By Jim Stanford,Economist, Unifor

ou learn a lot about acountry by analyzing itsinternational trade. What

does it produce that the rest of theworld wants? What does it need,but can’t make itself? And what isthe balance between the two?By these criteria, it’s clear that

Canada has a big problem, anunintended consequence of theenergy boom that’s dominatedour economy since the turn of thecentury.We now face a Jekyll-and-Hyde

dichotomy in our trade perfor-mance. Sure, there’s a growingtrade surplus in energy products:almost $70-billion in 2013. But un-

fortunately, our performance in allnon-energy products and serviceshas deteriorated more rapidly thanour energy exports have grown.Until 2002, our export portfolio

was diversified, and we generatedtrade surpluses in many differentindustries (value-added as well asresources). But that changed oncethe energy export boom kickedinto high gear. We began to incurtrade deficits in non-energy trade,which reached a record $76-billionin 2013. Ironically, the more energywe export, the less of everythingelse we export. Our trade has de-industrialized before our eyes.Other components of our trade

also deteriorated during thisperiod. Our trade deficit in servicesreached $25-billion in 2013 (hurtby the overvalued loonie, anotherside-effect of the energy boom).And net outflows of investmentincome (reflecting growing foreigninvestment here) are anotherdrain. Put it all together, and ourbalance of payments is now deep

in the red: by $60-billion per year.Once we could export both re-

sources and value-added productsto the rest of the world – and morethan pay our bills in the process.

But now our capacity to producefor the world has become narrowlypigeon-holed in resources (espe-cially petroleum).In short, no matter how fast we

dig it up and export it, we needmore than oil to pay our way inworld trade. So how do we escapethis resource-dependant trap?

umankind is facing twomajor challenges thiscentury – to provide

energy for the two billion peoplewho currently have limited or noaccess to energy and to respondto climate change – and Canadahas the potential to make a dif-ference in both areas, say RichardJ. Marceau and Clement W. Bow-man, co-editors of the upcom-ing book Canada: Becoming aSustainable Energy Powerhouse.With advantages like a wealthof resources and expertise inbringing big projects to fruition,what is needed are visionaries topoint the way, and governmentsand industry to work together toimplement the plans.“We’ve built our countrythrough big projects, massiveundertakings that have stretchedour resources to the limit andsometimes beyond,” says Dr.Richard J. Marceau, vice-pres-ident (research) at MemorialUniversity and president of theCanadian Academy of Engineer-ing. As examples, he gives theRideau Canal, the CanadianPacific Railway, the James BayHydroelectric Project, the Trans-Canada Microwave Network andthe CANDU nuclear reactor.The successful completion ofthese immense transportation,energy and communication proj-ects is a testament to the strengthof the Canadian innovationstrategy, explains Dr. Marceau,adding that big projects are at thefoundation of today’s prosperity.“A good recent example is theNewfoundland offshore petro-leum industry,” he says. “It’smade Newfoundland themostexciting and dynamic Canadian

province right now.”Coming out of the confluenceof natural resource potential,private-sector enterprise andinvestment, as well as strategicgovernment support, the New-foundland offshore petroleumindustry is thriving in an incred-ibly harsh climate, Dr. Marceausays, adding that its impact isimpressive. As of 2010, this stillrelatively new industry wasresponsible for approximately33 per cent of provincial realGDP and resulted in the average

personal income being 6.5 percent higher, the unemploymentrate being 1.8 per cent lower andthe province’s population 16,400larger than they would have beenwithout the industry. Future oilindustry activity, and associatedinvestments in infrastructure,education, training, R&D andbusinesses, is expected to deliveradditional economic growth anddiversification, says Dr. Marceau.“How do we continue this na-tion-building?” is the question Dr.Marceau has examined. Canada

has to carry on its tradition ofbig projects, which are “spring-boards for the future, creatingnew innovation ecosystems andreleasing a torrent of entrepre-neurial activity and technologythat can propel capabilities andperformances to new levels,” hesays.Specifically, the focus shouldbe on energy, believes Dr. Bow-man, associate, Bowman Centre,Sarnia/Lambton Research Parkand chair of the Canadian

