{"id":9728,"date":"2025-01-27T05:16:21","date_gmt":"2025-01-27T05:16:21","guid":{"rendered":"https:\/\/www.rbc.com\/en\/thought-leadership\/climate-crunch-canadas-role-in-american-energy-dominance\/"},"modified":"2025-03-26T04:54:39","modified_gmt":"2025-03-26T04:54:39","slug":"climate-crunch-canadas-role-in-american-energy-dominance","status":"publish","type":"rbc_tl","link":"https:\/\/www.rbc.com\/en\/thought-leadership\/climate-action-institute\/climate-crunch\/climate-crunch-canadas-role-in-american-energy-dominance\/","title":{"rendered":"Climate Crunch: Canada\u2019s role in American energy dominance"},"content":{"rendered":"

Issue #07<\/span><\/p>\n

\u2794<\/span> America\u2019s era of energy dominance is here. What does it mean for climate policy?
\n\u2794<\/span> Climate Action Annual Report 2025: What Semex and Purolator have in common
\n\u2794<\/span> What Canadian business leaders say about climate action
\n\u2794<\/span> The TV series capturing U.S. oilpatch\u2019s cheery mood<\/p>\n

Hot takes<\/h3>\n

\"\"<\/p>\n

Subsidies, funding and leadership. <\/strong>These three levers will advance climate progress, according to a majority of the 100-plus business executives we surveyed for the Climate Action 2025: A year for rewiring<\/em><\/a>, <\/em>our annual report tracking Canada\u2019s climate progress. Around three-fourths of Canadian businesses have a climate strategy in place, and roughly 40% believe they are (almost) equal partners with governments in driving climate action. Read the survey here<\/a>.<\/p>\n

Severe weather events are costing Canada\u2019s economy. Natural disaster claims of $8 billion last year in Canada smashed the previous record of $6 billion, as climate-change fuelled weather events played havoc across the country from Jasper to Toronto, Insurance Bureau of Canada<\/a> estimates. It\u2019s not just Canada. Early estimates show Los Angeles\u2019 wildfires could trigger economic losses of as much as US$150 billion\u2014the costliest natural disaster<\/a> in U.S. history. Globally, the losses stood at US$320-billion last year<\/a>, 30% higher than 2023.<\/p>\n

Misinformation is the world\u2019s top short-term global risk. <\/strong>That\u2019s according to a World Economic Forum<\/a> report on global risks. While misinformation, and its close cousin disinformation, pervades society, it also pollutes discourse on climate issues. Social media<\/a> is not helping as it plans to remove guardrails on misinformation. WEF\u2019s top 4 long-term risks are all environmental: extreme weather events, biodiversity loss, critical changes to Earth\u2019s system, and natural resource shortages.<\/p>\n

Oilpatch cowboy tales. <\/strong>Taylor Sheridan, co-creator of the Yellowstone <\/em>TV series\u2014which tapped America\u2019s conservative-progressive cultural clash\u2014, is back with Landman<\/em> (Amazon Prime), a Texas Permian Basin tale rife with drug cartels, roughneck life and merciless ribbing off the renewable sector\u2019s presumed deficiencies compared to the oil sector. Watch the acerbic, plain-speaking oil lease executive\u2014or landman\u2014Billy Bob Thornton bat away Permian and parental troubles on a daily basis. It\u2019s reductive and retro\u2014quite like the American mood right now.<\/p>\n

\u2794 Bi-Weekly Climate Action Award: <\/strong><\/span> To Ontario for launching a Home Renovation Savings Program that offers 30% rebate on heat pumps, rooftop solar panels and battery storage systems, etc. Buildings<\/a> account for 13% of Canada\u2019s emissions.<\/p>\n

\u2794 Bi-Weekly Climate Action Fail Award: <\/strong><\/span> To Australia for delaying the rollout of new carbon emission targets by 2035, citing the return of Donald Trump\u2019s<\/a> return to the White House.<\/p>\n

Canada\u2019s role in U.S. energy dominance<\/h3>\n

There were no tariffs on Canadian goods on Day One of Donald Trump\u2019s presidency\u2014but they could come as soon as Feb. 1. Amid the chaos of Washington\u2019s tariff and \u201ceconomic force\u201d threats, there might even by a sliver of opportunity for Canada: the potential of a new bilateral energy trade deal between the two as the U.S. president vows \u201cenergy dominance\u201d for America.<\/p>\n

The U.S. president has declared an \u201cenergy emergency\u201d to build new critical infrastructure. Could some of it be built in Canada given the integrated nature of the two country\u2019s energy sector?<\/p>\n

Trump\u2019s inaugural speech focused on \u201cliquid gold under our feet,\u201d and exporting American energy all over the world. Would Canada be feeding America\u2019s domestic oil and gas markets that would free up U.S. output for exports? The contours of Trump\u2019s Great Energy Game views Greenland, Canada, Mexico and the Panama Canal, as resource and depots hubs that the U.S. can draw upon. Glass half-full suggests Canada can be an equal partner in fortifying North American energy security. Glass half-empty suggests the U.S. may need less Canadian oil and gas in the future if its \u201cdrill, baby, drill,<\/a>\u201d mantra leads to a domestic output boom. Cue for calls in some quarters to resurrect the long-dead, Asia-facing Northern Gateway oil pipeline<\/a>.<\/p>\n

