Industry urges national framework for energy policy

Canadian National Energy Strategy seeks coherent regulatory reform and market access, harmonizing transmission infrastructure and renewables, cutting interprovincial barriers to build an efficient, low-cost power system and investment certainty for energy producers and consumers.

Canada’s energy ministers need to attack the regulatory walls built by provinces around their energy sectors that discourage innovation and drive up costs for consumers, General Electric Canada Inc. president Elyse Allan says.

In their meeting next week, federal and provincial ministers expect to launch an effort to build a national energy strategy for Canada, and business leaders are urging them to find common ground on regulatory and market access issues to create a more efficient energy marketplace.

While much of the focus has been on the oil and gas sector, there is rising concern that provincial policies in the power sector are creating a needlessly expensive and balkanized system.

Ms. Allan is vice-chair of the Energy Policy Institute of Canada EPIC, an organization representing nearly 40 companies including energy producers from all sectors and their consumers and suppliers. The group will make a presentation to ministers when they gather in Kananaskis next week, urging them to get serious about creating a national framework for energy policy and regional cooperation across provinces.

“For a company like GE, the extent to which we have certainty around the regulatory and public policy framework across Canada – and to the extent that we have some coherence across the country – it just makes it much easier to anticipate and invest and have the technology ready for when people want it,” Ms. Allan said.

“Achieving some certainty and coherency are probably two of the most enabling actions that we could take in terms of realizing our energy opportunity as a country.”

She said that need for clarity extends across the board – from investments in transmission infrastructure for oil and gas and electricity, to the deployment of renewable technology and energy efficiency.

In addition to its nuclear and oil and gas businesses, GE is a major player in the wind energy sector. Ms. Allan said the renewable energy sector will flourish best if all jurisdictions balance local employment goals with the need to build an efficient, market-oriented industry.

She declined to single out any jurisdiction, saying governments around the world are looking to create employment by promoting the local renewable sector. The province of Ontario is the most prominent province with aggressive local content rules in its feed-in tariff system, which provides premium power prices for renewable energy by requiring a significant amount of local content. But other provinces also have domestic content requirements.

“We certainly understand why and how governments want to think about energy from a job standpoint, and that’s happening around the world,” Ms. Allan said. “The challenge is to make sure we’re not undermining the efficiency and cost structure that keeps us competitive.

“Low cost electricity in a commodity driven and therefore energy intensive country continues to be an important competitive dimension. And so we always want to be looking toward that.”

All provinces and territories face major energy challenges, including the need for massive investment in infrastructure in order to develop the resources and get the energy to market.

The national energy strategy should include an effort to break down provincial barriers, and deal with longstanding irritants such as the battle between Quebec and Newfoundland and Labrador over access to transmission lines, and consider partnerships such as a Quebec-Alberta energy partnership to encourage collaboration, said Daniel Gagnier, another EPIC vice-chair who is a former executive at Alcan Aluminium and served as chief of staff to Quebec Premier Jean Charest.

“We’re not going to get to a different resolution [to provincial battles] than we have today until we have a national energy strategy,” Mr. Gagnier said.

He said ministers also have to find a way to remove overly burdensome regulatory hurdles from the construction of interprovincial and international transmission lines.

“We’ve got capacity and the reality is we don’t have enough infrastructure to either service ourselves or to service our markets,” he said. “We need to factor that into a national energy strategy.”

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