SpecialSustainable energy superpower

WEDNESDAY, MAY 2 1 , 2014 SE 1

AN INFORMATION FEATURE

Big projects promptenergy strategy

Developing massive assets+ connecting them as a system= sustainable energy superpower

rovided it can summonthe political will andmake the appropriate

investment decisions, Canadais well positioned to become asustainable energy superpowerand major player in the NorthAmerican electricity market overthe next 30 to 40 years, a timewhen global energy consump-tion is likely to double in NorthAmerica alone, says Dr. JastinNathwani, executive director ofthe Waterloo Institute for Sus-tainable Energy.Although it is widely recog-nized that the transition froma fossil fuel to a low-carbonenergy system will take decades,Canada has a “clean-energy ad-vantage” and is abundantly richin low-carbon energy resources,including hydro, wind, bioen-ergy, geothermal, and advancednuclear. However, says Dr. Nath-wani, before Canada can capital-

ize on its advantages, politicalbarriers to inter-regional energytrading are going to have to comedown, and further investmentsare going to have to be made ininter-regional and cross-border

energy infrastructure.“Electricity generation isa high-value manufacturedgood that has the promise andpotential of delivering largebenefits through inter-regionaltrade enabled by transmissionand interconnections,” says Dr.Nathwani. But achieving sucha goal will require a dramaticshift away from the “provincialself-sufficiency paradigm” to acoherent national strategy.“Realizing the full potentialof clean electricity exports fromCanada to the U.S. through anexpanded power grid requiresprovinces, U.S. states and thefederal government to establisha clear policy framework andspecific mechanisms to reducebarriers to investment and to thedevelopment and approval ofspecific projects,” he says.There are encouraging signsthat this process is already

underway, he adds. The federalgovernment in particular hasbeen supportive of infrastruc-ture expansion across regionalboundaries. “This is your Key-stone, and this is your liquefiednatural gas in British Columbia,”he says. Over the longer term,it is logical from an investmentperspective for regional energysystems, such as those that existbetween Ontario and Quebec, orNewfoundland and Nova Scotia,or Alberta and British Colum-bia, to be expanded in order tofacilitate the large scale export ofenergy to the U.S. and beyond.He adds that Canada’s cleanenergy resources even carry aprice advantage as traditionalfossil-fuel sources are becomingincreasingly subject to carbon-emission penalties in the UnitedStates in order to speed-up thetransition to a low GHG-emis-sions environment.

The value-added crisis in Canada’s trade

Capitalizing on clean energy advantage

OPINION

ELECTRICITY

Strategy, Page SE 2

Trade, Page SE 4

INSIDE

Hydroelectric projects: Enabling a shift toward renewableenergy resources. Page SE 2

LNG: Stakeholders value community engagement process.Page SE 4

Sustainable cities: Energy systems need to be part of urbanplanning. Page SE 6

This report was produced by RandallAnthony Communications Inc. (www.randallanthony.com) in conjunction with the advertisingdepartment of The Globe and Mail. Richard Deacon, National Business Development Manager, rdeacon@globeandmail.com.

By thenumbers

Canada’selectricitysupplycomes from:

Almost

60%hydroelectricpower

12%nuclear power

3%non-hydrorenewablesources, such aswind and solar

Close to

13%fossil fuels,including coal,natural gas andpetroleum

Dr. Jastin Nathwani believes a powergrid can leverage Canada’s electricitypotential. SUPPLIED

“Energy can be a principaldriver of the economy asit is a sector where Canadacan be a sustained leader.”

Clement W. Bowmanis an associate at Bowman Centre,Sarnia/Lambton Research Park

Visit globeandmail.com/energysuperpower

LET’S INNOVATE ANDENGINEER A BETTERWORLD TOGETHER

The Canadian Academy of Engineering is the national

institution through which Canada’s most distinguished

and experienced engineers provide strategic advice

on matters of critical importance to Canada.

www.acad-eng-gen.cawww.cae-acg.ca

the globe and mail • wednesday, may 2 1 , 2014SE 2 • AN INFORMATION FEATURE

Wake up, Canada: seize the opportunityfor super-sized value-added projects

OPINION

SUSTAINABLE ENERGY SUPERPOWER Visit globeandmail.com/energysuperpower

y any measure, New-foundland and Lab-rador’s Muskrat Falls

hydroelectric scheme is amega-project. The 560,000 cubicmetres of concrete for the powerhouse and spillway alone wouldbe more than enough to pave aone-metre wide and 10-centime-tres thick path from St. John’s toVancouver.But it’s the $7.7-billion proj-ect’s contribution to Canada’ssustainable energy inventorythat really sets it apart.Muskrat Falls is phase oneof the Lower Churchill Project.It includes an 824 megawatthydroelectric generating facil-ity, the Labrador-Island Linkthat will transmit power fromMuskrat Falls to Soldiers Pondon the Avalon Peninsula, and theMaritime Link, being constructedby Emera of Nova Scotia, con-necting Newfoundland and NovaScotia. Construction of the majorcomponent is underway andexpected to take five years tocomplete.Muskrat Falls and Gull Island– the second phase of the project– are considered the best unde-veloped hydroelectric sources inNorth America. Together, theyhave a combined capacity ofmore than 3,000 megawatts.Nalcor Energy, Newfound-land public energy corporation,

