Canada–U.S. energy relations

Canadians and Americans share the closest energy relationship in the world. Energy infrastructure—including oil and gas pipeline networks and electricity grids—is tightly integrated. Canada is the United States’ largest and most secure supplier of oil, natural gas, electricity and uranium.

In 2007:

• Canadian exports accounted for 9% of total U.S. energy demand.
• Two-way trade in energy totalled $100 billion.
• Cross-border direct investment in the energy sector was worth nearly $90billion.
• Canada exported 1.8 million barrels of oil per day to the United States
• Canada provided 82% of all U.S. natural gas imports, representing 16% of U.S. consumption.
• Canada and the United States supplied each other with almost all of our respective electricity imports through our integrated electricity grid.
• Renewable electricity, including hydroelectric power, accounts for nearly two-thirds of Canada’s electricity generation, and is a significant component of Canada’s electricity exports to the United States.
• Canada supplied approximately one-third of the uranium used in U.S. nuclear power plants.

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Oil

Canada: the largest oil supplier to the United States

Since 1999, Canada has been the largest supplier of U.S. crude and refined oil imports. In 2007, Canadian crude oil and petroleum products represented 18% of U.S. crude oil imports, at nearly 2.5 million barrels per day. From 2005 to 2007, the volume of Canadian crude oil exports to the United States increased by 7.4% per year.

The bulk of this increase was due to expanded production in Alberta, and this trend is expected to continue. In 2007, Canada’s total oil production was 3.4 million barrels a day, and output is rising.

Canada’s reserves represent a safe, secure and long-term supply of oil for North America

• Canada has approximately 179 billion barrels of proven oil reserves—the world’s second-largest reserves after those of Saudi Arabia. Over 95% of these reserves are found in oil sands deposits.
• Petroleum development is taking place not only in the oil sands, but also in Canada’s north and in the Atlantic offshore region.
• U.S. firms are significant investors, producers and developers of new technology in Canada’s oil sector. Similarly, Canadian oil companies are major investors in the U.S. petroleum industry, providing jobs and income for Americans.
• As oil exports from Canada increase, pipelines and refineries are expanding in the United States, representing more investment and more jobs for Americans.

Sustainable development of the oil sands

Like all energy production, oil sands production has an environmental impact, in this case particularly from greenhouse gas (GHG) emissions. Canada, Alberta and the industry have already taken action to reduce GHG emissions from oil sands production. On a per barrel basis, GHG emissions have fallen by 32% since 1990.

Canada is also investing to ensure that we create the emission reduction pathways we need, through technology such as carbon capture and sequestration. Canada and the United States have already collaborated successfully. One such project, Weyburn-Midale, is the largest carbon dioxide (CO₂) injection project in the world and has resulted in the sequestration of approximately 10 million tonnes of CO₂ since 2000.

For more information about the oil sands, please visit:

• Government of Alberta
• Canadian Association of Petroleum Producers

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Electricity

Canada: the largest electricity supplier to the United States

Canada and the United States share a fully integrated electricity grid and supply almost all of each other’s electricity imports. Canada is a major supplier of electricity to New England, New York, the Upper Midwest, the Pacific Northwest and California.

Canada is one of the world’s largest producers of hydroelectricity, producing about 13% of the world’s total. Hydroelectricity represents about 60% of Canada’s total electricity generation—that’s over three times the global average.

In fact, 77% of Canada’s electricity comes from sources that do not emit greenhouse gases.

Canadian electricity represents a reliable source of power and is a key element in obtaining long-term North American energy security and addressing our collective climate change challenges.

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Natural Gas

Canada: the largest natural gas supplier to the United States

Canada is the world’s third-largest producer and second-largest exporter of natural gas.

In 2007, Canada provided 82% of all U.S. natural gas imports, representing 16% of U.S. consumption.

Canadian exports of natural gas go primarily to the U.S. Northeast, Midwest, Rocky Mountain, California and Pacific Northwest regions.

Canada is continually investing in natural gas exploration and infrastructure.

• Only 27% of Canada’s potential conventional natural gas production, estimated at more than 500 trillion cubic feet, has been produced.
• Industry is developing new pipeline projects to access arctic resources, including in the Mackenzie Delta.
• Open, well-regulated markets and sound, stable and cooperative policies facilitate natural gas investments and strengthen North American energy security.

