Is Alberta ready for 2050 and the increasing decarbonization of the Canadian Economy?

“This week, Toyota announced an ambitious new goal to reduce emissions from new vehicles by a whopping 90 per cent over the next 35 years. The company says that by the year 2050, it hopes to phase out nearly all gas powered engines…. producing instead hybrid-electric or pure electric vehicles.

Of course, the bold Toyota pronouncement comes at an interesting time for the auto industry, quick on the heels of Volkswagen’s admission that its clean diesel engines weren’t actually as clean as it claimed.

Today we wanted to take a look at the idea of going gas-free…. or very nearly gas-free by 2050 and ask whether it’s a realistic goal.”

  • Toyota phasing out gas engines by 2050 not realistic, says critic, by CBC Radio’s The Current with Anna Maria Tremonti, Guest Hosted by Piya Chattopadhyay

So for those not keeping track, Toyota is now the second major company to say that they are moving toward phasing out gas powered cars. They want to do this by 2050 and Toyota has now joined with Tesla and the scandal plagued Volkswagen in pushing towards this goal.

Now, some might say that the decarbonisation of the world economy is not an issue that present day Albertans have to worry about. The change after all is to come in 2050.  Some might argue that this is a problem for my daughter’s generation or maybe my potential grandchild’s. However, this would be wrongheaded because the grand economic change required takes more than a generation.

Think about Silicon Valley. While, it has had many successes and came into its own in the 1980s and 1990s, Silicon Valley`s foundational was laid in 1951. For, in 1951, Stanford University created its epicentre: the Stanford Research Park. Because of that act, other things could happen. Stanford University graduates William Hewlett and David Packard, who founded their firm Hewlett-Packard in Packard’s garage, were able to move into the Research Park two years later. Due to the Research Park, Stanford University had the audience required to launch an Honours Cooperative Programme that permitted full-time employees of local firms to pursue graduate degrees from the University on a part-time basis. From the inception of the Research Park, it took an additional thirty years and many interventions to make Silicon Valley the behemoth we know today.

The same is true when one thinks about our Oil Sands. Based in Fort McMurray, Alberta, and with a large research and development facility in Edmonton, Syncrude is known for its pioneering exploration of the Athabascan Oil Sands. Incorporated in 1964, it started operations in 1978. However, as noted by Roger Miller and Marcel Côté in their book, Innovation Reinvented: Six Games that Drive Growth, it took a long time to drive the costs down, move toward profitability and launch a second mine. (Innovation Reinvented: Six Games that Drive Growth, p157).

However, that story of innovation is not the whole truth. For the history of the development of the Alberta Oil Sands cannot be told without describing the role of government. Or put differently, the Bituminous Sand that rests in Alberta was always seen as a profitable resource, if it could be developed. There are pictures in the Provincial Archives of Alberta, where men are trying to use the bituminous sand as an experimental pavement. Scientist, Engineers and Government Bureaucrats knew that this natural resource could make Alberta very wealthy, if one could just find a way of extracting value from it. This is why Syncrude Canada was founded.

The only problem was the cost. In 1968, Syncrude Canada received regulatory approval. However, by 1974, the project cost had more than doubled to about $2 billion dollars. Before, the hyperinflation and stagflation of the 1970s and 1980s, this was a lot of money and investors were looking to pull out. In fact, if it was not for the entry of Pierre Elliot Trudeau, Bill Davis and Peter Lougheed, the project would have collapsed. If it was not for the Winnipeg Agreement of 1975 coupled with a host of future political players like Don Getty and Jean Chrétien, Alberta would not have developed its resource. For, those players worked out an arrangement where the Federal government took 15% interest in the project, the Government of Alberta took 10% and the Government of Ontario took 5%. Those politicians provided the needed capital to make the project work. In doing so, the three governments bought the time necessary for Syncrude Canada to become the profitable workhorse it is today. With that being said, this project took more than 20 years to become the workhorse, it is today.

Consequently, using Silicon Valley and Syncrude Canada as our measuring tools, Albertans have to start today to look for our next economic driver. The only question is where do we look?

We could look towards developing an alternative energy sector: a sector which exports clean energy to parts of BC, Saskatchewan and the Mid-Western United States. This could mean the exploitation of our land and solar resources. Or put differently, as we move toward freer trade with Europe and Asia (via the TPP and CETA), family farms will feel the need to look at the profitability of their crop rotation. If we assume that crops are essentially solar energy collectors for humans and animals, one might ask why farmers wouldn’t change their crop rotation so that they have less canola, wheat and barley and more solar panels and solar collectors. Or farmers might even change their approach to profitability. Instead of changing their crop rotation, they may just add a new “crop” like a wind mill or two. These potential developments are possible if farmers are creative and if money is available.

Or maybe we could look towards creating a knowledge based economy. The Government of Alberta could spend money to create hubs of knowledge excellency. This might mean creating research institutes or research universities that create knowledge in the areas of medicine or engineering. Those research institutes could develop that knowledge in-house or move ideas to Alberta-based corporate incubators.

Or given our history with the petrochemical industry and our love of nature, we could become the recycling capital of the world. This would be an interesting twist on our history. Instead of being hewers of wood and drawers of water, Albertans would become the inverse or opposite of that. By recycling metal and plastic, Alberta’s economy could develop a sophisticated feeder system and market distribution system. The truth is that because of our oil history and rail infrastructure, we can do this easily.

Those examples are not meant to be prescriptive solutions but examples of how luck Alberta is. We have a number of indigenousness industries and resources that can develop a new history. Alberta has people with a wide set of knowledge and talents. From Aboriginal communities who are looking to make a difference to Citizens who are looking for a change; Alberta can take its population and combine it with our new comers to evolve, again. However, all of this needs a direction, a vision. It takes a government that is willing to put public money into a project. It takes a private sector that is willing to come up with ideas. It requires a public sphere, including NGOs and academics, which will push for new ideas and perspectives. It requires us – citizens – to take a chance. All of this takes vision and drive. All of this takes a Big Vision.

Since Lougheed, Alberta’s Progressive Conservatives have not provided it. The Wildrose Party says said very clearly that it has no grand vision for the provinces and it wants to cut government instead. On the other hand, the NDP seems to want to keep the status quo. The Alberta Party doesn’t know what to believe, so I think it is up to us – the Alberta Liberal Party – to provide that Big Vision. Are we up for it? Is the Alberta Liberal Party up for the providing the Big Vision? We did under Rutherford and Sifton. I think we are up to doing it again.

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About 52ideas

Here are my 52 Ideas. What are yours?