All eyes on Canada, U.S. energy outlooks at Bloomberg Global Energy Finance summit in New York

May 9, 2017     / / / /

By OMAR ALLAM

PUBLISHED : Wednesday, May 3, 2017 12:00 AM

NEW YORK CITY—Last week, United States President Donald Trump triggered a wave of significant policy changes and made threats about trade, energy, steel, and dairy. The shifting policy landscape in Washington has raised questions about the future of NAFTA and relations with Canada.

On energy co-operation, the burning question for Canadian policy-makers, scientists, and the private sector is: will the U.S. act in isolation, or continue to take advantage of its well-developed energy relationship with Canada, its closest and most important trading partner, and others?

Today, there is deep and ongoing bilateral and multilateral work involving Canada and the U.S. in key areas such as low-carbon electricity; clean energy technology; energy efficiency; carbon capture, use, and storage; climate change adaptation; and reducing emissions from the oil and gas sector. This work is significant.

It was no surprise that, given the turmoil in U.S. relations with a number of its allies and trading partners, that both American and Canadian energy policies were highlights at the Bloomberg Future of Energy Summit in New York City April 24 to 25.

This invitation-only forum that I attended convenes global players to tackle issues around energy markets and policy. In the crowd this year was a significant group of Canadian business executives, industry pioneers, and senior Canadian federal and provincial government officials.

All eyes were on Rick Perry, U.S. energy secretary, and Canadian Natural Resources Minister Jim Carr. Canadians in particular were looking for an indication of where the Canada-U.S. relationship is going.

Minister Carr’s keynote discussed the current and future Canadian energy policy landscapes and highlights of Canada’s clean-energy competitiveness. He stressed that Canada’s resources drive American prosperity: energy for American cars and factories, lumber for American construction, and minerals for high-tech manufacturing. He also focused on how Canada’s resources help power the American economy while creating jobs and opportunities for American workers.

“Energy partnership represents nine million American jobs, spread across every congressional district.” he said.

During his keynote address, Perry discussed the emerging American energy strategy. One key message that left many in the crowd scratching their heads was that the U.S Department of the Energy (DOE) could intervene in state energy planning, should it deem it a threat to the survival of baseload coal generation and nuclear power. His comments were noted by the crowd of business leaders and clean-energy investors, who were unsure of the department’s right to intervene in matters within a state’s mandate, under the authority of national security.

Are there issues that are so important to the national security of this country that the federal government can intervene on a regulatory side?” Perry said. “I’ll suggest to you that there are, from the standpoint of being able to have, and make sure that we maintain, a [minimum level of demand] on our [electrical] grid is of national security.”

His comments cast new uncertainty on state policies promoting the expansion of renewable energy. Perry, a former governor and advocate of states’ rights, said national security issues could be important enough to override them.

These remarks may demonstrate how the new Trump administration wants to undo what it sees as the climate change and energy policy faults of the former administration of Barack Obama, even if proposed actions contradict a core Republican value of limited government.

“There’s a conversation, there’s a discussion, some of it obviously very classified, that will be occurring as we go forward, to make sure that we have the decisions made by Congress, in a lot of these cases, to protect the security interests of America,” he said, and that “states and local entities do in fact get pre-empted with some of those decisions.”

As he concluded his remarks, Secretary Perry said very little on climate change, but he told the standing-room-only crowd that the United States should modify its participation in the Paris climate change agreement, rather than abandon it altogether.

The conclusion from these discussions at the summit should be: keep a close eye on President Trump’s energy policies, and have a risk-management strategy in place. There could be major challenges, opportunities, and disruption for Canadian energy companies in the coming months and years, as we adapt to new leadership in our closest ally.

For Canada to stay competitive in today’s global economy, the Canadian government and industry need to press forward with an international trade strategy to diversify our export markets for natural resources.

Omar Allam is a former Canadian diplomat and current CEO and founder of the Allam Advisory Group, a global trade advisory and commercial diplomacy consulting firm.

The Hill Times – original piece available online:https://www.hilltimes.com/2017/05/03/eyes-canada-u-s-energy-outlooks-new-york-summit/105412

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