This past week has seen further waves buffeting the oil industry. Millions of people around the world marched on Friday demanding climate action, and British Columbia won a court ruling that temporarily blocks Alberta’s turn-off-the-taps legislation.
Against this backdrop, the recent Energy Disruptors conference in Calgary was timely indeed. The event brought about 1,500 energy sector leaders together with world experts to talk about the winds of change.
Peter Tertzakian, chief energy economist at ARC Financial, spoke of the economic forces of “disruption, denial and transition” that are disrupting industries like media, retail, technology and now energy. And Gianna Manes, CEO of Alberta-based utility Enmax, said her company is “paying attention to the megatrends of decarbonization, digital technology, and distributed energy.”
Climate concerns are only one factor in the emerging energy market disruption. Fast-evolving technologies like AI, blockchain, and smart grids are radically changing jobs and cost structures. New energy sources are rapidly scaling up, including hydrogen, solar, wind, wave and geothermal, and battery electric.
As these three megatrends accelerate, our No. 1 concern in Alberta is the jobs and capital draining out of oil and gas.
Premier Jason Kenney is right that we must speak up for Alberta oil. Equally, we need to keep sight of the bigger picture. We all know that while oil and gas has brought us prosperity, it’s also a commodity with volatile prices. Like the proverbial one-company town, Alberta’s over-dependence on one economic sector has left us vulnerable.
The question is how well will Alberta prepared for the disruptive change coming to the province’s energy sector. The answer will decide our fate.
Trying to preserve the status quo in the face of massive economic forces could make Alberta the new Detroit. Instead, we could seize the bull by the horns and work towards making this province the new Silicon Valley of clean energy. If we do so, it could be a real windfall; if we don’t, our competitors will.
As Tertzakian dryly commented, “the real force of change for disruption often comes from the microeconomics of business: stronger, disruptive competitors.”
It’s time. The patch needs to pivot. Not because we are giving up – we aren’t. Not because we feel bad about our energy sector – we should feel proud of our many achievements.
It’s about remembering who we are: Albertans are builders, innovators, and people deeply connected to the mountains and prairie on our flag. We can build on our success and take our energy expertise to the next level – what Mary Moran, CEO of Calgary Economic Development calls “our higher purpose.”
Moran’s vision, echoed by many, is that Alberta steps up to take a leadership role – and gains a wealth of good jobs – by developing the new types of energy that the world is demanding, alongside fossil fuels.
We are better positioned to achieve this than most of our competitors. Alberta is blessed with a high-grade mix of all that’s necessary to make it happen: a highly educated workforce with world-class engineering, technology and business acumen; abundant raw materials in wind, solar, hydrogen, and geothermal; energy infrastructure ready to go; and policy frameworks, like no sales tax and the only deregulated electricity market in Canada.
The shift is already underway. Calgary-based Greengate Power, for example, is building one of the largest solar projects on the continent in Travers, Alberta northeast of Lethbridge. Greengate CEO Dan Balaban says Alberta boasts solar resources to rival Florida and “the best onshore wind in North America. We’re now at the point where renewables make sense in a subsidy-free market.”
Another Alberta energy innovator is Proton Technologies. Working on sites like abandoned oil wells, Proton can produce valuable, zero-carbon hydrogen fuel at a fraction of the production costs required by a conventional built plant.
The low-cost hydrogen could be used by upgraders, for example, to replace diluent (used for moving bitumen through pipelines), and freeing up the pipeline space used to import diluent. It’s not a trade-off between jobs and the environment, but rather a win for both, as well as a chance to increase market access.
Alberta urgently needs a forum for business, government and other stakeholders to have this conversation. It could be useful mandate for Kenney’s $300-million War Room – doing macroeconomic research on energy sector risk analysis and strategy.
Alternatively, think tanks like the Canada West Foundation, the Energy Futures Lab or the new Transition Accelerator could also join the conversation or even play host.
Alberta needs an organization to take the lead. Who will do it?
Shelley Willson is an Alberta-born businessperson, consultant and writer. Her work has appeared in Troy Media, the Calgary Herald, the Globe and Mail, and Corporate Knights magazine.