. But whether the oil producers and their spokespeople in industry and governments like it or not, the other parts of MESS are increasingly becoming as important as markets. If markets, environment and social licence don't line up, delays and frustration will ensue.
In the U.S., one S – security – might just trump all. The Americans are fixated on national energy security, which they can see over the horizon courtesy of domestic discoveries of shale oil and gas.
Freeing themselves from the Saudis and other Middle East producers, to say nothing of anti-American hotbeds such as Venezuela, receives widespread support as a foreign policy objective. That S is absent from Canadian debates, given the country's huge energy surpluses.
Energy security will likely (but not assuredly) tip Barack Obama's administration's eventual decision in favour of the Keystone XL pipeline to ship bitumen oil from Alberta to Gulf of Mexico refineries, since Canada is seen as an extension of the U.S. in foreign policy and energy terms.
Back in Canada, as Prof. Gattinger explains in her paper, federal and provincial governments have frequently been unable to work together on energy. Stephen Harper's federal government doesn't even try. It's left energy policy largely to the provinces, on the theory that they own the natural resources.
Various reports have been published and conferences held about what a national energy strategy might look like. These have all consumed much time and gone nowhere.
Alberta Premier Alison Redford, for example, has spoken of a "national vision for energy," concluding that "we can achieve this." A glance at a map would have told the Premier that engaging with British Columbia would be necessary to get bitumen oil to the coast. Instead, she didn't even try to engage seriously with the coastal province where opposition has grown to the Enbridge pipeline from the bitumen oil fields to the West Coast. With Christy Clark freshly elected as B.C. Premier, the Albertan says perhaps the time has come to talk.
Prof. Gattinger suggests perhaps something as amorphous as a national energy framework between Ottawa and the provinces might help intergovernmental co-operation. It would take a very different federal government, and different provincial attitudes, to work toward sorting out this MESS.
Eds Note: Frank McKenna's current employer was wrongly identified in an earlier version.