Carney government in talks with Saskatchewan to fast-track energy projects

It could lead to non-binding memorandum of understanding similar to the one signed by Alberta Premier Danielle Smith and Carney, or an agreement or series of deals separate from but aligned with Ottawa’s forthcoming national electricity strategy.

Saskatchewan wants to streamline the timelines for regulatory approvals of uranium mining projects and nuclear power plants that currently can take up to 15 years to reach conclusion, to secure federal support for development of small modular nuclear reactors, and for building out infrastructure to transmit power so that provincial industries can be competitive, according to the senior source. 

The two sides are also discussing the clean electricity regulations from the Trudeau-era government that several provinces have long opposed, as well as the industrial carbon price and whether or how those levies might be modified, the insider said.

A deal with Saskatchewan would help bolster Carney’s claim to lead a federal government that is more open and accommodating of the concerns of the West at a time when separatist sentiment is on the rise.

The talks are separate from a joint agreement by Saskatchewan, Ontario, Alberta and New Brunswick to work co-operatively to advance the development and deployment of small modular reactors, according to a provincial source who was not involved in the Saskatchewan-Ottawa talks.

A senior federal official downplayed any specific discussions, saying only that the Carney government is working on agreements with all provinces to speed up project approvals.

There are a few uranium mines in northwestern Saskatchewan which are not far from Alberta’s oilsands or from the Northwest Territories, all of which could be part of a more interconnected power grid, said the senior source, who said governments must map out how provincial and national needs for power will shift in the short, medium and long term, and how those needs would be met with an “affordable, reliable power supply.”

“You need to understand what the need for power is today and what the need is going to be tomorrow,” they said. “How many electric cars are we going to have on the road in 10 years? That’s going to change our grid system. Are we going to build a west coast pipeline and precipitate the expansion of not only the oilsands industry but the oil production in western Saskatchewan?”

Small nuclear modular reactors are seen as a key piece of that puzzle for Saskatchewan, as they are for Ontario, Alberta and New Brunswick which have all identified the technology as a way to achieve low-emissions power generation.

As Ottawa has designed a national electricity strategy, it is looking at the roadblocks to a broader upgrade of Canada electricity grid to ensure it is fit for purpose decades down the road.

Carney and his ministers have repeatedly said the electricity strategy is due soon.

“Our objective is to more than double the size of Canada’s electricity grid, increase Canada’s energy advantage and deliver cleaner, more reliable and more affordable power for Canadians,” the prime minister said after he met with premiers in Ottawa at the end of January.

Carney’s overall economic agenda is putting a big bet on electrification of the auto sector, as well as eyeing development of high-speed rail in Eastern Canada, both of which will increase demands on the country’s electricity grid.

At the same time as it is pushing the development of more clean electricity sources, the Carney government says it is committed to fighting climate change despite looking to boost Canadian oil and gas exports to new markets via a potential new pipeline, making it dependent on whether Alberta can scale up a carbon capture and storage megaproject.

Energy Minister Tim Hodgson told an audience in Calgary last month that the Liberal government is “future proofing” its energy industry in trying to access new Asian markets for Canada’s liquefied natural gas and other products, including in India and China, where he and Carney recently travelled.

China, he observed, is making big progress on the use of renewable sources of energy, and wants to use Canadian liquefied natural gas as “a major transition fuel” away from coal-fired power generation. “We have a chance to do right by us and to do right by the world,” he said.

With files from Alex Ballingall