In the May issue of Wiley journal Climate and Energy, NERA Managing Director Dr. Jeff D. Makholm and Associate Director Dr. Laura T.W. Olive examine the historical political context of bilateral energy trade between the United States and Canada. The two countries share a singular geopolitical endowment: the world’s longest and highest value trading border. The countries, who share abundant natural resources and institutional foundations, are also closely connected by extensive pipeline infrastructure systems and dozens of international power transmission links.
But even with such a strong trading history and common institutions, energy access and transmission on one side of the border is often a mystery to those on the other side. For example, those in Canada planning the Keystone XL oil pipeline were confronted by US practical and political barriers they would not face in Canada. In addition, those looking to expand the links to renewable Quebec hydroelectricity for export to New England face entry barriers that are unintended consequences of that region’s quest for a workable wholesale electricity market. These and other examples demonstrate that even the world’s two most experienced and successful international trade partners face persistent barriers to useful energy trades—buried in the historical choices and regulatory practices unique to each.
Dr. Makholm and Dr. Olive describe the historical context of the development of US-Canada energy infrastructure and explore three current disputes: (1) Keystone XL and NAFTA Arbitration; (2) Enbridge Line 5 in the current US courts; and (3) hydroelectricity trade and collective action in New England. The authors explain that, in the context of long-lived energy infrastructure systems, historical and political institutional contexts, which reflect powerful interest groups to once-current events, are critically important, are critically important to understanding current disputes.
Makholm, Jeff D. (May, 2023). “The Tie That Binds: The Trials of US-Canada Energy Infrastructure,” Climate and Energy, 39/10, ©2023 Wiley Periodicals, Inc., a Wiley Company.