says Muskrat Falls will powerhomes and businesses acrossNewfoundland and Labradorwith clean, renewable energy forgenerations.Gilbert Bennett, Nalcor’s vicepresident for the Lower ChurchillProject, says now that major con-struction activities are underway,the challenge will be to keepthe massive project on track bymonitoring the progress of themain contractors and carefullymanaging labour supply.“There are several other biginfrastructure projects underwayin the province that are drawingfrom the labour pool,” he says.“On top of that, many New-

foundlanders and Labradorianshave left to work on major proj-ects in other parts of the country,and we want them to come backhome to work for us.”The success of Muskrat Fallsis an inspiration to proponentsof other potential sustainableenergy schemes such as the con-cept for a massive hydroelectricproject that proposes harness-ing the Mackenzie River in theNorthwest Territories to produce13,000 megawatts of power, withseven low dams to avoid landsubmersion.The concept was developed byindustrial engineer Pierre Gin-gras, an associate researcher with

the Montreal Economic Instituteand specialist in the construc-tion of hydroelectric projects.His proposal, based on researchcompleted last December andpublished this year by the Cana-dian Academy of Engineering inthe book Canada: Winning as aSustainable Energy Superpower,suggests a project that would in-clude an upstream water controlstructure, six downstream pow-erhouses, and 10,000 kilometresof transmission lines to takethe power to Edmonton. Thecomplex could produce powerequivalent to 525,000 barrels offuel per day and help Albertaand Saskatchewan transitionaway from high-carbon-footprintthermal generating stations.Mr. Gingras wonders if theelectricity might also be usedto replace steam with electricheating elements in oil sandsoperations, which would elimi-nate water use and reduce airemissions from fossil fuel used togenerate steam.“The priority is to build aware-ness of the Mackenzie River’shydroelectric potential andattract the interest of policy-makers,” says Mr. Gingras. “Thisis a project as big as the JamesBay complex, and it could makea major contribution to Canadabecoming a sustainable energysuperpower.”

HYDROELECTRICITY

Potential for renewable energy for generations

Academy of Engineering EnergyPathways Task Force. “We startednine years ago with an under-standing that an energy systemis important to the country. Thatunderstanding has now turned usinto believers.”Energy can be a principal driverof the economy as it is a sectorwhere Canada can be a sustainedleader, says Dr. Bowman, and anumber of initiatives involvingelectricity could also help NorthAmerica meet climate changetargets.“We have the capability togenerate enormous quantities ofelectricity, way beyond our ownneeds,” he explains, adding thatCanada currently only utilizesabout a third of its resources forhydroelectric power and could in-crease nuclear energy productionby a factor of 10. “Both sourceshave very low greenhouse gasemissions,” Dr. Bowman says.

“If we combine themwith anational grid that connects fromeast to west across Canada andis linked to the U.S., we couldprovide electricity to the States.”Replacing some of the coal powergeneration in the U.S. could havea substantial impact on GHGemissions, he adds.Big projects have a largeimpact, but most take years to ac-complish and require substantialinvestments at a time when eco-nomic benefits are far off, says Dr.Bowman, who believes they arenot jobs for single companies ora single set of shareholders. Theyare national projects, serving along-term national interest.They also have the potentialto strengthen Canada’s eco-nomic and social fabric, says Dr.Marceau. “We have the resourcesand expertise to produce some-thing that the world continuesto need. It’s an opportunity not

just for economic growth, butalso for bringing greater unity ofspirit, thought and action to ourcountry,” he says.For Dr. Marceau, this is anexample where the sum can begreater than its parts. “By devel-oping thesemassive assets withthe view of connecting them as asystem, we can leverage them forgreater impact,” he says, add-ing that the combined strengthwould provide a solid foundationfor research and financial backingfor “developing game-changingtechnology with the potentialto reduce the accumulation ofcarbon in the atmosphere.”

Canada: Becoming a Sustain-able Energy Powerhousewill belaunched on June 26 at the AGMof the Canadian Academy ofEngineering and will be availableat www.cae-acg.ca/publications-of-the-academy/.

FROM PAGE SE 1

Strategy: Driving the economy and lowering GHG emissions

The aerial view of Muskrat Falls looking downstream conveys a sense ofthe project’s vast potential – it will power homes and businesses acrossNewfoundland and Labrador. SUPPLIED

Crude oil and bitumen don’t yield the same returns as value-added petro-leum products and diversifying exports could lead to a significant increasein revenues. ISTOCKPHOTO.COM

“We have the resourcesand expertise to producesomething that the worldcontinues to need. It’s anopportunity not just foreconomic growth, but alsofor bringing greater unityof spirit, thought andaction to our country.”

