Danielle Smith wants a fight on climate policy. Justin Trudeau should give it to her
After a week of literal record-breaking heat, you might think the government of Alberta would at least pretend to take climate change more seriously. But as the mandate letters for Premier Danielle Smith’s minister of environment and minister of energy show, her government remains all hat and no cattle when it comes to the issue.
Oh, it’s still happy to pretend it’s doing something. As the letters state, “Alberta is the most responsible energy producer and exporter on Earth. Our industry and government spend billions annually on pioneering and commercializing technologies that are turning our massive oil and gas reserves into a long-term, environmentally sustainable and responsible source of energy for the world.”
Never mind that Alberta’s per-barrel emissions are actually higher today than they were in 1990 and barely lower than they were in 2005. And let’s set aside, for the moment — we’ll get to it — that its inventory of unreclaimed environmental liabilities is now well in excess of $100 billion. To hear the premier and her key ministers, the biggest priority here isn’t reducing emissions or tightening regulations but rather cutting red tape and finding ways to dump treated oilsands water back into the rivers more quickly. As the Pembina Institute’s Simon Dyer said, “It’s impossible to be an energy and environmental leader without a clear plan to reduce emissions, and Alberta doesn’t have one.”
Said plan was, by the way, one of Smith’s key pre-election pledges. While former environment minister Sonya Savage promised a package of “commissions, committees and studies” to determine how Alberta ought to pursue its “aspirational” net zero by 2050 target, those are conspicuously absent from her successor’s marching orders. Instead, it includes a very curious directive to conduct "an analysis into Alberta’s carbon sink capacity to establish a true understanding of Alberta’s position in relation to carbon neutrality."
In other words, they want credit for the existence of a boreal forest in Alberta and the carbon dioxide it’s sequestered over the years. This is a familiar argument among the dwindling crowd of climate change skeptics (and growing number of climate policy slow-walkers) that’s been debunked repeatedly by people who actually look at the data, including the National Observer’s own Barry Saxifrage. As he wrote in 2021, “Over the last two decades, the once great carbon sink has steadily drained away. It's now gone, and the balance in the forest has tipped to emitting CO2 instead.”
This isn’t the only free lunch Smith’s government is looking to dine out on. It also wants credit for LNG exports, another familiar fantasy that has been knocked down by economists and other experts who are in the dangerous habit of knowing things. The federal government is apparently entertaining the idea, which one can only assume is because it understands most of these theoretical credits — which, again, are about as likely to happen as me getting hired by Postmedia — would actually accrue to British Columbia. LNG terminals are located on the B.C. coast and process gas is extracted from within its borders. Jonathan Wilkinson, the federal minister of natural resources, must have a prankster’s sense of humour.
But Smith’s relentless search for reasons why Alberta doesn’t have to do the heavy lifting — or any lifting, really — on reducing its greenhouse gas emissions is no laughing matter. Instead of putting forward a real plan and policies needed to make it happen, the Smith government is trying to wait out the federal government and its belaboured efforts on an oil and gas emissions cap and net-zero electricity regulation for 2035. When they’re inevitably announced some time later this year, Smith will saddle up on her high horse and pretend they represent yet another affront to Alberta’s oil and gas industry.
What they really represent is a late-game attempt to bring Canada within shouting distance of its 2030 targets under the Paris Accord. And while the Trudeau Liberals may have held out hope that Alberta’s recent provincial election would deliver a government willing to at least take this stuff seriously, that’s clearly out the window now. Now, with an eye towards an election of its own and the need to protect Albertans (and Canadians) from the growing financial risks associated with the energy transition, the Trudeau Liberals might want to turn the tables a bit here and start playing offence.
If Alberta won’t force its oil and gas companies to start spending more — way more — on cleaning up its old wells and tailings ponds, maybe Ottawa should. In addition, the feds should end all remaining subsidies, which they’ve already promised to do, and introduce a new surtax on oil and gas profits. The proceeds could be used as a deposit against the cost of cleaning up the mess these companies seem comfortable leaving behind for taxpayers. If Alberta’s growing inventory of tailings ponds and unreclaimed wells are cleaned up ahead of schedule by industry — unlikely, given the current pace and scale, but theoretically possible — the funds could be returned to Albertans in the form of a special dividend or one-off transfer to its government.
Yes, the companies would surely howl about how this represents yet another “National Energy Program.” The Smith government might do some saber rattling about separation and independence. And federal Conservatives might even try to turn it into an election issue, one that could easily backfire in the places they need to win more seats.
Let them. Wakeup calls are rarely pleasant for the person getting woken up, after all. But the longer Alberta is allowed to sleepwalk towards a climate-driven financial catastrophe of its own making, the higher the price will be for everyone else. And if it really is “the most responsible energy producer on Earth,” as we keep getting told time and again, maybe Alberta and its United Conservative Party government will actually do the right thing here for a change.
About that net-zero electricity target
The Smith government and its proxies in the Postmedia opinion pages have tried to suggest the federal government’s forthcoming net-zero regulations for the electricity sector will cost taxpayers as much as $87 billion. This math was almost immediately challenged by the economic modelling firm that did the work for the government of Alberta, but even its own comparatively conservative estimate creates some sticker shock for anyone who’s paid an electricity bill lately.
Said modelling revolved around a 2021 report from the Alberta Electric System Operator, which used cost estimates for wind and solar power generation that were as much as double the current cost. As Blake Shaffer, an economics professor at the University of Calgary and former head trader for TransAlta Corp., told the Globe and Mail, “The numbers in that AESO report are not credible.”
