The 'Quebec model' and energy resources

Judgment in this area shouldn't be clouded by nostalgia for a bygone time, no matter how glorious.

PLQ - La Grande Braderie des ressources naturelles

The group that prepared the document calls itself Maitres chez nous 21e siecle, a borrowing from the slogan that Jean Lesage's equipe du tonnerre rode to victory in the 1962 provincial elections. Its leading signatories are, if not has-beens, best known for their former public incarnations: ex-premier Bernard Landry; Claude Beland, ex-president of the Desjardins credit-union movement; Claude Larose, ex-president of the CSN labour central.
The group's proposal harks back to the early-1960s nationalization of Quebec's hydro-electricity resources, and offers it as a model for the development of more recently emerged energy technologies and resources: wind power, natural gas and petroleum. The manifesto is highly critical of the Charest government for allowing private firms to take the lead in exploration and development of potential energy resources, notably shale gas and petroleum.
But while it's true that the government has been slapdash in its approach to development of newly emerged energy resources, notably shale gas, nationalization is not the optimal route, despite its sentimental attraction for devotees of the statist "Quebec model" of development.
It overlooks vital differences between the development of hydroelectric resources and fossil-fuel extraction. A prime consideration in nationalizing hydro resources was to establish a network that would allow for uniform electricity pricing provincewide, and in that respect it has splendidly succeeded. This, however, is not an imperative in gas or petroleum exploitation.
As well, the potential for hydro development was clear. The rivers were in plain sight waiting to be tapped. Gas and petroleum development, however, is contingent on as-yet-undetermined underground deposits. Exploration for these is a costly business that requires expertise and resources the government currently lacks.
It is also a risky business. The government could invest hugely in exploration and come up with less return than anticipated -and this at a time when it is already hugely in debt and faced with other pressing societal needs. Meanwhile, the private sector has the motivation and the resources to explore and develop gas and petroleum deposits. The government's role should be to encourage this while exacting appropriate royalties and enforcing stringent environmental rules.
With very few exceptions, this is the model to which the rest of the world adheres in this 21st century. All things considered, it is also the most sensible route for Quebec to take.
Judgment in this area shouldn't be clouded by nostalgia for a bygone time, no matter how glorious.


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