Alberta and national unity

The election results illustrate a stark divide between Alberta (and Saskatchewan) and the rest of the country. The Conservatives won all seats save one in Alberta and Saskatchewan, but made very little headway in the rest of the country, losing votes in both Ontario and Quebec.

It's hard to find a compromise between people who feel that the oil patch is being ignored, insulted, or undermined, and people who are extremely worried about climate change and want more ambitious action.

From here in BC, I think the message to Alberta should be something like this:


I can understand why Albertans feel that they're taken for granted. Our energy-intensive lifestyle has been made possible by fossil fuels. In Vancouver, most of the gasoline powering our vehicles comes from Alberta refineries - and we complain when gas prices go up. That energy is the result of a lot of long hours and hard work.


Albertans also feel anxious and vulnerable. Oil prices have come down, putting a lot of people out of work. In the long term, climate change and the prospect of declining demand for oil mean that producers with high costs and high emissions intensity are going to find it hard to compete.

This suggests that at some point, Alberta will need to diversify its economy away from fossil fuels. However, this is a decision that must be made by Albertans. It cannot be imposed on Alberta by the rest of Canada.


What the rest of Canada does require - as shown in the election results - is that Alberta accept the need for carbon pricing. It cannot be free to dump CO2 into the atmosphere. Ideally Alberta would implement its own carbon price, as the Notley government did, but if not, Ottawa will do it for them.

Carbon pricing is compatible with continued oil production. As Stephen Gordon says, the justification for a carbon price is that it motivates us to cut the lowest-value emissions, instead of the most visible emissions.


As long as Alberta decides to continue oil production, Canada is willing to support additional pipeline capacity to make sure that Alberta gets the best price for oil production (which benefits the Canadian economy as a whole, not just Alberta).

This is why Ottawa supports the Trans Mountain expansion, despite the minefield of political and legal obstacles in BC. When BC's new government attempted to block it, giving Kinder Morgan cold feet, the Trudeau government used the biggest hammer available by purchasing the pipeline outright. (TMX was an election issue in BC, but in the end the Liberals held the most closely-watched seats, including Burnaby North, North Vancouver, and West Vancouver. In a post-election interview, Horgan appears to be resigned to TMX.)


If at some point in the future Alberta does decide to diversify its economy, Canada is also willing to support it. Replacing fossil-fuel energy with carbon-free energy will require a lot of new projects, which means a lot of engineering and construction work.

If there's a need for federal contributions to support oil well cleanup, or carbon capture projects (like Saskatchewan's Boundary Dam), or new infrastructure for hydrogen production, or retraining programs, the rest of Canada is willing to contribute. Alberta's oil exports have obviously benefited Alberta, but they've also helped the Canadian economy as a whole. People talk a lot about equalization, which isn't a factor in BC, but the oil patch has also bid up wages across the country, especially for blue-collar workers.

Again, though, this is Alberta's decision to make.

Chris Turner suggests that, rather than wartime mobilization, what the climate emergency demands is something like the Marshall Plan. Just as Western Europe had to rebuild after World War II, we need to replace and rebuild our energy infrastructure.

US planners stressed the importance of the Europeans taking the initiative and the responsibility for the plan. From PPS/1:

It is necessary to distinguish clearly between a program for the economic revitalization of Europe on the one hand, and a program of American support of such revitalization on the other. It would be neither fitting nor efficacious for this Government to undertake to draw up unilaterally and to promulgate formally on its own initiative a program designed to place western Europe on its feet economically. This is the business of the Europeans. The formal initiative must come from Europe; the program must be evolved in Europe; and the Europeans must bear the basic responsibility for it. The role of this country should consist of friendly aid in the drafting of a European program and of the later support of such a program, by financial and other means, at European request.

I think the same approach would be useful here.

A reading list on Alberta and national unity. This isn't a comprehensive list, just my attempt to pull together some material that may be of interest to people concerned about national unity.

(1) The human view

Kate Beaton, Ducks. A short webcomic series. Beaton spent a year or two working in Fort McMurray, and her comics provide an on-the-ground view of what that looks like.

Chris Turner, The Patch: The People, Politics, and Pipelines of the Oil Sands. Reviews. A sympathetic history of the oil sands from an environmental writer (Turner is also the author of "The Leap").

