December 2014—The Council of the Americas Energy Action Group is pleased to have the opportunity to submit the following recommendations for consideration by the North American ministers of energy:
1. Regional energy integration must be a priority not an afterthought, underlining a broader drive for economic expansion. North American competitiveness is strengthened by efficient, adequate, cost-effective energy supply, supported by energy markets integration. The meeting of North American ministers of energy on December 15, 2014 will be an important opportunity to advance a tripartite agenda for concrete results.
2. Regulatory alignment is critical in order to reduce or eliminate the tyranny of small differences which contribute to bottlenecks and inefficiencies. A better understanding of North American energy markets through data sharing and market analysis would be important, contributing to harmonized definitions and a more integrated data system for North American energy.
3. Energy infrastructure must be upgraded, including pipelines, rail, waterways, and transmission lines, among others. Appropriate authorities should be required to approve cross-border pipeline permits within a defined period of time. Non-action on individual permit requests within the allotted time should be deemed approval absent an extraordinary circumstances waiver. As Mexico upgrades its power grid, the tender process should be transparent and subject to national treatment provisions. Energy development contracts should allow for long-term planning and investment. Critical infrastructure must be protected, especially from cyber adventurism.
4. Investment climate issues determine the ultimate willingness of companies to enter foreign markets. Transparency is a key to addressing ongoing rule of law and corruption issues wherever they arise. Professionalization of regulatory bodies in Mexico can be accelerated with capacity building support from relevant U.S. entities as appropriate. Limited liability clauses for impacts not caused by negligence should be part of contracts, especially offshore. Growing demand for talent and trained workers can be met with strengthened workforce development programs including enhanced partnerships with universities, companies, and governments at both the federal and state levels. Regional (vs. national) certifications should be considered for skills-based jobs such as welding.
5. Clean energy targets should be flexible in order to buoy the development and construction cycle for wind and solar projects, among others. They should also be considered in the context of overall energy targets, including targets and credits of emissions contributing to global climate change, both on a North American and a sub-regional basis. In the meantime, energy conservation should be promoted more effectively.
6. The cost of game changing technologies is decreasing; while their impact is not yet huge, they may soon become material. North American joint research and development projects would build technical and research capacity while contributing to the sector.
7. The United States has moved from energy dependency to abundance and various restrictions are now obsolete. Natural gas exports should be emphasized as a significant new opportunity for effective energy diplomacy, particularly in Central America and the Caribbean Basin, a region of significant mutual interest and potential cooperation with Mexico and Canada.
8. Timely and accurate communications with the broader public are critical to build trust and support for reforms across North America. Expectations must be realistic around such issues as energy security, affordability, access, and community benefit including job creation, both directly and indirectly related to energy reforms and integration.