Cross Border Relations: U.S. and Canada – Energy Siblings?

Did you hear?  There’s a new President of the United States.

Lost in the initial – and furious – cycle of analysis of Barack Obama’s election was his impact on Canada-U.S. relations.  Early indications are that Obama’s presidency may mark a fundamental shift in how the U.S. deals and, particularly, trades with their northern neighbour.  Nowhere is this relationship more crucial than energy.

It’s impossible to understate the importance of the relationship to both countries.  Few nations are as inextricably linked and interdependent as are the “brothers from a common mother.”  Canada is – by far – the largest supplier of oil, natural gas, uranium and electricity to the United States.

A full three-quarters of everything Canada exports goes to the U.S. Canada has always sold itself to the U.S. as a safe energy investment – no coups, no civil wars, no transoceanic shipping.  A “Made in the USA” green shift cannot help but mean less energy shipped south – and fewer dollars coming back.

Just how much energy does Canada send south?  A lot.  In 2007, $ 41.6 billion worth of crude oil was transported to the U.S., along with $ 31.4 billion worth of natural gas, and $ 3.1 billion worth of electricity.  In 2006, Canada exported more than $91 billion in energy to the world, mostly the U.S.  Energy exports aren’t just important, but a pillar of the Canadian economy.

Canada Energy Sources to U.S.: As energy system

In many respects, Canada and the U.S. form a single energy market.  What makes Canada and the U.S. so energy-interconnected?  In a word, geography.

The vast majority of Canada’s population, and thus its energy infrastructure, is spread out on a relatively thin line along the U.S. northern border.  In many respects, it makes much more sense to speak of a series of regional transnational energy grids than two countries.  With a few exceptions, notably Newfoundland, Canadian provinces export far more energy to nearby U.S. states than to other provinces.

Take electricity.  Canada and the U.S. share an integrated electricity grid and supply almost all of each other’s electricity imports. Canada is a major supplier of electricity to New England, New York, the Upper Midwest, the Pacific Northwest and California, the majority of it clean hydroelectricity.

The two countries are becoming more interconnected, not less.  The aptly-named Montana Alberta Tie Ltd. is planning to construct transmission lines that will connect the electricity markets of Alberta and Montana.  This is notable as the first-ever merchant power transmission line between the two jurisdictions.

The $3.1 billion in electricity Canada exports to south is increasingly clean. Canada’s federal government is committed to deriving 90 per cent of Canada’s electricity from non-emitting sources by 2020.  Thus, the shared North American electricity grid will trend greenwards, to coin a phrase, regardless of U.S. policy.

Both countries are investing time and resources into wind power – already the  fastest-growing renewable energy source in the world.

Recently, Canada exceeded 2,000 megawatts of installed wind energy capacity.  Partially in response, the U.S. Department of Energy reported that wind could provide 20 per cent of the U.S.’s electricity by 2030.

Equally significant is hydropower. Using 90 per cent of hydropower, British Columbia provided $7.7 million worth of electricity to Idaho in 2007. New England, New York, the Upper Midwest, the Pacific Northwest and California, are also continuing to proactively manage their air emissions by receiving a large portion of electricity, specifically hydropower, from Canada.

Natural gas is no different.  The two countries rank first and second in worldwide natural gas production, and Canada supplies the U.S. with 82 per cent of its natural gas imports. The American appetite for natural gas, which burns much cleaner than conventional oil, is on the rise.  The only thing holding back increased trade is infrastructure, especially in the east.  Canada is developing Arctic pipelines and LNG terminals to provide more, as most Canadian natural gas exports enter the U.S. through pipelines in Idaho, Montana, North Dakota, and Minnesota.

Perhaps most encouragingly, the two countries also cooperate extensively in research and development.  Canadian companies and researchers work closely with American counterparts to develop the next generation of energy sources, such as hydrogen, solar and bioenergy, and on large-scale projects such as CO2 storage.

