The Canada-US trade and energy relationship - Policy Options
U.S.-CANADA RELATIONS. The United In addition, Canada is the single largest foreign supplier of energy to the United States. Canada. The US-Canada energy relationship is evolving fast, and in ways that will change both countries and the world. With this in mind, The Chicago. The Clean Energy Dialogue embarked upon by Canada and the United States testifies to this importance. On the one hand, because of the high level of trade.
The two countries also cooperate on a range of bilateral fisheries issues and international high seas governance initiatives; they are also founding members of the Arctic Council.
Bilateral Economic Relations The United States and Canada share the world's largest and most comprehensive trading relationship, which supports millions of jobs in each country. In addition, Canada is the single largest foreign supplier of energy to the United States. Canada and the United States operate an integrated electricity grid under jointly developed reliability standards. Uranium mined in Canada helps fuel U.
Canada and the United States have one of the world's largest investment relationships. The United States is Canada's largest foreign investor by far, with about Canadian investment in the United States is concentrated in software and IT, financial and business services, industrial machinery, and real estate. The Regulatory Cooperation Council seeks to stimulate more trade by increasing bilateral regulatory transparency and cooperation and eliminating unnecessary differences and duplication that hinder trade and investment.
Canada has challenged U.
U.S. Department of State
The United States has encouraged Canada to strengthen its intellectual property laws and enforcement. Canada's Membership in International Organizations In addition to close bilateral ties, Canada and the United States cooperate in multilateral fora, including international efforts to combat terrorist financing and money laundering.
Fulbright Canada offers awards for undergraduate students through the highly acclaimed Killam Fellowships program. Canada is one of the countries included in theStrong in the Americas initiative, which seeks to increase student mobility between the United States and the countries of the Western Hemisphere.
By far the most significant trade surplus from the energy trade for Canada comes from exports of petroleum products. One key difference between the ener- gy systems of Canada and the US is the composition of energy sources used for electricity generation. As indicated in figure 4, in the majority of electric- ity generated in Canada came from hydroelectricity.
This abundance of hydropower means that Canada depends much less on coal-fired power plants for electricity than many countries do " the US included. The US derives significantly more electricity from coal than Canada does. The US also uses more natural gas for electricity generation. However, this abundance of hydropower does not necessarily translate into an advantage across all regions in Canada. In Ontario, for example, the provincial government maintains that it will close its four coal-fired plants Atikokan, Lambton, Nonticoke and Thunder Bay by December 31,citing environ- mental and health concerns.
The government plans to replace coal- fired capacity with natural gas, nuclear, hydroelectricity, and wind, along with increased conservation measures.
These differences have obvious implications for any clean energy strategy. On the one hand, the US can achieve very large emissions reductions by replacing its coal-fired electricity plants with less carbon-intensive alter- natives, while Canada requires a broader range of measures across multiple sectors to reduce emissions.
On the other hand, electrification in Canada provides greater emissions reductions due to the lower emissions intensity of electricity generation. This has implica- tions for both the ambition and pace of climate policy development and implementation here in Canada. Already, GHG emissions targets in Canada have been moderated to line up with less stringent proposed US targets, at 17 percent below levels by Yet US ambition and timing on the climate file remains unclear and uncertain.
Early momentum in Congress with the Waxman-Markey Bill, together with various Senate bills, has stalled. A federally mandated cap- and-trade system that could link with Canada remains in limbo. Clean ener- gy technology discussions have not yielded specific results.
Recent tailpipe emission standards harmonization is the sole substantive element. An inevitable question for Canada will be whether and how it does some- thing on climate policy while the US does nothing and delays persist south of the border. National Round Table on the Environment and the Economy NRTEE reports in and demonstrate that an early, economy- wide carbon price signal is the most cost effective means of meeting deep GHG emissions reduction targets.
Delay is costly as the carbon price will have to rise to meet stated targets in a shorter time frame. Like all countries, Canada will seek to implement policies that achieve the most GHG emissions reduc- tions at the least economic cost. A core issue for the development of a clean energy strategy for Canada will there- fore be whether it takes action on cli- mate policy objectives now, or only at a later date pending US action.
The US-Canada Energy Trading Relationship | Global Trade Magazine
For Canada, there are both risks and opportunities in US climate pol- icy and its impact on Canadian ener- gy and climate policies. Table 2, developed by the NRTEE, illustrates the types of trade-off risks at play from both an economic and environ- mental perspective in contemplating various leading, lagging, or harmo- nizing scenarios for Canada. They include competitive sectoral impacts, regional distribution impacts, appli- cation of border carbon adjustments, and missing both medium-term and longer-term tar- gets.
It offers a way to contemplate optimal Canadian policy design to minimize risks. No option is risk-free " including harmonization " and there are inescapable costs to all options.