Canada: Premiers Unveil Canadian Energy Strategy At Summer Meeting

At the summer meeting of the Council of the Federation that was held in St. John's from July 15 to 17, 2015, Canada's provincial and territorial Premiers unveiled their Canadian Energy Strategy (CES). The CES is the product of the Canadian Energy Strategy Working Group, which was established in 2012 to develop a strategy that would:

  • further develop and communicate provinces' and territories' shared objectives;
  • enhance citizens, stakeholders, and investors understanding of approaches to develop energy in an environmentally sustainable manner;
  • provide greater coherence to advocating and promoting Canada's interests internationally; and
  • continue to provide focus to initiatives that will help Canada achieve our collective vision as a responsible global energy power.

The CES, which has been developed over the last few years by a number of working groups across the country, is aimed at facilitating energy cooperation in Canada. The Premiers have taken the initiative to create their own strategy, one which is designed to reconcile sustainability objectives with the need to get western oil to market through new pipeline construction.

Although the provinces and territories in Canada have different energy sources, needs and priorities, the intent is to ensure that the provinces and territories are better positioned to build necessary energy infrastructure, improve sustainability and expand production through agreement on a set of common principles. The development of the CES has focused on three main areas: (1) sustainability and conservation; (2) technology and innovation; and (3) delivering energy to people. The final strategy sets out 10 areas of focus and associated goal-oriented activities as part of a national vision for the future of oil, gas and electricity across Canada:

Sustainability and Conservation

1. Promote energy efficiency and conservation.

2. Transition to a lower carbon economy.

3. Enhance energy information and awareness.

Technology and Innovation

4. Accelerate the development and deployment of energy research and technologies that advance more efficient production, transmission, and use of clean and conventional energy sources.

5. Develop and implement strategies to meet energy sector human resource needs now and well into the 21st century.

6. Facilitate the development of renewable, green and/or cleaner energy sources to meet future demand and contribute to environmental goals and priorities.

Delivering Energy to People

7. Develop and enhance a modern, reliable, environmentally safe and efficient series of transmission and transportation networks for domestic and export/import sources of energy.

8. Improve the timelines and certainty of regulatory approval decision-making processes while maintaining rigorous protection of the environment and public interest.

9. Promote market diversification.

10. Pursue formalized participation of provinces and territories in international discussions and negotiations on energy.

Since its release, the document has been criticized for its vacuity, and commentators have characterized the tempered language in the CES as a reflection of the significant disconnect between the provinces' views on energy development. An expected sticking point at the premiers' conference was the reconciliation of greenhouse gas emission reduction targets with energy production and pipeline development. The discussion in the CES appears to reflect this obstacle, generally discussing market-based policies to reduce greenhouse gas emissions without committing to specific targets:

The transition to a lower carbon economy will be further supported by provinces and territories examining the potential use of market-based policies that create economic incentives to reduce greenhouse gas emissions. In addition, provinces and territories can explore various approaches to emissions reporting requirements, and apply consistent and co-ordinated approaches across Canada, creating a foundation for future progress on carbon management (CES at 16).

In addition, the CES points out that a range of carbon management mechanisms are available to help the provinces and territories reduce emissions, including setting a price on carbon. With regard to regulatory delay, the CES commits to collaboration between the provinces to improve information to proponents and stakeholders to navigate the regulatory process, remove duplication and inconsistencies between different regulatory processes, and share knowledge and best practices to enhance regulatory systems. This is coupled with a commitment to ensure regulatory systems maintain rigorous protection of the environment and public health and safety (CES at 29). Again, the general language in the CES appears to reflect the difficulties in reaching agreement on development initiatives and environmental protection.

The unveiling of the CES may well have been much ado about nothing; it remains to be seen whether the implementation of a national energy strategy is merely a pipe dream, or if Canadians will see a meaningful multi-provincial approach to energy development in Canada. Since the federal government did not provide feedback on the CES, attempts to streamline regulatory approvals may be frustrated, particularly where federally regulated matters such as intra-provincial pipelines are involved. Participants in the Canadian energy sector will continue to watch policy developments within the context of energy production and infrastructure, technological innovation and climate change as they unfold in the aftermath of the Premiers' conference and beyond.

Alberta Releases Updated Climate Change Regulations

On a related note, Alberta has released revised versions of four regulations associated with the Climate Change and Emissions Management Act. The revised Specified Gas Emitters Regulation, Specified Gas Reporting Regulation, Administrative Penalty Regulation, and Climate Change and Emissions Management Fund Administration Regulation are now available online. As discussed in an earlier post, Alberta's new government recently announced a two-step process to (i) renew and update the province's current regulations on carbon emissions, and (ii) establish an advisory panel (chaired by Dr. Andrew Leach of the University of Alberta School of Business) that is responsible for carrying out a review of Alberta's climate change policy and providing advice on a permanent set of measures so that Alberta can develop a preliminary proposal before the COP 21 UN climate change conference in Paris this December.

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