Two countries so inextricably linked in energy policy, production, trade, and use, are mutually dependent, for better or worse.  While presidential policies – or prime ministerial policies, for that matter – can have a significant economic impact, in the long run, the North American energy market isn’t going anywhere.

Just like the old saying goes, you can’t choose your family.  Both Canada and the U.S. are lucky to have each other as siblings.

Inching toward greener cellphones

Cell phones are evolving into green machines

Full Story [The New York Times]

All About Energy #2

Canadian Centre for Energy Information  |  February 2009  |  News Update

There’s no denying that change is in the air. In January we witnessed the groundswell of support for a new administration in the United States. President Obama’s inaugural address captured the hearts and minds of a nation. And his message on energy was clear: America needs to consume less and embrace green energy.

The morning of the inauguration, Canada’s Environment Minister Jim Prentice also set out Canada’s priorities and welcomed American re-engagement in multilateral climate change negotiations. All in an effort to engage the U.S. in pursuing coordinated energy and environmental policies.

Canada and the United States enjoy a strong energy-specific trade partnership. The magnitude of change to that relationship remains to be seen.

Featured Post  A cool billion. That’s the dollar value attached to a new Clean Energy Fund in the 2009 Budget. The federal government hopes this initiative will leverage investment in carbon capture and storage and other environmental projects.

Drilling into the Discussion  Climate change solution or just a bunch of hot air? With carbon capture a key feature of the Clean Energy Fund initiative in the federal budget we took an in depth look at the debate around carbon capture and storage.

GHG Grades  As the key provinces that power Canada’s energy engine, Alberta and Ontario came out on top with big GHG numbers while Quebec topped the PFC hit list. And utilities led all sectors. But this is one report card where low score wins.

Partner Profile  The Centre for Energy is proud to partner with the Canadian Nuclear Association. The CNA has just released an impressive new website “Nuclear Technology Exploring Possibilities”, to deliver learning resource to teachers and students.

Out and About  The Canadian Nuclear Association will host its annual conference February 25-27, 2009. Speakers will include The Honourable Brad Wall, Premier of Saskatchewan, who will speak on the topic Nuclear Industry Development in the New West. The Honourable Jack Keir, Minister, New Brunswick Department of Energy is scheduled to present Adding Nuclear Capacity in New Brunswick.

Going green a taxing experience

Canada Revenue Agency is pressing more companies to buy into “the paperless filing solution” by sending T4 and other information electronically. Its web page includes T4 web-forms and desktop applications for use in calculating totals, validating data and enabling companies to print completed slips for their employees. Don’t have an access code? Call the CRA Help Desk at 1-877-322-7849.

Employers who use management software can file up to 20 megabytes of information – equivalent to some 20,000 slips, including original and amended T4s – by using the agency’s XML Internet file transfer service.

New building has sunny disposition

If you’re in Montreal this summer and in the vicinity of the new John Molson School of Business at Concordia University, take a cue from the old CBC-TV children’s show, The Friendly Giant, and “look up, ‘waaay up”. The top two floors of one facade of the school will be clad in solar panels in what the university heralds as a world-first integration of combined solar heat and power technology into a non-residential building.

Also the largest solar-electric installation in Quebec, the Solarwall will cover 300 square metres and generate enough power for the building during the heating season. In off-peak periods, it also is designed to feed power back into the grid, potentially generating revenue for the university.

“Construction of the . . . building provided our researchers with an opportunity to integrate state-of-the-art innovative solar technology, developed right here at Concordia, into a building which will set new standards for construction,” Chancellor and Vice-President Judith Woodsworth says.

The installation was designed by the Canadian Solar Buildings Research Network which is led by Dr. Andreas Athienitis, a professor in Concordia’s department of building, civil and environmental engineering.

It was underwritten by Natural Resources Canada’s CanmetENERGY division and the Quebec energy efficiency agency with three industrial suppliers: Conserval Engineering (Solar wall), Day4Energy (photovoltaic panels) and Sustainable Energy Technologies (electronic components which converting the solar electricity for building use.)

