Why, indeed, should Canada be an energy superpower?
David Detomasi is a professor and distinguished faculty fellow in international business at the Smith School of Business at Queen’s University. He is the author of Profits and Power: Navigating the Politics and Geopolitics of Oil.
There has been much confident talk about making Canada into an “energy superpower.” Two prime ministers – Conservative Stephen Harper and Liberal Mark Carney – have in living memory uttered that phrase.
Canada has that capability. It is the world’s fourth biggest producer of oil and fifth biggest producer of natural gas. The country also has a full range of other energy sources: Hydro, geothermal, wind and solar are growing in importance, and a nuclear renaissance is on the horizon.
Energy generates jobs, income and growth – all currently in short supply. Supporting energy projects helps todevelopspecialized world-class finance and service capabilities that have export potential. Moreover, building energy infrastructure networks through pipelines and enhanced port and rail capacity generates lasting economic benefits.
So why hasn’t Canada done what is required to become a full energy superpower? Because large parts of the country have either not wanted to or were unwilling to accept what it takes to become one. And therein is the real problem: This country needs a compelling narrative for becoming an energy superpower, which we do not yet have.
The sticking point is simple. For Canada, this transformation would require more mining and increased oil and gas production. However, a large segment of the Canadian electorate – the one that propelled Justin Trudeau to three election victories – has not wanted to do that. Indeed, they deemed it morally wrong to even propose, let alone do.
Those sentiments may be dormant now, muted by our nationalist reaction to a threatening U.S. President. But Donald Trump’s time will end, and surging Canadian economic nationalism may fade with his exit. When it does, opposition to oil and gas expansion will likely arise again, and with it, more barriers, delays and consequent unachieved ambition.
Creating an energy superpower will be the work of a decade or more. For it to stick through variations in public sentiment, the goal requires anchoring in something beyond “more is better.” What are the purposes toward which that strength is put? What additional good things could be achieved by Canada gaining energy superpower status, and what undesirable things could be slowed or prevented?
The former list is long. If coupled with export infrastructure, more energy production would support Canada’s allies. Exported Canadian energy comes without the political strings that other suppliers sometimes attach, and builds international goodwill. It would also enhance national unity by quelling separatist sentiment in Western Canada.
The latter list is also long. Most Canadians likely oppose the use of child labour in foreign lithium mines, and the often-abysmal environmental and labour standards in which they toil. They also likely oppose the funnelling of resource revenue into terrorists’ or dictators’ hands that funds aggression against our friends and allies. Limiting coal consumption in emerging markets by substituting it with Canadian natural gas generates environmental gains.
Alleviating the absolute energy poverty in which two billion of the world’s people continue to live seems to be a worthy goal, as is increasing the economic prospects of Canada’s Indigenous peoples. We also do not like bullies who use energy production as a cudgel. Canadians should achieve energy superpower status because it would help those needing it while giving pause to the strong.
Moreover, we have laid the groundwork to do it. Over the past decade, Canadian business headlines focused on such things as sustainable finance and ESG, which for many investors, meant less or no capital provided for oil, gas or mining. Today, those restraints are lifting as Canada manages relations with Mr. Trump, frets over languishing productivity, and navigates a geopolitically unstable world. Ethically financed Canadian energy can help stabilize our foreign relations while also improving our economy.
The term “superpower” is a Cold-War leftover. At the time, the contenders built and used power to present a vision of what their leadership would be like. However imperfectly fought, the Western alliance won because its vision proved more compelling and its strength more enduring. It combined power and purpose.
Canada can craft a similarly compelling “why” for achieving energy superpower status. To last, that “why” needs to be based on the moral, as well as the economic, gains to be had. Countries will continue to rely on oil, gas and mining: Canada can influence how those activities are done. Moreover, the strength generated by our own energy production can help build a world Canada wants and that voters could consistently support.
Otherwise, two decades from now, another Canadian prime minister will again utter the same phrase, and historians will wonder why we let the moment pass in 2025.
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