Energy
Trump’s plans should prompt Ottawa to reverse damaging policies aimed at oil and gas
From the Fraser Institute
By Tegan Hill
Adding to a long list of costly federal policies that restrict oil and gas development, the Trudeau government plans to cap greenhouse gas emissions from the oil and gas sector at 35 per cent below 2019 levels by 2030. This is the exact opposite of what Canada needs, particularly given developments south of the border.
President-elect Donald Trump has made it clear he aims to boost U.S. oil and gas production. Pledging to “drill, drill, drill,” Trump will lift restrictions on liquified natural gas exports, expedite drilling permits, and expand offshore oil production through new lease sales. He also plans to create a National Energy Council to establish U.S. “energy dominance” by “cutting red tape, enhancing private sector investments across all sectors of the economy, and by focusing on innovation over long-standing, but totally unnecessary, regulation.” These changes will lower the cost of oil and gas development in the U.S., which means production will increase and commodity (e.g. crude oil) prices will likely drop in the U.S., Canada and beyond.
Of course, this might lower prices at the pump, lower home-heating bills and bring good news for consumers. But policymakers should understand that lower commodity prices would be a big hit for provincial budgets in Alberta, Saskatchewan and Newfoundland and Labrador, which rely heavily on resource revenues. In Alberta, for example, a $1 decline in the price of oil results in an estimated $630 million loss to the provincial treasury. The federal government will also take a hit. In 2022 (the latest year of available data), Canada’s oil and gas industry paid the federal government more than $9 billion in corporate income taxes.
And because the Trudeau government has introduced numerous new regulations that restrict oil and gas development, it would be very difficult for the industry to increase sales volume to offset any loss. And according to a recent report by Deloitte, the government’s proposed emissions cap will curtail oil production by 626,000 barrels per day by 2030 or by approximately 10.0 per cent of the expected production—and curtail gas production by approximately 12.0 per cent.
There’s also Bill C-69 (the “Federal Impact Assessment Act”), which overhauled Canada’s federal environmental review process making the regulatory system more complex, uncertain and subjective. And Bill C-48, which bans large oil tankers off British Columbia’s northern coast, presenting another barrier to exporting to Asia. All of these policies make Canada, and particularly energy-producing provinces such as Alberta, Saskatchewan and Newfoundland and Labrador, less attractive for investment.
Indeed, according to the latest survey of oil and gas investors published by the Fraser Institute, 50 per cent of survey respondents said the “stability, consistency and timeliness of environmental regulatory process” in Alberta scared away investment compared to only 11 per cent in Texas. Similarly, 42 per cent of respondents said “uncertainty regarding the administration, interpretation, stability, or enforcement of existing regulations” was a deterrent to investment in Alberta compared to 13 per cent in Texas. And 43 per cent of respondents said the cost of regulatory compliance was a deterrent to investment in Alberta compared to 19 per cent for Texas. Without strong investment, energy-producing provinces won’t be able to increase production.
Trump’s plan to reduce regulations and bolster U.S. oil and gas production will lead to lower prices for oil and gas. While that’s good news for consumers, policymakers should understand how the new normal will impact government coffers. To offset the loss associated with lower prices and lower revenue, provinces need more natural resource development. But that will require the Trudeau government to reverse its damaging policies and abandon its emissions cap plan.
Energy Talking Points by Alex Epstein
|
|
It’s said that in politics there’s no silver bullet that’ll make everything better.
But we do have 1 silver bullet in the chamber: the opportunity to unleash American energy, which Donald Trump has rightly vowed to do.
- The single most important thing government can do to make our lives better—something that will lead to a better economy, a lower cost of living, more job opportunities, a lower deficit, greater security, and a better environment—is unleash abundant, affordable, American energy.
- If we unleash abundant, affordable, American oil, natural gas, and coal production from the anti-energy policies holding it back, we can go from crippling inflation—substantially driven by energy costs—to affordable food, housing, transportation, and heating bills.
- Unleashing American energy will take us from nationwide electricity shortages to affordable, reliable power for all—and from losing good job opportunities to China, which we’ve allowed to outcompete us on energy costs, to creating millions of new well-paying jobs here at home.
- Unleashing American energy will take us from begging OPEC+ for oil, depending on Russia for uranium, and being at China’s mercy for critical minerals, to producing an abundant and secure supply of these crucial commodities at home.
- Many Americans are hesitant to embrace policies that unleash abundant, affordable energy because they think it will harm environmental progress—progress in air and water quality, safety from climate, and enjoyment of nature. Nothing could be further from the truth.
- Environmental progress isn’t in conflict with abundant, affordable energy; it requires abundant, affordable energy—to afford pollution controls, to clean up natural environmental hazards, and to protect ourselves from the always-dynamic and dangerous climate.
- Thanks to abundant, affordable energy, America has been wealthy enough to innovate and adopt pollution controls that make our air far cleaner—which is why America was able to increase its fossil fuel use 25% since 1970 while reducing air pollution 78%.¹
- Thanks to abundant, affordable energy, America has been able to clean up natural environmental hazards such as undrinkable water, which requires affordable, reliable energy to purify, or mosquito-infested swamps, which require abundant, affordable energy to drain.
