Social Policy in Ontario

Canada’s all about energy … to send elsewhere

Posted on December 24, 2014 in Policy Context

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TheGlobeandMail.com – Globe Debate
Dec. 24 2014.   Jeffrey Simpson

Here’s a slogan on sale for last-minute political shoppers: Canadian energy for Canadians!

How radical would that be? Here we are in a country pleased (wrongly) to call itself an “energy superpower,” but the best our governments and energy companies can usually manage are new ways to export energy.

Yes, yes, Canada has energy surpluses. And these surpluses need to find markets elsewhere to be profitable, whether it’s hydro or oil or natural gas. We can’t use all we produce. We can make money sending it south or overseas. But we could use more if we thought of energy as a national asset for use first by Canadians, or at least more by Canadians.

Canada’s constitutional arrangements get in the way of thinking nationally. The provinces control natural resources here, unlike in other federations. Provinces think first and foremost of themselves, in particular how much money they can get for those resources, which invariably means selling them outside Canada.

Ottawa generally stands mute on the sidelines. This silence has been particularly apparently during the Harper years, because the Conservative government applies strict constitutional reasoning: What is federal is federal, what is provincial is provincial. You can see this at work in health care. Ottawa will cut a cheque, but not attach strings to how the money is spent.

This strict compartmentalization is a defensible constitutional position. It minimizes squabbling. It keeps Ottawa out of the provinces’ hair. It cuts down on costly, sometimes open-ended federal interventions in areas of provincial jurisdiction. It prevents Ottawa from being seen by provinces as nothing more than a cash cow.

But another way of thinking about Canadian federalism sees Ottawa with its “spending power,” a power upheld by the courts, and the only government with a “national” vision.

Natural resources such as energy are provincially owned with national implications. Where we sell, to whom and for what prices, and how we exploit the resources have fiscal-policy and sometimes foreign-policy implications. Natural resources contribute to the country’s standard of living, and to regional differences, which Ottawa through equalization is charged with trying to flatten.

A “Canadian energy for Canadians” approach would not see Uncle Ottawa bullying its way into provincial jurisdiction. Rather, it would invite the federal government to suggest to provinces that it stands ready to assist them financially in projects that would move Canadian energy across the country.

Think about hydroelectricity. We don’t have anything like a national grid in Canada. We don’t even have effective regional grids, but rather bits and pieces of regional grids. We’ve got highways and train tracks linking the heartlands of Quebec and Ontario, but we don’t have an energy corridor from surplus-producing Quebec to Ontario.

By extension, we don’t have the capacity (or political willingness) to move Newfoundland’s future hydro surpluses to Ontario. Instead, if the next Labrador projects ever see the light of day, the power will go through the Maritimes to the United States, aided by a loan guarantee from Ottawa.

The same applies for Manitoba hydro surpluses that Ontario says it does not want or need, so the surplus goes south. In the West, new surpluses of oil and gas have gone south or offshore.

Three or four years ago, a group of people from environmental and business organizations, and from assorted think tanks, gathered in Winnipeg and Banff to talk about what a more national energy framework might look like. More than anything else, it was a mind-stretching exercise trying to think through how future energy and environmental policies might work together across the country.

They deliberately didn’t invite the federal government, because they understood such talk would offend the Conservatives. They were even reluctant in the early stages to invite provincial representatives, in case anybody believed – perish the thought – the wind was up for something called a National Energy Policy.

Preliminary papers were produced and much private discussion ensued, but the effort petered out.

We are left therefore with a funny country: very rich in energy of every kind but unable and unwilling to talk about it in a national context. The best and often only approach we can take is to frame discussions about how fast, and under what circumstances, we can produce it to send elsewhere.

< http://www.theglobeandmail.com/globe-debate/canadas-all-about-energy-to-send-elsewhere/article22187185/ >

Tags: economy, globalization, ideology, jurisdiction

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