Canada’s Energy Third Way: Not Carney, Not Poilievre

Optimize, add value, electrify, build. Above all else, be smart and strategic, not overly optimistic or captured by incumbents

Canada is entering one of those rare moments when the country’s energy future is being shaped by two competing stories — both confident, both wrong, and both incapable of delivering the economy Canadians deserve.

Mark Carney tells a comforting tale: there is plenty of runway left for oil and LNG exports out to 2050, so Canada should hold steady and enjoy the revenue while it lasts. Pierre Poilievre tells a louder one: let the oil and gas industry grow without restraint, unburdened by climate policy, community resistance, or any evidence that there will be global markets for Canada’s hydrocarbons after 2030.

Critiquing Carney does not mean endorsing Poilievre. Rejecting Poilievre does not require buying into Carney.

There is a third way. And it is the only one grounded in economic reality, technological change, and the responsibilities of a modern democracy.

Carney’s Pleasant Fiction

Carney’s story tries to square the circle between climate ambition and fossil-fuel optimism. He argues that the world will need Canadian oil and LNG for decades. The problem is not that Carney is unaware of global energy trends; he has spent the last decade warning financial systems to prepare for rapid decarbonization.

The problem is that he underestimates the speed and scale of those shifts today.

Despite publicity around the re-born oil and gas-friendly Current Policies Scenario, the International Energy Agency still projects global oil demand to peak this decade, with gas peaking not long after. China’s gasoline demand has already peaked. Electric vehicle adoption is accelerating, and global clean-energy investment has more than doubled in five years. LNG markets — supposedly Canada’s great hope — are approaching a global glut as Qatar, the United States, and Australia flood supply over the next two to three years.

Carney’s position is not reckless, but it is dated. It assumes the future will bend to Canada’s export ambitions, rather than acknowledging the fierce technological and geopolitical forces pulling the world away from fossil fuels. Like the backward-looking Canadian oil and gas industry and its political champion, Alberta Premier Danielle Smith, the Prime Minister is fixated on supply, rather than worrying if there will be demand, also known as “customers.”

Carney’s argument rests on a deeper Canadian myth: that our hydrocarbons are simply too ethical, too stable, or too secure for the world to ignore. But oil markets don’t work that way. Buyers care about price, not virtue. They care about reliability, not political storytelling. And increasingly, they care about how to transition out of oil altogether, not how to lock in another generation of dependence.

Carney wants Canada to glide toward the future with one foot on the accelerator and one on the brake. That strategy rarely ends well.

Poilievre’s Resource Fundamentalism

The second story, Poilievre’s, is something else entirely. The Conservative leader has embraced the idea that any limit on the oil and gas sector is a threat to the very idea of Canada. His promise is simple: unlimited production, unlimited pipelines, unlimited growth, and no interference from climate policy, citizens, or the courts. During the 2025 election, his energy campaign was an unapologetic promise to give the oil and gas industry whatever it wants.

This is not conservatism. It is hydrocarbon fundamentalism.

It ignores Indigenous rights and land stewardship. It dismisses the climate obligations that every advanced democracy must meet. It pretends that markets are static and that demand for oil and gas will grow simply because Canada wants it to.

Poilievre’s vision of the energy future is rooted in a fantasy. He swallows wholesale Alberta’s oft-repeated claim that its oil and gas industry is the cleanest and most environmentally friendly in the world. Emissions are lower. Environmental impacts are negligible. The provincial regulator is a model for the rest of the world. Canada’s oil is somehow “ethical” because it was produced in a democracy that respects human rights.

None of this is true. At an average of 66 kgs of CO2e per barrel, oil sands heavy crude is one of the most emissions-intense barrels in the global market. Credible estimates of the Alberta industry’s unfunded environmental liabilities are $300 billion, a mindboggling amount that would bankrupt the Province if taxpayers are forced to pick up the tab for oil company malfeasance. And the Alberta Energy Regulator is widely considered to be the most captured and ineffective in the world.

Canada’s oil is arguably unethical. Deeply unethical. And all the more so because oil companies, Alberta, and the Government of Canada collude on the charade of claiming otherwise.

This fever dream, which Poilievre believes with religious conviction, leaves Canadians exposed to the very disruptions that are already reshaping global energy systems. He offers certainty: the certainty of clinging to the past until the past collapses beneath us.

The danger of Poilievre’s model is not only that it is environmentally irresponsible; it is that it is economically reckless. Betting everything on oil and gas at the very moment global markets are shifting is the equivalent of doubling down on Blockbuster in 2004 because the store still has customers.

Poilievre chooses not to understand the international context. Major economies are racing toward electrification, clean technology, and energy efficiency. Global automakers are electrifying fleets. Governments are enacting carbon tariffs, clean manufacturing incentives, and industrial strategies designed to secure the next century’s competitive industries. The CPC leader ignores it all. His vision treats the 2020s as if they were the 1990s, pretending that pipelines are destiny and that diversification is optional.

Poilievre’s plan is a blueprint for being left behind.

Why Canadians Feel Stuck Between Two Bad Choices

Part of the appeal of the Carney and Poilievre narratives is that both offer simplicity in a moment of dizzying change.

Carney offers reassurance: things won’t change that fast, so we don’t need to act that boldly. Poilievre offers defiance: things shouldn’t change at all, and if they do, it’s someone else’s fault.

Both are emotionally appealing. Neither is intellectually honest.

