B.C. businesses dread soaring prices from Alberta’s proposed law

Business groups in British Columbia are turning on their provincial government as analysts fear a proposed law in Alberta could increase costs on a range of goods across the Lower Mainland.

A trade war between B.C. and Alberta over the $7.4-billion Trans Mountain pipeline project to the West Coast could soon result in oil-rich Alberta cutting off petroleum supplies to B.C. and send prices for gasoline, diesel and even consumer goods soaring.

Alberta Energy Minister Marg McCuaig-Boyd’s Bill 12, Preserving Canada’s Economic Prosperity Act, is now on the order paper in Alberta.

“We’ve been clear that if the government of B.C. persists in attacking our jobs and economy, they will face serious consequences. We’ve been saying for a long time that this bill will focus on giving us the power to control our oil and gas products that belong to Albertans,” McCuaig Boyd said in an email.

She declined to provide the specific contents of the bill, citing legislative process, but other lawmakers have indicated it would inflict economic pain in B.C.

“Their government has caused pain to Alberta families,” Alberta Deputy Premier Sarah Hoffman said of B.C. in the legislature on Tuesday. “We can certainly do the same, and we’ve put a bill on the order paper that enables us to do that.”

The prospect of restricting oil flows is causing stress among B.C. businesses, who have begun to call on Victoria to drop its opposition to the pipeline, which caused proponent Kinder Morgan Inc. to announce this week it would pare non-essential spending on the project until the federal government steps in.

“The impasse created and sustained by the provincial government is now challenging — in full view of the international investment community — the very ability of our country to govern itself,” Iain Black, Greater Vancouver Board of Trade president and CEO, said in a release, which called on Victoria to “immediately stand down” as the trade war escalates.

Other groups expect Alberta’s plans will result in higher costs for fuel, but also for consumer goods like groceries as trucks transporting those goods around B.C. will pass higher transport costs onto consumers.

“Trucks are going to start using fuel surcharges,” said Chris Gardner, the president of the Independent Contractors and Business Association of British Columbia.

“It would be significant and it would impact people’s daily lives. People need to understand that this is quite serious,” he added.

He said restricting oil flows to B.C. would affect his members, especially those that drive long distances through the interior of the province to remote worksites.

Analysts have provided mixed forecasts on how much fuel costs would rise if Alberta cuts off all petroleum product shipments to B.C., but they all point to higher fuel prices, especially in Vancouver and the surrounding areas.

“Every facet of B.C.’s economy would be affected — forestry, mining,” said GasBuddy senior analyst Dan McTeague, adding that the resource industry uses a lot of diesel in their operations.

McTeague said the average price for gasoline in the Lower Mainland right now is $1.50 per litre, but a complete restriction on oil, gasoline, diesel and jet fuel shipments would immediately send prices in the area to $2 per litre as fuel distributors ration supplies to fill-up stations.

That would mean the cost to fill up a typical car with a 60-litre tank would cost $120, and the cost to fill up a pick-up truck would be $200.

McTeague said it would be challenging for the Vancouver region to source alternative supplies of gasoline, because shutting down the existing Trans Mountain pipeline would also affect Washington.