Moe draws the line in the dirt: “We will not attempt the impossible when it comes to power production”

Clean Electricity Standard unrealistic and impossible for Saskatchewan, says premier

REGINA – On May 2, Saskatchewan Premier Scott Moe drew a line in the sand, or perhaps prairie topsoil, on federal climate change initiatives, which, if brought to fruition, would mean an end to up to 86 per cent of the power production in Saskatchewan by 2035.

In delivering the keynote address to the 30^th Williston Basin Petroleum Conference, Moe categorically said the proposed federal Clean Electricity Standard, expected to be implemented this year, was “unrealistic, and impossible.”

“Soaring rhetoric cannot change the laws of thermodynamics; never has been able to, and it certainly would never will be able to. So this target is zero net-zero by 2035, it doesn’t contemplate the eventualities of not having enough baseload power, not only in Saskatchewan grid, but in many other provinces across the nation.” Moe said.

“I want to be very clear about this in Saskatchewan, we will not attempt the impossible when it comes to power production. We’re not going to risk plunging our homes, our schools, our hospitals, our businesses, that are operating and creating wealth in our communities into a cold and dark evening because of the ideological winds up another level of government.”

“We’re not going to put the security of the energy system that we have here in jeopardy and we will not increase power costs unnecessarily for our industries, our businesses and our families in this province, to the point where they are completely unaffordable. Saskatchewan requires reliable, affordable electricity. It is required to be available and available on demand. And under this government’s watch, that most certainly will be the case for years in the future,” Moe said.

This policy stance, if carried out, is sure to come to loggerheads with the federal government, and have profound implications for Estevan, Coronach, Saskatoon, North Battleford, Swift Current, Moose Jaw, and Lanigan, in particular, but the entire province in general.

 

Here is his speech, verbatim:

 

Welcome this morning. It’s a great honor for me to join you here this morning on what is the 30th edition of the Williston Basin Petroleum Conference. Thirty years and still going strong. I’ll be married 30 years this year. So I understand precisely just how long that is. And how rewarding that that is.

But congratulations to all of the organizers and sponsors, not just at this year’s event, but all of the organizers and sponsors that have ensured the success of this conference for three decades. Literally attracting people from across the continent for what I think is an ever so crucial conversation, always has been a crucial conversation, but even more important today about oil and gas and energy, and so much more. And this year, I will see there’s plenty for us to talk about in this room, and in this part of the world.

There’s yes oil and gas. But there’s also critical minerals. There’s hydrogen. There’s uranium. There’s geothermal. There’s carbon capture, and storage. And of course, there’s going to be discussion about many other key factors that we see occurring around the world. There’s geopolitical concerns that we see playing out. And in other areas of the world, there’s government policy concerns that we see, at times, playing out in, in our part of the world, and on our continent.

So I want to just begin by welcoming everyone, to what we believe is the greatest province, the province of Saskatchewan. We particularly want to welcome those that have traveled internationally. Those from south to the 49^th parallel, from the United States. I had the opportunity to be in Washington, DC, last week. I was engaging on what is our most valuable and valuable trade partnership with the with the United States of America. So welcome to each of you.  And I hope you enjoy your visit to our province. We appreciate you as people travel more often into our province and come up here. And we certainly are appreciative of that.

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Support energy

Folks, in the time I have this morning, I want to discuss a few things, some of the actions that we’ve taken in government to support the growth in the energy sector as a as a whole, with a focus, yes, on international engaged engagement, what we’re doing to ensure that our province continues to be to be a place where there’s a supportive environment for this industry into the future. And then I want to talk a little bit about protecting that environment, that environment of opportunity that we have in Saskatchewan, and more broadly across the continent that we share. I want to talk a little bit about protecting it from unrealistic policies, ideological policies, versus policies that are much more based in reality. Policies that, quite frankly, at times are threatening the energy security and continental energy security that that you were part of building.

Ladies and gentlemen, this province, our province of Saskatchewan, we have, as Heather said, the food, the fuel and the fertilizer to provide energy security and food security to the world. We have the ideas. We have the innovations and we will certainly have the people right here. We have so much of what the world needs today.

