Image Credit: Mary Altaffer/Associated Press
by Colin Robertson
CGAI Vice-President and Fellow
Table of Contents
- Clinton or Trump: Canada’s Energy Relations with the US
- Energy, Environment, and Climate in the Campaign
- Clinton and Trump on Energy, Environment and Climate
- What We Are Doing Now
- Advancing Canadian Interests after November 8
- About the Author
- Canadian Global Affairs Institute
Energy, the environment, and climate change will figure prominently in Canada-US relations after January 20, 2017. The environmental movement will continue to press for ‘environmental justice’ –which means different things to different groups - in alignment with allies, especially indigenous peoples. Regardless of whether it is a Clinton or Trump presidency, Canadian leadership - provincial, federal, and private sector - must pro-actively advance our interests with Congress, the Administration and its agencies, and with state governments.
Both Hillary Clinton and Donald Trump plan to spend a lot of money on infrastructure, including that related to energy. US business likes this idea. A majority of Republicans and Democrats, in both the Senate and House, as well as governors, would like more money devoted to infrastructure. Again, there will be opportunities for collaboration, improving North America’s relative competitiveness.
Trade figured prominently throughout the campaign with Hillary Clinton stating that she would not accept the Trans-Pacific Partnership (TPP) in its current form and would appoint a ‘Trade Prosecutor’. Donald Trump has declared he will “tear up” the North American Free Trade Agreement (NAFTA) and not sign the TPP. Regardless of who becomes president, we can expect more US protectionist trade action whether aimed directly at Canada - levies on softwood lumber are coming soon - or indirectly, as we recently experienced on aluminum when the US took aim at China.
On foreign and security policy, Donald Trump condemned the Obama/Clinton handling of the Middle East, accusing them of creating ISIS and signing the worst deal possible with Iran. Hillary Clinton criticized Donald Trump’s association with Russian President Vladimir Putin. Both candidates have also said that they expect the Allies to do more in defence ‘burden-sharing’. This means that NATO members will be expected to meet the commitment of 2 percent of their GDP devoted to defence spending. Canada is currently at .98 percent, one of the lowest in the Alliance. Canada did not feature in the three presidential debates beyond a reference by Mr. Trump to Canada’s health care system as being “so slow it’s catastrophic in certain ways.”
While presidential elections focus on the nominee’s personalities and personal baggage, this election has often appeared more like Keeping up with the Kardashians with a dash of House of Cards than The West Wing. The campaign lifted Saturday Night Live ratings to new heights. For Donald Trump it has been about his taxes, the ‘grab ‘em’’ Access Hollywood tape, his claim that the election is rigged and his refusal to say whether he will accept the results if he loses. For Hillary Clinton, it is her emails whether released through the State Department or leaked by WikiLeaks (courtesy of the Russians), her health, contributions to the Clinton Foundation, and now the renewed FBI investigation into her emails.
But as many pundits observed, it was a historically ugly presidential campaign and the final New York Times/CBS News Poll of the campaign concluded that an “overwhelming majority of voters are disgusted by the state of American politics, and many harbor doubts that either major-party nominee can unite the country.”
There was surprisingly little discussion of climate change despite Bernie Sanders saying in the Democratic primary debates that climate change was the biggest challenge facing America. In the Clinton-Trump presidential debates, concerns about climate change, and ideas on what to do about it were minimal.
In the third debate, audience member Ken Bone asked: “What step will your energy policy take to meet our energy needs while at the same time remaining environmentally friendly and minimizing job loss for fossil power plant;workers?”. In response, Donald Trump touted “clean coal” and bashed what he described as President Barack Obama's ‘war on energy’ while Secretary Clinton promoted hydraulic fracturing (“fracking”) for natural gas as a “bridge” to renewable fuels. She also cited climate change as a “serious problem” and said that she wants to make sure we don't leave people behind.
Barack Obama and John McCain sparred over their cap and trade plans to tax pollution. Mitt Romney accused Barack Obama of promising “to slow the rise of the oceans…and to heal the planet” but later Mr. Romney moderated his stance in acknowledging global warming. As President Barack Obama was a ‘green’ advocate, notably implementing higher national fuel efficiency standards for cars and trucks in 2009, which were also applied in tandem by the Harper Government. More actions followed, including the Clean Power Plan in 2015 and in 2016 with the ratification of the Paris Climate Accord and its commitments stretching over future years.
