Securing Canada’s energy future

Lisa Raitt: Thank you for tuning in to The Raitt Stuff. I’m your host, Lisa Raitt, and in this podcast, I’m going to share insights on current hot topics in the areas of public policy, politics and business with some guests along the way. Welcome back, everybody, to The Raitt Stuff. We’re going to take a look at a different natural resource right now. And we’re going to be talking a little bit about natural gas and the importance of natural gas, not only to our past prosperity as a nation, but as well our future prosperity. And I was really intrigued last week when I saw a group come together to talk about natural gas and energy in the construct of what we need to have for a secure future in Canada. And who I have with me today is the Chair of the Energy for a Secure Future, Shannon Joseph. Shannon is an energy and sustainable development professional with 15 years’ experience that includes not only the upstream oil and gas industry, but as well Indigenous relations and the municipal sector. Shannon, it’s a delight to have you with us here today at The Raitt Stuff. Looking forward to a great conversation, but I’m going to start with the very big question is why or what is energy for a secure future?

Shannon Joseph: Thanks so much, Lisa. It’s great to be here today and really timely opportunity to talk about energy in a secure future. So, yes. So what is this? So this is an initiative of the gas energy sector. So kind of all parts midstream, upstream, downstream. But it’s looking at really bringing together a range of voices for a new kind of positive and nation building conversation about how to approach energy, both in terms of Canada’s domestic energy transformations that we’ve been going through for a number of years now, but also in terms of the role that energy can play in the world and that Canada can play as a solution provider in the world. And the initiative brings together leaders from the business community. We have, you know, Ricardo Prosperi from Tenaris, a big steel producer in Ontario, Dominic Barton, who’s the Chair of Rio Tinto, Victor Thomas, who’s the CEO of the Canada India Business Council. But we also have labour leaders like Sean Strickland, and we have a large, a pretty sizeable group of indigenous leaders who I would also call business leaders like Annette Lonechild from White Bear First Nation, whose nation’s working on energy production and carbon capture. Justin Burke, who’s the CEO of Athabasca Indigenous Investments, which is a 23 nation consortium that has ownership stakes in Enbridge pipelines. And of course and I say, of course, only because there was a major decision recently, Crystal Smith of the Haisla Nation, who’s Cedar LNG project just got their environmental approval. So a broad group who all want to talk about energy and a secure future.

Lisa Raitt: Why did everybody come together at this point? I mean, it is very much to note that you’ve got building trades, corporate Canada and indigenous leadership together. So it’s not just a bunch of corporates coming together to try and go and lobby the various levels of government. This is a serious, non-partisan civil society approach to it all. So what made everybody come together?

Shannon Joseph: Well, I think there’s been a lot of important lessons learned over the last 12 months or, you know, in particular since the Russian invasion of Ukraine. And I think, you know, the banking community certainly started talking about those lessons in terms of the energy trilemma we need to solve for affordability, for energy security, for environmental leadership. And, you know, I think I’d add to the list geopolitical coherence, add to the list reconciliation. But I think there was a recognition among many people that there had been blind spots in the way Canada had been approaching energy and environment and how these things come together. And there was a real opportunity to say, okay, what can we do differently? How can we learn from the experiences that we’ve been seeing around the world, not just in Europe, but in Asia, and how will that inform what we do and what are all the reasons for that and what are all the other ideas and values we want to bring to the table in that conversation?

Lisa Raitt: Yeah. Your first piece of research that actually came out is something called Ownership and beyond: how indigenous peoples are shaping a more secure energy future. Now, can you give us a little bit of an overview of the kinds of things that listeners would read in your report?

Shannon Joseph: So I think listeners would see that we have indigenous ownership in all aspects of Canada’s O&G industry. We have indigenous communities that are regulators in projects like Squamish Nation was a regulator for Woodfibre. I think we’d see different kinds of partnerships between First Nations themselves on managing different impacts of projects between their communities. So it’s not just industry to indigenous, it’s indigenous to indigenous and it’s really carving a way forward for Canadian energy informed by a range of things, including indigenous values and how these projects are done.

Lisa Raitt: Yeah. You mentioned at the beginning that an interesting choice for the word secure. Secure means not just security of the economics or the prosperity of a country. But secure can actually mean national security matters. It can mean security for the country. Explore a little bit for us the thinking behind the term secure that you’re using, because it’s obviously a deliberate decision to go with the word secure.

Shannon Joseph: Well, I think that, you know, to your point, energy security and the geopolitical aspect has really come to the fore in the last few months with what happened to the Nord Stream pipeline, with countries suddenly needing new energy allies and new energy suppliers. And so I think there is a new realization around how geopolitics comes into play in the energy space that I think is going to remain going forward. But secure also means environmentally sustainable. Secure also means affordable and reliable and an underpinning for social mobility. I think people often forget that energy is about making people’s lives better and the more affordable and abundant it is, the more people have access to higher standards of living. And that’s something that countries around the world have been pursuing. And we think a lot about growing middle class in India, the growing middle class in China, but, you know, in Germany and Italy this year and in other countries that are wealthy countries, there was this moment of, wow, our energy is now expensive and this is really hurting people. And what are we going to do about this? We have to readjust. And so I think having a secure future is one where we are kind of advancing all these things at once and we’re looking at how does our solution to energy get us the reliability and affordability? People need to have good lives, but also the environmental performance. We need to have a secure world and a high quality environment because that’s also important for people. So it’s about broadening the conversation.