A new report from the Pembina Institute shows that there are, in fact, a variety of viable pathways to reaching net-zero emissions on Alberta’s electricity grid, from widespread deployment of carbon capture and energy storage technology to the creation of major new interties with the grids in British Columbia and Montana. Far from being an economic drag, these pathways could actually turn Alberta from a net-importer of electricity to an exporter while lowering the bills consumers pay. “Residential electricity prices in 2035 under four of six scenarios would be lower than the actual prices in 2022 by 17– 24%,” the report says. “Only by adding a large deployment of energy storage, CCS for combined-cycle facilities, and intertie capacity between Alberta, British Columbia and Montana do costs approach 2022 levels by 2035.”
You can be sure the Smith government will ignore these findings in favour of its own preconceived biases here. The tell there, if anyone even needed one, was in the fact that the mandate letter for the new minister of energy and minerals did not once mention the words “solar” or “wind.” Small modular reactors, on the other hand, get referenced three different times.
Are EVs really “piling up” on dealership lots?
In journalism, you’re taught to look for the “man-bites-dog” stories, the ones that invert widely held beliefs or challenge conventional wisdom. And the one that’s been circulating on right-wing Twitter lately about electric vehicles suddenly “piling up” on dealership lots in the United States certainly meets that test.
The Reuters story, which has been seized upon gleefully by the fossil fuel enthusiast community, noted that “U.S. dealers have more than 92,000 EVs in stock, more than three times the number on their lots a year ago. Overall, new vehicle inventories are up 74% from a year ago.”
This is, in part, a story about supply chains that were badly backlogged last year getting back to normal. When you’re comparing data over two different time periods, it’s always important to keep the point of comparison in mind and what it looked like at the time. It’s also a story about the fact that certain luxury EV models aren’t selling, which shouldn’t come as a surprise given the growing concerns around inflation and the cost of living.
Perhaps most importantly, it’s a story that doesn’t include any sales data for Tesla, the clear market leader in the United States. Tesla continues to ramp up production and sales, and it’s been aggressively cutting prices — a tactic that is clearly eating into the sales of competing luxury brands. “Tesla's price cuts, and competitors' responses, pushed average selling prices for EVs for the second quarter to $53,438,” the Reuters story said. “That is down 19.5% from the peak of $66,390 in June 2022.”
This is good news for consumers, and there’s far better news yet to come. With more than 90 new EV models expected to hit the American market by the end of 2026, the number of choices — and, crucially, lower-cost choices — will grow exponentially. So, too, will their sales, of course. And if the BYD Seagull (the most popular $11,400 electric vehicle you’ve never heard of) ever makes landfall on our shores? Well, it’s safe to say those dealers might have a very different problem on their hands.
Good News of the Week
For all the hand-wringing being done about Bill C-18, it always seemed to me like it was the government’s opening move rather than its final offer. The legislation effectively asks big tech companies to return a small portion of the advertising revenue they’ve captured that used to support the production of journalism, and Meta and Google’s reaction to it — essentially, taking their respective balls and going home — always struck me as an obvious bluff.
I have a bigger stake in this outcome than I do with most pieces of legislation, given the role that traffic from Google (and, to a much lesser extent, Meta) plays in supporting online news organizations like Canada’s National Observer. And while I haven’t been thrilled by the way the federal government has handled this file so far, I’ve learned not to judge a negotiation that’s unfolding in public before it’s actually over. Remember when Chrystia Freeland was renegotiating NAFTA and Conservatives were encouraging her to take whatever she could get and not press Canada’s case too aggressively?
Well, this feels vaguely similar. As the Globe and Mail reported yesterday, the federal government released details on the regulations that would apply to Meta and Google, and while Meta remains firmly in bluff mode, Google’s representatives declined to comment — but confirmed that they were still in talks with the feds.
I suspect this will all end with a compromise that interested observers will spin as victory or surrender for both sides, depending on where they sit. Either way, as long as it results in continued access to key digital pathways for Canadian news content, and maybe some additional revenue or resources, that counts as a win — for all of us.
Then, the government can get down to the real business at hand here: finding a lasting solution to the challenges faced by English Canada’s news media, ones that were never going to be resolved by a so-called “link tax.” If it’s really feeling brave, it could even review the CBC’s mandate before Pierre Poilievre gets a chance to do it himself.
The Maxed Out podcast might be on hiatus for the summer, but that doesn’t mean I’ve stopped podcasting entirely. On Tuesday, I joined my friend Charles Adler on his fantastic new podcast to discuss Alberta politics, social media algorithms and why I don’t own a cowboy hat. Rate and review it, if you could.
On Monday, I wrote about why our elected officials need to start taking their jobs a little more seriously, and why that means cooling it on the Taylor Swift tweets. I also proposed a basic financial and political literacy test for aspiring politicians that would never, ever happen, for reasons I think we all understand.
And on Tuesday, I had a column on the growing effort to gaslight Canadians on how our democracy really works. It’s entirely possible, after all, that Pierre Poilievre’s Conservatives could win more seats than Justin Trudeau’s Liberals without actually holding power. But that’s not undemocratic (or worse), as some Conservative pundits and politicians are saying, and it certainly isn’t an invitation to unrest (or worse). It’s on them to tamp this stuff down, of course, but I have very little confidence that will actually happen.
In other words: get ready for a Canadian version of the “stop the steal” nonsense coming to your Facebook page soon.
Twitter keeps getting worse, but I’m still over there for some (suitably terrible) reason. You can also find me on Threads now at max.fawcett — hey, I had to do it — and I’m always happy to hear from readers via email at [email protected].