ARC ENERGY IDEAS

The news flow has started off 2021 with a bang!
Saudi Arabia surprised the oil markets announcing a voluntary 1 MMB/d cut to their production for February and March.
The Democrats gained two seats in the Georgia election, granting them greater power in the US Senate.
The stock markets saw the change as a positive signal for clean energy companies.
Bitcoin is attracting attention, but are digital currencies consequential for energy?
Next, after a tough year for making predictions in 2020, we introduce some foolproof predictions for 2021. See Peter Tertzakian’s recent commentary “Look Into 2021.”
Finally, we review the barrage of policy strategies, draft legislation, and action plans released by the Canadian Federal Government at the end of 2020:
December 11, 2020: “A Healthy Environment and a Healthy Economy”
December 16, 2020: Hydrogen Strategy for Canada
December 18, 2020: Small Modular Reactors Action Plan
December 19, 2020: Draft Clean Fuel Standard Legislation
We debate the $170/tonne carbon tax by 2030. How would the tax impact energy prices, and how do the rebates work? Will the policy result in people reducing their GHG emissions?
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This week, our guest is Ellis Ross, an MLA in the British Columbia Legislature since 2017, representing the Skeena riding for the BC United political party (formerly the Liberal Party). His region includes the communities of Kitimat and Terrace on the northern coast of British Columbia.

Ellis also currently serves as the Shadow Minister for Energy and LNG. Before being elected to the British Columbia legislature, Ellis Ross was the Chief Councillor for the Haisla Nation, in that position, he signed an agreement with an LNG developer to build a plant on the Haisla Nation reserves.

Here are some of the questions that Peter and Jackie asked Ellis: Why did you enter provincial politics and why have you decided to run in the next federal election for the Conservative Party? How has the LNG Canada project impacted people in your community? What is the status of LNG Canada? What is the status of Cedar LNG, a smaller project in collaboration with the Haisla Nation and Pembina Pipeline Corporation also located in Kitimat? Is BC’s requirement for net zero LNG by 2030 effectively a ban on new LNG development? What is the status of the transmission line and electricity supply, if LNG must be net zero by 2030? How do you think Canada should tackle the climate challenge and energy projects differently? What is the potential for blue ammonia shipments by rail and tanker from the Northern West Coast to Asia?
Other content referenced in this podcast:

• Edison Motors is a privately owned Canadian Clean Technology Company. In 2023, we built Canada’s first Production Electric Hybrid Truck; consisting of Edison make Powertrain, Chassis and Cab.

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This week, our guest is Dawn Farrell, President and CEO of Trans Mountain Corporation. On May 1, 2024, the Trans Mountain Expansion Project (TMEP) started commercial operations. Over a decade in the making, this milestone is a huge accomplishment. Originally built in 1953, the expansion project triples the pipeline's capacity from 300,000 to 890,000 B/d.
This significant expansion of Canada's only oil pipeline to the West Coast comes at an important time since Canadian production was expected to hit the limits of the existing pipeline system later this year. The expansion will allow Canadian crude oil to access new markets in California and Asia, and it is expected to lift oil prices by increasing the number of buyers for Canadian oil.
The TMEP is not without controversy, given its high cost (currently estimated at $C 34 billion compared with $C 7.4 billion in 2017), opposition to the pipeline in some areas of British Columbia, and the Federal government's purchase of the project in 2018.
Here are some of the questions Peter and Jackie ask Dawn: Tell us about the pipeline operations currently, has Alberta crude oil reached the dock in Burnaby, British Columbia? What are the logistics, operations, and safety precautions for moving the Aframax tankers from the Burnaby Terminal to the open ocean? What is the importance of this pipeline to Canada? What are some of the factors that contributed to the high costs? What is the process and timing for the current regulatory hearing that could change the tolls?
Content referenced in this podcast:

• Trevor Tombe: The Trans Mountain pipeline was worth every penny of its $34 billion price tag (April 30, 2024)

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The United Kingdom (UK) has had to balance its net-zero ambitions with energy security after suffering from a price shock in 2021 that increased the cost of energy and forced them to stop importing Russian natural gas.

This week, Lord Martin Callanan, the UK’s Parliamentary Under Secretary of State (Minister for Energy Efficiency and Green Finance) at the Department for Energy Security and Net Zero, joins the podcast. His responsibilities include CCUS, hydrogen, green finance, energy efficiency, and emissions trading.

Here are some of the questions Jackie and Peter asked Lord Callanan: How do you respond to those that oppose the licensing of new North Sea oil and gas developments? Has the UK changed its policies or subsidies to compete with the US Inflation Reduction Act (IRA)? How can a carbon-market approach with price volatility compete against the certainty of the IRA-style, subsidy-based policy? How does the UK structure offshore wind, nuclear, CCUS, and hydrogen incentives to attract capital?
Content referenced on this podcast:

• See the live power generation on the UK’s National Grid: https://grid.iamkate.com/
• See the latest carbon clearing prices in the UK Emissions Auctions: https://www.ice.com/marketdata/reports/278

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LinkedIn: @ARC Energy Research Institute
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This week our podcast guest is Rachel Walsh, Environmental Commodities Strategist at BMO Capital Markets.

Here are some of the questions Peter and Jackie asked Rachel: Is the hefty Canadian emitter carbon tax starting to impact competitiveness? Is the carbon levy causing industrial emitters to invest in reducing their emissions? Canada and Alberta have introduced incentives to reduce the capital cost of carbon capture and storage (CCS) projects. Are these incentives enough to kick-start the industry? Are the contracts-for-difference that guarantee a carbon price for industrial emitters over a decade or more required for investment in large decarbonization projects? The Canada Growth Fund has set aside about $7 billion for contracts-for-difference; how much carbon do you think that will mitigate? The voluntary markets have struggled with credibility issues; do you expect this will improve and prices will increase? Could strong voluntary markets reduce the risk of investing in Canadian compliance markets since they offer an alternative way to monetize the carbon credits?

Content referenced on this podcast:

• Clean Prosperity Canada
• ICE has introduced two futures markets for Alberta Carbon Credits: Alberta Emission Offset and Alberta Emission Performance Credits

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