Lisa Raitt: Yeah. Just to your point, in the UK, I read last week that in the UK that the government says it’s funding up to on an average of 50% of a home’s heating costs and it’s about £1,500 per family per household, which is a pretty interesting statistic. We’re not there in Canada obviously, where our governments are actually sending checks to people because they can’t afford their own energy. Secure is a real concept. It’s not just something that is happening in countries that don’t have resources. I mean, it’s happening in countries that are part of the G20, they’re part of the G7.

Shannon Joseph: Absolutely. But I think one of the things that has come to the fore is that there are countries that have domestic energy sources like Canada and the United States. And so we haven’t felt, you know, at one point, I think it was in last fall, natural gas was at $60 per MCF and now it’s down at 20. But, you know, $60 as an input to your heating costs, to your power costs, to your production costs if you’re a manufacturer, like that is very significant. And there are factories in Europe that had to shut down or just stop operations because the demand was too high and impacting consumers. And I think that people are thinking about this in a new way. And because Canada is in a position and the United States has been a position where we have surplus supply, we are producers of energy, we’ve been able to come to the aid of other countries. The United States has ramped up its LNG and Canada has been supplying gas to the United States that has enabled them to play some of that role. And we’re going to do more of that. But we could do even more. And I’ve read an article in The Globe and Mail talking about Chancellor Scholz’s visit to Canada and Prime Minister Kishida from Japan coming to Canada. And they’re all asking for our LNG and we need to talk about how are we going to do that, How are we going to have a secure future for Canada and play a role in providing that for our friends around the world.

Lisa Raitt: And in Canada, the conversation though, is really constricted, meaning that there has to be an equal conversation about the environment and emissions, as well as a conversation about whether or not you’re going to be extracting and exporting. That’s a bit of a contrast to the United States, where they have made major approvals in the last couple of months in terms of exploration and development of their natural resources like energy, oil and gas. And in Canada we seem to be a little bit more, I would say, cautious given our commitments to the Paris Agreement and keeping emissions down and reducing emissions. So tell me a little bit about how you approach the questions around global emissions and the use of Canadian gas around the world.

Shannon Joseph: So, you know, I just start by, I think in the United States, part of the reason the conversation has been different is because natural gas played an enormous role in the United States, meeting its Paris commitments, which, you know, President Biden famously announced a year and a half ago. And so they know that natural gas can help countries both deliver energy security for households and people and businesses, but it can also help a country significantly reduce their emissions. Now, Canada has a different energy mix, and I think we view those opportunities differently. But I think that’s also because the way we’ve approached things has really kind of put Canada, is really only looking at Canada by itself and it’s like what else can Canada do to reduce its emissions where coal doesn’t play a big role in our electricity the way it did in the US. But I think that, you know, there’s lots of opportunities for electrification of operations in Canada. There’s opportunity for sequestration of emissions in Canada. And one thing we can’t ignore because of the nature of our economy is that if we export gas to other countries that are currently 75% coal fired power like India or growing, I don’t know what the percentage is in China, but I think it’s over 60%. Japan, I think was around 30% coal. But if we help those countries which have much larger populations than us cut their emissions, I think Shell put out a piece recently that said if we could displace 20% of China’s coal fired production, it would reduce emissions by 780 mega tons annually. So that’s absolute emissions, and that happens to be bigger than Canada’s total emissions. And so if we care about the climate issue, we also have to care about how do our resources play a role globally in bringing down emissions.

Lisa Raitt: Yeah, so it’s not just about reducing emissions domestically, that cutting emissions worldwide is actually a benefit?

Shannon Joseph: That’s right. And that’s because it’s not the tailpipe in Canada that drives emissions in Canada or the tailpipe in the US. You know, there’s a global atmosphere and there’s a global climate and all these things are driven by global emissions. And even though we want to do our part in Canada and have been and there’s all kinds of innovation going on across all sectors of our economy, we can’t ignore the fact that we could play this very large role now and that by playing that large role, we’ll also be helping our allies get themselves off of reliance on actors in the world that they don’t want to rely on. And it happens that because of what’s been going on in partnerships in Canada, we are going to advance reconciliation too, by doing some of this work. And so lots of things are coming together. If Canada can act in the near term on these opportunities.

Lisa Raitt: So some of our listeners do dabble on a day to day basis with the concept of taxonomy, and some don’t actually know what taxonomy is. So can you give me an overview of the importance around paying attention to taxonomy when it comes to oil and gas, gas specifically, and when it comes to the work that the Energy for a Secure Future is doing?

