Colleagues & friends,
The year that is coming to a close is one for the history books. Never have we faced such unprecedented times on so many fronts: a health pandemic, small businesses fighting for their lives, social isolation, travel restrictions, holidays that come and go without family at the table and federal spending on a scale never before seen to combat the effects.
As we close 2020, our forecast from the first quarter was realized: the world, our country, and our region have changed.
We began the year with pan-Canadian rail disruptions; the federal government taking over twinning the Trans Mountain Pipeline and discussions on which was a higher priority – the economy or the environment. Headlines today remain focused on COVID-19 as its impacts are far worse than anyone thought possible in January. As the year comes to an end, vaccines are beginning to trickle out across the country. They are the light at the end of a long, dark tunnel.
Here in the Maritimes, construction projects and maintenance turnarounds were postponed, but eventually completed. Excellent project management and efficient logistics saw many completed ahead of schedule and, unthinkably, under budget.
The Atlantic bubble was a sigh of relief, if only temporarily.
The federal government has offered hundreds of billions of dollars in social safety nets and incentives. The Bank of Canada has maintained interest rates to within a hair of zero.
As we noted earlier in the year, the Canadian equalization program is in for a shock as it is recalculated in 2021. Provinces such as New Brunswick, Nova Scotia and Quebec, all heavily dependent on the inputs, will feel a rather significant pinch as Alberta, traditionally the largest contributor, reduces its contributions.
The “flattening” of the disparity between regions means fewer peaks and valleys across the nation, so less will be inputted by the “haves” and less will be received by the “have-nots.” While the “have-nots” need to build their own economies to lift themselves up, the “haves” are adjusting to lower revenues.
The Alberta economy was brought to its knees by a perfect storm created by an international price war, drastic demand cuts, full storage across the continent, and no new capacity to get its product outside North America.
The demand side of the economic equation has fallen drastically causing an even further price drop. The COVID pandemic has reduced transportation fuels to historic lows. Indeed, air travel to our region is still being cut, with some airports, such as Sydney, N.S., and Saint John, N.B., left without any service from major airlines.
As we embark on 2021, we are optimistic it is the “clean up” year after the storm that was 2020. With vaccines rolling out to the general population in the first quarter, we can be hopeful that Canadians soon will embark on new-normal lives.
In the meantime, it is crucial for individuals to remain vigilant and stay healthy, protect themselves and those around them.
Over the past year, we have been reminded of the difficult and demanding work of healthcare workers and other essential workers. Our heartfelt thanks and gratitude goes out to them. We are deeply grateful for their dedicated efforts.
In addition, workers in the energy sector have risen to the challenge. They produce and deliver the energy to keep our homes warm, our lights on and enable us to work offsite. The disruption to the economy would be even more dire if we were not able to continue to operate from our homes.
From the Atlantica Centre for Energy, the very best to you and your family for the coming holiday season, in whatever form it takes. It is our sincere hope that you and your families remain healthy, both physically and mentally, as we chart a new path in 2021 together.
President, Atlantica Centre for Energy