The Keystone XL Pipeline permit debate dogged Canada-US relations throughout the Obama administration and contributed to an appearance of personal animosity between Prime Minister Harper and President Obama. Mr. Trump has promised to approve the XL presidential permit in exchange for a share of its profits. “I want it built, but I want a piece of the profits. That's how we're going to make our country rich again". Hillary Clinton opposed Keystone XL during the 2016 campaign. As Secretary of State, however, she gave the initial XL application the environmental green light. As she told a California audience in 2010: “we are inclined to do so, and we are for several reasons -- going back to one of your original questions -- we're either going to be dependent on dirty oil from the Gulf or dirty oil from Canada…until we can get our act together as a country and figure out that clean, renewable energy is in both our economic interests and the interests of our planet.”
Reflecting in January on the environment and climate, Hillary Clinton said “climate change is real—no matter what climate deniers say. I've laid out bold national goals to address the threats it poses. As president, I’ll say no to drilling in the Arctic. I’ll stop the tax giveaways to big oil and gas companies. And I’ll make significant investments in clean energy. Our children's health and future depend on it.”
Secretary Clinton promises to deliver on the pledge President Obama made at the Paris climate conference, “without relying on climate deniers in Congress to pass new legislation.” She promises to reduce greenhouse gas emissions by up to 30 percent in 2025 relative to 2005 levels and put the country on a path to cut emissions more than 80 percent by 2050.
As president, she promises on day one to “set bold, national goals that will be achieved within 10 years of taking office” that will:
- generate enough renewable energy to power every home in America, with half a billion solar panels installed by the end of Hillary’s first term;
- cut energy waste in American homes, schools, hospitals and offices by a third and make American manufacturing the cleanest and most efficient in the world; and
- reduce American oil consumption by a third through cleaner fuels and more efficient cars, boilers, ships, and trucks.”
As president, she also promises to:
- Defend, implement, and extend smart pollution and efficiency standards, including the Clean Power Plan and standards for cars, trucks, and appliances that are already helping clean our air, save families money, and fight climate change.
- Launch a $60 billion Clean Energy Challenge to partner with states, cities, and rural communities to cut carbon pollution and expand clean energy, including for low-income families (read the fact sheet here).
- Invest in clean energy infrastructure, innovation, manufacturing and workforce development to make the US economy more competitive and create good-paying jobs and careers (read the fact sheet here).
- Ensure safe and responsible energy production. As we transition to a clean energy economy, we must ensure that the fossil fuel production taking place today is safe and responsible and that areas too sensitive for energy production are taken off the table (read the fact sheet here).
- Reform leasing and expand clean energy production on public lands and waters tenfold within a decade.
- Cut the billions of wasteful tax subsidies oil and gas companies have enjoyed for too long and invest in clean energy.
- Cut methane emissions across the economy and put in place strong standards for reducing leaks from both new and existing sources.
- Revitalize coal communities by supporting locally-driven priorities and make them an engine of US economic growth in the 21st century, as they have been for generations (read the fact sheet here).
- Make environmental justice and climate justice central priorities by setting bold national goals to eliminate lead poisoning within five years, clean up the more than 450,000 toxic brownfield sites across the country, expand solar and energy efficiency solutions in low-income communities, and create an Environmental and Climate Justice Task Force (read the fact sheet here).
- Promote conservation and collaborative stewardship. Hillary will keep public lands public, strengthen protections for our natural and cultural resources, increase access to parks and public lands for all Americans, as well as harness the immense economic potential they offer through expanded renewable energy production, a high quality of life, and a thriving outdoor economy (read the fact sheet here).
Secretary Clinton also promises to make “the biggest investment in American infrastructure in decades, including establishing an infrastructure bank” that draws from the private sector. Her website describes her plan, with a promised investment of $275 billion, as follows:
- Repair and expand our roads and bridges. Hillary will make smart investments to improve our roads, reduce congestion, and slash the “pothole tax” that drivers silently pay each and every day.
