The role for Alberta on the road to Canada’s 2050 net-zero target

It’s been a source of consternation among some in the energy sector — what sort of future lays ahead for the oil and gas sector in light of the federal government’s commitment to reach net-zero emissions by 2050?

A recent report by TD Bank suggested that between 312,000 and 450,000 people working in the oil and gas sector could lose their jobs by 2050. But the transition away from fossil fuels has already left those in the industry wrestling with unknowns.

So what might the future bring — and what sort of active role can Alberta play in the years to come?

Federal Natural Resources Minister Seamus O’Regan told CBC’s Kathleen Petty that when it comes to transition, his approach involves a “three-fold common mission.”

“One, we have to reach net-zero by 2050. Secondly, we have to make sure that the economy continues to prosper, and that we continue to create the jobs that people need,” he said on the latest episode of the West of Centre podcast.

“And thirdly, no one can be left behind.”

  • Listen to this week’s full episode of West of Centre here:

West of Centre1:03:22Resourceful thinking

A ‘just transition’ for energy workers

At this year’s virtual policy convention, Liberal delegates agreed that a “just transition” should take place for energy workers who would lose their jobs as the country moves towards renewable energy.

That followed the promised “Just Transition Act” in the party’s 2019 election platform, which promised access to training and support for affected workers.

Such legislation has yet to emerge, and O’Regan said much of that was owed to legislative delays attributed to the pandemic.

“We learned a lot of lessons on the just transition that we went through with coal, in a much smaller way, in Alberta,” O’Regan said. 

“[We] got into communities and saying, ‘OK, you know, we’re getting off of coal, let’s retrain people for jobs and positions that are going to prosper in the future.'”

A recent TD Bank report suggests that between 312,000 and 450,000 oil and gas workers could lose their jobs by 2050. (Kyle Bakx/CBC)

O’Regan said for now, his “singular focus” was on lowering the emissions from the extraction and use of oil.

“In some quarters, you know, you hear that it’s anti-oil. It’s not for me,” he said. “Not in my province, not in my department, not my ministry, not for my government.

“What it has to be, though, is about lowering emissions.”

Carbon capture and blue hydrogen

Last month, the provincial government asked the federal government for $30 billion in funding to explore carbon capture, utilization and storage (CCUS) technologies, and the federal government agreed to collaborate as part of a federal-provincial working group.

“It’s critical. We think it’ll be particularly critical for hydrogen, which Alberta is going to play a big part in,” O’Regan said.

WATCH | Alberta banks on hydrogen exports:

The Alberta government has announced an ambitious plan to use existing infrastructure to build a hydrogen export industry, but critics point out they’re planning to use fossil fuels to make the hydrogen instead of trying to use renewable energy in the first place. 1:51

O’Regan said it would be “foolhardy” for Canada to turn its back on “blue” hydrogen, which involves storing the carbon emitted from natural gas.

“So that’s where CCUS comes in,” he said. “And that’s why it’s so important in lowering emissions. And in creating a, I think, very, very exciting new hydrogen industry for Alberta, and for the west.”

Some have expressed doubts about the strategy, arguing hydrogen isn’t green enough. But O’Regan said the “objective, singularly, is to reduce emissions.”

“The fact of the matter is, oil and gas in this country is not some marginal industry. It is our number one industry. So, we would be foolish to deny the industry the opportunity to take advantage of it and to create fuels of the future,” O’Regan said.

Climate change as ‘economic opportunity’

The TD report surrounding jobs in the oil and gas industry estimated that 50 to 75 per cent of those working in the industry could lose their jobs by 2050.

But O’Regan said he felt that report was “all about the risk, and nothing about the opportunity.”

“Climate change, and the president has said this — the prime minister has been saying it for years — climate change is the biggest economic opportunity of our time,” he said. 

An illustration shows a NuScale Power Module on a truck. NuScale is a small modular reactor company. Alberta joined Saskatchewan, Ontario and New Brunswick in signing a memorandum of understanding Wednesday related to exploring the feasibility of small-scale nuclear technology. (NuScale Power)

O’Regan said that in many areas, he believed Canada could lead, including in hydrogen, critical minerals and carbon capture.

“One of the most exciting places of opportunity for us is in critical minerals. We’ve got them all,” he said. “We’ve basically got just about everything you need for solar panels, for lithium batteries.”

On Wednesday, Alberta became the fourth province to sign an agreement supporting the development of small modular nuclear reactors (SMRs) in Canada. 

Opponents say SMRs aren’t proven to create jobs and will cost more than other alternatives. But O’Regan said in the case of SMRs, some “let perfect get in the way of the good.”

“I mean, all of this stuff together will get us to net zero,” O’Regan said. “So, I won’t turn my back on anything. And I certainly would not turn my back on nuclear.”

Conservative climate plan

On Thursday, Conservative Party leader Erin O’Toole announced a climate plan that would put a price on carbon for Canadians at $20 per tonne, instead of the current $40.

O’Regan said he gave credit to the party for introducing a price on pollution, but called lowering the price “a mistake.”

“If they think lowering it is going to impress anybody, any investor in the world right now, it’s certainly not going to show the leadership that Canada needs to show in the world,” he said.

WATCH: Conservative climate plan includes lower carbon levy:

Conservative Party Leader Erin O’Toole unveiled his party’s climate plan, which includes a price on carbon. Though he says it’s not a tax, his critics say otherwise. 2:03

Andrew Leach, an associate professor in the Alberta School of Business at the University of Alberta, told West of Centre that he was happy to see O’Toole pivot and acknowledge pricing had to be part of the solution.

However, he said the “personal low carbon savings accounts” concept was lacking when it came to logistics, administration and privacy, among other issues.

“The heavy lifting here is also being done not just by the carbon price at the pump, but by keeping the industrial emitters carbon price, moving along with a parallel to what is now the clean fuel standard, the electric vehicle mandates, or zero emission vehicle mandates,” Leach said.

“There’s a lot to this policy, which I think is a real positive for the discussions we’re going to have going forward.”

Kelly Cryderman, who covers politics for the Globe and Mail, told West of Centre that the policy was clear in that it realized the seriousness of climate change.

“There’s a lot to criticize in terms of the policy. There’s a lot that you could consider gimmicky,” Cryderman said. “But it is still a policy that can be debated, that can evolve, that, you know, stakes out some markers.”

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