OTTAWA — The return of Donald Trump has forced a reckoning in Canada with the potential to reshape the Canadian economy — including the direction its energy flows.
“We will need to do things previously thought impossible, at speeds we haven’t seen in generations,” Prime Minister Mark Carney said last week, as he declared Canada’s traditional economic relationship with the United States “over.”
During his first week in office, Carney gathered Canada’s premiers and got them to agree that in the face of Trump’s tariffs, they will remove all internal trade barriers by Canada Day on July 1. The Canadian Chamber of Commerce, among others, has estimated those barriers diminish Canada’s GDP by 4 percent annually.
Carney’s plan includes trying to make it seamless for people and products to flow east-west, rather than south to the U.S. That includes energy, especially the clean kind — most electricity, nuclear power, as well as wind and solar.
On Monday, Conservative Leader Pierre Poilievre promised to create a Canada First National Energy Corridor, a pre-approved corridor for pipelines, transmission lines and rail lines.
People in Canada’s clean energy sector have been advocating for years for the country to think big and do more to leverage an abundance of clean power.
POLITICO spoke to Philippe Dunsky, the president of a Montreal-based consultancy that bears his name. Dunsky recently wrapped up his chairmanship of the federal government’s Clean Electricity Advisory Council, delivering a report last June to Natural Resources Minister Jonathan Wilkinson called “Powering Canada.” The report offered a blueprint to deliver an essential thing to Canadians: clean, affordable electricity created within their own country, to heat their homes and power their lives.
The report received scant attention. But now, thanks for Donald Trump’s economic threats, its thesis has become a central plank in Canada’s economic pivot away from the U.S.
Here is a transcript of our interview, edited for length and clarity:
We have problems getting electricity to flow east to west in this country. Can you explain the basics of the problem?
The problem is a natural one — there’s greater demand and concentration of demand south, than east-west. We’re a less dense country [compared to the U.S.]. So naturally, if we do nothing, our power goes south. If we’re deliberate about it, we can do something.
In your report for Energy and Natural Resources Minister Jonathan Wilkinson, you talked about the need to stitch the country together a little better. Can you summarize what you recommended?
I can start with what we’re not recommending. This is not about an east-west power line. That’s kind of a railway analogy.
What this is, is more east-west integration regionally. Look expansively at something like Vancouver-to-Winnipeg; this tremendous opportunity to integrate that region and really optimize the system and make electricity more affordable and cleaner.
That’s true in the west. True in central Canada as well. Between Ontario and Quebec, there’s some trading now, some exchange, but there can be an awful lot more. Quebec, especially going forward, could benefit if Ontario is really going to build out its nuclear base load infrastructure. Same thing in Atlantic Canada, and I’ll say Atlantic/Quebec, because there’s a really important linkage there.
You’re looking, broadly speaking, at three big regions that could be doing an awful lot more trading … and that would allow us to clean the grid faster and cheaper.
It’s just not there because we just naturally go to where demand is easiest and most apparent — and that’s south.
How would this regional-based system make energy more affordable for Canadians? Give me an example.
It’s like Trade 101. We had an election about free trade [in 1988]. And what was that election all about? It was about the belief that when you have free-flowing trade, you can actually lower costs for everyone, and that’s because you’re optimizing systems. That is definitely true for electricity.
Look at B.C. and Alberta. Alberta has the best wind resources and the best solar resources in all of Canada. British Columbia wants wind power, so they’re going out and putting out RFPs [requests for proposal] to have a whole pile of new wind development in B.C.
The winds in Alberta are twice as good as B.C.’s, meaning wind power in Alberta costs half as much as it would in British Columbia. If B.C. could tap into Alberta’s wind, and Alberta gets all the economic development benefits, B.C. gets the cheaper power.
Right now, it’s the opposite.
What needs to be done to link those two provinces?
The real issue is largely political will. Right now, Canada has — just like with our broader discussion about trade — we have 10 silos, plus the territories. Each one is planning and building its system as if it’s an island, with the odd connection here and there. We have to open up a bit.
Mark Carney is talking about the need to connect internal trade. It’s a big deal because of what’s going on with the U.S. When you look at the urgency with which this is being talked about now, how does that make you feel?
It makes me feel hopeful. We finally have an opportunity. We have a window in front of us to actually see this happen. Everyone who’s ever looked at this knows that it should happen, knows that it needs to happen, knows that it’s beneficial for Canadians across the board. And the politics have not been there. The politics may be there now.