In pursuit of common energy ground between Alberta and B.C.
Conflict between B.C. Premier Christy Clark and Alberta Premier Alison Redford over the proposed Northern Gateway pipeline to the West Coast is not in the long-range interests of either province and needs to be resolved.
In July, Ms. Clark laid down five conditions for considering support of the project, including a provision that B.C. must receive a “fair share” of the fiscal and economic benefits. Ms. Redford’s response was immediate and negative and seemed to assume that B.C. was seeking a share of Alberta’s oil royalties, even though this was not the case.
Since the Alberta Premier has been seeking to take the lead in developing a “national energy strategy,” it’s in her interests to take the initiative in negotiating a resolution to this dispute with British Columbia. Otherwise, the question rightly arises: “How can you lead the development of a national energy strategy – which involves finding common ground on the energy front among 10 provincial governments, three territorial governments, the federal government and the private sector – if you can’t find common energy ground with your sister province of B.C.?”
In seeking to reconcile the interests of Alberta and B.C. on the energy front, there needs to be a renewed commitment on the part of both provinces to the spirit and the letter of the Trade, Investment and Labour Mobility Agreement (TILMA) negotiated by Alberta’s Ralph Klein and B.C.’s Gordon Campbell. Under this agreement, both provinces pledged to reduce and eliminate trade barriers between them rather than to increase them. Under Section 15(2), the two provinces agree to “promote enhanced inter-jurisdictional trade in energy,” and Part IV details a formal dispute resolution procedure.
Since the original negotiation of TILMA in 2006, Saskatchewan has also become a party to this interprovincial free-trade agreement now called the New West Partnership. Since Premier Brad Wall is more experienced in government and energy matters than both Ms. Clark and Ms. Redford, would it not be worthwhile to invite him to play a mediating role?
Finally, in seeking to find common energy ground between Alberta and B.C., there might be merit in broadening the discussion to consider electricity generation. Electric utility experts have long argued that a greater integration of B.C.’s hydro generation with Alberta’s thermal generation could significantly lower the electricity rates in both provinces and further strengthen export possibilities.
In addition, such a broadening of the energy discussion would require B.C. to take into account Alberta’s concerns about the future development of another huge hydro dam proposed by B.C. Hydro for Site C on the Peace River. With respect to the Site C development, the positions of the provinces are somewhat the reverse of what they are with respect to the Gateway project. In the case of Site C, B.C. will benefit economically from the project and Alberta will suffer the negative downstream impact on the environment and aboriginal peoples.
Would B.C. be willing to grant Alberta a fair share of the fiscal and economic benefits from Site C if Alberta would be willing to do likewise with respect to Gateway? Or if in B.C.’s estimation that the negative effects of Gateway on the environment and aboriginals are so serious as to justify not proceeding with the project, would B.C. accept a similar judgment from Alberta with respect to Site C?
Important considerations deserving of frank and open discussion, negotiation and mediation between two great provinces that stand to benefit much more from the reconciliation of their conflicting interests than they do from their perpetuation.
This column was published by the Globe and Mail on October 5, 2012