Canadians instinctively know the country is not ready for the global energy order that is emerging. They see the signals: China’s warp speed transition to renewable energy (wind, solar, batteries) and electrotech (EVs, heat pumps), Europe cutting fossil fuel use and electrifying faster than expected, and clean energy investments soaring worldwide. They see the Alberta wildfires and British Columbia heat domes that have made climate change a lived experience, not an abstraction.

What Canadians are missing is a story that threads the needle. One that acknowledges what must change while protecting what matters most. A story grounded not in nostalgia or denial, but in possibility.

That story already exists.

The Third Way: A Practical, Prosperous, Forward-Looking Path

The Third Way begins with optimizing the energy infrastructure we already have, rather than endlessly building more.

The Trans Mountain pipeline is a perfect example. After years of battles and billions in cost overruns, the pipeline now gives Alberta’s producers secure tidewater access. Managers estimate that shipping capacity can be expanded another 200,000 to 300,000 barrels per day using the existing pipe. A neglected Alberta technology, partial upgrading, can be used to eliminate the valueless diluent that takes up 20% to 30% of space inside that pipe. Whereas now TMX can ship a maximum of 413,000 actual barrels of crude oil per day, my suggestions could raise that number to the full 890,000 barrels per day of nameplate capacity.

Enbridge recently announced plans to optimize its Mainline pipeline to US markets by 400,000 barrels per day. Several smaller pipelines have the potential to add another 250,000 barrels per day. Partially upgrading the “dilbit” flowing south could add several hundred thousand more barrels per day. Then there is “DRUbit,” which removes most of the diluent from dilbit, then transports the heavy crude by specially designed “unit trains.”

Shipping Alberta’s heavy sour crude smarter, not harder; minimizing risk instead of trying to maximize revenue by building new capital-intensive infrastructure; thinking outside the box instead of being captured inside it; thinking strategically instead of doing what we’ve always done; busting out of the status quo instead of being smothered by it.

Isn’t it time to try something different instead of retreating to the same old thing, just with different customers? Surely that’s preferable to tearing Western Canada apart by pitting British Columbia and Alberta against one another over a new pipeline?

Optimizing existing infrastructure is not a small idea. It is the difference between an economy that squeezes more value out of every barrel and one that keeps repeating the same political and economic battles for diminishing returns.

Beyond Combustion: The Next Hydrocarbon Economy

From there, the Third Way turns toward the future uses of hydrocarbons, the non-combustion markets that are growing precisely because the world is moving beyond oil and gas as fuels. For the past decade, provincial agency Alberta Innovates has been researching how to convert bitumen into high-value carbon fibre, asphalt binder, construction materials, and advanced composites. These markets don’t disappear when climate policy tightens. They expand.

Similarly, natural gas can be reimagined not merely as a combustible fuel but as a feedstock in hydrogen, petrochemicals, and manufacturing processes where its carbon can be captured, stored, or embedded in products. This is value creation, not value extraction.

In the 20th century, Canada let other countries define value. We extracted; others refined. We shipped raw resources; others built industries around them. The Third Way flips that model on its head. It treats hydrocarbons not as fuels to be burned but as materials to be transformed — the foundation for new manufacturing, new technologies, and new export markets.

This is exactly what successful energy economies do: they evolve.

Value-Added Prosperity: The Canada We Could Be

The Third Way also demands that Canada stop shipping raw resources abroad only to buy back the finished products at a premium. Adding value here — in processing, manufacturing, refining, and advanced materials — builds jobs, resilience, and export strength. We cannot keep consigning ourselves to the lowest rung of the global supply chain while claiming we want prosperity for future generations.

Value-added strategies are not partisan. They were the backbone of postwar Canadian industrial policy. They were how Ontario built an auto sector, how Quebec built aerospace, and how the prairie provinces built food-processing industries. The idea that value-added energy manufacturing is radical simply shows how much ambition has drained out of our national imagination.

A National Project: Building the Grid That Powers Everything

And finally, the Third Way recognizes the single greatest economic opportunity of the next 25 years: building a national power grid capable of electrifying Canada’s economy. Every other G7 economy is racing to expand transmission, integrate renewables, and modernize their grids. Even the United States, despite Donald Trump’s resistance. Canada, with great wind and solar resources and a legacy of low-emissions hydro, should be leading. Instead, we are treading water while provinces argue and investment stagnates.

A modern grid unlocks industrial competitiveness, reduces household energy costs, supports clean tech manufacturing, and enables electrified transportation and heating. It is the foundation of a thriving 21st-century economy. Carney says he wants to build it. The Climate Competitiveness Strategy, embedded in his 2025 budget, is a solid framework for

but his oil and gas agenda has pushed it aside, at least for the foreseeable future. Poilievre is simply not interested.

If Canada builds this grid, it unlocks everything else: clean steel, battery manufacturing, heat pumps, hydrogen production, data centres, robotics, and the manufacturing of the electrotech that is increasingly driving the 21st century economy.

If we fail, we lock ourselves into stagnation.

The Courage to Choose the Future

Canada is a country that constantly underestimates itself. We treat energy decisions as a binary choice: old economy or new economy, pipelines or wind turbines, fossil fuels or climate action. But the real work of nation-building happens in the space between those false choices — in the messy, pragmatic, forward-looking middle where countries reinvent themselves.

Criticizing Carney’s fossil-fuel optimism is not an endorsement of Poilievre’s fossil-fuel maximalism. Rejecting Poilievre’s ideology of limitless extraction does not require signing onto Carney’s slow glide path.

Canada’s Third Way is both bolder and more responsible than either. It optimizes what we already have. It builds what we actually need. It positions the country not for yesterday’s economy, but for tomorrow’s.

And that future is waiting. If we choose it.