Energy minister makes the case for U.S.-Canada energy alliance in Washington

Wilkinson said while the idea could “go in a number of different directions,” he sees the alliance putting together a list of priorities and projects and finding ways to work together to support industry stability in North America. It would not require Congressional approval, he said, which means it’s unlikely to be attached to a trade pact.

Wilkinson is the latest Liberal to visit Washington since Trump promised to slap 25 per cent tariffs on all imports from Canada. Wilkinson told American lawmakers Wednesday that the best way for the U.S. to protect its economic dominance and national security from China is to work with Canada.

Wilkinson is among those being floated as candidates to replace Prime Minister Justin Trudeau, who announced he would be stepping down when a new Liberal leader is chosen later this year.

The minister said Trump’s tariff threat is a “little bit difficult to understand.”

“The U.S. cannot be energy-dominant without Canadian energy,” Wilkinson said during a panel discussion at the Wilson Center’s Canada Institute earlier Wednesday.

Canadian electricity powers the equivalent of six million American homes, the U.S. imports four million barrels of Canadian oil per day and Canada supplies natural gas to parts of the Pacific Northwest and California, the minister said.

He also cited the United States’ reliance on Canadian uranium, potash and critical minerals.

Further integrating energy and resource markets between Canada and the U.S. would lessen reliance on China, Russia and Venezuela, the minister said. That aligns with the goals of the incoming Trump administration, he added.

“None of this is possible if we get in a tit-for-tat exchange,” Wilkinson said.

But the incoming Republican leader likes to see fast results and any alliance would require consultation and time. Wilkinson said there are near-term projects but any alliance strategy would need to allow Canada to expedite its actions and deal with permitting issues.

Wilkinson had meetings with Republican Senators Ted Cruz and Kevin Cramer and Democrat John Hickenlooper on Tuesday. He also met with policy experts and resource sector executives.

Most legislators understand that Canada and the U.S. need each other, Wilkinson said.

The president-elect has indicated he means to go forward with the tariffs and announced a new department to be called the External Revenue Agency in a post on social media Tuesday.

Federal and provincial leaders have pitched different ways to respond to the threat. NDP Leader Jagmeet Singh has called for retaliatory tariffs on critical minerals.

During a meeting between Trudeau and the premiers in Ottawa Wednesday, most leaders committed to a united path forward and to leave every option on the table.

Premier Danielle Smith, who visited Trump at his Florida Mar-a-Lago resort over the weekend, broke from the pack, saying Alberta won’t be able to support Ottawa’s plan unless restrictions on energy exports to the U.S. are off limits.

Smith, who appeared at the leaders’ meeting virtually, previously said retaliatory tariffs on oil would cause a national unity crisis.

The threatened tariffs could be devastating to the Canadian economy. The Canadian Chamber of Commerce estimates they would shrink Canada’s gross domestic product by 2.6 per cent and cost households an average of $1,900 annually.

They also would hit the American economy.

“More than 20 states rely on Canada as their top import source, totaling some $176 billion in mineral products like oil, natural gas, and raw mineral ores,” Andrew DiCapua, a senior economist with the chamber, said in a statement.

The Canadian Federation of Independent Business estimated the duties, and any subsequent retaliatory tariffs, would lead two-thirds of small businesses to increase prices for consumers.

“This is an SOS call to all governments: reduce red tape, eliminate internal trade barriers, and ease the tax burden on small businesses,” said Corinne Pohlmann, the CFIB’s executive vice-president of advocacy.

The Canadian Manufacturers and Exporters, which represents thousands of manufacturers, sent an open letter to Trudeau Wednesday urging immediate action, including short-term tariff relief, investment incentives and supply chain support to protect their sectors from the economic shock of tariffs.

This report by The Canadian Press was first published Jan. 15, 2025.

Kelly Geraldine Malone, The Canadian Press

by The Canadian Press

Energy minister makes the case for U.S.-Canada energy alliance in Washington

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