Richard J. Marceauis vice-president (research)at Memorial University andpresident of the CanadianAcademy of Engineering

By Clement W. Bowman,Associate, Bowman Centre,Sarnia/Lambton Research Park,and Surindar Singh, ExecutiveDirector, Renewables & EmergingTechnologies, Alberta Innovates:Energy and Environment Solutions

here was once a timewhen it made eminentsense to send all our oil

and gas south. It no longer does.And it’s not just because of the XLpipeline. It’s because Canadiansare losing billions of dollars a yearby being too slow and complacentabout finding new markets.Consider the past decade. The

Australians exported LiquefiedNatural Gas (LNG) to China andJapan at parity with crude oilprices – around $16 per millioncubic feet (MCF). Canada annu-ally exported around three trillioncubic feet (TCF) of its natural gasto the United States only, oftenat prices below $3 per MCF. Thelost revenues were around $13per MCF. If one TCF per year hadbeen sent to Asia, this would havegenerated an additional $13-bil-lion each year. This would haveeasily paid for all the necessarypipelines and LNG terminals, aswell as other massive infrastruc-ture projects – and created high-paying jobs and immense wealthacross Canada. Natural gas royaltyrevenues would have increased –and Alberta would not have hadany deficits.A similar situation exists with

our bitumen exports. Comparedto the refining of conventionalcrude oil, it takes a refiner around$15 per barrel more to refine bitu-men to transportation fuels. Whenthe differential between world

crude oil price and bitumen priceexceeds $15 per barrel, then itbecomes more profitable for U.S.refiners to refine bitumen – butCanadians lose. For example, if thedifferential is $25 per barrel andone million barrels of bitumen arebeing refined in the United States,Canadians “lose” $10-millionper day or $3.65-billion per year.Don Wood’s team at the Bow-man Centre has estimated that a100,000-barrel-per-day bitumenrefinery in the Sarnia-Lambtonregion would cost $10-billion. If bi-tumen is diverted to this refineryand the differential is maintainedat $15 per barrel, the capital costof this refinery would pay for itselfin less than three years. Lower dif-ferentials mean higher royalties –the Alberta government revenueswould be increased significantly.Canada needs to diversify

its energy markets by buildinginfrastructure both east and westof Alberta. And Canadian govern-ments have always done so – the

TransCanada railways in the 19thcentury, the extensive oil and gaspipeline networks in the 20thcentury. Now, it’s time once moreto make a strategic decision onbuilding the energy infrastructurefor the 21st century. This wouldpay for itself within a few years.For governments, it would meanmore revenues; for industry, itwould mean better market accessand therefore greater profits; toEastern Canada, it would meanbetter energy security; for allCanadians, it would mean morehigh-paying jobs and wealthgeneration.The delegates at the May 2013

conference titled Bitumen - AddingValue: Canada’s National Oppor-tunity concluded that failure toexpand our market reach hasresulted in “value destruction ona scale never witnessed before inthis country.” Now is the time fornational action to capture the truevalue of our energy resources. It’sin our own best interests.

INFRASTRUCTURE

BITUMEN UPGRADING PROJECT’S BUSINESS CASESEEN AS SOLID

Job creation, energy security and economic gains are someof the arguments for moving the Sarnia/Lambton bitumenupgrading project forward, says Don Wood, an associate ofthe Sarnia-based Bowman Centre and former Polysar vice-president.Mr. Wood is part of a team of executives with petroleumindustry experience who are currently looking for a corpo-rate champion (or champions) for the $10-billion oil sandsbitumen upgrader and refinery in Chemical Valley.“Canada stands to gain a significant increase in exportrevenue, and Alberta interests will have access to a newmarket for bitumen at more stable prices,” says Mr. Wood,adding that the local economy in the Sarnia/Lambtonregion will also see significant stimuli.Part of the infrastructure is already in place, Mr. Woodexplains, as the two pipelines that are currently com-ing into Sarnia can carry diluted bitumen and increasingtheir capacity is feasible. And if the new upgrader is builtto produce gasoline, diesel and other value-added petro-leum products, an acceptable return on investment can beachieved.There are three existing refineries and two petrochemi-cal plants as well as unused refinery and upgrader-suitableplants available, in addition to land, pipelines and otherrelated infrastructure. Taking the existing assets into ac-count, Mr. Wood estimates that infrastructure developmentwould pay for itself within a few years.“We have pipelines, local infrastructure and surplusskilled construction labour, all strategically located in thecentre of the North American market, with access to inter-national markets through the St. Lawrence Seaway,” saysMr. Wood, adding that additional benefits include produc-tion costs equivalent to those in the U.S. Gulf Coast andlower than in Europe and Asia, making the facility globallycompetitive.“Ours is a welcoming community with over a centuryof experience hosting oil and gas industry projects,” Mr.Wood says. “Since we will use the latest technologies toeliminate or minimize emissions, and will consult with alllocal stakeholders, approvals to build are expected to beobtainable.“The only losers would be the refineries abroad thatwould have to find their feedstock elsewhere,” says Mr.Wood, adding that the new 150,000-barrel-a-day upgraderand refinery in Sarnia would allow Canada to capture$2.5-billion annually in added value. If the bitumen isnot processed locally, that opportunity would be lost, orsent south.