In particular, today, when you see some of the unrest in other areas, and you’re seeing that play out in the economic indicators, here, in Saskatchewan. We are forecast to lead all provinces and economic growth not just this year, but next year and likely years into the future. Real GDP numbers released yesterday: largest increase in the nation of Canada was the province of Saskatchewan 5.7% well above the 3.6% average of our nation, our unemployment rate also more than the national average. Our population in this province today is growing faster than it has in over a century. More people are coming to Saskatchewan because there are opportunities here,  shared opportunities.

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We have, today, more than 80 projects that have been committed to in the private sector over the course of the last year to total investments about $32 billion of direct investment in those 80 projects. Activity in our energy sector is picking up – $2.8 billion in capital investment last year, forecast to be $3.4 billion this year. And quite frankly, even higher than that.

We see investments in in the critical minerals and rare earth sector. We see in the north, northern parts of our province, continued investments in the uranium industry with the reopening of the MacArthur River Mine and the Key Lake Mill. And we see Cameco, that is operating both of those mills, that is signing long-term uranium supply contracts around the world, most notably and most recently with country Ukraine.

Our mining industry, our energy industry, our forestry industry, our construction sector are all hiring people. And this year our exports are up 44%, again, the highest rate of growth in the country of Canada.

And here are some things that we’re doing to ensure that Saskatchewan continues to move forward, on the economic front:

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First, our government is telling our story, your story, around the world. That’s what I was doing in Washington, DC. Yet again, last week. The story of our energy sector, the story of our sustainable energy sector, we’re doing this much more aggressively than I would say any other government, much more aggressively than even we have in years gone by, and we’re doing it in in more places around the world. We’re doing it through our sustainable Saskatchewan communications campaign. And if you’ve been in an airport over the course of the last few months, and you’d likely spent more time in that airport than you anticipated, you would have seen some of the Sustainable Saskatchewan campaign playing out. That campaign is designed to tell a story about this province and the industries that are operating in this province that I would say has been largely under reported by mainstream media in this province and across the nation. And I would also say underappreciated by our federal government in this nation.

So we’re conveying important facts, not only to our customers abroad, but to our other Canadians or our fellow Canadians. We are conveying important facts like this fact here: the fact that Saskatchewan’s enhanced oil recovery program has sequestered enough carbon now, to make 4.5 million homes energy neutral for the entire year. We’re telling the world about Saskatchewan’s sustainable energy producers, in all industries – tremendous corporate citizens; environmentally responsible, fully invested in our communities in this province. Creating wealth, not only for families, but for the broader communities where you and others are doing business.

Trade

We’re telling that story on trade missions around the world. We have nine trade and export offices open as we speak, in Europe and Asia in the Middle East and Latin America. And most importantly, we’re telling that story with our largest trading partner, and our strongest ally, the United States.

We’re telling the story of a province that is a steady and reliable supplier to more than 150 countries around the world, providing food security, providing energy security for more than 150 countries around the world. And what we say in this province is we should not only be proud of what we produce here, but we should be proud of how we produce it. And we would invite all Canadians to be equally proud of how we produce the most sustainable energy, the most sustainable food products, right here, in Saskatchewan.

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My friends, we’re also continuing to invest to make sure that Saskatchewan remains a competitive and welcoming place for years into the future. In March, we brought in our provincial budget, like we do each and every year, and that budget, we paid down a billion dollars of provincial debt. This is on top of a billion dollars that was paid down in last year’s budget. And we continue, today, to offer some of the most competitive incentives in North America to the energy sector as well as other sectors that are creating wealth in community after community in the province of Saskatchewan. Generous incentives for exploration and the production of not only oil and gas, but critical minerals; rare earth elements, helium, uranium, and the steps involved with carbon capture, storage and utilization.

Incentives

Programs like the Saskatchewan Petroleum Innovation Incentive, the oil infrastructure investment program and the high water cut program. Minister Reiter can speak in much more detail to those.

We are a jurisdiction with a competitive tax and incentives, for your industry and, and many others. We are jurisdiction where we believe in sensible regulations and a proven commitment to infrastructure investment, public infrastructure investment, to support private infrastructure investment. A jurisdiction that has been willing to step up and support your industry, and support your business and all that are employed within it. And to defend it at times.

