Capitalizing on clean energy advantage

Provided it can summon the political will and make the appropriate investment decisions, Canada is well positioned to become a sustainable energy superpower and major player in the North American electricity market over the next 30 to 40 years, a time when global energy consumption is likely to double in North America alone, says Dr. Jatin Nathwani, executive director of the Waterloo Institute for Sustainable Energy.

Although it is widely recog- nized that the transition from a fossil fuel to a low-carbon energy system will take decades, Canada has a “clean-energy advantage” and is abundantly rich in low-carbon energy resources, including hydro, wind, bioenergy, geothermal, and advanced nuclear. However, says Dr. Nathwani, before Canada can capitalize on its advantages, political barriers to inter-regional energy trading are going to have to come down, and further investments are going to have to be made in inter-regional and cross-border energy infrastructure. “Electricity generation is a high-value manufactured good that has the promise and potential of delivering large benefits through inter-regional trade enabled by transmission and interconnections,” says Dr. Nathwani. But achieving such a goal will require a dramatic shift away from the “provincial self-sufficiency paradigm” to a coherent national strategy.

“Realizing the full potential of clean electricity exports from Canada to the U.S. through an expanded power grid requires provinces, U.S. states and the federal government to establish a clear policy framework and specific mechanisms to reduce barriers to investment and to the development and approval of specific projects,” he says.

There are encouraging signs that this process is already underway, he adds. The federal government in particular has been supportive of infrastructure expansion across regional boundaries. “This is your Key- stone, and this is your liquefied natural gas in British Columbia,” he says. Over the longer term, it is logical from an investment perspective for regional energy systems, such as those that exist between Ontario and Quebec, or Newfoundland and Nova Scotia, or Alberta and British Columbia, to be expanded in order to facilitate the large scale export of energy to the U.S. and beyond.

He adds that Canada’s clean energy resources even carry a price advantage as traditional fossil-fuel sources are becoming increasingly subject to carbon- emission penalties in the United States in order to speed-up the transition to a low GHG-emissions environment.