Gattinger: Will Energy Security Unite Or Divide Canadians?
The Russian invasion of Ukraine has propelled energy security to the top of political agendas. Europe’s desire to reduce its dependence on Russian oil and gas creates opportunities for producing countries the world over, including Canada. It’s no surprise that energy companies and premiers of producing provinces are advocating that Canada can help strengthen European energy security.
Renewed emphasis on energy security arrives at a time of heightened global concern about climate change. Energy security and climate imperatives are interacting in new and unprecedented ways. And emerging debates suggest they could create further divisions over energy and climate in Canada, rather than unite Canadians.
How should Europe reduce its dependence on Russian oil and gas? Viewed through a traditional security lens, the answer is clear: by replacing imports from Russia with resources from other countries. Through this lens, the war in Ukraine makes plain how important a secure supply of oil and gas is to the economy, society and national security.
But in the context of climate change, some say Europe should replace Russian oil and gas with other energy sources — wind and solar, geothermal, bioenergy, hydrogen. Through this lens, the war in Ukraine makes plain how dependent countries are on fossil fuels and the need to get off them entirely — not perpetuate fossil fuel use by expanding production elsewhere.
The reality of course, is somewhere in between.
On natural gas, where Europe relies on Russia for some 40 per cent of supply, the European Commission’s REPowerEU plan aims to source gas from other suppliers via pipeline and LNG. It also aims to reduce dependence on gas with measures like reducing consumption, energy efficiency, hydrogen, electrification and renewable power. Combined, the Commission states the plan could reduce EU reliance on Russian gas by two-thirds in a year and eliminate Russian imports by 2030. REPowerEU aligns with the International Energy Agency’s 10-point plan for European gas, which leans on similar measures to eliminate imports from Russia by 2030 (but with an anticipated one-third reduction in imports from Russia in the first year instead of two-thirds).
Plans for replacing oil imports from Russia, which amount to about 2.5 million bbls/d — more than a quarter of European imports — are forthcoming.
And last Friday, EU leaders doubled down on the 2030 timeline and announced they plan to eliminate oil and gas imports from Russia by 2027 with detailed plans to come in the spring.
Whether all of this can be achieved in such a short time period is a very open question. Five years is a blink of an eye in global energy systems.
What is clear is that Europe is taking a two-pronged approach that attends to both energy security and climate imperatives. The war in Ukraine may accelerate European plans to reduce oil and gas in its energy mix, but that’s a long-term proposition — opportunities for producing countries to sell into Europe remain, as attested by Germany’s plans to build two new LNG import terminals. It’s no wonder political leaders of producing countries, notably the United States, are calling on energy companies to ramp up production to address supply shortages while the administration continues to pursue policies to reduce emissions.
Back here at home, how things will play out looks unfortunately all too predictable. Canada seems uniquely capable of taking energy and climate issues that could unite the country and using them instead to divide it. While Canadian producers and Premier Jason Kenney have laid out how Canadian oil and gas can bolster Europe’s energy security, others say these ideas are opportunistic and wrong-headed.
Ottawa, for its part, has struggled openly with its position. The environment minister is saying Canadian oil and gas aren’t the answer for Europe. The natural resources minister is saying they could be. Which is it?
On Friday, before leaving Warsaw, the prime minister may have clarified Ottawa’s stance, saying Canada doesn’t have the infrastructure to supply oil and gas to Europe but it can help the continent get off oil and gas entirely. Coming on the heels of the federal government’s repeated delays making a decision on the Bay du Nord oil project off the East Coast, one wonders what kind of backlash the PM will come home to.
Canada seems set for conflict yet again on energy and climate. Is there a way to change course?
First, energy security and climate action should not be framed as incompatible. The country needs policy approaches that integrate energy and climate in the short and long terms. This is about ‘and’ not ‘or’. Europe’s two-pronged approach underscores this.
Unfortunately, energy and climate policy are often made in silos in Canada — witness separate ministers for the environment and natural resources in Ottawa. This militates against developing integrated approaches that attend to both energy and climate priorities.
Second, it needs to be made clear how Canadian contributions to global energy security can also help realize domestic and global net zero emissions. Canadian oil and gas must be both available and desirable. How carbon competitive is Canadian LNG (very, as it happens)? What is the current and future emissions intensity of Canadian oil? How are oil and gas producers working with renewable energy firms, nuclear companies and other low emissions solutions providers to reduce emissions? How could oil and gas exports that reduce emissions elsewhere be credited to Canada? Answers to these questions need to be robust and credible.
Third, Canada should think strategically about how to position itself in existing and emerging global energy markets. It’s unclear how quickly Canada could supply oil and gas directly to Europe, but selling more into other markets, notably Asia and the United States, helps free up supplies elsewhere that could be sent to Europe. Doing so in a way that helps to reduce global emissions would be key.
Crucially, this is about more than oil and gas — it’s also opportunities for nuclear, for hydrogen, for technology transfer and for scientific collaboration. And it’s a chance to reinvigorate Canada-U.S. oil, gas and energy security relations, all big gaps in the Roadmap for a Renewed US-Canada Partnership.
All of this arrives as the federal government works on finalizing its new climate plan, its approach to capping and cutting emissions from oil and gas, its strategy for carbon capture, utilization and storage, and the federal budget. It’s not too late for Canadian contributions to domestic and global energy security to be integrated into these plans. To do that, collaboration among government departments, levels of government, industry, innovators, Indigenous communities and civil society will be pivotal. We need a tent, not more silos.
Perhaps most importantly, Canada should be seen as part of the energy solution for Europe, not sitting on the sidelines mired in domestic conflict and confusion.