North America
The Energy Picture
prepared by
North American Energy Working Group
June 2002
(1) Introduction
In early 2001, U.S. President Bush, Canadian Prime Minister Chretien, and Mexican President Fox recognized that, as neighbors, their energy issues merited regional attention and agreed there would be great benefit to all three nations from enhanced cooperation in this area.
North America is one of the world’s most important regions for energy — producing about one-fourth of global energy supply and consuming about 30 percent of the world’s commercial energy. National markets have grown over the years in both magnitude and complexity. Today, North America must concern itself with a range of energy issues, including energy resources, reserves, technologies, infrastructure, trade and investment/ financing, laws, regulations, the environment, employment, energy security, and other factors affecting the energy market. In addition to energy, North America has a broad range of other important economic, social, technological, and environmental issues that require cross border communication and cooperation.
Given that interest by the three leaders, at a meeting on March 8, 2001, then Energy Ministers Ralph Goodale (Canada), Ernesto Martens (Mexico), and Spencer Abraham (United States) formally committed to work more collaboratively on North America’s energy issues. To achieve this goal, the three cabinet-level officials agreed to establish a group of national representatives that would focus specifically on the region — the North America Energy Working Group (NAEWG). The concept of the NAEWG was announced by the three Heads of State at the Summit of the Americas in April 2001. Natural Resources Canada, the Mexican Secretariat of Energy, and the U.S. Department of Energy jointly chair the Working Group.
The goals of the Working Group are to foster communication and cooperation among the governments and energy sectors of the three countries on energy-related matters of common interest, and to enhance North American energy trade and interconnections consistent with the goal of sustainable development, for the benefit of all. This cooperation process will fully respect the domestic policies, divisions of jurisdictional authority, and existing trade obligations of each country.
To achieve these goals, the Working Group will exchange views and share information on factors affecting North American energy, including policies and programs, market developments, anticipated demand, and sources of supply and identify issues that need to be addressed, such as regulatory structures, interconnections, technical specifications, and technology research and development. On June 27 and 28, 2001, the first meeting of the NAEWG took place in Washington, D.C. The U.S. Department of Energy hosted the inaugural meeting and Secretary of Energy Abraham addressed the group. Senior government officials attended from the three countries. A second meeting was held in Ottawa, Canada, in December 2001. A third meeting was held in Mexico in May, 2002.
As a first step, the Working Group agreed to three areas of work: preparation of a joint report on the outlook for North American energy; initiation of discussions on electricity regulatory issues; and examination of energy efficiency standards in each country. The Working Group also discussed pursuing future cooperation in the areas of environment and science and technology. At the Ottawa meeting, the Working Group agreed to pursue cooperation in two additional areas: science and technology and natural gas. The Working Group also agreed to convene a meeting of experts in the area of critical infrastructure protection. The group agreed as a next step to continue efforts in information sharing, electricity, energy efficiency standards-related issues, and to explore the harmonization of energy modeling methodologies.
The value of collaboration on energy issues has been recognized for some years among the countries of the Western Hemisphere. Representatives from North America, the Caribbean, and Central and South America met in 1994 at the Summit of the Americas and began a “Hemispheric Energy Initiative,” which supports a range of cooperative energy discussions and activities within the region. The North American Energy Working Group will build on this effort to explore new ways the three nations can work together to expand interconnections and maximize trade.
North America — The Energy Picture, a joint effort of Canada, Mexico, and the United States, provides an overview of North American energy, as agreed by the NAEWG in June, 2001. The Energy Picture is one of the first outcomes of the NAEWG. The report places North America’s energy issues in a context by briefly summarizing the region’s economic overview, energy supply, energy demand, infrastructure, laws, regulations, policies, energy data, and energy projections. The report serves as a reference document for NAEWG programs and for more general use by government, business, and the general public.
The reader should note that each country provided its own policy, regulatory, and statistical information and projections, except where otherwise noted.