Energy Progress or Environment First? The Canadian Dilemma
Oil sands mine in Alberta, Canada outside Fort McMurray: Michael Kodas/InsideClimate News
Canada's economic conditions since Justin Trudeau became Prime Minister in 2015 have brought about serious concerns amongst Canadians. Living standards have been dropping, and wage stagnation and deterioration in public services are some of the recent difficulties within the country. Production has declined massively since the COVID-19 Pandemic, while GDP growth has slowed considerably compared to past governments. Some argue that Canada is in a recession, as the unemployment rate reached 6.8% last November, and the rising cost of living continues pushing Canadians to cut back on spending. Although US President Donald Trump has ultimately paused tariffs on Canada for the time being, there is no indication that the potential 25% tariffs may be imposed later. Thus, immediate action is needed in Canada to boost its economy and get out of its current slump.
An area in which the country has great potential to grow its economy is through the energy sector. Canada is enriched with natural resources that can be used to produce energy from various sources. It has the third-largest proven oil reserves, behind only Saudi Arabia and Venezuela. In 2022, Canada was recorded as having the second-largest reserve for uranium globally, only surpassed by Kazakhstan. Such resources provide Canada with an advantage that most countries do not have. Canada shows potential for growing its economy by producing energy through its abundant natural resources.
Canada is in a position better than ever to provide energy, given the current international circumstances. It is worth considering the current relationship Europe has with Russia. Despite stiff opposition, criticism, and cutbacks to the energy market in Europe, France, Spain, Austria, Hungary, and Slovakia deposited Russian fossil fuels in 2024. However, these countries alone were not the only ones that traded with Russia. The EU imported a record amount of liquid natural gas from Russia in 2024. With that in consideration, Russia also remains Europe’s second-largest gas supplier, amounting to 18% of EU imports. Although Europe has been looking towards cutting down on Russian energy and has done so, Russia continues to have Europe as a significant energy client. Canada, through its natural resources, can act towards competing against Russia and provide an alternative to the Europeans, given their opposition to Russia and its war with Ukraine.
Moreover, with recent technological advancements, Canada is well-positioned to play a significant role. The continuous rise of Artificial Intelligence (AI) has meant a greater demand for it, insisting on more production. The major technological companies such as Microsoft, Google and Amazon are moving towards using nuclear energy to produce AI and meet the growing demands for the product. Cryptocurrency has also had a tremendous impact on the market in recent years. The digital coin requires a vast amount of energy to mine, which is why nuclear energy has been considered a legitimate energy source, as it is carbon-free, sustainable and very reliable inefficient production. Canada has the privilege of offering such energy with its large uranium reserves that can be used to power various types of cryptocurrency. Canada has great potential for growth and production in the energy sector, and further technological advancements will only create more opportunities for the country.
With a federal election in Canada this year, certain parties have looked towards pushing energy policy further. Pierre Poilievre’s Conservatives are looking to grow Canada’s energy sector. As the front runner for the election, he has discussed plans to build liquid natural gas plants, pipelines and refineries. Poilievre has emphasized the use of nuclear energy for American technological companies. He has already made strides in this direction, stating that the Conservatives will repeal the supposed anti-energy laws of the Liberals and the NDP to create more energy in Canada. Expanding energy production remains a key priority on the Conservative agenda.
The Conservative movement for energy appears not only on the national level but also on the provincial level. Alberta Premier Danielle Smith has stated she wants to work on multiple infrastructure projects that focus on the development and upgrading of exporting of oil, natural gas and other natural resources. Moreover, the Alberta government has recently signed a new oil and gas agreement with Enbridge that will eventually increase oil exports to the United States. However, Smith looks at manners to restrict the production of energy. Recently, the Alberta government proposed additional restrictions on wind and solar energy.
Nevertheless, some factors may complicate the expansion of Canadian energy, especially in the case of the US. The tariffs that supposedly will be imposed by the Trump Administration will impact Canadian oil producers with a $7-billion hit in profit margins as the US government is considering imposing a 10% tariff on Canadian oil and gas. Such drawbacks to exporting energy to the US would need to be considered by the government. A decision would have to be made on either moving exports to other parts of the world or continuing trading with your most important partner, even if it means damaging your exporting sectors.
Although such energy production can help Canada grow its economy, it is not without its opposition and drawbacks. A primary concern is the environment. Oil production leads to pollution, which can lead to respiratory and cardiovascular diseases. Such fossil fuels can lead to toxic substances entering into our soil and drinking water, potentially increasing the likelihood of different cancers, congenital disabilities and liver damage. Such emissions coming from oil are said to exacerbate climate change issues further, as 2024 was recorded as the warmest year on record for Earth. There are also major concerns about potential oil spills. There is no better example than the BP Deepwater Horizon Oil Spill in 2010, which spread across 68,000 miles of sea surface and killed 1 million seabirds, 5,000 marine mammals and 1,000 sea turtles; BP had to pay over $65 billion through the compensation process. Canada has already faced first-hand opposition to oil production, as protestors have chained themselves to containers protesting pipelines. There has been stern restraint and anger from pipeline constructions being done on Indigenous land. This, in turn, has forced oil companies to advertise themselves as being supportive and in favour of Indigenous communities.
Discussing nuclear energy appears almost impossible to do with someone without mention of the Chernobyl disaster and the Fukushima nuclear accident. The fears of a major nuclear disaster are always imminent, and in the minds of individuals, thus the subject to this extent is still taboo because of the potential cataclysmic catastrophes that could ensue if nuclear energy is being managed recklessly. There is also the concern about discarding radioactive waste, as the substance can remain hazardous to civilization and the environment for thousands of years.
Such concerns with oil and nuclear energy may cause Canadians to prefer “safer” energy sources, such as wind and solar. However, wind power is unpredictable, rendering it potentially inefficient and dangerous to wildlife. Solar energy is highly expensive and ultimately is dependent on sunlight, an issue for a country such as Canada with long winter months.
Energy sources will always have benefits and drawbacks as no perfect energy source exists. While oil and nuclear energy face many risks, they provide great possibilities for Canada and its abundance of natural resources, given the current global circumstances. Whether or not the Conservatives will push such energy goals as they have spoken on remains to be seen. Regardless, there is potential in the energy sector for Canada to grow its economy and escape the current slump it is in. It is up to Canadians to decide whether or not they want to be major energy producers or focus their concerns on the environment first.