All the hand-wringing and anger over the way the Rest Of Canada treats Alberta and its oil and gas sector obscures the fact that some very, very interesting things are developing in clean technology.
It seems that cynical Canadians both to the east and west of this province are too ready to dismiss claims that Alberta is a world leader in the clean production of fossil fuels. (And, of course, it is even more grating that citizens of those provinces keep fueling their cars and homes with products from much dirtier foreign sources.)
The story needs to be told: Clean tech is a big, big deal and Alberta is getting very good at it.
This development couldn’t come at a better time for Alberta, which is struggling to pivot away from conventional oil and gas production techniques even, as prices are in the tank and provincial coffers are empty.
The opportunity in clean tech is staggering: It is estimated that the clean tech market in the U.S. is worth $4.8 trillion – a figure that is so big it’s hard to get your head around it. One definition I looked at noted that it is one million times one million.
Advances in Alberta’s clean tech sector will be laid out Tuesday, when the Alberta Clean Technology Industry Alliance releases an important report at the Emissions Reduction Alberta’s SPARK Conference in Edmonton. Details of that report are under embargo, but – having seen an advance copy – I can tell you that Albertans need to read this report and pay close attention to this vital shift in our economy.
There are two dimensions to the shift: necessity and opportunity. Like it or not, Alberta’s oil sands have become the poster child for all that is wrong with fossil fuels. It is a story that appeals to emotions rather than reason, and therefore is all the more difficult to refute.
So, it is necessary for Alberta companies to accelerate clean tech innovation and to also find ways to market those technologies to other jurisdictions around the world.
Doing so also presents a tremendous opportunity to grow the province’s economy, tapping into our wealth of expertise. Alberta has the highest concentration of professional engineers per capita in North America, at 8.8 per 1,000 residents. That’s nearly double the Canadian average. We can mandate those engineers to accelerate the creation of clean technology – and the knowledge we gain can be shared with the world. You don’t need a pipeline to export this product, and – bonus – you’re not forced to sell it to the U.S. at discounted prices.
The ideas and technologies we’re developing here are worth a lot of money, and that will flow back to Alberta companies. It should also not be lost on us that those same technologies will help countries that emit a lot more carbon dioxide than we do to clean up their act.
The question for Albertans and its provincial government is how to build on the momentum that these amazing engineers and entrepreneurs have created and are still creating. The answer is three-fold: creating a friendly regulatory environment, improving access to financing, and – brace for it – throwing some taxpayers’ money at it.
Now, government subsidies of business is not a popular topic, in part because the practice has such a spotty record over the years. In the 1980s, for example, the PC governments of Peter Lougheed and his successor Don Getty made a series of investments in the name of “diversification” which turned out to be almost laughable flops.
Ted Morton, former provincial finance minister and now executive-in-residence at the University of Calgary School of Public Policy, has written about the “dirty dozen” of bad investments, including giving money to NovaTel Inc. to manufacture cellphones, and to Peter Pocklington’s Gainers meatpacking operation. Morton calculates the total losses of such foolhardy investments at $2.2 billion.
But there is a flip side, too. Direct provincial investments created our biggest winners, including Syncrude Canada Ltd., Alberta Energy Co. (now Encana Corp.), and the Bank of Alberta (now Canadian Western Bank). It is estimated that a $1-billion investment returned more than $200 billion in private sector spending, and essentially triggered decades of prosperity in Alberta.
In its budget released last week, this UCP Alberta government has put the province back on course to balancing its books. That is a necessary and responsible thing to do.
But the current government can also take a lesson from the NDP government it succeeded. When new technology holds a high promise of return, then the smart thing to do is make the investments that will make that growth happen faster.
Clean tech is the road that will help lift this province out of its fiscal nightmare. Let’s hope our government has the vision to ensure we make the most of this golden opportunity.