Opinion: New day for Canada demands bold moves on low-carbon growth from industry and governments
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The first ministers' conference in Saskatoon earlier this month might be remembered as the moment Canadian politicians finally got on the same page about decarbonizing the energy sector.
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To realize the vision of turning Canada into a low-carbon energy superpower, we now need the energy sector to step up. And we need provincial and federal governments to put more skin in the game to convince industry that big investments in decarbonization will be economical in the long term.
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First, we need the oilsands majors to commit to building the proposed Pathways Alliance carbon capture project without further delay.
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The federal and Alberta governments have already offered to cover almost two-thirds of Pathways' capital costs, as well as setting up additional carrots and sticks to help get the project over the goal-line. They've also agreed on the need for new pipelines to tidewater that can substantially increase revenues.
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A new climate of federal-provincial collaboration creates an opportunity for policy changes the companies want, such as cancelling the oil and gas emissions cap.
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What are the Pathways companies waiting for? The time is now to strike a deal with governments and build the infrastructure that Canada's oil sector needs to remain competitive in a rapidly decarbonizing world.
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Getting Pathways built quickly is critical to this goal and to Canada's larger low-carbon growth ambitions. The project would reduce emissions by 22 million tonnes per year, almost a third of the oilsands' total. It would set Canada's oil and gas sector on a virtually unstoppable trajectory to decarbonization.
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For years, trying to decarbonize the energy sector has been like pushing a boulder up a hill. Pathways could heave us over the top.
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For their parts, the provincial and federal governments should build on their new-found spirit of co-operation to strengthen the country's industrial carbon pricing system. That will unleash not just Pathways but also a wave of other low-carbon projects.
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Strong industrial carbon pricing eliminates the need for duplicate policies such as the oil and gas emissions cap, which has created friction between Alberta and the federal government. If Alberta is willing to get on board with carbon market reforms, then the federal government would be wise to cancel the cap.
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