Open main menu
Home
Random
Recent changes
Special pages
Community portal
Preferences
About Wikipedia
Disclaimers
Incubator escapee wiki
Search
User menu
Talk
Dark mode
Contributions
Create account
Log in
Editing
National Energy Program
(section)
Warning:
You are not logged in. Your IP address will be publicly visible if you make any edits. If you
log in
or
create an account
, your edits will be attributed to your username, along with other benefits.
Anti-spam check. Do
not
fill this in!
==Goals== The NEP's goals were "security of supply and ultimate independence from the world oil market; opportunity for all Canadians to participate in the energy industry; particularly oil and gas, and to share in the benefits of its expansion; and fairness, with a pricing and revenue-sharing regime which recognizes the needs and rights of all Canadians."<ref name="Budget_1980" /> The NEP had three main objectives: increase ownership of the oil industry by Canadians; price energy fairly for Canadian consumers; and provide Canadian energy self-sufficiency. The NEP was also designed to promote lower prices with price controls; promote exploration for oil in Canada; promote [[alternative energy]] sources; and increase federal government revenues from oil sales through a variety of taxes and revenue-sharing agreements.<ref name="canadian_encyclopedia">{{citation |title=National Energy Program |encyclopedia=The Canadian Encyclopedia. Historica Foundation of Canada |date=January 2005 |url=https://www.thecanadianencyclopedia.ca/en/article/national-energy-program |access-date=2018-01-05 |archive-date=2018-05-19 |archive-url=https://web.archive.org/web/20180519131210/http://www.thecanadianencyclopedia.com/en/article/national-energy-program/ |url-status=live }}</ref> The NEP's Petroleum Gas Revenue Tax (PGRT) instituted a [[double-taxation]] mechanism that did not apply to other commodities, such as gold and copper (see "Program details" item (c), below), "to redistribute revenue from the [oil] industry and lessen the cost of oil for Eastern Canada" in an attempt to insulate the Canadian economy from the shock of rising global oil prices<ref name="Neustaedter_2001">{{citation |title=The National Energy Program: Canada and the United States |first=Carman |last=Neustaedter |institution=University of Calgary |date=March 2001 |url=http://pages.cpsc.ucalgary.ca/~carman/courses/nep.html |access-date=2008-07-09 |archive-url=https://web.archive.org/web/20080331130646/http://pages.cpsc.ucalgary.ca/~carman/courses/nep.html |archive-date=2008-03-31 |url-status=dead }}</ref> (see "Program details" item (a), below). In 1981, Scarfe argued that by keeping domestic oil prices below world market prices, the NEP was essentially mandating provincial generosity and subsidizing all Canadian consumers of fuel, because of Alberta and the other oil-producing provinces (such as Newfoundland, which received funding by the NEP for the Hibernia project).<ref name="Scarfe_1981" />{{rp|8}} However, [[Marc Lalonde]], the Minister of Energy Mines and Resources whose department oversaw development of the NEP would later say in 1986: "The major factor behind the NEP wasn't Canadianization or getting more from the industry or even self sufficiency," [...] "The determinant factor was the fiscal imbalance between the provinces and the federal government [...] "Our proposal was to increase Ottawa's share appreciably, so that the share of the producing provinces would decline significantly and the industry's share would decline somewhat."<ref>Graham Ron, One Eyed Kings - Promise and Illusion in Canadian Politics, pg. 81</ref> ===Details=== The NEP "had three principles: (1) security of supply and ultimate independence from the world market, (2) opportunity for all Canadians to participate in the energy industry, particularly oil and gas, and to share in the benefits of its expansion, and (3) fairness, with a pricing and revenue-sharing regime which recognizes the needs and rights of all Canadians."<ref name="Budget_1980"/>{{rp|6}}<ref name="Scarfe_1981">{{citation |work=Canadian Public Policy |title=The Federal Budget and Energy Program, 28 October 1980: A Review |first=Brian L. |last=Scarfe |location=Department of Economics, the University of Alberta |date=Winter 1981 |volume=VII |issue=1 |pages=1β14 |jstor=3549850 |publisher=University of Toronto Press, Canadian Public Policy}}</ref>{{rp|5β7}} "The main elements of the program included: (a) a blended or 'made-in-Canada' price of oil, an average of the costs of imported and domestic oil, which will rise gradually and predictably but will remain well below world prices and will never be more than 85 per cent of the lower of the price of imported oil or of oil in the US, and which will be financed by a Petroleum Compensation Charge levied on refiners...; (b) natural gas prices which will increase less quickly than oil prices, but which will include a new and rising federal tax on all natural gas and gas liquids; (c) a petroleum and gas revenue tax of 8 per cent applied to net operating revenues before royalty and other expense deductions on all production of oil and natural gas in Canada...; (d) the phasing out of the depletion allowances for oil and gas exploration and development, which will be replaced with a new system of direct incentive payments, structured to encourage investment by Canadian companies, with added incentives for exploration on Canada Lands (lands which the federal government held the mineral rights as opposed to private lands and lands which provinces held the mineral rights); (e) a federal share of petroleum production income at the wellhead which will rise from about 10 per cent in recent years to 24 per cent over the 1980-83 period, with the share of the producing provinces falling from 45 to 43 per cent and that of the industry falling from 45 to 33 per cent over the same period; (f) added incentives for energy conservation and energy conversion away from oil, particularly applicable to Eastern Canada, including the extension of the natural gas pipe-line system to Quebec City and the maritimes, with the additional transport charges being passed back to the producer; and (g) a Canadian ownership levy to assist in financing the acquisition of the Canadian operations of one or more multinational oil companies, with the objective of achieving at least 50 per cent Canadian ownership of oil and gas production by 1990, Canadian control of a significant number of the major oil and gas corporations, and an early increase in the share of the oil and gas sector owned by the Government of Canada."<ref name="Scarfe_1981" />{{rp|6}}
Edit summary
(Briefly describe your changes)
By publishing changes, you agree to the
Terms of Use
, and you irrevocably agree to release your contribution under the
CC BY-SA 4.0 License
and the
GFDL
. You agree that a hyperlink or URL is sufficient attribution under the Creative Commons license.
Cancel
Editing help
(opens in new window)