Shannon Joseph: Sure. So, you know, I think right now, lots of investors and businesses and others are asking themselves, how do we get the investment we need to build and do the things we need to either deliver resources to market to reduce our emissions significantly, to do the investments in technology we want. And taxonomy is going to play a role in how the financial community views what is a sustainable investment, what is a green investment, what is a transition investment is one of the terms out there. And that’s going to be really important. And I think going back to not every country has the same resources and Canada and the United States have unique energy resources that can play a global emission reduction role. We have to have a taxonomy in Canada and we have to have an approach to sustainable finance in Canada that drives capital towards the investments that need to be made in Canada so that we can have low emission steel and low emission cars and low emission oil and gas and all the other things we want to produce. But we also need to have those tools also recognize that Canada, if we had the investments in the LNG space, could significantly reduce global emissions and that matters a lot and that’s something other countries can’t do. And if we develop a paradigm for sustainable finance that’s based on Europe’s economy or some other economy and doesn’t recognize that opportunity and enable that opportunity, then we’re not really helping the global environmental issue that everybody is supposed to be working together on.

Lisa Raitt: Yeah. Excellent. So Shannon, it’s great talking about how we can help from an international point of view and help reduce emissions around the world. But you know, we’ve got some big items that we have to accomplish here in Canada in order to achieve the emissions targets that we have. And I’m wondering what is the role that gas can play here in Canada for our own economy that is transitioning to a net zero.

Shannon Joseph: Thanks, Lisa. And that’s a really important part of the work we want to do. And even though we’ve kind of started in the International space, Canada, like so many other countries around the world, is looking to transform its energy systems to lower its emissions. And we want to do that in an orderly way so that we don’t experience what the UK and Germany and other countries are experiencing, which is suddenly rapidly escalating costs, impacts to businesses, impacts to jobs, etcetera. We want things to be done in a way that also preserves certain things for people, including affordability and natural gas infrastructure. Natural gas and the gas infrastructure that we use in Canada distributed has an important role to play in delivering energy to Canadians and delivering lower and lower emission energy as we blend in renewable natural gas, we blend in hydrogen. We are using infrastructure that exists already. I think it was the IESO, but also the Ontario Energy Association had a report talking about the need to triple electric infrastructure if we were going to electrify everything and if we have to do all of that in the next 10 to 15 years, that’s very expensive and those costs are going to be passed on to people. But if we look at how we can leverage our gas infrastructure in delivering lower and lower emission energy solutions to people, then it doesn’t matter if it’s an electric solution or a hydrogen blend solution or an RNG solution. The point is people get the energy they need affordably. We deliver these things, leveraging the full value of the infrastructure we have because we know it’s sometimes hard to get things permitted and built in Canada as well. So we need to think about those resources as well. And then we get the results, the emission results that we’re looking for, but in a better way. And that’s an important part of what we want to talk about as well in this work.

Lisa Raitt: And underscore the importance of people involved in this equation. Last year, Canada welcomed a million new people to our country, and we’re going to continue to add half a million a year as we move forward. So you do have to be able to look after the energy supply in an affordable way in order to make sure that we’re supporting our population as it grows.

Shannon Joseph: That is absolutely critical. And, you know, the government put out those targets of half a million new immigrants a year to Canada. My own parents were immigrants, and I just know how important it is to have affordable energy, not just for people in their homes, but for the businesses Canada is going to build to employ all these new people. And all of those things are good. And it goes back to the idea that energy fits together with lots of important values in how we build a society that we all want to live in. And yeah, we need to just have a conversation about how to transform these systems in the right way.

Lisa Raitt: I guess any other thoughts from Energy for a Secure Future that we haven’t covered yet?

Shannon Joseph: Well, what I want to say is I really want to invite all of your listeners to go to www.energysecurefuture.ca to see the work we’re doing and to check out our LinkedIn and Twitter channels. We’re often sharing work we’re doing, but others in our coalition and just other friends of the organization, I think, you know, the Business Council a number of weeks ago put out a great piece around building their sustainable future, talking about a lot of the same things that we’re talking about, whether it’s the LNG opportunity, whether it’s tools that the Government of Canada can use to enable greater indigenous participation in these projects. And so, yeah, I want to just say come look at what we’re doing and please get involved because if we’re going to build a conversation that kind of incorporates the missing pieces of the energy and environment discussion, we need to do that together. We need to ensure that many, many can buy in and that this is going to be a resilient way forward over time, not something where we, you know, it swings politically, but it’s something that we can all get together behind. And this just makes sense for Canada, and that’s what I’m hoping we can do together.

Lisa Raitt: Amazing. So Energy for a Secure Future is a non-partisan civil society endeavour that includes corporate Canada, it includes indigenous leadership, and it also includes building trades, all working together to ensure that Canadians understand the importance of natural gas to our economy both here and to it as being a solution for emissions issues around the world. And I would be remiss if I didn’t mention as well that the Business Council of Canada piece also has as the co-author the Chair of the First Nations Major Projects Office and they do remarkable work as well in this space. I want to thank you Shannon very much for coming onboard today.

Shannon Joseph: Thanks, Lisa.

Lisa Raitt: Thanks so much for tuning in. Now, if you have any questions or comments or even requests on topics to discuss, drop me a line at [email protected]. Your interactions actually will make this better. I’m your host, Lisa Raitt, and this has been The Raitt Stuff.

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