ENERGY ANALYSIS

Primary energy productionin Canada increased 3.3 percent between 2011 and 2012to 17,335 petajoules. This fol-lowed a 3.6 per cent increasebetween 2010 and 2011.One petajoule equalsroughly the amount of en-ergy required to operate theMontréal subway system forone year.Crude oil accounted for thelargest proportion of primaryenergy production in Canadain 2012, at 42.9 per cent. Thiswas followed by naturalgas (34.9 per cent), primaryelectricity (9.9 per cent), coal(8.6 per cent) and gas plantnatural gas liquids (3.6 percent).

EXPORTS AND IMPORTSJust over 58 per cent ofprimary energy produced inCanada is destined for exportmarkets, primarily the U.S.Exports of Canadianenergy and energy productsincreased 5.3 per cent in 2012to 11,234 petajoules.Canada exported 73.5 percent of its crude oil produc-tion, 56.5 per cent of itsmarketable natural gas and23.3 per cent of its refinedpetroleum products.Imports of energy de-creased 0.8 per cent from 2011to 3,709 petajoules in 2012.Crude oil accounted for44.6 per cent of imports,followed by natural gas (32.7per cent), refined petroleumproducts (13.4 per cent) andcoal (7.4 per cent). Together,these products and commod-ities made up 98.1 per cent ofenergy-related imports.

ENERGY CONSUMPTIONCanada’s energy consump-tion decreased 0.6 per cent to8,179 petajoules in 2012, fol-lowing a 7.5 per cent increasein 2011.Energy consumptionincreased in total mining andoil and gas extraction (+13.3per cent) and the construc-tion sector (+3.6 per cent).All other sectors showeddecreases in energy con-sumption.Refined petroleum prod-ucts (38.1 per cent) were themain source of energy con-sumed in Canada in 2012, fol-lowed by natural gas (30.8 percent) and primary electricity(22.5 per cent).

Source: Statistics Canada

SARNIA-LAMBTON

With gratefulacknowledgementto our sponsors:

THE BOWMAN CENTREWestern Sarnia-Lambton Research Park1086 Modeland Road, Sarnia, ON N7S 6L2

KNOWS OILWe have the expertise Canada needsto host the newest bitumen upgraderrefinery. With our existing refineriesand petrochemical plants, ourworkforce is one of the most skilledin the world. After all, we’re in thebirthplace of North America’s oilindustry, so we’ve developed areputation for dealing with oil andoil processing. Processing bitumenin Canada is the sensible solution.Let’s keep the work in Canada.Let’s keep Canada working!

READY,WILLING& ABLE

CONSULTING ENGINEERS“engineering integrity since 1959”

CONSTRUCTIONASSOCIATION

Two key strategies are needed:1. Canada must defend its capac-ity to produce and exportvalue-added products, not justresources. We must be able toproduce higher-value prod-ucts (and services, too) thatthe rest of the world will buy.This will require consciousindustrial strategies to supportinvestment and innovation inmanufacturing and tradableservices.

2. An obvious place to start isby maximizing value-addedpossibilities directly connectedto our resource base. Insteadof exporting bulk unprocessedcommodities, we shouldupgrade, refine and processour petroleum (into refinedproducts and petrochemicals).It’s shocking that we nowimport almost as much refinedpetroleum product as weexport – shameful for a major

petroleum power. Upstream,too, we could do much betterat leveraging Canadian-madeinputs (like high-value machin-ery and capital equipment) forour mines and wells, insteadof importing them all from therest of the world.

Canada will never become atruly developed and successfultrading nation unless we rebuildour collective capacity to addvalue to our own resource wealth.We can and must becomemorethan hewers of wood, drawers ofwater – and scrapers of tar.

