Thank you for having me.
I think it's important that we make sure we take heed in not overrelying on a single resource, but I think we all would agree that there is an important role for developing Canada's fossil fuel resources. One of the big questions we have to answer is, to what end? What are we using this one-time endowment for when it comes to diversifying our overall economy and our overall energy landscape?
A key opportunity for us, if we are going to be thinking strategically about our fossil fuel resources, is how we use them to invest in cleaner opportunities. Canada contributes about 2% of the global GDP, yet we capture only about 1% of the clean energy industry globally, which is about a $1-trillion industry, but also is rapidly growing. It's forecast to be about $3 trillion within the next seven years.
Renewable energy is a major subset of the overall clean tech industry. It has grown about tenfold in the past decade, reaching about $300 billion last year. Renewable electricity accounted for about half the new electricity supply installed globally in the past two years, while in Europe alone almost half the electricity supply last year came from solar photovoltaics on their own. Canada is a major player in this market, and we shouldn't underestimate that. Right now, Canada has the seventh largest electricity system on the planet, so we shouldn't think of ourselves as small players in this overall market. Not only are we a very large electricity consumer on our own, but we're also right next door and well connected to the second largest electricity system in the world, the United States. Canada is home to the fourth largest hydroelectric capacity and the ninth largest wind energy capacity in the world.
So when it comes to clean energy, there are some ways to think about it. Canada can either be considered the smallest of the major players, or the largest of the minor players. Either way, we have a big opportunity to grow our share in what is a growing market. I think there are three ways we can grow and diversify into renewable energy.
The first is to start at home. Currently, our electricity system accounts for about 10% of our overall greenhouse gas emissions, and there are major opportunities to clean that up using cleaner electricity sources, including renewables. A clean electricity system is not only important to decarbonizing the system itself, but an increased reliance on electricity is going to be important to decrease our overall energy footprint as we move things like building, heating, and transportation onto the electricity system.
Another key opportunity for diversification is to take advantage of the large electricity market south of the border. Currently, we export about $4 billion of electricity to the United States. The United States' heavy dependence on coal opens up an important opportunity for them to be reducing their emissions, but also for us to be supplying the United States with clean electricity.
Last, manufacturing is another really important area for market diversification for us. Renewable energy's growth has been exponential over the last couple of decades, but that growth is forecast to continue, not only to decarbonize existing electricity systems, but also to help provide electricity to the 1.3 billion people around the world who don't have power. Canada is already an established manufacturer, with products ranging from solar panels, to wind turbines, to inverters, to emerging areas of power storage. Renewable energy manufacturing is very synergistic with our existing automobile industry. Germany has proven the synergies between these two manufacturing sectors.
To take advantage of manufacturing, Canada not only has significant domestic market opportunities in the United States where renewable energy continues to grow, but also in Latin America, which has become one of the largest growing markets for renewable energy. Our geographic proximity gives us a competitive advantage.
To sum up, Canada is already a significant player in the clean energy market, and we shouldn't underestimate ourselves, but this is a globally growing market and we have lots of room to grow and to be a much more major player. But there is competition to get there, so if we want to be a serious player in the growing clean tech market, now is the time for us to take advantage of that.
The first and most important thing the federal government can be doing is to internalize the cost of carbon so we can send a strong market signal that this is an area that Canada wants to be serious about developing.
The second and the last thing I'll say is there's an opportunity for the federal government to try to get our provinces to work more closely together on this issue. An important vehicle for that is the Council of Energy Ministers, so we're not acting like 10 different energy markets, but taking advantage of our market as a country.
Thank you.