It’s one of the immutable tropes of Canadian politics: conservative parties are better for the business community than their more progressive counterparts. But in her ongoing war against the reality of the federal government’s “just transition” legislation, Alberta Premier Danielle Smith seems determined to prove that wrong.
After all, her province is in the midst of a pitched battle for many billions of dollars in clean technology capital, which became all the more intense after the Biden administration’s Inflation Reduction Act tilted the table in its direction. And while pretending that Ottawa is deliberately plotting to eliminate millions of jobs and destroy entire sectors of the economy might delight her most ardent supporters, leaders of the industry she’s apparently trying to defend sound far less enthusiastic about her approach.
And no wonder: unlike Smith, they have billions of dollars in potential investments — and perhaps the very existence of their companies — at stake.
Just ask Alex Pourbaix, CEO of Cenovus Energy. In an interview with the Calgary Herald’s Chris Varcoe, he said investments in the decarbonization of Canada’s oilsands — you know, the ones the federal government wants them to make — will create jobs, not destroy them. “This transition, if done correctly and if we’re able to materially decarbonize the Canadian barrel of oil, I actually think it should result in more jobs — and materially more jobs — in the Canadian energy sector.”
Derek Evans, another oilsands company CEO, suggested the real issue would be the availability of people, not jobs. “I’m quite worried, let me put it this way, that we don’t have enough people in Canada to get the job done,” the MEG Energy CEO told The Canadian Press’ Mia Rabson.
In other words, they’re not afraid of the energy transition. Instead, they’re afraid of not getting that transition right — and the governments involved being more focused on scoring political points. They probably should be afraid, given the Smith team’s determination to misrepresent the federal government’s position here and continue lying about the jobs it supposedly plans to eliminate, even in the face of numerous corrections from the government in question.
That’s a clear contrast to what’s happening in the United States, where state and federal governments that might otherwise squabble are at least aligned in their efforts to attract low-carbon capital. The Inflation Reduction Act, which passed last August, has made carbon capture technology far more attractive in places like Texas, which has already seen two major announcements in the last three months. As Christoph Gebald, the co-owner of a Swiss direct air carbon capture company called Climeworks, told Time last year, “It will establish the United States as the place to be to deploy such technologies. And I am very convinced that this will also kick off a spiral of action from investors.”
That spiral will only accelerate if Alberta can’t get its act together. Like Texas, Alberta has an oil and gas industry that needs to reduce its emissions and a physical geography that makes carbon capture both possible and potentially profitable. And while the federal government isn’t offering incentives quite as generous as those proffered by the Biden administration, it has already put billions of dollars in tax credits up for grabs. What’s missing is a stable political and regulatory environment in Alberta and a provincial government willing to work with its national counterpart to match the money they’re putting on the table.
Ironically, this could actually be what ends up costing Albertans their jobs — not the federal plan to invest in training and education but the provincial government’s unwillingness to accept and embrace reality.
Smith and her proxies in the Postmedia pundit class can continue to pretend the long-awaited “just transition” legislation is a nefarious plot to eliminate oil and gas, kill hundreds of thousands of jobs and reduce Alberta to penury. But indulging in this self-serving theatre means wasting valuable time that could be going towards actually managing the energy transition, and ensuring both Alberta and Canada are as well-prepared and positioned for it as possible.
Rest assured, American states like Texas and Louisiana will be more than happy to eat our lunch here. But in time, Albertans may be less pleased about Smith’s decision to serve it up to them on a platter.
Comments
We all seem to forget that the oil and gas sector is an enormous funding group for the Conservative Party.
We can make a just transition from fossil fuels but we will still need oil for manufacturing or plastics, steel, textiles. And as for natural gas, million of us use it to heat our homes. To heat a home with gas or electricity or geothermal, wood pellets are all different choices that a 4 season country like Canada has to have.
Danielle Smith is proving to be more dangerous than Carbon Taxation.
Erm, no, we need to be moving away from heating homes with gas, or for that matter wood pellets. Luckily, by all accounts heat pumps work really well.