LNG project brings ‘sense of optimism’to northern community

ENGAGEMENT

ation-building takesmanyforms. In the late 19thcentury, the completion

of a railroad linking Eastern andWestern Canada helped transformCanada from a concept to a fact.Similarly at the onset of the 21stcentury, the completion of pipe-lines and export terminals allowingliquefied natural gas (LNG) to beexported to Asia and around theworld is viewed as a significant actof nation-building.“It’s the new frontier,” says LNG

Canada’s director of external affairsSusannah Pierce. “The proposedLNG projects provide a newmarketfor the energy industry – in thiscase natural gas – which has thepotential to be a significant revenuegenerator and job creator, benefit-ing all Canadians.”Independent studies commis-

sioned by the Government of Brit-ish Columbia indicate that if fiveLNG facilities were operating in B.C.by 2020, it couldmeanmore than$98-billion in new capital invest-ment, 75,000 permanent new jobs,more than 39,000 average annualjobs over the construction period,and generatemore than $100-bil-lion in new government revenuesover a 30-year period. All this ispossible, says Ms. Pierce, becauseof themove away from a closeddomestic and North Americanmar-ket to an international one whereenergy prices can be significantlyhigher.The LNG Canada project is also

significant in the high “sociallicence fee” the company is willing

to pay to ensure that human andenvironmental needs are addressedduring both the building and op-erational phases of the project.“Asmuch as possible, the plant is

being built incorporating the com-ments and interests of the peoplewho are potentially affected,” shesays. In Kitimat, where the LNGexport facility is proposed, HaislaNation Chief Ellis Ross says thecompany has been as good as itsword, preferring consultation toconfrontation and extending eco-nomic development opportunities

to the Haisla people.“They’ve been very upfront

about the impacts and don’t applyfor permits without consulting withus first,” he says, adding that theproject offers somany benefits tohis people that it has the potentialtomove the Haisla Nation awayfrom dependence in economicmatters. “If this isn’t the perfectexample of reconciliation at work,then I don’t knowwhat is,” he says.In Kitimat, mayor Joanne

Monaghan says the arrival of LNGCanada has transformed the com-

munity, renewing hope and revers-ing a long economic slide. “Wewere in a situation of doom, andnow we’re having a boom,” shesays. “We’re building new housesand renovating old ones, which isenhancing our neighbourhoods.We were down to two children onour street a few years ago, nowwe’re up to 20. There’s a renewedsense of optimism.” She adds thatshe has an extremely good rapportwith LNG Canada. “I have their cellnumbers. They always talk to me,they listen to our concerns andthey’re always polite.”Typically taking the call from

people like Mayor Monaghanand other concerned citizens isMary-Ellen Proctor, LNG Canada’scommunity liaison officer. Bornand bred in the North, Ms. Proctorsays she views the project as a kindof salvation for towns like Kitimat,one that will keep families andcommunities together by provid-ing opportunity. “At LNG Canada,we like to think of ourselves asnew neighbours,” she says. “Welike what we’re doing, but we wantpeople in the community to likeit as well, so we’ve set up a systemwhere people can come to us withtheir concerns.”The LNG industry is still in an

embryonic stage, and there aremany hurdles to pass, but the wayin which it has already been suc-cessful in building communitiesand renewing hope in the Northspeaks well of its ambition to be apositive force in nation-building inthe years to come.

SOLUTIONS

TECHNOLOGY

LNG Canada has built a good rapport with community members, says Mary-Ellen Proctor, LNG Canada’s community liaison officer. SUPPLIED

Located in the municipality of Clarington in Durham Region, 70 kilometres east of Toronto, Darlington is OntarioPower Generation’s newest CANDU nuclear generating station. It provides approximately 20 per cent of Ontario’selectricity needs, enough to serve a city of two million people. SUPPLIED

Energy efficiency makes good sense for businesses and Pulse Energy’ssoftware has contributed to an average of 10 per cent savings for utilitycompanies’ commercial clients. LORI BAMBER

the globe and mail • wednesday, may 2 1 , 2014SE 4 • AN INFORMATION FEATURE

SUSTAINABLE ENERGY SUPERPOWER Visit globeandmail.com/energysuperpower

2013

We made progress in reducing the precentage of primary exports over a 20-year period and then blew it over the past 10 years. INTERPRETATION BY CLEM BOWMAN

Reliance on primary exports

60%

55%

50%

45%

40%

35%

30%1980 1990

PRIM

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PRO

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FROM PAGE SE 1

Trade: Strategies for adding value

“The proposed LNGprojects provide a newmarket for the energyindustry – in this casenatural gas – whichhas the potential to bea significant revenuegenerator and job creator.”