There are significant headwinds that we are facing from time to time. And we continue to fight that in this region of the nation. And I will say many are continuing across the nation, and across North America as well. We’re coming to a crossroads, I would say. And what is at stake is our continental energy security.

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Food security

We have continental food security, to the degree that we actually take it for granted in North America. And we do that through a very integrated system, back and forth across the 49^th parallel. We have 40% of the arable farmland, here, in Saskatchewan and we’ll go down to Fargo, North Dakota and we’ll buy a great bid red quad track tractor. We’ll bring it back we’ll hook on to a drill , a SeedMaster, whose plant is just east of the City of Regina. And that agricultural producer in this province will go out and they will see crops that were bred by either the College of Agriculture at the University of Saskatchewan, my alma mater, or one of the US colleges. They’ll take some potash and Saskatchewan, phosphate from Florida. And they’ll seed that crop.

And then they will go back down to the southeastern United States, and they’ll grab some crop protection products, and they’ll apply that to that crop. They’ll go to Winnipeg, Manitoba, to buy a MacDon swather. Bill cut that crop. They’ll go back to East Moline, Illinois, to buy a great big green combine, maybe two, come back here, harvest that crop, put it in a trailer that was built in Anaheim, pulled by Peterbilt that was built in the US and take those oats back down to Iowa, where they’ll be processed by a company like Quaker Oats, providing oatmeal for all of us and food security for North Americans.

And we’re going to ship some of that offshore, thereby providing food security for other people and our global citizens.

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Continental energy security

We need to think that way when it comes to our continental energy security. And if you don’t think continental energy security is important today, just look across the pong, at the policy decisions that have been made in the European Union over the course of the last 10 years or so. They’ve sacrificed. The European Union, through policy decisions, has sacrificed their energy security.

What we see here is a federal government that is going down watch that very same road, continuing to move forward with policies that often are based in ideology, and not based in what is realistic. You’ve heard me talk about that the federal carbon tax, a policy that came in, and the promise that was made that it would never go above $50. Here we are today, at a $65 carbon tax in the nation of Canada, and are projecting to go possibly to $247 per tonne. Unrealistic, and unrealistic policy. And I would say, quite frankly, an impossible policy.

Meanwhile, we see, also, a federal government here that is moving ahead with caps on emissions in the oil and gas sector. Today, our oil and gas sector, in this nation, employs over a half a million people. It’s responsible for somewhere between six and 10% of the Canadian GDP. It generates billions of dollars for families. It generates billions of dollars for governments through taxes and royalties. And it represents one of our largest exporting industries.

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Clean and sustainable energy

Moreover, the energy that is produced by our oil and gas companies, in particular, in this province, is some of the cleanest and some of the most sustainable energy that you can find on Earth. Something we can be proud of as Saskatchewan residents and as Canadians.

And I would say that if the world is going to use more oil and gas for years to come, likely decades to come, and I think that is true, then the world should be using clean, sustainable, Canadian, North American energy.

Cap on emissions driven by ideology

Ladies and gentlemen, the rest of the world crude oil like we do here in Saskatchewan, global emissions from oil production would drop 25%. overnight. It’s very clear that the cap on emissions is a policy that is driven much more by ideology than what is I like to call common sense.

It’s unrealistic, it’s impossible. And the same can be said for Clean Electricity Regulations that are currently under development, indirectly impacting everyone in this room and years into the future. Right now, Canada has one of the cleanest electricity grids. And where there’s work to do, that work is happening. More than 80% of the Canadian electricity grid today comes from non-emitting sources: nuclear, hydro. In Saskatchewan we have Boundary Dam 3, an innovation of its own, with the carbon capture and storage facility on that plant and thereby using that carbon for enhanced oil recovery. SaskPower has been building natural gas plants to increase the stability of our electricity grid, but also to reduce our emissions profile.

Next year we’re seeing the Great Plains Power Station in Moose Jaw scheduled to come into service. A few years ago, we had Chinook Power Stations come into service in Swift Current. Those natural gas power plants emit about half the CO2 that that unabated coal plants do, and SaskPower’s emissions are coming down or coming down, due to that investment in sustainable, reliable electricity, through building natural gas plants.

