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Curtis: Is American energy independence a threat to the Canadian economy?

By: /
25 January, 2013
By: John Curtis
Adjunct Professor at Queen's University and Chair of Statistics Canada's Advisory Committee on International Trade Statistics

The United States will never be “independent” with respect to energy – most of New England through to New York City is, and will remain, dependent on Quebec Hydro, for example. Yet the fact that with respect to oil and gas the U.S. will possibly reach self-sufficiency will have an enormous impact on Canada, particularly on Alberta and Saskatchewan. Revenues will be lower and investment less than otherwise would have been the case, which, however, will lead to a more balanced Canadian economy over the decade.

This modest pessimism needs to be tempered by uncertainties within the United States with respect to infrastructure directly and indirectly related to energy and with respect to concerns about the environment – fracking to obtain gas in particular might turn out to have enormous human and ecological cost, which could have the effect of slowing American “independence” and of encouraging further technological progress, both concerning production and consumption.

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