Susannah Pierceis LNG Canada’s director of externalaffairs

or more than a century,Canada has been a leaderin nuclear engineer-

ing. Today, the country has thepotential to assume a key posi-tion in nuclear energy, with theuranium andmaterials necessaryto generate an endless, sustain-able supply of power, says DanMeneley, professor of nuclearplant safety at the University ofOntario Institute of Technology.“It’s inexhaustible,” says Dr.Meneley, former chief engineerat Atomic Energy of Canada Ltd.,noting that nuclear energy hasan important – albeit controver-sial – role in making Canada asustainable energy superpower.“We have an embarrassment of

riches, but only if we have thecourage to use it.”Canada’s nuclear expertiseoriginated around 1900 with theNobel Prize-winning researchof Ernest Rutherford, a NewZealand-born physicist workingat McGill University. He becameknown as the father of nuclearphysics.It continued with W.B. Lewis’sgroundbreaking research onnuclear power following theSecond World War, especiallythe development of the CANDUreactor. Dr. Meneley calls this“our bird in the hand,” and notesthat more than half of Ontario’selectricity is now generated bythese reactors.

“Oil is looking weaker everyday,” he comments, but Canadahas a supply of uranium thatcould last thousands of years, aswell as the rawmaterials to buildas many reactors as we want.“It can be done all within ourown economy,” he says, althoughit’s important to have “politicalgumption” and to design reac-tors for safety. “Our children andour grandchildren will accept it,but only on one condition: thatwe manage the energy correctly.”Now is the time to begin, Dr.Meneley stresses. “The later wedo it, the higher the price of oilwill be. We can, if we wish, be offoil in 50 years, there’s no ques-tion about it.”

usinesses represent thenext major opportu-nity for energy efficiency,

according to David Helliwell,co-founder and CEO of PulseEnergy. Commercial buildingsin North America use $200-bil-lion in energy each year, yethave been often overlooked bytraditional conservation efforts.Mr. Helliwell’s company hascombined energy expertise andsoftware analysis to tackle thisproblem.“Our mission is to make theworld’s businesses more energy-efficient,” Mr. Helliwell says, ex-plaining that the company pairsthat objective with a uniqueapproach to cost-effectivelydelivering savings.“We partner with utilitiesand analyze energy data fromtheir customers,” Mr. Helliwellsays, with Pulse Energy’s energyintelligence software identify-ing anomalous power use andhighlighting areas to improve.Sometimes it’s as simple aschanging operating schedules orturning off appliances overnightto deliver meaningful cost andenergy savings.”Since it started working withBC Hydro in 2009, Pulse Energyhas built up an impressive trackrecord. “[BC Hydro] rolled outour software to hundreds of theirlargest commercial customers aspart of a continuous optimiza-tion program that has deliveredaround 10 per cent savings on av-erage,” Mr. Helliwell says, addingthat the operational efficiency ofthe buildings has been improvedby a combination of the softwareand energy managers. He em-phasizes that those percentages

have been achieved through low-or no-cost measures with shortpayback periods.Pulse Energy now works withleading utilities across three con-tinents, and is on track to ana-lyze over two million businessesby the end of 2014. These gener-ate an immense amount of dataon how commercial customers –dry cleaners, shoe stores, offices,elementary schools, universitiesand others – interact with theirenergy use, which feeds backinto constantly improving thesoftware.This innovation has come tothe attention of British Gas Busi-ness, the commercial divisionof the United Kingdom’s largestenergy company. In a recentlyannounced deal, Pulse Energy’stechnology will improve the en-ergy performance of British Gas’sentire commercial customerbase at over 900,000 locations.British Gas was attractedby Pulse Energy’s commercialexpertise and ability to improvecustomer relationships. “Our pri-mary role is to help them betterengage with their customers sothey can provide better services,”Mr. Helliwell says, adding thatenergy savings lead to lowerbills, an important part in at-tracting and retaining customers.“It’s a virtuous circle we’re proudto be a part of.”Energy intelligence also playsan important role as morerenewables are coming on board,says Mr. Helliwell. Bringing moreintelligence into the system andencouraging people to tailortheir energy use to its availabilitycan ease the pressure on the gridand reduce the need for storage.

Courage and safe design key tonuclear potential

Intelligent energyconservation solutions

LNG Canada is proposing to build and operate an LNG export facility near Kitimat,British Columbia – but we can’t do it alone. We are working with First Nations, the public,and all levels of government to share information and ask for input on our plans. Whilethere is still much work to be done, LNG Canada is building strong relationships with thecommunity now, in anticipation of these relationships lasting well into the future.