- Lower transportation costs and unlock economic opportunity by expanding public transit options. Hillary will encourage local governments to work with low-income communities to ensure unemployed and underemployed Americans are connected to good jobs.
- Connect all Americans to the internet. Hillary will work to ensure that by 2020, 100 percent of households in America will have access to affordable broadband. She will also invest new resources in bringing free Wi-Fi to public buildings and public transportation.
- Invest in building world-class American airports and modernize our national airspace system. These investments will reduce carbon emissions and save travelers and airlines an estimated $100 billion in avoided delays over the next 15 years.
- Build energy infrastructure for the 21st century. We can unlock America’s clean energy potential by modernizing infrastructure like dams, levees, and wastewater systems—saving billions of gallons of clean drinking water and generating clean energy.
Secretary Clinton’s Vision for Modernizing North American Energy Infrastructure offers a lot of scope for collaboration with Canada around pipeline modernization, rail safety, grid security, and a public-private infrastructure investment facility. Specifically, it promises to:
- Repair or replace thousands of miles of outdated pipelines to improve safety and reduce methane leaks by the end of her first term in office.
- Improve pipeline regulations, including instituting automatic or remote-controlled shut-off valves and leak detection standards that have been recommended by the National Transportation Safety Board.
- Work to close the loophole that allows companies to ship oil sands crude without paying into the Oil Spill Liability Trust Fund.
- Accelerate the phase-out of outdated tank cars that create the greatest safety risk and make information on companies’ progress available to the general public. Ensure rail regulations are strengthened and enforced within the United States and across the US-Canada border.
- Instruct the Department of Transportation to guarantee that first responders and the public have better information on oil and hazardous materials passing through their communities.
- Partner with rail companies in aggressively repairing track defects that cause derailments and evaluate whether shale oil presents unique explosion risks.
- Create a Presidential Threat Assessment and Response Team to improve coordination across federal agencies and strengthen collaboration with state and local officials and the electric power industry in assessing and addressing cybersecurity threats.
- Implement a cybersecurity strategy that integrates and protects the expanded use of distributed energy resources and other cutting-edge clean energy technologies.
- Provide new tools and resources to states, cities and rural communities to make the investments necessary to improve grid resilience to both cyber-attack and extreme weather events.
- A National Infrastructure Bank: Establish a National Infrastructure Bank to leverage public and private capital to invest in critically important infrastructure projects, including energy infrastructure projects.
- Challenge Grants: Award competitive grants through Clinton’s Clean Energy Challenge to states, cities and rural communities that take the lead in reducing carbon pollution by investing in renewable energy, nuclear power and carbon capture and sequestration, and reducing energy costs by investing in efficiency in both new and existing buildings.
- Accelerating Investment: Ensure the federal government is a partner in getting clean and affordable energy to market by making the infrastructure review and permitting process more efficient and effective.
- Expanding Consumer Choice: Offer financing tools for grid investments that support the integration of distributed energy resources and for gas pipeline investments that enable households and businesses to switch away from heating oil and other petroleum products.
- A New “Pipeline Partnership”: Help cities, states, and rural communities repair and replace thousands of miles of pipelines by leveraging big data, predictive analytics and innovative testing procedures to more quickly and effectively find and fix pipeline leaks through a public-private partnership between federal regulators, pipeline companies, local utility commissions and leading technology providers and research institutions.
- Transportation Funding: Work with Congress to close corporate tax loopholes and increase investment in transportation solutions that expand transit access and reduce commute times, oil consumption, and pollution.
- Innovation: Increase public investment in clean energy R&D, including in storage technology, designed materials, advanced nuclear, and carbon capture and sequestration. Expand successful innovation initiatives, like ARPA-e, and cut those that fail to deliver results.
Secretary Clinton also promises a North American energy compact based on the following principles:
- Ambitious Targets: Drive greater ambition in the global fight against climate change through coordinated targets for clean energy and cutting carbon pollution, internationally recognized reporting mechanisms, and a binding review process.