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Nuclear Energy

Canada has the world’s largest known deposits of high-grade natural uranium and is the world’s leading producer of uranium for nuclear energy, accounting for roughly one-third of the total global mine production. The uranium mined in Canada contains more energy potential than does all of our annual oil and natural gas production combined.

Canada supplies approximately one-third of the uranium used in U.S. nuclear power plants. That is enough to provide over 5% of the total U.S. supply of electricity.

About 15% of Canada’s electricity comes from nuclear power plants, based primarily in Ontario.

Nuclear energy is a safe, reliable, economic and clean energy source.

• Without nuclear power, Canadian and U.S. greenhouse gas emissions would be about 10% higher annually. Emissions of other air pollutants would also be higher.
• Canada is the leading global supplier of medical isotopes and radiation technologies that are widely used today for preventing, diagnosing and treating disease. Every day, around 34,000 patients in North America rely on Canadian medical isotopes for procedures using nuclear medicine, such as diagnosing the severity of heart disease or assessing the spread of cancer.

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Renewable Forms of Energy

Canada is a significant producer and consumer of renewable energy, and is committed to making its energy production and use cleaner by reducing environmental impacts from conventional sources and by developing new and cleaner energy options.In 2007, the Government of Canada introduced a number of initiatives to support clean energy technology, increase renewable energy supply and improve energy efficiency. These include $1.5 billion invested to increase Canada’s energy supplies from renewable sources such as solar, tidal, hydro, wind, biomass and geothermal power.

• Hydroelectricity
  • Canada is one of the world’s largest producers of clean, renewable hydroelectric power.
  • About 60% of the electricity generated in Canada in 2007 came from hydroelectric power plants.
    
    
• Wind power
  • In 2007, Canada’s installed capacity for wind power generation was 1,856 megawatts (MW), enough to power more than half a million homes.
  • Canadian provinces are currently targeting over 9,000 MW of installed wind capacity by 2015.
    
    
• Solar power
  • Solar energy production is growing in Canada. Since 1998, solar thermal energy has increased by 20% per year, while solar voltaic capacity has grown by 22% per year. So far, most of the market for solar voltaic has been in off-grid applications, which account for 93% of this capacity.
    
    
• Biomass
  • In 2007, biomass created 1,380 MW of electrical energy.
  • Almost 6% of the total energy consumed in Canada is produced from biomass. The majority of this production is in the pulp and paper industry, which uses by-products to produce steam and electricity.
    
    
• Geothermal power
  • There are more than 30,000 geothermal energy installations in Canada. They are used for residential, commercial, institutional and industrial purposes.
    
    
• Biofuels
  • Canada is a world leader in the development of processes for converting cellulosic-based feedstocks, such as agricultural and forestry waste, to cellulosic ethanol.
  • Ethanol production plants currently operate in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario and Quebec.
  • Environment Canada will require 5% renewable content in gasoline fuel by 2010 and 2% renewable content in diesel and heating oil by 2012.
  • With support from the Government of Canada, Iogen Corporation built the world's first full-scale demonstration plant to convert biomass fibres to cellulosic ethanol using enzyme technology. Located in Ottawa, Ontario, the plant can process over 25 tonnes of wheat straw per week, using enzymes produced in an adjacent facility.
  • Biodiesel is a renewable fuel produced from a variety of fats and vegetable oils, which include oilseeds such as canola and soybeans, rendered animal fats, recycled restaurant grease and palm oil.
  • Canada’s current biodiesel fuel production capacity is 105 million litres or 27.7 million gallons. By the end of 2008, capacity is expected to rise to 140 million litres or 37 million gallons.

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Links for further information

Government:

• Atomic Energy of Canada Limited
• Indian Oil and Gas Canada
• National Energy Board
• National Research Council Canada Institute for Fuel Cell Innovation
• Natural Resources Canada

Associations:

• Canadian Association of Petroleum Producers
• Canadian Centre for Energy Information
• Canadian Electricity Association
• Canadian Energy Research Institute
• Canadian Gas Association
• Canadian Hydropower Association
• Canadian Nuclear Association
• Canadian Wind Energy Association