Turner describes Alberta's perspective:

The culture of a place - and an industry - often endures even in the face of radically changed circumstances. A company town still sees itself as intimately connected to a long-departed industry, a business sector moves from margin to mainstream (or vice versa) without embracing its changed role. The oil sands were an underdeveloped subsector at the margin of the global oil industry, situated deep in the hinterland, far from centres of economic or political power. Calgary was a scrappy business town of ranchers and wildcatters, not a political capital or financial hub, in a province long treated as the hick prairie cousin of Confederation. The Patch emerged on the margin of a margin of a margin. It boasted of energy superpower status even as it still felt, at its core, like a risky frontier dream in constant danger of failure.

Turner concludes:

When the Patch’s boosters say they are simply supplying a product everyone uses every single day, they are not wrong. When the prime minister says, “No country would find 173 billion barrels of oil in the ground and just leave them there,” he’s not wrong. When anti-pipeline protesters say some of that oil has to stay in the ground, they’re not wrong. When Indigenous people say they’ve never been properly consulted about what those pipelines and bitumen mines are doing to their land, they’re not wrong.

There’s more to the debate, though, more to the way forward, than being right. A thing of such scope and power and wealth as the Patch doesn’t go away overnight or in a few years. Building the entire industrial basis of modern society on a new energy regime does not happen overnight or in a few years. We will have the Patch for decades. It is a fixture on the Canadian landscape. It employs tens of thousands. It is a truly national project or else the term has no meaning.

We have all benefited. We are all stakeholders. We are all complicit.

(2) Pipeline capacity and economics

Andrew Leach, Canadian Oil Export Pipeline Capacity and Export Demand. A visualization of NEB data.

Kent Fellows, The Invisible Cost of Pipeline Constraints. Estimates the cost of the increased discount on Canadian oil due to pipeline constraints: about $15B/year. Half of that is reduced revenue for the Alberta government. For a longer explanation, see Scotiabank, Pipeline Approval Delays.

Tristin Hopper, Why Canada shouldn't refine the oil it exports. An excellent explanation of the economics of oil extraction and refining.

(3) Notley's climate policy

Justin Giovannetti and Jeffrey Jones, Alberta carbon plan a major pivot in environmental policy. Globe article describing Notley's climate plan, announced in November 2015 with support from both environmentalists and the CEOs of major oil producers.

The Leach Report (Climate Change Advisory panel report). The detailed blueprint for the Notley government's climate policies, including an economy-wide carbon tax, phasing out coal-fired power by 2030, and a cap on total emissions from the oil sands.

This wasn't enough for the Horgan government in BC, which made a serious attempt to keep the Trans Mountain expansion from happening. This was likely a major factor in the 2019 election result in Alberta: The perception was that trying to work with Ottawa had failed, so it was time for a more adversarial approach.

Eric Denhoff, What will Alberta oil sands producers say now when Wall St. asks about climate policy? An op-ed by the former deputy minister for climate change, describing how investors are asking for strong environmental policies.

(4) What's next?

Eric Denhoff, Why are Albertans so damned angry? A good article published by the Georgia Straight, the local alt-weekly in Vancouver. Unemployment is high; the oil and gas industry is unhappy about C-69; Kenney's political interest lies in inflaming the situation.

Jen Gerson, How to harness the volatility of the populist right. She describes what Kenney is trying to do, using a metaphor from Preston Manning:

It starts with a description of a rogue well - an oil or gas well in which pressure from below builds until it explodes. The only way to prevent catastrophe is to drill a relief well, a secondary line that channels and vents that pent-up energy. Drill the relief line too deep or too shallow and the rogue well explodes anyway: hit the right angle and the canny drill operator can harness the energy to his own end.

This, Manning believes, is the nature of populism. Ignore it and it will consume you; tap it clumsily and it will both explode and leave you implicated in its self-destruction. But drill that relief well just right and energy abounds.

The Economist, Aramco is both the industry's Goliath and a firm vexed by problems. A good description of how the oil industry as a whole is grappling with the challenge of peak demand as climate change looms larger. Aramco's plan is to be the last producer standing. They have compelling advantages: both low production costs (less than $3/barrel) and low emissions.