- Thanks to abundant, affordable energy, we can protect ourselves from the always-dangerous climate by powering heating and A/C systems, storm warning and evacuation systems, and irrigation systems; witness the 98% drop in climate-related disaster deaths over the last century.²
- Thanks to abundant, affordable energy we have the wealth we need to enjoy and preserve the most valuable and beautiful parts of nature—which is why America is able to be both the world’s economic superpower and a place of unsurpassed access to the great outdoors.
- The key to supporting America’s energy abundance and environmental progress is maintaining steadfast support of individual and economic freedom, including the protection of property rights.
- Property rights allow our energy companies to produce and innovate as they judge best. The shale revolution happened here because we alone protect underground property rights. Producers used this freedom to figure out how to extract abundant oil and gas from once-useless rocks.
- Property rights allow us to care for our environment on our own property—and people tend to care best for what they own. And property rights are the basis for laws protecting our air and water from dangerous levels of pollution.
- America has shown time and again that pro-freedom energy and environmental policies drive energy and environmental progress. And we can do it again, if we reverse the anti-freedom policies of the past several decades and embrace the following “energy freedom” policies.
- To aid America in unleashing American energy, I’ve created the Energy Freedom Plan—a comprehensive plan that includes hundreds of high-leverage policy changes for every aspect of energy, from drilling to pipelines to electricity to nuclear to rare earth elements.
- The Energy Freedom Plan is based on 5 game-changing goals:
- Unleash responsible development
- End preferences for unreliable electricity
- Set environmental standards using cost-benefit analysis
- Address climate danger through resilience and innovation
- Unleash nuclear energy
- Unleash responsible development
Anti-development policies prevent the drilling, mining, transporting, and building all energy needs to reach its potential—from natural gas to nuclear to solar.
Liberating responsible development will create unprecedented US energy abundance.
- End preferences for unreliable electricity
Our grid is being ruined by systemic preferences for unreliable electricity, which cause prices to rise and reliability to decline.
Ending these preferences and prioritizing reliability is needed to make power cheap and reliable again.
- Set environmental standards using cost-benefit analysis
The EPA harms prosperity and health via emissions standards that impose huge costs for little or no benefit.
Real cost-benefit analysis, including objective health science will promote prosperity and environmental quality.
- Address climate danger through resilience and innovation, not punishing America
“Climate policy”” that singles out US emissions makes us poorer and less resilient while global emissions go up.
Becoming more resilient and unleashing innovation are the keys to climate safety.
- Unleash nuclear energy from pseudo-scientific restrictions
The strangulation of nuclear has made it 10 times more expensive than it needs to be.
Unleashing nuclear, including getting rid of pseudoscientific policies like LNT and ALARA, will make possible a nuclear renaissance.
- This week I will be releasing the FULL Energy Freedom Plan, including over 100 SPECIFIC game-changing policies that can unleash American energy like never before.
To make sure you see the whole plan, follow me @AlexEpstein and especially subscribe to alexepstein.substack.com.
Questions about this article? Ask AlexAI, my chatbot for energy and climate answers:
Popular links
- EnergyTalkingPoints.com: Hundreds of concise, powerful, well-referenced talking points on energy, environmental, and climate issues.
- My new book Fossil Future: Why Global Human Flourishing Requires More Oil, Coal, and Natural Gas—Not Less.
- Speaking and media inquiries
“Energy Talking Points by Alex Epstein” is my free Substack newsletter designed to give as many people as possible access to concise, powerful, well-referenced talking points on the latest energy, environmental, and climate issues from a pro-human, pro-energy perspective.
Share Energy Talking Points by Alex Epstein
For every million people on earth, annual deaths from climate-related causes (extreme temperature, drought, flood, storms, wildfires) declined 98%–from an average of 247 per year during the 1920s to 2.5 per year during the 2010s.
Data on disaster deaths come from EM-DAT, CRED / UCLouvain, Brussels, Belgium – www.emdat.be (D. Guha-Sapir).
Population estimates for the 1920s from the Maddison Database 2010, the Groningen Growth and Development Centre, Faculty of Economics and Business at University of Groningen. For years not shown, population is assumed to have grown at a steady rate.
Population estimates for the 2010s come from World Bank Data.
From CPAC on YouTube
In a virtual news conference, Danielle Smith, the premier of Alberta, discusses her meetings with U.S. President-elect Donald Trump in West Palm Beach, Florida. Smith met with Trump to discuss the incoming president’s repeated threats to impose a 25 per cent tariff on all products from Canada and Mexico.
New lawsuit challenges Ontario’s decision to prohibit safe consumption services
The Trump Administration Must Bring Moderna to Heel
Musk Completely Derails UK Political Establishment, Accuses PM’s Party Of Covering Up Muslim Rape Gangs
The Pandemic Planners Come for Hoof and Hen…and Us Again
-
International2 days agoCalifornia’s Fire Catastrophe Is Largely a Result of Bad Government Policies
-
Alberta2 days agoAlberta’s wildland firefighters are on their way to assist in California
-
Economy2 days agoFixing the Trudeau – Guilbeault Policy Mess May Take Longer Than We’d Like – Here’s Why
-
City of Red Deer2 days agoNomination Period Open for Red Deer 2025 Municipal Election
-
Business2 days agoBlack Rock latest to leave Net Zero Alliance
-
Alberta2 days agoCommunity Fireguard Program Protecting Canmore and the Bow Valley from wildfires
-
Business2 days agoBiden goes after Facebook for eliminating ‘fact-checkers’: ‘Really shameful’
-
Red Deer2 days agoChamber CEO announces 4 initiatives to boost business community