Sea Change: U.S. and Canada Announce Common Goals on Climate, Energy and the Arctic

The United States and Canada have not only declared a ceasefire in their intermittent border wars over energy and environmental policies, they have also forged a new alliance for a longer fight that lies ahead.

Meeting in Washington, President Barack Obama and Prime Minister Justin Trudeau issued a far-reaching declaration of common interests that included action on the Paris climate agreement, new standards for developing and protecting the Arctic, and common targets for controlling methane leaks from oil and gas production.

Most significantly, both nations committed to control emissions of methane from oil and natural gas wells, pipelines and storage sites. The goal is to reduce these emissions by 40 to 45 percent in about a decade. The U.S. has already proposed steps to rein in pollution from new facilities, but now will target existing production infrastructure—and so will Canada.

At a news conference, Obama said that the U.S. and Canada are “responsible for a lot of the carbon pollution that is causing climate change. If we don’t agree, if we’re not aggressive, if we’re not far-sighted, if we don’t pool our resources around the research, and development and clean energy agenda required to solve this problem, then other countries won’t step up and it won’t get solved.”

At the same time, they vowed to consider climate impacts in all decisions about development in the Arctic.

Environmental advocates would have liked them to go even further, such as by declaring the Arctic closed to drilling, or declaring an end to expanding tar sands mining. Scientists have called both moves necessary for the world to rein in emissions of greenhouse gases.

Annie Leonard, executive director of Greenpeace USA, called the new promises “commendable only as a stepping stone toward a fully protected Arctic without fossil fuel extraction.”

Still, green groups were pleased by the overall direction of the emerging partnership.

“After many years in which Canada moved in the wrong direction on climate change, it’s especially exciting to see Prime Minister Trudeau swiftly correct course and set Canada back on track toward a clean energy future,” said Gene Karpinski, president of the U.S. League of Conservation Voters.

This is a second honeymoon for a bilateral relationship that had been strained for years. Washington and Ottawa made common cause while fossil fuel allies George W. Bush and Stephen Harper were in power, when the two nations abandoned the Kyoto Protocol and emphasized tar sands development. Under Obama they split over the international climate agenda and, notably, the Keystone XL pipeline.

That all changed last year when Canada’s voters ousted Harper’s conservative government. Since then, its federal and provincial leaders have embraced action on the climate crisis. Even after Obama disappointed Trudeau by rejecting the cross-border KXL pipeline last fall, they are plainly comfortable together.

Bob Perciasepe of the Center for Climate and Energy Solutions, a Washington think tank, said the leaders “have set the stage for closer cooperation than ever before” on energy and climate.

Embracing the Paris treaty that was completed in December, the two pledged to act this year by “completing mid-century, long-term low greenhouse gas emission development strategies” that would move toward the steep reductions needed to get emissions eventually down to zero.

Their joint statement also calls for cooperation on research, increased spending on clean energy, further tightening rules on vehicle emissions, and more.

The methane declarations were the jewel in this shared crown.

Methane is a potent greenhouse gas, and its emission from the U.S. and Canadian oil and gas industries rank among the world’s highest. (Other sources, such as agriculture and landfills, are also important.)

The goal, previously set by the U.S. and now endorsed by Canada, is to reduce these emissions by 40 to 45 percent from 2012’s level by 2025.

“Together, the new commitments demonstrate that these leaders recognize the urgent need for action to limit methane pollution,” said Fred Krupp of the Environmental Defense Fund, which tracks the issue closely.

“Cost-effective solutions are readily available, and are already being deployed in some states,” he said.

Like Obama’s earlier proposals to address methane from new sources, the new regulations to address existing sources are seen by the industry as “unnecessary window dressing as industry is already reducing methane dramatically,” said Frank Maisano, a partner at Bracewell LLP’s Policy Resolution Group in Washington.

“It’s clear this administration is kowtowing to environmental extremists whose only wish is to keep our nation’s affordable and abundant energy supplies away from those who need it the most by keeping it in the ground,” said Lee Fuller, vice president of the Independent Petroleum Association of America. Many companies represented by IPAA produce fuel from older, nearly depleted wells that could be particularly affected by new rules.

Getting the two countries to coordinate any regulations is an important step. Canada’s exports of gas to the U.S. have been falling, but they are still substantial, and the fracking boom in the U.S. has spurred some trade in the opposite direction as well. With prices low and intense cost competition among producers, balancing the two countries’ policies would avoid destabilizing  the market. (The leaders suggested they would work with Mexico in a similar way.)

The Obama administration, though, will not be able to complete the proposed new U.S. rules, even in a rough draft, before it leaves office next January.

The Environmental Protection Agency will begin in April by proposing a rule requiring the industry to submit extensive new information, a first step in a drawn-out regulatory process. The agency said it hoped to begin receiving the data it needs later this year.

“We intend to work swiftly, and will involve stakeholders in meaningful ways, as we have been doing all along,” said Gina McCarthy, the EPA administrator.

In the past few weeks, the EPA has published troubling new data about the rate of methane emissions, which remain poorly documented.

“The new data show that methane emissions are substantially higher than we previously understood,” said McCarthy. “So, it’s time to take a closer look at regulating existing sources of methane emissions.”

A document published by the agency on Thursday showed how complex its task is.

“There are hundreds of thousands of existing oil and gas sources across the country; some emit small amounts of methane, but others emit very large quantities,” it said. “EPA will be seeking a broad range of information that will help us determine how to effectively reduce emissions, including information such as how equipment and emissions controls are, or can be, configured, and what installing those controls entails.”