THE IMPACT OF CANADIAN ENERGY POLICY ON CHANGING FEDERAL-PROVINCIAL RELATIONS: COMPETITION AND CONFLICT BETWEEN ALBERTA AND OTTAWA

ABSTRACT

Canadian federal energy policy since the early 1970s has run counter to the interests of the producing provinces. Federal policy has always been predicated upon two points: sufficient domestic supply and acceptable domestic prices. Until the early 1970s, federal policy had been complementary to that of both the producer and consumer provinces. Natural gas shortages in 1970 and 1971, the OPEC embargo, and the quadrupling of prices radically changed federal policy. Exports were no longer promoted, and the federal government undertook to protect Canada from the inflationary pressures of rising world energy costs. These policies have run counter to those of the energy producing provinces, particularly to those of Alberta.

While it would appear that producer-provinces would have sufficient leverage to insist upon their interests, the federal government has made good use of its direct and indirect powers to set the agenda. This suggests that the Trudeau government has begun a recentralization of federal prerogative in an area historically the preserve of the provinces. Because the government has largely been successful, a difference between federal governments and supranational organizations is suggested. In supranational organizations the power to veto is vested in the governments of the states-members; in an integrated federal state, that power resides in the central government.