The energy industry shifts to optimism

The growth in renewables and stabilized oil markets are causing energy lawyers to be upbeat
The energy industry shifts to optimism

There is a palpable sense of optimism coming from energy lawyers these days. For businesses across the energy spectrum – from renewables to traditional oil and gas and new entrants such as Indigenous groups – things are looking up.

Most obviously, renewables are an area where opportunities abound. “It’s an exciting time to be a renewables lawyer in Canada,” says Vivian Kung, a lawyer at Blake, Cassels & Graydon LLP in Toronto. Kung notes that the Ontario government announced this summer that it plans to invest in what could be the biggest acquisition of clean energy in Canadian history. It’s a “dramatic change in direction” in just a few short years, says Kung.

MLT Aikins LLP counsel Ken Tennenhouse, based in Winnipeg, says that for the first time in several years, there are significant opportunities for independent power producers (IPPs) and Indigenous groups across Western Canada to develop new wind, solar, and electricity storage projects for the grid.

In fact, Indigenous groups are seeing real progress in their relationships with energy companies across the board, despite there being much more work to be done. “The playing field is still fluid. Things are continuing to change. But overall, the direction is definitely towards you’ve got to get the First Nations onside,” says Gavin Fitch at McLennan Ross LLP.

And even traditional oil and gas companies – which have the most to lose from the energy shift – are sounding upbeat. Kerri Howard at McCarthy Tétrault LLP notes that balance sheets are more robust for these companies, and there is a focus on expanding core assets.

Traditional oil and gas companies are also investing in new technologies, especially in the clean energy space, such as carbon capture and sequestration. A recent US$14 billion deal between Enbridge and Dominion Energy ­­­– which will increase Enbridge’s renewables holdings significantly ­­– is just one sign that the oil and gas sector is embracing the energy transition.

These transitions are not without challenges. Finding the proper balance between government and the private sector is not easy. If private companies are forced to take on too much of the burden, or governments do not spend public money prudently, then progress will stall. Political fights between the provinces and the federal government are ongoing.

Across the board, though, there is optimism that the transition is well underway. Welcome to the future of energy.