Energy and Climate Change at the North American Leaders Summit

Q1: Will energy and climate change be on the agenda for the upcoming North American Leaders Summit?

A1: President Barack Obama, Prime Minister Stephen Harper, and President Felipe Calderón will meet in Guadalajara, Mexico, on August 9–10 to discuss a range of regional priorities, including the economy, transnational organized crime, responses to the H1N1 influenza outbreak, the political situation in Honduras, and possibly trade issues. In addition, clean energy and climate change is expected to be high on the agenda for discussion. The North American Leaders Summit is the new incarnation of what was formerly known as the Security and Prosperity Partnership of North America, started under the Bush administration. Energy, not necessarily climate change, has long been part of the annual discussion and ongoing work among the three countries. With the December 2009 international negotiations in Copenhagen fast approaching and cap-and-trade legislation pending Senate approval in the United States, clean energy and climate will undoubtedly be a topic for discussion.

Q2: What kind of outcome related to energy and climate is likely to emerge from the talks?

A2: It is difficult to determine what new energy and climate initiatives will result from this meeting given how much these leaders have discussed the issue in other venues. President Obama has met with Prime Minister Harper and President Calderón individually and in both instances signed bilateral memorandums of understanding (MOUs) on clean energy and climate change cooperation. The MOUs outline areas of cooperation to advance the development and deployment of clean energy technology and sources and to advance common climate change goals. The bilateral cooperation with Canada seems to have progressed further than the cooperation with Mexico to this point. In June, Energy Secretary Steven Chu kicked off the first meeting of the U.S.-Canada Clean Energy Dialogue, where the two countries discussed cooperation on renewable and energy efficiency technologies, such as next-generation biofuels, cleaner engines, and home and building efficiency improvements; carbon capture and sequestration; and more efficient, clean, “smart” electrical grids. They also met with the private sector to determine ways to accelerate clean energy deployment. Bilateral cooperation with Mexico is moving forward as well, but at a slower pace. The leaders also discussed energy and climate at the Western Hemisphere Summit, the Major Economies Forum, and at a lower level, during the ongoing climate negotiations.

It is unlikely that the United States will be able to take any decisive action on two priority areas for Canada and Mexico: a unified carbon market and a so-called Green Fund. The Canadians voiced an early desire to discuss how Canada and the United States will ensure that emerging carbon policies in each country will be integrated so as to not disrupt energy and other trade flows. The United States is unlikely to be able to deliver on this discussion until the Congress decides on whether to approve a nationwide cap-and-trade program. Mexico has proposed and is promoting a Green Fund, a global fund for financing mitigation efforts. Again, the United States is not likely to have advanced discussion on this topic at the North American Leaders Summit, as this issue is closely tied to the ongoing international climate negotiations. Any new initiatives from this meeting will likely be a trilateral extension of what has already been agreed to under the two bilateral frameworks.

Q3: How significant is cooperation with Canada and Mexico on energy and climate issues?

A3: North America is a well-integrated energy market, and both Canada and Mexico are among top energy trading partners with the United States. Emerging energy and climate policies in each country could affect the efficiency of this market and raise costs to consumers if the proper steps are not taken to manage these unintended consequences. The three countries have long held regular meetings to discuss a variety of energy topics and engage in joint collaboration on energy technology development and demonstration. Many North America watchers are looking to this meeting to see how the three leaders can chart a new direction for North American cooperation on issues of common concern. As each country grapples with how to make the transition to a low carbon economy, these discussions and cooperation are important to maintaining progress on energy integration, technology development and deployment, and outreach to the private sector, all of which will be important to achieving these common goals. Historically, one of the dangers of these multilateral dialogues is that the activities agreed to in the presence of leaders do not receive ample follow-up, funding, and policy attention once the summit is over. Due to the integrated nature of the North American market, it will be important that the dialogue among Canada, Mexico, and the United States take on real and substantive policy issues (like integrating carbon markets, as the Canadians suggested), as well as actual technology collaboration where it makes sense—and not simply be a regular review of policies and activities in each country.

Sarah Ladislaw is a fellow in the Energy and National Security Program at the Center for Strategic and International Studies in Washington, D.C.

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