Canada has its work cut out as it keeps tariffs at bay and helps America realize its energy ambitions without losing sight of its own climate goals.<\/p>\n

Meanwhile, the U.S.\u2019s own climate targets are out the window with its exit from the Paris Climate Accord. If that positioning turns into a full reversal of the Inflation Reduction Act, it\u2019s hard to see other major economies not following suit and scaling back their investments, according to Institute head John Stackhouse<\/a>.<\/p>\n

Read John Stackhouse\u2019s take on Trump\u2019s first day back in the White House<\/a>.<\/p>\n

Climate Action 2025: Rewire & reboot<\/h3>\n

The Institute\u2019s second annual report<\/a> on Canada\u2019s climate action is full of insights, but here are five themes that stood out to us:
\n<\/strong>
\n1. The big number:<\/strong> Climate action has doubled in Canada over the past five years, and there is one big driver: sizeable government funding announcements of $177 billion worth over the past decade, according to our tracking<\/a>. Now comes the other hard part: how to fully deploy it.<\/p>\n

2. Climate security is the new watchword.<\/strong> ESG is out, climate security is in\u2014or so it seems. Protecting North American resources and supply chain is going to be critical over the next decade. However, governments will also need to distinguish between friend and foe (yes, we are looking at you, America).<\/p>\n

3. Canadian innovation is alive and well\u2014and under-reported: <\/strong>Guelph-based Semex<\/a> is working away to make future generations of Holstein cattle breeds low-carbon. Meanwhile, unknown to most, logistics firm Purolator<\/a> helped Canadian startups build better e-bikes. Innovation, driven by market forces, can lead to serendipitous solutions.<\/p>\n

4. Alberta is a climate leader:<\/strong> The province\u2019s early coal phaseout needs to be celebrated. Of course, Alberta\u2019s U-turn on renewable development has undone some the goodwill, but climate progress is almost never linear.<\/p>\n

5. A spate of new green projects could<\/strong> boost the<\/strong> Climate Action Barometer.<\/strong> Our proprietary index on Canada\u2019s climate action<\/a> is tracking progress from a spate of decarbonizing projects, including Entropy\u2019s carbon capture and storage projects, Shell\u2019s Polaris carbon capture and Canada Nickel\u2019s<\/a> Timmins project, among others.<\/p>\n

\"\"<\/p>\n

ICYMI<\/h3>\n

\u2794 Seven big environmental decisions facing the B.C. government in 2025<\/a><\/strong><\/span><\/p>\n

\u2794 Donald Trump\u2019s economic advisors on the wonder of tariffs<\/a><\/strong><\/span><\/p>\n

\u2794 U.S. energy chief vows to \u2018unleash\u2019 U.S. expansion<\/a><\/strong><\/span><\/p>\n

\u2794 U.S. ESG funds had a bad year with a record outflows<\/a><\/strong><\/span><\/p>\n

\u2794 California is waiving climate rules to speed up wildfire-hit LA\u2019s rebuild. That might be a mistake<\/a> <\/strong><\/span><\/p>\n

The Institute In Action<\/h3>\n

\u2794<\/span> On January 15, we gathered over 100 business, NGO, government, and climate leaders to launch our flagship climate action report, Climate Action 2025: a year for rewiring. We heard from Dave McKay<\/strong><\/a>, RBC<\/a> CEO, Sir <\/strong>Andrew Steer<\/strong><\/a>, President and CEO of the Bezos Earth Fund<\/a>, and Canadian artist Ed Burtynsky on ways Canada and the world can rewire our thinking and strategies to keep climate on the radar.<\/p>\n

\u2794<\/span> Institute head John Stackhouse<\/strong> is in Davos. Follow him on LinkedIn<\/a> to read his frequent updates.<\/p>\n

\u2794<\/span> On January 30, Myha Truong-Regan<\/strong>, our Head of Climate Research, \u00a0will be on a panel alongside Jennifer McLeod Macey, SVP, Public Affairs & Communications, Leger, and Tracey Bodnarchuk, CEO, Canada Powered by Women, at the Toronto Regional Board of Trade\u2019s Powering our Climate & Energy Economy Symposium,<\/a> to discuss what Canadians really think about climate and energy policy.<\/p>\n

What\u2019s on the team\u2019s reading wish list: <\/strong>Waste Land: A World in Permanent Crisis<\/em> by Robert D Kaplan, The Technological Republic: Hard Power, Soft Belief, and the Future of the West<\/em> by Alexander C Karp and Nicholas W Zamisk, Abundance<\/em> by Ezra Klein and Derek Thompson.<\/p>\n

\n

Curated by Yadullah Hussain<\/strong>, Managing Editor, RBC Climate Action Institute.<\/p>\n

Climate Crunch would not be possible without John Stackhouse<\/a>, <\/em>Myha Truong-Regan<\/a>, <\/em>Sarah Pendrith<\/a>, <\/em>Farhad Panahov<\/a>, <\/em>Lisa Ashton<\/a>, <\/em>Shaz Merwat<\/a>, <\/em>Vivan Sorab<\/a>, <\/em>Caprice Biasoni<\/a> and <\/em>Frances Dawson<\/a>.<\/em><\/p>\n

Have a comment, commendation, or umm, criticism? Write to me here (yadullahhussain@rbc.com<\/a>)<\/em><\/p>\n

\n

Climate Crunch Newsletter<\/h2>\n

Sign Up<\/a><\/p>\n<\/div>\n<\/div>\n