Conservatives in Alberta: the gift that keeps on taking

Albertans, and Canadians, will be paying for oil and gas profits for generations. Unless you're Danielle Smith, that is.

Credit: Danielle Smith on X(formerly Twitter)

Alberta Premier Danielle Smith has a complicated relationship with her libertarian ideology that puts her in the most contradictory positions and, frankly, makes it difficult for those who look for answers within the ideology to understand what’s going on in the Premier’s Office.

I followed Danielle Smith’s personal blog after she left 770 CHQR in 2021. I remember getting a good giggle out of one post in which she detailed all of the government “freebies” she would enjoy when she and her husband retire in Panama. It is always something to behold when libertarians extol the virtues of receiving government-funded benefits. 

When Smith proposed to make the “Free Alberta Strategy” the focal point of her platform in the 2022 United Conservative Party leadership race, it came as no surprise. Anti-Ottawa sentiment, especially if it can be bolstered with the name “Trudeau”, is a proven campaign strategy in the province.

The same can be said of her desire to free the Alberta government from paying for every visit to a family doctor, while adding currently uninsured services masquerading as “medical choice”, but that’s another post.

Handing over more money to Alberta’s oil and gas industry, though, seems to be at odds with such a fervently anti-government ideology as libertarianism, unless we tie it in with the idea that certain obligations, such as taxation or environmental remediation, are considered to be an unfair clause in the social contract.

As such, it was also not surprising that Smith would champion and implement the Asset Liability Management Program, formerly known as “R-star”. The program is intended to find ways to use taxpayer dollars to cover environmental liabilities of Alberta’s billion-dollar oil and gas industry – something Smith doubled-down on in her recent ministerial mandate letter to Alberta Energy.

Great for oil and gas, even though it will cost Albertans for generations.

One thing about conservatives is that they will tell voters they believe governments should not be used to interfere in the market.

Unless, however, they’re talking about reducing corporate responsibility or increasing “red-tape (regulation) reduction” as a way of creating “business-friendly” investment environments where competition is seen as a way to encourage innovation and provide options and ensure enough supply to meet demands that will keep costs lower for consumers.

While these things may be true in an actual free market, this belief works the other way as well – that governments can (and even should) be used to benefit existing business or industries to stifle competition at the cost of investment, true competition, and to the detriment of citizens.

Alberta, we have a problem

Over the summer of 2023, Danielle Smith and the UCP placed a moratorium on approvals of green energy projects, under the guise of requesting an inquiry into remediation and clean up regulations currently in place for those projects at the end of their life cycle.

Our provincial motto should be “Fortis et Liber et Ironia Plena” – strong and free and full of irony.

It’s a good excuse, as excuses go, but governing parties in this province are still trying to distract from speculation over why they won’t take care of the current problems.

Alberta has been the beneficiary of billions in investment into green energy projects. So much so, that current and planned projects will almost match the grid capacity generated by decades-old natural gas generated facilities in less than five years – and that’s not including the projects that were caught up in the moratorium.

So, when Danielle Smith announced the government of Alberta would be enacting its Sovereignty (Within a United Canada) Act against the federal government’s proposed Clean Electricity Regulations on November 27, it didn’t make a lot of sense because the market for renewable energy generation is set to overtake the capacity generated by fossil fuels well before 2030 when these regulations will start affecting Alberta businesses. 

When she added that she was considering creating a Crown Corporation to kick-start more investment in natural gas-generated electrical capacity, it sounded ludicrous. At the time, I referred to it as “Smith trying to keep the horse and buggy industry alive” but I’ve come to realize it’s just one more way to use taxpayer dollars to pay out oil and gas owners.

Because renewable electricity generation is being built so quickly, natural gas generating facilities are going to find demand no longer exists to the extent it once did and they will start losing money. When you add in the contractual obligations to remediate those facilities, it’s nothing but money out the window for those owners who are long-time friends of conservative governments.

What is a government to do?

If you’re a libertarian who believes that obligations are an infringement upon personal (and corporate) freedoms, you might plan to use the grace period afforded to you by your market interference (with the moratorium) to create a Crown Corporation that will pay existing businesses “fair value” for their aging and soon-to-be outdated infrastructure and release them from their environmental liabilities by making them the responsibility of the Alberta taxpayer.

Great for oil and gas; not so great for Albertans.

Between oil and gas (not including oil sands) and mining, the province is staring at more than $80 billion in unfunded and underfunded liabilities. With the oil sands, it's upwards of a hundred billion more.

Here’s hoping you too can make plans to retire in Panama.

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