Energy environment will test Canadian businesses’ resiliency, panel says
Controlling energy costs are increasingly important to competitiveness.
OTTAWA — The energy environment is evolving with advances in oil and gas extraction, the development of alternative energy sources, changes within the electricity market, and new regulatory requirements.
Understanding the implications of the complex energy environment and global pressures are critical for future business resilience and success, according to a report from the Council of Canadian Academies.
The expert panel report, Energy Prices and Business Decision-Making in Canada: Preparing for the Energy Future, details how Canadian businesses have historically been successful in responding to fluctuating energy prices, but this should not be considered a predictor for future resiliency or competitiveness.
Main findings include:
- Exposure to energy prices varies by sector. A firm’s strategy depends on whether it is energy intensive, capital intensive, or produces energy-intensive products.
- Firms have successfully adapted to energy price changes in the past, but there is no guarantee that this resilience will continue into the future.
- Canadian firms are unlikely to suffer significant adverse competitiveness impacts as a result of higher global energy prices.
- A majority of firms (66%) reported that controlling energy costs was important for competitiveness.
- Increased preparedness in exposed sectors would mean greater resilience and better adaptation should energy prices change.