Canadian Manufacturing

Energy transition will be difficult due to regulatory hurdles, analysts say

Experts have suggested that Canada will have to double, perhaps even triple, the size of its electricity grid by 2050 in order to meet its net-zero goals.

April 19, 2022   The Canadian Press

From carbon capture and hydrogen development to the accelerated rollout of wind and solar power and rapid electrification of transportation systems, the federal government has laid out an ambitious roadmap to get Canada to its climate target of cutting emissions by 40 per cent below 2005 levels by 2030, and net-zero emissions by 2050.

But overhauling this country’s entire energy infrastructure in a short amount of time represents an unprecedented technical challenge that will cost hundreds of billions of dollars, experts say. And pessimists are quick to point out that Canada doesn’t have a good recent track record when it comes to getting ambitious, expensive infrastructure projects over the finish line.

In Alberta in particular — where the ghosts of cancelled pipeline projects still haunt the public consciousness — some observers believe this country has lost the political will and spirit of national unity that’s required to get big things done.

“We’ve spent a decade making building anything extremely difficult, if not impossible,” said Calgary-based energy analyst, oil services sector executive and consultant David Yager.

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“Canada’s recent history suggests these (net-zero) targets are aspirational, to say the least.”

Yager points to Enbridge Inc.’s proposed Northern Gateway pipeline, which was quashed by the federal Liberals in 2016. In 2017, the proposed $15.7-billion Energy East project was cancelled by TransCanada after being bogged down by regulatory delays, new environmental criteria, and opposition to the line along major sections of the proposed route.

Then in 2021, TC Energy’s proposed Keystone XL pipeline project was cancelled by U.S. president Joe Biden _ the culmination of a decade-plus battle that had pitted the energy industry against environmentalists opposed to the project.

Opponents of these projects say the cancellations and delays show the need to end reliance on the fossil fuel industry and move toward greener energy production.

But it isn’t just oil and gas projects that are becoming increasingly difficult to build these days, Yager said. In Ontario, wind farm projects have been cancelled because they pose threats to bat populations. In Quebec, a proposed hydro line that would have carried clean power to Massachusetts was scrapped after residents of tiny Maine refused to allow transmission through their state.

Experts have suggested that Canada will have to double, perhaps even triple, the size of its electricity grid by 2050 in order to meet its net-zero goals. That would require not just new transmission infrastructure, but interprovincial co-operation on new regional interties to help connect areas with access to clean power to areas still reliant on coal.

In addition, the federal government wants to increase Canadian production of critical minerals such as copper, aluminum and lithium in order to support a domestic supply chain for the electric vehicle industry.