The United States: The world’s lone remaining superpower, home of the world’s largest economy and military, the world’s largest producer and consumer of natural gas, and soon the leading producer and consumer of oil.

China: The rising power that has lifted 500 million people out of extreme poverty over the last 30 years, set to overtake the United States as the globe’s largest economy within the next decade with massive investments around the globe, and now the world’s largest emitter of greenhouse gases.

And…Canada? Yes, Canada. While dwarfed by the United States and China by population and GDP, Canada punches well above its weight when it comes to energy. Not only does Canada have the world’s third largest oil reserves (following Saudi Arabia and Venezuela), it is the fourth largest producer of natural gas.

While China, the United States, and Canada may appear to be odd bedfellows, they each play a significant role in energy flows around the world, as illustrated in the Wilson Center’s “Tracking the Energy Titans” infographic. Canada, the large producer but low per-capita user; China, a large consumer and producer but with low per-capita usage and plenty of consumption growth; and the United States near the top of the charts in production and consumption (total or per person).

Hidden Hydro Connections

While coal consumption in China, the political battle over the Keystone XL pipeline, and the incredible rise in wind and solar generation have dominated energy headlines, all three countries also have immense hydropower potential.

China leads the way with an astounding 282 gigawatts of hydropower capacity as of the end of 2014. Canada and the United States follow with 78 and 79 gigawatts of capacity, respectively. While China leads the world in overall hydro capacity, the proximity and close relationship between the U.S. and Canada make for interesting policy linkages and adds wrinkles to both countries’ attempts to combat climate change.

If you include nuclear, Canada produces approximately 80 percent of its electricity from “clean” sources of power. The United States produces about 32 percent from similar sources. Canada’s experience with large-scale hydro and location therefore make it a vital partner in U.S. efforts to combat climate change by reducing emissions.

Under the EPA’s Clean Power Plan, officially unveiled this summer, states have the option of using imported Canadian hydroelectricity to decrease their greenhouse gas emissions. This rule will encourage U.S. consumers to consider Canadian exports in their energy mix and potentially incentivize Canadian producers to increase capacity. In addition to the extra capacity, hydropower’s ability to provide relatively constant power will help give more flexibility to states in their adoption of intermittent renewable energy sources like wind and solar.

While the United States and Canada produce similar amounts of energy from hydropower, U.S. production is highly concentrated in the western states, specifically Oregon, Washington, and California. Unfortunately, these states are experiencing debilitating drought, making it difficult to maintain production levels, and they may see more dry spells in the future. Projections for eastern North America are brighter. Quebec will likely see increases in precipitation and temperature, creating more capacity for hydropower.

About That Regulatory Environment…

Incredibly, only three percent of dams in the United States create electricity. Following in the footsteps of Canadian hydropower development – or importing more energy from that development – could go a long way toward reducing U.S. reliance on fossil fuels for electricity generation and reducing greenhouse gas emissions.

While hydropower seems like a natural opportunity for renewable energy expansion in eastern North America, current U.S. regulatory and incentive structures do not fully support such a change.

New legislative and executive endeavors have made hydro more competitive. The Clean Power Plan encourages importing from Canada, and President Obama signed two laws designed to reduce regulatory burdens on new U.S. hydro projects and make it easier to the transition from non-electricity producing dams to electricity producing dams. But, critically, the renewable portfolio standards for many U.S. states do not accept Canadian hydropower as a renewable resource, thus diminishing its attractiveness to potential investors.

New Canadian Prime Minister Trudeau is in an excellent position to work with President Obama through his final year in office to create a framework for increased cooperation between the U.S. and Canada on climate goals generally and hydropower specifically. By increasing Canada’s visibility as an exporter of clean hydropower and enabling Quebec and other provinces to sell their clean energy to the United States, Canadians can accelerate North America’s climate commitment.