What’s the next big thing after oil for Alberta?
Is oil becoming passé?
If so, what is going to replace it in Alberta? What kind of industries will provide the well-paying jobs that lured so many people to this province over the past 20 years and kept them here?
That’s the big question facing Albertans, and other petroleum-producing regions of Canada, as the bad news regarding the future of fossil fuels keeps piling up.
Just last week, the National Energy Board released a report in which it forecast that fossil fuel consumption in Canada could peak in two years and then drop by as much as 13 per cent by 2040. This is a big shift. It’s the first time since the NEB began forecasting in 2007 that fossil fuel use peaks within the projection period. Previous reports indicated that demand would increase for the next two to three decades.
Things are changing much faster than previously anticipated.
The NEB attributes the decline in demand to: carbon taxes, which will discourage consumption; energy efficiency; emerging energy technologies; and slower population growth. Global climate change policies and the development of renewable energy and electric vehicles are also likely to shrink demand for fossil fuels around the world, according to the NEB.
Of course, this doesn’t mean Canada won’t continue to produce and export oil. Just not as much as previously expected.
Shrinking demand is not the only problem. Some in the oilpatch are losing hope that Alberta oil will ever make it to Asian markets since the pipelines that would get it to coastal ports are either cancelled or delayed.
So it’s not surprising that in some quarters people are looking for something else that will give Albertans a better chance at long-term prosperity.
Something like the big idea that Peter Lougheed had in the 1970s when he decided to kick-start oilsands devel- opment by investing millions of dollars of public funds into oilsands projects and ongoing technology research with the intention of turning the resource into a long-lasting source of income for the province.
Lougheed’s vision didn’t turn out exactly the way he had wanted and in the last 10 years environmental issues and carbon emissions put the oilsands in a negative light, especially outside Alberta. But there’s no question oilsands development enriched both individual Albertans and the provincial treasury over decades. So what’s next? Calgary has the highest cluster of engineers and information technology professionals in the country thanks to the oil and gas sector. Many of them are out of work but they have the kind of skills that could be transferred to the tech sector. And it is the tech sector that many entrepreneurs in Calgary are betting on.
Rocket Space, a Silicon Valley firm, is moving into Calgary next year. There’s plenty of empty office space.
And like Toronto, Calgary has put together a bold bid for the next Amazon headquarters. Even if it doesn’t win, it hopes its pitch will attract lesser stars so the city can become a tech-hub.
And then there are the well-funded startups looking at how water technology could play a role in Alberta’s future.
At the University of Calgary, researchers are trying to figure out how they can decarbonize oil extraction.
There are no such big ideas coming from our current crop of political parties.
The NDP government of Rachel Notley is pushing renewable energy projects as part of a plan to reduce carbon emissions. But while switching to renewables and natural gas will clean up the infrastructure that delivers electricity, we won’t be selling or profiting from renewables or renewable technology the way we do from oil.
The new United Conservative Party, now led by Jason Kenney, doesn’t even acknowledge climate change or the need to reduce carbon emissions.
It simply wants to cut taxes, especially the carbon tax, and cut spending, and somehow quickly balance the government’s books.
They seem to think that somehow, despite all evidence to the contrary, Alberta can simply return to the days of $100-a-barrel oil and unfettered oilsands development.
Those days are over. That’s why we need to start working on the next big thing.
Calgary has the highest cluster of engineers and IT professionals in Canada thanks to oil and gas. Many are out of work, but can apply their skills to the tech sector that the majority of entrepreneurs in Calgary are betting on