If that isn’t good enough for the Clean Electricity Standard, it’s quite likely is going to be the case that they want zero emissions by 2035. Again, that’s not achievable.

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Impact on Saskatchewan

So what does that mean for our province and the reliability of our electricity grid? Well, today we have coal, and we have natural gas as well as renewables, but coal and natural gas are actually the very foundation of our generating network. We’re expecting new regulations are going to be quite severe, as they come out likely to summer. SaskPower won’t be able to operate any coal fired plant, including BD3 past 2030 by way of those regulations. And it means we may have to shut down our natural gas power plants, including the one that just opened, including the one that is not yet open, potentially by 2035.

And then that begs the question, ‘Where would we in this province get our baseload electricity from?’ Wind and solar, they can submit power production, but we cannot provide baseload generation and certainly not in our climate here, which unfortunately, as I said of this week.

Soaring rhetoric cannot change the laws of thermodynamics; never has been able to, and it certainly would never will be able to. So this target is zero net-zero by 2035, it doesn’t contemplate the eventualities of not having enough baseload power, not only in Saskatchewan grid, but in many other provinces across the nation.

The target does not contemplate also, I would say, the extraordinary costs associated with meeting these targets, and other areas that have made these policy decisions are facing extraordinary costs in the in the price that they pay for their electricity. Unreliable power with skyrocketing costs. It’s unrealistic, it’s impossible. And it certainly doesn’t fit the growth plan and the growth agenda that we have in this province to be competitive so that we can attract investments in all of those industries.

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We will not attempt the impossible

So ladies and gentlemen, I want to be very clear about this in Saskatchewan, we will not attempt the impossible when it comes to power production. We’re not going to risk plunging our homes, our schools, our hospitals, our businesses, that are operating and creating wealth in our communities into a cold and dark evening because of the ideological winds up another level of government.

We’re not going to put the security of the energy system that we have here in jeopardy and we will not increase power costs unnecessarily for our industries, our businesses and our families in this province, to the point where they are completely unaffordable. Saskatchewan requires reliable, affordable electricity. It is required to be available and available on demand. And under this government’s watch, that most certainly will be the case for years in the future.

So I can ask you to stay tuned for a number of new details on this topic in the coming weeks on our response to the federal government’s new Clean Electricity Regulations that are coming forward some time, at some point this spring.

Energy is the bedrock of society

So folks, I’m gonna close this with this observation: energy in all of its forms – It is the very bedrock of our society. Without access to secure, affordable supplies of energy, not only in this room, not only in this province, not even only on this continent. Without that access to secure, affordable supplies of energy, we’re in big trouble. We don’t grow much, and that matters in this province. We don’t go very many places also matters in this province. We don’t move anything from point A to point B. And we get cool in the winter.

Energy is everything to us. It’s everything to our society. It’s how we create wealth in this province, in this nation and on this continent, and who would do us well, to ensure that policy decisions that are being made at every level of government, north and south of the border, most certainly are taking into account, not only food security like we have, but taking into account the importance of energy security, continental energy security.

And that’s what I’ve said on so many occasions, not only around the world, but in Washington, DC, most recently last week. We need to have a much more mature discussion about energy, our access to energy or the affordability of that energy. I want to thank each and every one of you for taking part in this discussion in what you do each, each and every day and in providing supplying some of the most sustainable energy that you can find on earth. Thank you for the contributions that you make the energy industry, thank you for the contributions that you make to our province, and our continent of North Americans. Appreciate it and congratulations on your 30th anniversary to the Williston Basin Energy show and enjoy your conference.

 

Pipeline Online provides the in-depth coverage on energy issues in this province that no other media comes close to. It does NOT receive federal journalism subsidies. However, with recent threats from Facebook to block news links, it’s important to follow Pipeline Online in other manners. The easiest is to check each morning at PipelineOnline.ca, with the top story posted at 7 a.m. Monday to Friday, and additional coverage throughout the day and weekend. But you can also follow on LinkedIn and Twitter. You can follow editor Brian Zinchuk online at LinkedIn as well (you’ll see more stories that way). Finally, you can subscribe to a weekly newsletter. 

 

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