At a recent speech before the Empire Club of Canada, Michele Harradence, Enbridge EVP and President of Gas Distribution and Storage, issued a stark warning: Canada is falling behind in meeting the rapidly growing energy demands of the future.
Harradence highlighted that “reliable, resilient, and cost-effective energy” has been the backbone of Canada’s economy and quality of life, but without immediate and substantial investment, the country risks losing its footing. She made it clear that Canada’s current regulatory, tax, and incentive structures are failing to attract the necessary investment to power the future.
Harradence’s speech followed Enbridge’s recent US$19-billion acquisition of three major U.S. energy assets – the East Ohio Gas Company, Questar Gas Company and its related Wexpro companies, and Public Service Company of North Carolina – a move that transformed Enbridge into North America’s largest natural gas utility. It was a strategic pivot, showcasing the reality that opportunities for growth are becoming more abundant south of the border, where incentives are stronger and barriers lower.
However, the story is different in Canada.
Global energy demand is on the rise, driven by energy-intensive advancements in artificial intelligence (AI) and electric vehicles, among other factors. In the U.S., energy consumption is projected to grow by up to 15 per cent by 2050, while here in Canada, electricity demand is expected to double within the same period. In Ontario alone, demand is forecasted to rise by a staggering 75 per cent over the next 25 years, Harradence noted. Meeting this demand will require supply capacity to increase by two to three times its current levels – a feat Canada is currently unprepared to achieve.
The urgency of the situation is reflected in the anticipated cost to meet these needs. Reaching Canada’s 2050 net-zero targets could demand between $1.5 and $2 trillion in investment, but Canada is not attracting this capital at a sustainable rate. “The harsh reality is … We will not meet our future energy needs at today’s pace of investment,” Harradence emphasized. She pointed out that the U.S. is already pulling ahead by offering incentives that Canada simply can’t match. Enbridge’s recent acquisitions in the U.S. are a testament to the investment-friendly environment that Canadian energy companies increasingly seek.
Years of sluggish investment in Canada have led to a 36 per cent decline in completed major energy projects from 2015 to 2023. Harradence didn’t mince words in identifying the causes: Canadian energy investors face a complex web of regulatory red tape, a tax climate that discourages capital, and fragmented incentives that are unable to compete with those offered by the U.S. “We need to turn that around,” she said, stressing the necessity of cutting through regulatory barriers. The goal, she argued, should be clear, well-designed regulatory frameworks that offer certainty to investors and deliver timely yes-or-no decisions.
Harradence, as an industry insider, also advocated simplifying Canada’s tax and incentive systems to attract investment. “If we can get these three elements working … and working together cohesively … they can be magnets that help attract investment,” she said. A rational, competitive tax structure that investors can understand, along with efficient economic incentives, is essential to keeping Canada’s energy sector alive and competitive.
While Harradence was critical of Canada’s energy policies, she praised Ontario’s Ford-led Progressive Conservative government, noting its bold steps to embrace energy as a catalyst for economic growth. “It’s great to see how wholeheartedly the Ontario government is embracing all forms of energy as key enablers of economic growth,” she said. Ontario has launched the largest competitive energy procurement in its history, adopting an “all-of-the-above” approach to energy resources. Ontario Minister of Energy and Electrification Stephen Lecce recently outlined the government’s ambition to make Ontario an energy superpower, and emphasized the need to leverage private capital for building sustainable energy infrastructure.
Harradence’s speech was a rallying call for action. Canada’s energy sector cannot afford to delay critical reforms if it hopes to remain competitive in a rapidly changing global landscape. With demand for energy soaring and other nations attracting the investment needed to meet it, Canada must streamline its regulatory frameworks, simplify its tax and incentive systems, and encourage private investment. Failing to act could leave Canada lagging far behind, unable to meet its growing energy needs and missing the economic opportunities of the future.
Toronto-based Rashid Husain Syed is a highly-regarded analyst specializing in energy and politics, with a particular emphasis on the Middle East. Besides his contributions to both local and international newspapers, Rashid frequently lends his expertise as a speaker at global conferences. Organizations such as the Department of Energy in Washington and the International Energy Agency in Paris have sought his insights on global energy matters.
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