According to one of the leaders of North America's largest pipeline company, the clock is ticking on Canada's climate targets and the federal government will have to come up with an answer to the Biden administration's recent climate package or risk falling behind in the clean energy boom.
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Click here to see other videos from our team. Colin Gruending, executive vice-president at Enbridge Inc., said at the Energy Disruptors conference in Calgary this week that they urge Ottawa to respond to the U.S. climate package We could get lapped here by the Americans. Let's get started. We ll have not much done by the year 2030. In a panel discussion on Canada's energy future, Gruending praises the incentives built into the US $369 billion Inflation Reduction Act IRA, which some say could pave the way for an explosion in renewables and clean energy infrastructure south of the border over the next decade. Calgary-based Enbridge's pipeline business dwarfs what it is doing in renewables. Enbridge's green operations still rank among the largest in Canada, so its views carry weight in Ottawa and elsewhere. As part of its approach to the energy transition, Enbridge will invest increasing proportions of its capital in natural gas and renewable energy projects.
Canada has implemented carbon pricing and an investment tax credit for carbon, capture, utilization and storage, and Canada is strong out of the gate, CCUS Gruending said. Prime Minister Justin Trudeau s government must respond to the IRA or risk losing investment that could help Canada meet its own climate goals, according to Prime Minister Justin Trudeau. Gruending suggested that the federal government should look at ways to remove uncertainty over future carbon prices through instruments such as contracts that would allow companies to hedge their risk of future price changes or power purchase agreements that could assure a fixed carbon price over a given period of time. Gruending is part of a growing chorus that has been calling for the Trudeau government to respond to the IRA. In a recent Financial Post op-ed, former industry minister Navdeep Bains, currently vice-chair of global investment banking at Canadian Imperial Bank of Commerce, wrote that the speed and scale of President Joe Biden's clean energy package could lead to discomfort in Canada. Capital is fluid, and it will flow to the U.S. if the investment opportunities are there, and with these measures they will be there in abundance, he wrote.
The prime minister's words weren't welcomed in the oilpatch, where leaders had hoped that Ottawa would be willing to expedite approvals for natural gas export projects. Rose said at the conference on Sept. 20 that natural gas is the fastest growing energy segment. It will be supplied by a jurisdiction with much higher emissions than we have. If we don't provide it, it's worse for the global atmosphere on a net-net basis. Gruending said that Canadian natural gas, with its lower emissions intensity, is in significant demand and should be exported to displace the use of coal in other jurisdictions. Gruending said that the idea of perfection is probably unrealistic. It is a game of incremental wins: LNG beats coal, and Canada LNG beats other LNGs. It is that simple.