- Clean Power Markets: Build on the momentum created by the Clean Power Plan, which sets the first national limits on carbon pollution from the energy sector, and regional emissions trading schemes in Canada, Mexico, and the United States to drive low carbon power generation across the continent, modernize our interconnected electrical grid, and ensure that national carbon policies take advantage of integrated markets.
- Clean Transportation: Work to harmonize vehicle efficiency, emissions and fuel standards, strategies for electric vehicle deployment, clean freight and logistics, and other low-carbon transportation solutions.
- Methane Management: Establish continent-wide methane emissions reduction targets and coordinated strategies for reducing leaks from both new and existing sources.
- Infrastructure Standards: Develop common, world-class standards for North American infrastructure that create good jobs and careers, support prevailing wage and project labor agreements, and ensure energy transportation across the continent is clean, safe, reliable and affordable.
Again, there is a lot here for Canadian involvement as much of it builds on existing collaboration.
Hillary Clinton is also expected to use presidential executive authorities, that have been stretched by both Presidents George W. Bush and Barack Obama, to enact environmental and climate change policies through rulemaking by the Environmental Protection Agency. Assuming she can get Senate consent for her Supreme Court nominees, her exercise of presidential powers will likely be sustained in face of the inevitable constitutional challenges.
Donald Trump’s website, ‘Make American Great Again’, does not include sections on the environment or climate change but does on energy, where he describes his positions as follows:
- Make America energy independent, create millions of new jobs, and protect clean air and clean water. We will conserve our natural habitats, reserves and resources. We will unleash an energy revolution that will bring vast new wealth to our country.
- Declare American energy dominance a strategic economic and foreign policy goal of the United States.
- Unleash America’s $50 trillion in untapped shale, oil, and natural gas reserves, plus hundreds of years in clean coal reserves.
- Become, and stay, totally independent of any need to import energy from the OPEC cartel or any nations hostile to our interests.
- Open onshore and offshore leasing on federal lands, eliminate moratorium on coal leasing, and open shale energy deposits.
- Encourage the use of natural gas and other American energy resources that will both reduce emissions but also reduce the price of energy and increase our economic output.
- Rescind all job-destroying Obama executive actions. Mr. Trump will reduce and eliminate all barriers to responsible energy production, creating at least a half million jobs a year, $30 billion in higher wages, and cheaper energy.”
- Read Donald J. Trump’s 100-Day Action Plan, here. Read Mr. Trump's Remarks at theShale Insight Event and at theWilliston Basin Petroleum Conference.
Mr. Trump has evolved from a view that America, with its own resources, can become completely oil self-sufficient to the position of making the US free of OPEC oil and oil from other hostile interests. This reflects the more mainstream Republican perspective. Mr. Trump’s leading energy advisor is North Dakota Republican Representative Kevin Cramer who is also co-chair (along with New York Democrat Representative Bill Owens) of the Northern Border Caucus. Rep. Cramer has said he favours a small carbon tax.
The regular meetings of North American energy ministers, which were re-invigorated in 2014 after the North American Leaders summit, have been a positive development.
The Energy Ministers’ mandate is to promote continental energy security, integration, and collaboration; strengthen government-to-government relationships; and support business-to-business engagement in the energy sector.
Since 2014 the Energy Ministers have focussed on: North American energy public data; statistics and mapping collaboration; responsible and sustainable best practices for the development of unconventional oil and natural gas; and modern, resilient energy infrastructure for North America in all aspects - physical infrastructure as well as institutional infrastructure such as policies, regulations, workforce, innovation, practices to promote energy efficient goods and services, and sustainable technologies.
All three nations’ websites now contain uniform information relating to:
- the first suite of static and interactive North American energy infrastructure maps;
- a combined North American energy outlook;
- data tables and methodological guides to allow for the comparison of energy trade between the three countries; and
- a glossary of terms and definitions available in each country’s official languages.
