This week, officials from the United States, Mexico and Canada will begin renegotiating the North American Free Trade Agreement (NAFTA). Energy Secretary Rick Perry has cited the occasion as an opportunity to create a new, continent-wide energy strategy. Given the administration’s focus on fossil fuels in its energy agenda, however, it would be unsurprising if its vision for such a strategy includes more oil and gas development, more cross-border pipelines, and more pollution threatening the North American people and environment.
It is therefore up to U.S. cities, states and businesses to work with Mexican and Canadian partners to create a North American energy strategy that protects the continent from the effects of climate change—and positions each country to benefit from the global shift to clean energy. This shift means big business for North America—a fact that seems to be lost on the current administration. Already, the solar industry alone accounts for 43 percent of employment in the U.S. electric power generation sector, providing more than 370,000 jobs in 2016 compared to approximately 86,000 in the coal industry.
U.S. cities and states are up to the challenge. Although President Trump has stated his intention to withdraw the United States from the Paris Agreement, non-federal leaders across the country are stepping up in unprecedented numbers to lead the global climate effort. More than 200 cities and 9 states, for example, have joined the We Are Still In coalition, which has pledged to continue the fight against climate change and support the goals of the Paris pact.
These U.S. cities and states, along with the cities, states, provinces and national governments of Canada and Mexico, should collaborate to accelerate the cost reductions that clean energy has seen in recent years. Together, they should collectively commit to more ambitious clean energy deployment targets, to demonstrate to the world that North America is still interested in bold climate leadership.
Jobs, Cleaner Air, Reliable Power
At home, this would translate into jobs, less pollution and safe and reliable power. It would also make progress toward the pledges that the United States, Mexico, and Canada made at the 2016 North American Leaders’ Summit: reaching 50 percent clean power generation across North America by 2025; advancing appliance efficiency standards, which lessen costs for businesses and families; and reducing methane and black carbon pollution, which endangers the health of our populations and our planet.
A North American energy strategy should also promote a clean and equitable transportation system. Given that this sector is second only to electricity generation in terms of carbon pollution, it’s a common-sense move to significantly improve local air quality in metropolitan areas. By working together to expand vehicle electrification, states, cities and provinces can fight climate change and improve the health and productivity of their citizens.
Cooperation on carbon pricing to encourage clean energy deployment should be part of a North American energy strategy as well. The use of carbon pricing is already growing across the region. Building on existing provincial success, Canada will implement its nationwide program by 2018. Eighty-six percent of Canada’s population is already covered by a carbon price, and this number will rise to 100 percent under the national benchmark. Meanwhile, Mexico has a national carbon tax and intends to implement an emissions trading market by 2021.
Absent federal leadership, U.S. states should consider coordinating and potentially linking with these programs when feasible. The California-Quebec linked cap-and-trade system has already shown that integration is possible, promotes economic growth and provides regulatory certainty for businesses and investors. By harmonizing carbon pricing systems—within borders, but also across them—jurisdictions can avoid a patchwork of policies and promote deeper and more cost-effective emissions reductions.
As the rest of the world positions itself to lead and benefit from a clean energy future, a robust North American energy strategy is critical to the region’s long-term success—and in today’s world, an energy strategy must be a climate strategy. With a U.S. national plan focused on fossil fuel development, the future for North American clean energy collaboration lies with states, provinces, cities and businesses. Together, they can chart the course for a clean growth agenda. And with the global clean energy market valued at more than a trillion dollars, it would do much more to capture the expanding economic opportunity than simply betting on the past.