The political complexity of the Keystone XL pipeline in the U.S. our closest and most important trading partner underscores, in part, the trade costs of ignoring the full environmental impact of resource extraction. U.S. President Barack Obama has made it clear that the time has come for real action to address the climate crisis a message meant as much for Canada as it was for the U.S. Congress.
Rather than launching a panicked public relations campaign to reassure Americans that expansion of oil sands is "not going to destroy the planet," as Oliver recently put it, we need to understand the controversy over Keystone XL as a symptom of Conservative failure to take seriously the environmental consequences of resource development. While some companies may see the lack of regulation as a gift, many others recognize it for what it is: a poisoned chalice that will erode the reputation of our resources around the globe.
It was just such a scenario that Scott Vaughan, commissioner of the Environment and Sustainable Development, warned about in his final report earlier this year. He laid out the challenge clearly: as the environmental standards and consumer expectations of foreign markets evolve, Canada's environmental protections must keep pace with economic development if we are to enjoy sustained economic success. Ensuring that the full cost of pollution is included in the price of the resource, rather than leaving that cleanup to future generations, is a key step forward and not coincidentally, the best way to build confidence in our industry and trade partners.
A true long-term vision of resource development must also take into account the need for a diversified economy that includes value-added jobs and thriving export industries. We have to look at ways to upgrade and refine our own natural resources right here in Canada, instead of locking in pipelines to export raw product while demand remains unmet with domestic products here at home. It means making renewable energy and clean technology development a priority, so that Canadian innovators and workers can be leaders in what will be a $3-trillion market by 2020.
It also means that the Canadian government must deal with foreign ownership rules in a transparent and consistent way. Compounding mistakes, the Conservatives government recently reneged on its commitment to clarify the net benefit criteria in the Canada Investment Act to discourage foreign takeovers motivated simply by a desire to gain control of a strategic Canadian resource. This inaction led to a series of takeovers of Canadian oil and gas companies by foreign state owned companies such as Chinese-owned CNOOC, which even the Prime Minister admitted is not the kind of deal that benefits Canadians.
To date, the Conservatives have refused to create a formal process of accountability that would commit foreign entities to bring new capital, creates new jobs, transfer new technologies, or increase Canadian-based research and development. With some vision, foreign investment could support domestic added value by ensuring a well-defined "net benefit" to Canada. By incorporating revamped foreign ownership rules into our energy policy objectives, Canada could maximize investment while protecting strategic resources. Instead, we have seen a government approve deals that even they acknowledge are flawed.
Finally, there can be no lasting prosperity without a comprehensive energy development strategy that incorporates environmental sustainability and domestic value-added work on equal footing with growth and development. A sustainable strategy that positions Canada as a leader in both renewable and non-renewable energy sources must work hand in hand with the provinces and territories, a challenge that this Prime Minister has yet to take up. It also requires involving key stakeholders such as affected aboriginal communities as equal partners. First Nations, Inuit, and MÃ©tis peoples must be full participants at the tables where decisions are made a lesson that this government has forgotten, to the detriment of the projects it is trying to push through, like Northern Gateway.
There is no shortcut to social license to operate, a lesson that the Prime Minister appears to be learning the hard way.
NDP Peter Julian, who represents Burnaby-New Westminster, B.C., is his party's energy and natural resources critic.
The Hill Times