Clarity is key to unravelling complex energy industry issues in Canada. Too bad it’s in such short supply.
That deficit is pushing the latest energy hot button in B.C.: the high price of gasoline in Metro Vancouver. As chronicled recently in Business in Vancouver (“How B.C. Could Deflate Its Gas Bubble”– issue 1537; April 16–22), that price spike is being driven by a combination of factors, one of which is tied to Trans Mountain pipeline expansion delays.
However, complex problems don’t fit well into political sloganeering and calls to arms from anti-fossil-fuel forces. The Trans Mountain factor also won’t play well in Victoria, where the BC NDP government is doing its best to derail the multibillion-dollar project – efforts that have earned it enemy status with the new Alberta government.
Clarity over complicated issues can help B.C. avoid a needless battle with Alberta. For example, gasoline consumers need to know that Trans Mountain will reduce supply constraints that are contributing to record high gas prices.
The federal government also owes taxpayers, now on the hook for Trans Mountain, more financial clarity about the project. The Parliamentary Budget Officer’s analysis in January noted that Ottawa’s $4.4 billion purchase of the pipeline and its expansion project in August 2018 was at the high end of its estimated value range. Delays in completing the project will further erode its resale value for Canadian taxpayers and add to B.C.’s energy supply squeeze.
A recent Institute for Energy Economics and Financial Analysis (IEEFA) report also pointed out that measuring Trans Mountain’s success or failure will be difficult unless there is transparency around the federal government’s financing of the project, its operational costs and where its revenue is going.
There might be questions over how objective the American IEEFA is when it comes to fossil fuel development, but far more questions need to be raised over the transparency issues its report documents.