I myself use natural gas to heat my home RIGHT NOW, because that's what my home came with and that's what's generally been available and ripping it out and replacing it would cost money. But when my furnace gets to end of life, I'm sure as hell not replacing it with another gas-burner. Or if the right government program comes along I'll make the switch earlier than that.
Oil will certainly have applications in plastic and textiles for some time after we stop burning it. That's problematic in its own right, but for better or worse, yes, that use will persist. But probably not so much in manufacturing or steel, where there is significant movement afoot towards alternatives.
Carbon capture and storage (still largely unsuccessful technology) may reduce emissions for the production of a barrel of oil, but it does nothing to reduce downstream emissions when the oil/ gas is burned. So, of course oil companies are happy to take federal government subsidies to make it appear that they are doing something to address climate change, when in fact they are doing very little to reduce emissions. Having said that, maybe these oil executives can convince Danielle Smith to soften her stance regarding the feds.
It's unfortunate that there seems to be a long history of anti-federal government sentiment in Alberta I don't really understand it. Maybe Max can shed some light on this....Alberta is so well-positioned to become a leader in renewable technology-and there are many projects already built or under construction. And yes, I agree there will always be some oil production in places like Alberta, because we need it to make other products likes plastics, medical supplies etc. But, as I heard a former Shell oil executive say years ago, we should save our oil supplies for those products and not waste it on uses for which there is an alternative (transportation etc.).
It's unfortunate that the Conservatives are attacking the label "Just Transition" by fear-mongering. Shame on them again!
Well, all provinces find it useful to have some degree of anti-federalist politics, much the way countries so often like to have foreign enemies; it distracts the voters from governance that is either incompetent or deliberately hosing the people for the benefit of some moneyed elite.
But the extreme virulence of the anti-federal and specifically anti-Liberal politics in Alberta dates back to Pierre Trudeau's National Energy Policy, which would have set a constant within-Canada price for oil at a moderate level, neither as high as during boom times nor as low as during bust times. That would probably on balance have been good for Alberta's economy, and certainly would have been good for the rest of the country's economy, because all else being equal, stability is good for economies. An Alberta with constant $75/barrel oil would have been better off than an Alberta with $25/barrel oil one year and $125/barrel oil the next.
However, the immediate impetus for the policy was of course spiking oil prices, meaning that the immediate effect on Alberta would have been significantly lower prices--and, as they always do, they thought the good times were going to go on forever. Which meant that obviously, the point of the exercise was to screw Alberta--and certainly claiming that made for amazingly popular politics.
And while that was a long time ago--I'm middle aged, and I was a kid at the time--it's been so useful to Conservative Alberta governments, and probably to the oil patch, that they have worked hard to nurture it ever since, to the point where hating Liberals, especially if they're forming the federal government, is now basically part of Alberta culture. Which is why the party looking to take government in Alberta is the NDP.
Frankly, I'm surprised the Liberals in Alberta haven't taken a leaf from the Saskatchewan Conservatives and done a name change/rebrand--"Moderate Party", "Democratic Party", "Alberta Party" or whatever. Because under the name "Liberal", they are dead in the water and will remain so.
Side note: And yeah, Carbon Capture and Storage is a bunch of greenwashing bullshit. Mr. Fawcett says some sound things, but on other issues not so much, and certainly whenever he starts talking approvingly of CCS I just wince.
And before we get all excited about carbon capture and storage, we should look into what EOR (enhanced oil recovery) has in mind for the CO2 that is captured. CO2 pipelines snaking everywhere to unclosed oil wells near the end of their lifetime, to push more fossil fuel out of the recalcitrant ground isn't climate saving work, by any yardstick I employ.
What's more......those pipelines are creating havoc for western American communities trying to regulate safe distances from schools, hospitals and residences. CO2 is heavier than air, crawls along the ground in the case of a rupture...........and is an asphyxiate. It can kill you....but for sure, recycling it to coax more oil out of old wells.........is not any kind of permanent storage.
Once again.....public money is being vacuumed up for big projects pushed by tiny brains.
