Premiers should focus on labour, transportation
Although it may seem both incredible and anachronistic today, Canadian governments, through the Council of the Federation, produced a shared vision for energy as recently as 2007.
It called for action in seven areas: energy efficiency and conservation; technology development; renewable energy; transportation and transmission capacity; the regulatory process; energy sector human resource needs; and provincial participation in international energy discussions.
Hosted by the governments of Alberta, Manitoba, and Newfoundland and Labrador, a recent Canadian Energy Strategy Stakeholder Workshop in Edmonton revisited three of these themes (conservation; technology; and transportation and transmission).
So how did we get from 10 provinces agreeing on seven themes to a smaller group seeking stakeholder views on just three themes? And how can the upcoming Council of the Federation meeting make progress toward renewing and extending the 2007 vision?
The reason for the current fractiousness might be as simple as a shift in focus from common interests to self interest. Energy production, transport, consumption and regulatory oversight vary from province-to-province. Although this has always been true, there have been times in the past when the provinces have focused primarily on their own economic interests, and times when common in- terests have prevailed.
A thoughtful look at the seven points from 2007 reveals strong provincial benefits from pursuing each point, as well as potential spinoff benefits from joint efforts. For example, each province has taken steps to promote energy conservation and efficiency. This contributes to a more efficient economy (since energy is a key input for many industries). It also has the potential to enable consumers to reduce household expenditures. All provinces recognize these benefits.
Nonetheless, the provinces have taken very different paths to energy efficiency and conservation. British Columbia, Alberta and Ontario, in particular, have taken contrasting approaches. Although it is true that each province may benefit from lessons learned in another province, the “working together” element is difficult to identify.
To get over this hump and achieve the benefits of working together, the Council of the Federation should zero-in on the areas where co-operation is imperative.
The first of these areas is labour force development. The energy sector, particularly in Western Canada, faces a monumental shortage of skilled labour.
Provinces can address this individually, but it is more efficient to cooperate and include federal initiatives. Although governments and industry recognize this and are working together, they are falling short of the desired outcomes and the problem is getting worse over time.
Improving regulatory processes is a second area where co-operation is key. Energy invest- ments occur in huge chunks, and the resulting infrastructure lasts for decades. The need for regulatory certainty and efficient project reviews has been recognized for decades. Here again, there has been progress, but the best outcomes are yet to come. A growing societal concern that the regulatory process may not be adequately protecting the natural environment adds to the complexity of this issue. A joint approach based on common principles might produce superior outcomes.
Transportation and delivery systems are a third area ripe for greater co-operation. Transporting energy from where it is to where it will be consumed is expensive. Economic efficiency normally drives transportation decisions. B.C.’s current focus on its own economic interests, and its lack of confidence in the regulatory system’s ability to protect the environment, have put economic efficiency at the back of the bus. If Canadian producers are going to reap the benefits of the international demand for energy, the provinces have to figure out how to come together around transportation issues.
The Council of the Federation continues to meet until Friday in Niagaraon-the-Lake. The energy discussion needs to transition from the original list of seven things where each province can make some progress on its own to a shorter list of priorities for truly collaborative action.