Alberta Environment Minister Rebecca Schulz will meet with her federal counterpart, Environment Minister Steven Guilbeault, in Ottawa today as the province readies itself to oppose Ottawa’s proposed oil and gas emissions cap in court.
The meeting comes the same day the province will submit its formal, written feedback on the proposed cap, a program Ms. Schulz has said would effectively put limits on production.
Ms. Schulz described those limits as “unconstitutional and devastating,” in a weekend interview with the Edmonton Journal, saying the cap is encroaching on provincial jurisdiction.
She said she believes the oil and gas emissions cap will negatively affect the economy, resulting in lost jobs and promised the province would fight the federal cap-and-trade system in court.
“We will stand up for our province,” she said during the interview. “We will make sure that not only Albertans but Canadians understand the impact that this terrible policy would have.”
The federal government has said its cap on greenhouse gas emissions from the oil and gas industry is a bid to cut emissions in the sector by at least one-third by 2030 as part of its overall goal to reach net-zero status by 2050.
The proposed regulation will take the form of a cap-and-trade system, allowing companies to buy offset credits or contribute to a “decarbonization fund,” which would lower the requirement to 20 to 23 percent.
Today is the final day to provide feedback on the proposed cap system.
Draft regulations regarding the cap are expected to be published sometime this spring, with final regulations to follow next year.
“A promise we took to the Canadian people in the 2021 election was to put a cap on the amount of pollution from Canada’s oil and gas sector, and reduce it at a pace and scale needed to reach carbon neutrality in Canada by 2050,” Mr. Guilbeault said during a December press conference. “And unlike almost every other sector of our economy, pollution from the oil and gas sector is still going up.”
Mr. Guilbeault has said the emissions cap on oil and gas would not only “establish a pathway to carbon neutrality by 2050” but would help “unlock the kinds of job-creating projects that will guarantee the industry’s record profits are used to secure a bright future for our communities and workers.”
The Supreme Court said last October that Ottawa’s Impact Assessment Act—dubbed by former Alberta Premier Jason Kenney as the “no more pipelines act” because of the regulatory burden it placed on energy projects—was largely unconstitutional because it infringed on areas of provincial jurisdiction.
When asked about the potential for another court ruling against the new oil and gas cap framework, Mr. Guilbeault said the courts had ruled against them going after production. The new measures, however, are against pollution.
Provinces Push Back
Alberta Premier Danielle Smith and Saskatchewan Premier Scott Moe have both been vocal in their opposition of the cap-and-trade system, saying it exceeds federal authority.Ms. Smith said last December that she believed the oil and gas cap would end up before the Supreme Court, and that Alberta would have a good chance of winning.
“I think that that’s where this is headed,” she said. “But in the meantime, we’re going to make sure that they do not damage the investment climate that we have in Alberta.”
Mr. Moe condemned Ottawa’s regulatory framework, saying it and other regulations will have “serious economic impacts on Canadians and limit our sustainable Canadian energy products from producing heat and electricity to the world.”
Both Alberta and Saskatchewan have dug in their heels on various federal mandates over the past year, maintaining that Ottawa is overstepping with the rules it is putting in place to reach net-zero status by 2050.
Under the act tabled before the provincial legislature, Ms. Smith’s government is requiring provincial officials and agencies to ignore the requirement, saying it puts the reliability of electrical supply in the province in jeopardy.
Saskatchewan also invoked its Saskatchewan First Act last November, creating a tribunal that will study the economic impact of the Clean Electricity Regulations. The provincial act was designed to give Saskatchewan autonomy and jurisdiction over its natural resources.
Alberta and Saskatchewan have also joined other provinces in calling for equality when it comes to carbon pricing on home heating in response to Prime Minister Justin Trudeau announcing a pause on the tax for home heating oil last October.The move largely benefits Atlantic Canada, where 30 percent of homeowners still use furnace oil to heat their homes.
The premiers have since been demanding “fair treatment,” saying the exemption helps very few of their residents who, predominantly, heat with natural gas.