At their meeting in Winnipeg in February 2016, the ministers agreed, and Leaders endorsed at the June 2016 summit in Ottawa:
- sharing experience and knowledge in the development of reliable, resilient and low-carbon electricity grids;
- modeling, deploying and accelerating innovation of clean energy technologies, including renewables;
- exchanging information in order to improve energy efficiency for equipment, appliances, industries and buildings, including energy management systems;
- exchanging information and promoting joint action to advance the deployment of carbon capture, use and storage;
- identifying trilateral activities to further climate change adaptation and resilience; and
- sharing best practices and seeking methods to reduce emissions from the oil and gas sector, including methane and black carbon.
At their March summit in Washington, Prime Minister Trudeau and President Obama agreed to a to a 40 to 45 percent reduction in methane emissions, over 2012 levels, by 2025. In October, Mr. Trudeau promised that the price on carbon pollution should start at a minimum of $10 per tonne in 2018, rising by $10 each year to $50 per tonne in 2022. While Mr. Trudeau left to the provinces the method of implementation, Canadian industry would face a competitive disadvantage if the US did not impose a carbon price. Neither Mr. Trump nor Secretary Clinton has promised a national carbon price.
Mr. Trump has also promised to reverse (without much definition) the Obama administration’s approach on climate. If this meant, for example, abandoning the methane reduction target, again, Canada would be placed at a competitive disadvantage given our economic integration. It will be important to get an early read on the policy direction of the new Administration and the legislative goals of the new Congress.
Canadian governments and business need to reach out to the new Administration, Congress and state governments and legislatures and underline the importance of sustaining an integrated North American (including Mexico) approach to climate, energy and the environment. The Canadian approach should be finding common ground that serves and advances the agenda of the new Administration. It should start with security and defence – on which every President begins his day with a briefing – by putting North American energy independence and climate change (with rising sea levels, drought, natural disasters) into this security framework.
Finding common ground on a North American strategy will inevitably allow us to integrate into the framework items such as the permitting of transmission lines and pipelines but it should not be our first ask or we risk falling into what former Secretary of State Condi Rice described as the Canadian penchant to focus on “condominium issues”.
As a first step, the North American leaders should re-endorse the regular meetings of the Energy Ministers because they have become an excellent catalyst for practical action.
The domestic challenge for governments in Canada and the US will continue to come from environmental groups pressing for ‘environmental justice’ and a quicker exit from our dependence on fossil fuels. Environmental justice means different things to different groups. Secretary Clinton uses the term but her interpretation is not that of those groups, that at heart are off fossil fuels. They will never support fossil fuel infrastructure. In her private conversations, according to material released by Wikileaks, Secretary Clinton comes across as a pragmatist. She told, for example, labor unionists that she was at odds with the “most organized and wildest” of the environmental groups saying that they came to her rallies pressing her to “promise never to take any fossil fuels out of the earth ever again?' No. I won't promise that. Get a life, you know."
The environmental movement is increasing aligning itself with other allies, especially indigenous peoples and anti-poverty groups. Their objective will be to make the kind of protest movement witnessed in North Dakota around the Dakota Access pipeline the norm in both the US and Canada. With proposed new pipelines to tidewater and long cross-border transmission lines, Canada has much at stake.
Americans policy makers are watching the oil pipeline permitting process in Canada. While in opposition, the Trudeau Liberals opposed the Enbridge Northern Gateway permit granted by Harper Government that was subsequently thrown out by the Federal Court of Appeal in June 2016 for its failure to adequately consult aboriginal communities. In May 2016, the National Energy Board recommended the approval of Morgan's TransMountain Expansion as long as certain conditions were met. The panel appointed to look into the project raised a series of questions relating to aboriginal rights, the environment, Canada’s climate change plans, and Mr. Trudeau’s 2015 campaign promise that suggested local communities hold vetoes over major projects. The Trudeau Government has promised to make a decision before Christmas.
If the Trudeau government is not inclined to permit new arterial pipelines to Canadian coasts then why would there be an inclination to grant, for example, a renewed Keystone XL permit? As President Barack Obama once observed (wrongly) of the KXL pipeline “"Understand what this project is. It is providing the ability of Canada to pump their oil, send it through our land, down to the Gulf, where it will be sold everywhere else. That doesn't have an impact on U.S. gas prices." Notwithstanding the evidence that pipelines are a secure method of transportation they have become the symbolic face of the fossil fuel industry.
