As Global Leaders, Canada And Norway's Co-Operation Is Timely In The Face Of Surging Energy Demand

(MENAFN- The Conversation) In March 2023, Canada and Norway issued a joint statement on bilateral co-operation. Notably, the statement emphasized a commitment to“achieving carbon neutrality by 2050, to promoting research collaboration and to increasing trade and investment in clean technologies and renewables that help enable a green and just transition .”

Co-operation on energy transitions offers a timely way to strengthen this bond from 2025 onwards, more than ever in light of unfolding events on the global stage.

Canada and Norway have a long history of strong collaboration: they have had formal bilateral relations since 1942 , were founding members of the North Atlantic Treaty Organization (NATO) in 1949 and the Arctic Council in 1996 and co-signatories to the Canada-European Free Trade Association's Free Trade Agreement since 2008 .

Canada's and Norway's geographical and socio-economic similarities are striking, and help explain this active kinship.

Wind turbines are seen with the Rocky Mountains in the background near Pincher Creek, Alta. in June 2024. THE CANADIAN PRESS/Jeff McIntosh An opportune moment

Unfolding geopolitical developments - Russia's invasion of Ukraine , China's continued rise and U.S. President Donald Trump's second term - make it desirable to deepen connections between Canada and Norway.

As researchers in environmental policy, we argue that this collaboration should focus on advancing the energy transition. Here, both countries are faced with tremendous opportunities, but also difficult decisions that require political gumption. There are national elections that will take place in each country this year, which makes this a particularly opportune political moment to address this concern.

Both these climate-ambitious petro-powers have great potential to co-create pathways for prosperity. Both could conceivably implement advanced energy transition strategies that focus on the use of fossil fuel reserves judiciously and purposefully to finance climate change goals.

The National Bank of Canada envisioned something like this in a 2023 report, continuing discussions that date back at least a decade . The report concluded that:

Meanwhile, Norway's Government Pension Fund Global crossed US$1.7 trillion in 2024, bearing testament to the financial strength the country has derived from the petroleum era.

Electrification

The connections between fossil fuel wealth and a climate-friendly transition show much potential. However, too often those advocating for continued exploitation of carbon-based resources fail to acknowledge the accelerated phaseout timetable needed for greenhouse gas emission reductions. The use of natural gas as a transition fuel, for instance, requires a long-term plan for carbon neutrality. Without that, deployment effectively locks in decades of additional emissions .

We are all for using national resources for wealth creation if they quicken fossil fuel phase-down. But investments that impede this - such as state support for offshore wind development to electrify offshore oil rigs in Norway - are not only counter-productive, but also hypocritical.

The real promise these countries hold for the energy transition is in the call to electrify (almost) everything . This approach simultaneously uses two pathways:“greening” the electricity grid with low-carbon energy sources, and moving fossil fuel energy demand onto these clean electricity grids.

Digitalization , which refers to the wider socioeconomic changes inextricably linked to the shift from analog to digital systems, should also be seen as a parallel priority to enable real-time co-ordination of electricity demand and supply across coupled sectors.

Solar panels at the Michichi Solar project near Drumheller, Alta., in July 2023. THE CANADIAN PRESS/Jeff McIntosh Global leadership

Both countries already have relatively green grids. In Canada, almost 80 per cent of electricity was generated by carbon-free sources in 2023 ; in Norway, the equivalent figure was greater than 98 per cent . These figures measure up favourably compared to many other countries: about 60 per cent of the world's electricity is supplied by fossil fuels, mainly coal and natural gas .

For context, these green and greener grids have been achieved in an era of relatively flat electricity demand in many parts of both countries. But that is changing: sector demands like mobility, heating and data centres are already proving to be significant, new consumers of electricity . Huge quantities of additional electricity have to be rapidly generated while maintaining system stability.

Electricity demand is expected to double in both countries by 2050, reaching 1,300 TWh in Canada (more than doubling the 2023 amount of just under 600 TWh ), and 260 TWh in Norway (137 TWh in 2023 ).

How these two frontrunner states replace existing carbon-fuelled infrastructure and meet the anticipated growth in electricity demand is of global interest.

Energy strategy

In policy terms in both Canada and Norway, this strategy to electrify (almost) everything is well underway. Canada's climate change action plan includes commitment to a green grid by 2050 , and implementing Clean Electricity Regulations .

Norway is closing in on its target of 100 per cent vehicle sales being electric . And this June, the country is hosting the United Nations-supported Internet Governance Forum , which is an area critical to the sustainable energy transition.

Solar panels in a park in Oslo, Norway. (Shutterstock)

Actions need to follow ambitions, especially in industrial processes like steel-making where deployable solutions appear further down the horizon .

Stronger bilateral collaboration could also result in positive outcomes in geopolitical developments in the Arctic . Rapidly consolidating trade relations more broadly has rarely been so important from a political perspective. Building this collaboration along energy transition synergies presents advantages that remain gravely underexploited.

This is likely due to the political and economic status and sway that petroleum incumbents have held. But the twin transition of low-carbon electrification and digitalization offers Canada and Norway a chance to co-operate and lead their global regions into a new era of greener energy.

Building upon their shared geographies, structures, experiences and values, the time is ripe for collaboration on the sustainable energy transition. This could include government officials, individuals from utilities and regulators, industry representatives, members of civil society and Indigenous organizations, researchers and academics.

Together, Canada and Norway have the potential to work in tandem to move towards a more prosperous and sustainable global future.

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