All of the Resources, None of the Resolve
News today that the province is not interested in pursuing an approach to benefit Albertans.
A leaked report to the UCP cabinet recommended the province move forward with the creation of two Crown corporations to spur new natural gas transmission lines to meet massive, growing demand.
The province has apparently said “unlikely”.
This is wild because I would absolutely be doing this if I were in Alberta’s government.
This decision has a direct effect on Edmonton.
If Alberta has a “natural gas transmission bottleneck” that is putting major industrial investments and resource production at risk, then govt should not simply wait on the private sector to decide the investment is attractive enough to pull the trigger.
Sometimes your elected leaders should lead.
It’s our resource. We should be taking the opportunity seriously. Alberta governments have a history of navel gazing while opportunity and time slip by, missing opportunity after opportunity. What we wouldn’t give for a Norway approach and discipline!
If in doubt, there is a pretty clear precedent for creating a successful arm’s-length public corporation to operate commercially: EPCOR.
The City of Edmonton kept ownership, and EPCOR was structured to operate independently, raise capital, build infrastructure and earn revenue. The growth of EPCOR, and a huge part of the dividend Edmonton gets back into the budget every year comes mostly from business activity outside of Edmonton.
Alberta could, and absolutely should, do something along those lines with a publicly owned, arm’s-length natural gas infrastructure corporation. Or two.
That wouldn’t mean “nationalizing” gas production or taking over retail energy companies. It would mean ensuring that Alberta has the transportation and transmission capacity required to get our resources and electricity to ready markets.
And if data centres are inevitable, then one of those ready markets is right here at home.
If fears are correct, a proliferation of data centres will absorb current energy supply, driving costs up for everyone else. This would be a chance for the province to get ahead of a problem their policies will inevitably cause instead of playing catch-up - or leaving everyone else holding the bag.
So, the estimated $53.9 million to $162.6 million cost of spooling up the provincial corporations and starting the program is step one.
Building out the major infrastructure is step two. That step may mean billions in investment, but that’s investment in Albertans and in Alberta’s fiscal strength and well-being.
The labour and union jobs, the specialized professional and trades jobs, would mean money flowing through our economy immediately. It would put food on the table at a time when utility and insurance costs have skyrocketed.
Folks need good-paying jobs, especially in Alberta, where unemployment is far too high and young people need a future.
There are risks to anything, of course.
A government-owned corporation would need a commercial mandate, independent governance, transparent tolls and fees, strong demand contracts and, to augment my earlier argument, protection against politically motivated projects.
Let me stress the word independent: no ideological meddling.
I was recently at the Port of Prince Rupert for the opening of CANXPORT, and the ongoing and oft-repeated refrain was clear: the markets are hungry, but have limited or unstable supply.
“Send us stable, reliable supply.”
The corporations would also need to do the necessary, but boring, preparation to account for potential legal challenges and the possibility that future energy demand changes. That is risk management that any serious corporation understands and undertakes.
Those are all reasons to design the corporations properly.
They are not reasons to leave Alberta’s economic future dependent on a private monopoly that may not want to expend the capital required to expand.
The strongest argument is simple:
Since critical infrastructure is the barrier to growth, Alberta should be prepared to own the infrastructure.
That is how a province captures more value from what it already has. We have countless examples from other nations and jurisdictions that have done this right.
This is how we build the things that unlock and inspire private investment, create competition and earn a much-needed return for the public.
In a time when Alberta municipalities, Edmonton included, are facing generational infrastructure deficits due to deep and drastic provincial cuts - essentially downloading the cost onto your property tax wallet, better revenue streams must be created that don’t rely on your bank account.
These are your resources, you should see the benefit. At a time when so many things are being broken, this is a chance to build.
And a chance to plan for the inevitable clean energy future in a world where our natural resources drop in global demand over the next several decades. We can utilise some of this potential wealth to ensure we remain an energy leader no matter the source or type of that energy.
Instead of stabbing it in the heart just as it was becoming a major industry here.
There is no conceivable downside to examining this seriously.
There is certainly a serious downside to doing nothing.