Construction is scheduled for completion this summer, just a few weeks before classes begin in September. Visitors will be able to consult a real-time lobby display of the building’s solar energy capture and energy use.

Accounting from above

NASA is set to follow the Japanese space agency by launching its own carbon dioxide monitoring satellite

Full Story [Economist.com]

Ford jumps back into green car fray

In attempting to regain ground on the competition, Ford is aggressively re-entering the green race

Full Story [Reuters UK]

Can algae save the world – again?

Algae had played an important role in the earth’s history and scientists are hoping it can come up big again

Full Story [Reuters]

Waste not, pollute not?

Ontario residents now have fewer excuses to not recycle old batteries, solvents and other household hazardous waste with a new Do What You Can initiative inaugurated by Stewardship Ontario, the industry organization responsible for municipal Blue Box programs and the Municipal Hazardous or Special Waste (MHSW) program.

The goal is to more than double the amount of “hazardous” or “special” waste diverted from landfill over the next five years. Other targeted materials are paints, antifreeze, propane cylinders and other items which are commonly found in households but which need special care.

Consumers can check out their options, including drop-off locations, simply by entering their postal code. Locations include businesses such as RONA, Jiffy Lube and The Home Depot as well as municipal depots.

Prowling the Pumps – February 10, 2009

Canadian Gasoline Prices

Average across Canada

Another slight rise – up 1.7¢ per litre this week to 85.1¢. That gives us a cumulative price increase of 13.4¢ since the year began. In fact, we have seen price increases in five of the first six weeks of 2009. The good news is that the average price of gasoline in Canada is 19.1¢ lower now than it was one year ago.

Sizeable gains in Ontario (3.5¢ per litre), Quebec (3.2¢ per litre), New Brunswick (2.6¢ per litre) and Nova Scotia (2.9¢ per litre) were offset by a slight decrease in price in Alberta (0.3¢ per litre) and no change in price in Manitoba, Prince Edward Island, Newfoundland and Labrador, Yukon and the Northwest Territories, and only slight increases everywhere else.

Distribution of Gasoline Prices in 60 Canadian Cities
In five cities, six fewer than last week, prices were between 70¢ and 80¢ per litre; in 41 cities, two more than last week, prices were between 80¢ and 90¢; and in 13 cities, four more than last week, it higher than 90¢. In only one city were prices higher than $1.00 per litre.

Least Expensive Gasoline in Canada (per litre)

As one would expect when prices are rising everywhere but Alberta, Lethbridge, Edmonton and Lloydminster made it to the low-price five, ousting Sudbury and Edmundston. And, again as one would expect, the low-cost five aren’t as low-cost as they were a few weeks ago.

Most Expensive Gasoline in Canada (per litre)

Victoria has the cheapest gas of the pricey five, at 92.9¢ per litre, and Lloydminster has the costliest gas of the low-price five at 79.9¢ per litre, a difference of 13¢ per litre or $10.40 per 80-litre tank. But, excluding taxes, the price difference is a mere penny per litre. The other 12¢ is the difference in taxes.

As mentioned above, the average price of gasoline in Canada has risen 13.4¢ per litre since the beginning of the year, while the price of oil has been trading in a narrow range between $40 US and $50 US per barrel. In the past few days, we have seen oil dip even lower due to higher than expected storage inventories, poor economic performance and dissatisfaction with President Obama’s bailout package. Consequently, the Prowler is forecasting cheaper gasoline in the near future.

We’ll see what happens in the coming weeks.

Pricing by Province

	Last Week	This Week	Change
BC	0.904	0.910	0.006
AB	0.798	0.795	-0.003
SK	0.882	0.887	0.005
MB	0.842	0.842	0.000
ON	0.809	0.844	0.035
QC	0.858	0.890	0.032
NB	0.807	0.833	0.026
PE	0.844	0.844	0.000
NS	0.851	0.880	0.029
NL	0.935	0.935	0.000
YT	0.869	0.869	0.000
NT	1.017	1.017	0.000

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