Members of the committee, ladies and gentlemen, thank you for providing the British Columbia LNG Alliance with the opportunity to speak with you today.
First, I'd like to provide you with some background on the BC LNG Alliance. The alliance came together to serve as a common voice for British Columbia's leading LNG project proponents. Our mandate is clear: foster the growth of a safe, and environmentally and socially responsible LNG industry in British Columbia, an industry that will ultimately invest billions of dollars in Canada and provide thousands of jobs to British Columbians and Canadians for generations to come. In fact, LNG projects in British Columbia have the potential to be the largest capital investment ever made in Canadian history. For this to happen, however, we must develop an industry that is globally competitive. Having access to countries with which Canada is a free trade partner can only help the competitiveness of Canada's liquefied natural gas industry.
The BC LNG Alliance is made up of eight project proponents: Kitimat LNG, LNG Canada, Pacific NorthWest LNG, Prince Rupert LNG, Triton LNG, Woodfibre LNG, WCC LNG, and FortisBC. One of the most critical issues facing the Canadian energy sector, including B.C.'s nascent LNG industry is access to new markets to offset declining North American markets. Therefore, the BC LNG Alliance is supportive of the Trans-Pacific Partnership. We also wish to recognize the Province of British Columbia's continued leadership in advocating with the federal government for better access to the Asia-Pacific region.
My comments today address three themes related to the importance of new market access provided through the TPP and other trade agreements: B.C.'s clean energy can meet the growing global demand for natural gas; B.C.'s natural gas is an integral part of the global solution to reduce greenhouse gas emissions; and competitiveness. The ability to trade energy and energy products freely is important for the energy industry. Having the capability to trade freely with the 12 countries that make up the TPP, which, by the way, also represents about 40% of global GDP, will assist Canada in potentially becoming a significant supplier of much-needed natural gas in the form of LNG to countries that need cleaner burning fuels. This is important because the demand for energy is expected to grow. The World Energy Council projects that the world's primary energy consumption will increase approximately 30% to 60% over the next 30 years, depending on population, climate policy, energy efficiency, and technological innovation.
One of the reasons that this growth will occur is because it's expected that by 2030 there will be about 2.2 billion more people moving into the middle class, and they will want access to energy. Therefore natural gas is anticipated to grow across the power, industrial, residential, and commercial sectors. While demand for energy is growing, Canada's current markets for natural gas are significantly shrinking. While the United States has been Canada's biggest and only export market for energy, the massive increase in U.S. domestic natural gas supply has converted our most important external market to our biggest competitor. Not only is the U.S. importing significantly less Canadian natural gas, the flow has reversed in some parts of Canada. U.S. natural gas out of the eastern seaboard has replaced a significant portion of Canadian natural gas in eastern Canada. Without new markets for natural gas we will lose investments, jobs, royalties, and taxes in Canada.
On the subject of greenhouse gas emission reduction benefits, the environmental and economic case for B.C.'s natural gas is clear. The BC LNG Alliance submits to the international trade committee that the global environmental benefit resulting from a competitive Canadian LNG sector is one of the most significant greenhouse gas emission reduction policies or efforts presently being proposed in B.C. or in Canada. Furthermore, the International Energy Agency, in its latest report, says that even under the strictest of climate policies—holding temperature increases to less than 2°C—the demand for natural gas in 2040 will still account for 64% of the world's primary energy. Studies show that LNG has lower life-cycle emissions than coal, while the potential emissions reductions fluctuate moderately depending on a range of variables and assumptions used. In general, natural gas used to produce electricity results in approximately 50% less emissions than coal on a life-cycle basis.
On global competitiveness in establishing BC's LNG industry, we know that natural-gas-producing jurisdictions worldwide will compete aggressively to meet this energy demand.
As an example, Japan, the world's third-largest economy, is a critical export market for a range of Canadian goods from farm commodities to natural resources. Importantly for the natural gas industry, Japan would be potentially one of the biggest natural gas energy export markets among all of the TPP countries. Should one of our competitors have a tariff advantage over Canada through other free trade agreements, it would make the export of Canada's LNG less competitive, which could ultimately cost jobs and significant investment.
Finally, the construction of Canadian LNG projects will require goods and services that are not available in Canada, in particular, from Asia. If Canadian LNG projects are to be cost competitive, they cannot be subject to undue tariffs on such goods that are required and not available in this country. LNG construction in Canada will also benefit global suppliers, who will then purchase LNG over many decades, creating sustaining investment and employment in Canada. Therefore, the BC LNG Alliance is supportive of the Trans-Pacific Partnership.
Thank you.