Ottawa (September 27, 2018) – The Honourable Sergio Marchi, President and CEO of CEA, issued the following statement on the report from industry leaders:
“The Canadian Electricity Association (CEA) warmly welcomes the recommendations provided by the report of the Resources of the Future Strategy Table which was released on September 25th. The report is both valuable and timely. Moreover, the proposals issued by industry leaders are closely aligned with those that the CEA has long promoted with the Federal Government. I am grateful for the clarity and vision that the authors of the report employed.
Recommendations include:
- the need to modernize and streamline Canada’s regulatory system;
- the requirement to create a culture of innovation;
- the imperative to attract a skilled workforce;
- the priority of focusing funding around strategic infrastructure projects; and
- and the need to sharpen our country’s competitiveness, particularly as it relates to the United States.
CEA now asks that the Government move with urgency in ensuring that these recommendations are put into action. Not only does the economic climate require the renewal that these recommendations will generate, but they will also complement and provide for a useful framework for the Fall Economic Statement and Budget 2019, that the government will soon issue. Both public and private sector leaders must work in a meaningful partnership, if we are to successfully and strategically harness Canada’s energy resources and create a vibrant economy that works for all Canadians, in all regions of our country.”
Key Highlights of Alignment between the Resources Table Report (RTR) and CEA
- Modernize and streamline Canada’s regulatory system
RTR: “Either through a pilot or by taking a phased approach, establish a new regulatory path for electric utilities to encourage investment in innovations that reduce greenhouse gas emissions, expand renewable energy options and move the Canadian economy to clean electrification”.
Addressing regulatory impediments to energy development should be a key focus of the federal government. CEA has advocated for the lightening of the regulatory burden. Moreover, after factoring in provincial and territorial legislative and regulatory initiatives, the “cumulative regulatory pancaking” becomes dangerously heavy. Yet, no level of government is responsible nor accountable for this overall patch of regulations. This must change. The 14 levels of government must be aware of the cumulative impact and coordinate their actions, especially since our sector must ‘eat’ and pay for all these ‘regulatory pancakes’, and then pass the cost on to the consumers.
- Promote an Innovative Landscape
RTR: “Catalyze a vibrant innovation ecosystem that enables accelerated development and adoption of game-changing technologies so Canadian firms are a competitive force in a rapidly changing global environment.”
CEA promotes a culture of innovation and opened Canada’s first electricity Centre of Excellence in 2018. While promoting innovation within the sector is important, CEA members are caught in an “innovation gap” where governments are encouraging utilities to innovate, while regulators on the altar of keeping costs low, are routinely rejecting members’ innovation pilot applications. The legislative and regulatory arms must be synced.
- Smart Grid Deployment
RTR: “Canada’s renewable electricity generation capacity coupled with natural-gas-powered electricity generation can provide the entire country with the net cleanest electricity in the world with the right east-west infrastructure and Smart Grid deployment.”
CEA has been advocating for further investments in infrastructure and innovation support mechanisms to ensure the deployment of Smart Grid technology. Natural Resources Canada has confirmed that several innovation and clean energy infrastructure programs are oversubscribed. CEA has therefore asked for their recapitalization in our pre-budget submission for Budget 2019.
- Attracting and Re-Skilling Talent
RTR: “Attract new entrants into resource sectors, re-skill existing workers and create highly-skilled trades and science, technology, engineering and mathematics opportunities for youth.”
CEA established a member-based Human Resources Committee, which meets regularly to share best practices, challenges and opportunities with respect to talent attraction and retention and skills development and training. The establishment of apprenticeship programs and training centers have assisted in filling the trade talent pipeline in response to the retirement surge that has been experienced over the past several years and training and re-training will continue to be a priority as the sector deploys smart advanced infrastructure. Electric utilities are partnering with universities and colleges to develop, courses and curriculum for the new generation of electrical workers.
- Carbon Capture and Storage Development
RTR: “Canada’s oil and gas sector has two out of the world’s 15 carbon capture and storage (CCS) projects. CCS has the opportunity to decrease emissions by 20% globally, and the percentage can increase significantly with commercialization and adoption of utilization technologies.”
In fact, the electricity sector is also pursuing CCS projects. One example that has received worldwide recognition is SaskPower’s Boundary Dam Power Station, the world’s first commercial-scale carbon capture facility. The aging unit was replaced with a reliable, long-term producer of 120 megawatts of base-load electricity and can reduce greenhouse gas emissions by up to one million tonnes of CO2.
- Growing International Exports
RTR: “Canada will grow its annual natural resource exports to $350 billion through innovation, decarbonization, agile regulations, infrastructure, talent and inclusion… The Tables has set an ambitious exports growth target as the primary outcome of implementing the proposals put forward by the table.”
Canada is running a healthy surplus when it comes to electricity trade with the US. Some 30 U.S. States import clean Canadian electricity. There are 35 transmission line corridors across our border, with another 7 that are in various stages of development.
- Strategic Infrastructure Renewal
RTR: “A Canadian Strategic Infrastructure Plan will create focus around funding and tracking of strategic infrastructure projects, rather than the current approach of funding them on an ad-hoc or first-come basis.”
In 2018, seven of the top 10 largest infrastructure projects come from the electricity sector, totaling over $68 billion in capital investment. This has been consistently the case for the last number of years. Moreover, our members are currently investing some $20 billion annually towards renewing our aging infrastructure.
- Bill C-69
RTR: “Pilot the process outlined in Bill C-69 to give project proponents certainty on how to advance key projects; particularly, develop comprehensive, one-time science-based regional impact assessments, setting standards and resolution mechanisms for consultation”
CEA supports the government's expressed intention of Bill C-69 which is to improve the environmental and regulatory system for resource and infrastructure projects. However, lack of predictable timelines, cost implications and clarity of regulation is detrimental to Canada’s competitiveness.
The layering of complex and overlapping regulation adds costs and uncertainty that can discourage new investment. To achieve intended outcomes, Bill C-69 must establish greater predictability, clarity and feasibility of the scope of application and timelines for review and enable projects to get built once project approval is delivered, under known or predictable terms and conditions. In this regard, we have asked the Senate to make the appropriate amendments.
- Competitiveness
RTR: “Without an environment that fosters innovation and accelerates adoption of advanced technologies, the resource sectors will not be able to meet the changing expectations of the global markets. To capture growing resource opportunities, Canada must be poised to compete in changing global markets that will reward firms that are clean, digital, innovative, agile and cost-competitive.”
Canada’s business sectors, from banking and manufacturing, to energy and natural resources, are united in expressing concerns regarding the current Canadian investment climate.
These concerns stem, in part, from a growing divide with our biggest competitor for investment dollars, the United States, and specifically two increasing competitive gaps: a less attractive tax environment in Canada, and an increasingly complex and uncertain regulatory process for approving large capital projects in the country. This climate is also exacerbated by the uncertainty surrounding the NAFTA negotiations, and the imposition of various U.S. trade protectionist measures. The Government of Canada must ensure that the electricity sector, and our national economy in general, remains competitive.
About the Canadian Electricity Association:
Canadian Electricity Association (CEA) members generate, transmit and distribute electrical energy to industrial, commercial, residential and institutional customers across Canada every day. From vertically integrated electric utilities, independent power producers, transmission and distribution companies, to power marketers, to the manufacturers and suppliers of materials, technology and services that keep the industry running smoothly -- all are represented by this national industry association.
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For additional information:
Mouktar Abdillahi
Manager, Media and Events
Tel.: 613 688 2954
Email: abdillahi@electricity.ca