A Clinton administration would want to find common ground early with the new Congress to demonstrate it can govern. Secretary Clinton’s infrastructure program to increase US competitiveness and create jobs is a likely prospect having already been discussed by Speaker Paul Ryan and the likely new Democrat leader in the Senate, Chuck Schumer of New York. Energy independence will figure into this discussion. This would be another way to advance Canadian interests around permitting for pipelines and hydro-transmission lines. By involving the states, we could also advance recognition of, for example, big hydro projects under state renewable energy standards.
We need advocacy material that informs and explains the Canadian position and identifies the intersections with American interests. The objective should be to inform and build support in the US as well as Canada for sustainable energy collaboration.
This approach would also help address Canadian concerns. Royal Bank of Canada CEO Dave McKay recently observed that Canadians are polarized about resource development “when we should be focused on how cleanly we can produce it, how safely we can transport it, and how wisely we can consume it.” Canadian leadership needs to recognize and inform Canadians, that when responsibly harvested, our resources, including oil and gas, are our national inheritance. If we leave our products in the ground and don’t build the infrastructure to get it to market, governments will need to tax other sectors to make up for lost revenue.
This material should be developed in tandem with industry associations, notably CAPP, that have done a lot of advocacy work. The provinces and environmental groups will also have views. Our Washington Embassy and US consulates can offer lessons learned from the earlier advocacy campaign, conducted by the Harper government, around the oil sands and KXL pipeline.
On almost every issue with the US, we can always identify American partners. In advancing Canadian positions our success rate rises proportionately with the ability to make them congruent with American positions.
To achieve success means constant engagement at all levels through a thousand points of contact. These should include Canadian legislators participation in the Council of State Legislators regional conferences, Canadian premiers meeting with their count counterpart governors in the West, the Great Lakes and in the Atlantic/New England. Much good work has been accomplished by regional associations like the Pacific North West Economic Region (PNWER) and the Council of the Great Lakes Region. There are a host of cross-border business groups including the Canadian American Business Council, Canadian American Border Trade Alliance and sectoral groups like the North American Strategy for Competitiveness (NASCO). The Wilson Center’s Canada Institute does excellent work and the Bush Institute has compiled a handy scorecard on North American competitiveness. There are various regular forums looking at North American energy cooperation, notably the Vail Global Energy Forum. To the extent practical, we should also work with labour unions, environmental groups and First Nations.
Telling the Canadian story means using the tools of social media with facts and science-based evidence. Elements in the Canadian storyline would include:
- fossil fuels and big hydro projects will be part of our energy mix for decades to come;
- the role that the oil sands, pipelines and big hydro projects play in North American energy independence;
- the innovative work of Canadian Oil Sands Innovation Alliance (COSIA) in reducing the oil industry’s land and carbon footprint and water usage – innovative technology that has application globally;
- responsible energy development accords, developed through compromise and consensus (but consensus is not unanimity), that work for indigenous people and environmentalists and contribute to jobs and prosperity; and
- Canada’s approach to carbon pricing (tax, levy or cap and trade) and how these fit into our international climate change obligations.
Dealing with Congress, the Administration and the states means playing by American rules, including using lobbyists and lawyers. While the Administration is our best portal into the US process, Congress and state legislatures are the battlefields.
Nor can we ever forget that advancing Canadian interests in the US is a permanent campaign.
A former Canadian diplomat, Colin Robertson is Vice President and Fellow at the Canadian Global Affairs Institute and Executive Fellow at the University of Calgary's School of Public Policy. He is Senior Advisor to Dentons LLP working with the Business Council of Canada. He is a Distinguished Senior Fellow at the Norman Paterson School of International Affairs at Carleton University. He is a member of the advisory councils of the Conference of Defence Associations Institute and the North American Research Partnership and participant in the North American Forum. He is a past president of the National Capital Branch of the Canadian International Council. He is an Honorary Captain (Royal Canadian Navy) assigned to the Strategic Communications Directorate. He writes a column every two weeks on international affairs for the Globe and Mail and he is a regular contributor to other media.
Contact: [email protected]
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