"[Smith's] province is in the midst of a pitched battle for many billions of dollars in clean technology capital, which became all the more intense after the Biden administration’s Inflation Reduction Act tilted the table in its direction."
"Clean technology" meaning carbon capture and storage (CCS) — a fake climate solution, which captures a tiny fraction of emissions at high cost and perpetuates the O&G industry. Fossil fuels for longer. More emissions, not less. Ergo, not "clean".
AB oilsands producers have to reduce their emissions in the AB oilsands, not in Texas. Biden's Inflation Reduction Act (IRA) is a red herring.
Clean-up, reclamation, and emissions reduction are all standard costs of doing business. Why should taxpayers be on the hook for industry's business expenses? What ever happened to free enterprise? Polluter pay?
Why don't we pay for Cenovus Energy's pencils and paper too? Poor CEO Alex Pourbaix probably needs a new jet as well.
Canadian taxpayers are under no obligation to pay for industry's CCS, SMRs, emissions reduction, clean-up and reclamation. Simply put a rising price on carbon, stop shielding large emitters from carbon pricing, establish a decreasing emissions cap, and let oil companies operating in Canada decide how to meet it.
Ayup.
Alex Pourbaix, CEO of Cenovus Energy: “This transition, if done correctly and if we’re able to materially decarbonize the Canadian barrel of oil, I actually think it should result in more jobs — and materially more jobs — in the Canadian energy sector.”
By "energy sector", he means oil and gas. He does not mean renewables.
Fawcett: "In other words, they’re not afraid of the energy transition. Instead, they’re afraid of not getting that transition right"
Fawcett's imprecise language is highly misleading. To oilsands CEOs, "energy transition" means something very different from the common understanding of the term. It means "greening" fossil fuels, not getting off them.
Among oilsands industry leaders, Cenovus Energy CEO Alex Pourbaix has made no secret of his opposition to the energy shift:
"Cenovus CEO says future of energy is diversification, not transition" (Canadian Press, June 8, 2022)
"Cenovus chief urges Trudeau to pay for greening of Canada's oilsands" (Financial Post, Aug 09, 2021)
O&G companies are not going to become renewable energy companies. If O&G workers are to work in the renewables industry, they will work for renewable energy companies. Oilsands majors have no plans to move into renewables. Suncor just divested from renewables last year.
"This week, Cenovus, Canadian Natural Resources and Imperial Oil all reiterated their stance they have no appetite to build their own wind or solar. Instead, the focus is squarely on being oil & gas companies. …
"'The preference is to stick with what we know and what we're good at,' said Tim McKay, president of Canadian Natural, during the Scotiabank CAPP Energy Symposium.
"'If I was to get into wind power, I would have to relearn it and figure out how I could compete with other producers.'
"In the past, some executives have said it's not about a lack of knowledge, since oil majors have branched out into new ventures like petrochemicals without any prior experience.
"Cenovus chief executive Alex Pourbaix said the only renewable energy consideration would be potentially purchasing the electricity from a third party.
"'Where we're likely to remain is focused on oil & gas production. 'Don't look for us to become a late-entrant renewable-power developer.'
"Big oil companies have 'diametrically opposed' views on renewables" (CBC, Apr 09, 2021)
"The Canadian Association of Petroleum Producers (CAPP) also encouraged its members to submit feedback, with high-level recommendations like … ensuring any 'just transition' policy is aimed at cementing Canada as a global supplier of fossil fuels, rather than transitioning out of the industry."
"Industry and climate groups face off over just transition consultation" (National Observer, 06-Oct-21)
"It's difficult for Big Oil to even cast itself as committed to helping the world transition to a low-carbon future, since the investments by them in renewable energy are dwarfed by the money spent on new oil and gas projects."
"COP21: Big Oil in hiding at Paris climate talks" (CBC, Dec 07, 2015)
These articles need a glossary at the bottom, something with:
"Business Community", a term that does not include the 90% of every business that does the actual work, in return for a paycheque. "Business Community" only refers to investors and senior management.