Natural gas policy

Tom Adams
Globe and Mail
June 17, 2003

Toronto: Re NAFTA Lets The Gas Out Of Canada (June 12) – Eric Reguly, in promoting the view that “Canada made the grave mistake of not figuring out its own energy needs before it handed the entire [natural gas] industry to NAFTA,” would have our politicians decide how much natural gas we should use.

The track record of virtually every provincial and federal government in Canada under protectionism suggests that they would promote more energy use. Consider the subsidized oil price of the National Energy Program in the early 1980s and the Ontario NDP’s electricity subsidies to heavy industry in the early 1990s designed to discourage energy-conserving cogeneration.

NAFTA reduced the role of politicians and empowered consumers to decide for themselves how much natural gas they need. The result? Consumers in Canada are using our natural gas much more efficiently. Average natural-gas use per Ontario household has dropped by about 10 per cent over the past 10 years. Meanwhile, growing Canadian natural-gas exports to the United States are driving down coal-fired power’s market share.

Market-based natural gas prices, thanks to NAFTA, have been environmentally beneficial. Protectionism would only promote waste.

 

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