The economic importance of the energy sector is detailed in Table 4.1. Direct and indirect employments amount to 4.4% of the Canadian total, while contributing 10.2% of GDP. The energy sector is also responsible for 23% of merchandise exports. Overall, 81% of Canadian crude oil production, 43% of natural gas, 75% of uranium and 10% of electricity generated in Canada is exported. Although this production is delivered to a total of 141 countries, the bulk of Canada’s energy exports are destined for a single market, the United States.
Oil and gas (including refined petroleum products) overwhelmingly constitute the largest share of Canada’s total exports in terms of value, at $122 billion in 2019. Ninety-six percent of this total is shipped to the United States. While these exports are much less significant from the perspective of the United States’ total consump- tion, Canadian production remains important for its neighbour since it amounts to 56% of the United States’ crude oil imports, 98% of its natural gas imports, 21% of its uranium imports and 20% of its pet- roleum products imports. This trade relationship is also significant in the other direction; in value, 74% of Canada’s total energy imports come from the U.S. (26% of the crude oil and 22% of the natural gas used in Canada) (NRCAN 2021). Overall, Canada’s strong depend- ence on a single export market increases its exposure and reduces its control over the price of its energy exports.
Table 4.1 – Energy facts (2019) #
At 10.2% of the country’s GDP, the energy sector’s contribution to the economy is sizeable. However, this share is not matched by a similar contribution to employment, since only 4.4% of Canadian jobs are linked to the energy sector. In terms of direct contribution, this share is even more marginal; only 1.5% of jobs across the country are directly related to this sector.
Table 4.2 – Direct jobs and contributions to GDP from the energy sector #
With policy changes in Ontario respecting green energy production, clean energy investment (excluding investments in substantial hydroelectric power) fell from $US6.4 billion in 2014 to $US1.4 billion in 2019. Half of these annual investments were directed to onshore wind energy, while most of the rest went to solar PV. In 2018, clean energy’s share of employment amounted to 120,650 jobs, accounting for 42% of total direct employment of the energy sector and 1.7% of GDP (NRCAN 2019; NRCAN 2021).
More details on energy sector contributions to employment, as well as an overview of other economic indicators, can be found in Energy in Canada: A Statistical Overview, a policy brief from the Ivey Energy Policy and Management Centre, Western University (Alahdad et al 2020).