Working together to develop a cleansource of energy for the world.

www.LNGCanada.ca

SE 6 • AN INFORMATION FEATURE

SUSTAINABLE ENERGY SUPERPOWER Visit globeandmail.com/energysuperpower

the globe and ma il • wednesday, may 2 1 , 2014

Making cities more resilient by integratingflexible, local fuel sources

INFRASTRUCTURE

mall-scale projects thatproduce energy and useit more efficiently at the

community level are critical tosecuring Canada’s energy future,experts say.With energy use by cities

accounting for more than two-thirds of global demand, localurban solutions are instrumentalto curbing energy consumptionand the resulting environmentalconsequences, says independentconsultant Mary Ellen Richardson.“If Canada is to become a

sustainable energy superpower,Canadian cities will need to be asfocused on resource stewardshipand efficient management as theyare on resource extraction andtransport,” says Ms. Richardson,whose career in the oil, natural gasand electricity industries spans 30years. “We have to rethink how wedevelop our urban spaces and takeadvantage of the energy we havethere.”Energy use by cities accounted

for 67 per cent of global demandin 2006, a figure that is expectedto increase to 73 per cent by 2030,according to the InternationalEnergy Agency.Ms. Richardson notes that cities

in northern Europe, which havesimilar climates to ours, have built“district energy” systems, withsmall-scale “combined heat andpower” facilities that producethermal and electrical energy forlocal use or to sell to the electricalgrid. Few communities in Canadaare exploiting such opportunitiesto turn natural gas or local fuelfeedstocks such as wood biomass,solid waste and biogas into energy,she laments. “Literally, we wasteour waste.”Many Canadian provinces focus

their energy policies on distant,large-scale electricity plants ratherthan community energy systems,she says, adding that a bigger focuson efficiently meeting the heatingand cooling energy needs of citiesis critical.Michael Harcourt, the former

mayor of Vancouver and premier

of British Columbia, who hasserved on a number of organiza-tions dealing with urban sustain-ability, says that communitiesmust make energy an integral partof their strategies.“We have to change the way we

live,” says Mr. Harcourt, chair ofQuality Urban Energy Systems forTomorrow, a collaborative net-work focused on urban integratedenergy initiatives.He points out that Guelph,

Ontario, has a 25-year communityenergy initiative that requires it toreduce greenhouse gas emissionsby 60 per cent and per-capita en-ergy consumption by 50 per cent.“That means making the rightchoices.”For example, water storage,

treatment and delivery accountsfor 17 per cent of a municipalgovernment’s energy bill, he

says. People could significantlyreduce their water consumptionif the “grey” water resulting fromwashing and showering were re-circulated in their homes for otherpurposes.“We can dramatically reduce

costs and reduce consumption andcreate livable, sustainable solu-tions,” Mr. Harcourt says.Ms. Richardson acknowledges

that the capital costs of the infra-structure needed to pipe thermalenergy throughout a communitywould be significant, but it really isno different than installing sewers,water systems and other criticalinfrastructure needed to meetbasic needs.Vision is critical, as “convention-

al land-use planning approachestackle energy at the end of theplanning process, with energyconsiderations presently appear-

ing secondary to building or com-munity design,” she says. “Thisapproach misses the opportunityfor increased efficiencies, the useof local energy fuels and the appli-cation of other energy stewardshipconcepts.”A “reactive” approach locks

communities into long-term, less-adaptable energy scenarios, Ms.Richardson says, while one basedon flexible, local fuel sources isless vulnerable to supply interrup-tions from severe weather and gridfailures, and it helps communitiesfocus on energy conservation.“Cities are at the crux of the

climate challenge,” she says,although “this scale of a problemrequires multi-government co-operation and intervention of cityplanners working in tandem withthe community, technical expertsand policy-makers.”

District energy systems have been implemented, for example, in Oujé-Bougoumou, Quebec (top right), and Strathcona County, Alberta (bottom right). Theirinfrastructure is expensive to build, but if prices of high-grade energy sources – such as electricity, natural gas or oil – were to spike unexpectedly, thesesystems would allow central energy plants to switch fuel sources to renewables with much less overhead and still deliver reliable services, according to Ms.Richardson and her team members Terri Chu and Marlene Rogowska. FVB ENERGY

“We can dramaticallyreduce costs and reduceconsumption and createlivable, sustainablesolutions.”

Michael Harcourtis chair of Quality Urban EnergySystems for Tomorrow

Our answer is Yes.

We’re all part of something bigger. In the next 20 years the global demandfor energy is expected to grow by more than one-third. So how do we findbetter ways to responsibly provide the energy we need so everyone canbenefit from a healthy environment today and tomorrow?

We’re Canada’s largest energy company. Come and see how our breakthroughsin technology are improving environmental performance as we take on theessential questions around energy in the world we share.

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Can we do moreand use less?