Oil industry touts technology investment in submission to Alberta climate panel

CALGARY – The oil and gas industry wants investment in emissions-busting technology to play a big role in Alberta’s climate change strategy.

The Canadian Association of Petroleum Producers has made its submission to the five-member panel working on a broad plan to reduce the province’s greenhouse gas emissions.

“If we want to find the balance between increasing investment and production of energy here in Alberta and more responsible performance on the climate side, it’ll be technology that bridges both those two imperatives,” CAPP president Tim McMillan said in an interview.

Alberta should set a target for technology investment over the next 10 years and invest funds from its soon-to-be-hiked carbon levy to develop and deploy those technologies, the group said.

In June, the left-leaning NDP government announced the carbon price for large industrial emitters that exceed their allotment — now at $15 a tonne — would be rising to $20 a tonne next year and to $30 a tonne in 2017.

Between that change, and an increase in the corporate tax rate from 10 per cent to 12 per cent, CAPP has estimated the industry faces $800 million in higher cost over two years.

The climate change panel, headed by University of Alberta economist Andrew Leach, is tackling the province’s wider climate strategy, focusing not just on oil and gas, but on aspects like transportation and power, too.

The government has said it aims to have the architecture of a climate plan ready in time for the UN climate talks in Paris in December.

The work of the climate panel is happening in tandem with a separate royalty review led by ATB Financial boss Dave Mowat.

CAPP has honed in on a way that the royalty system could be used to further climate goals. One of its recommendations is to develop a clean infrastructure royalty credit program that would encourage the adoption of green technologies without hurting the industry’s competitiveness.

McMillan said British Columbia’s Infrastructure Royalty Credit Program serves as a good model. Under that program, companies can receive up to a 50 per cent credit for the cost of building roads or pipelines in underdeveloped areas of the province, which can be used against royalties.

CAPP also wants more power generation to come from natural gas, a cleaner-burning fuel than coal, and to export it to countries like China.

“If we were to swap out a megawatt of coal electricity for a megawatt of natural gas electricity, it has very meaningful effects on carbon emissions,” said McMillan.

It would also bring in more royalties and reduce consumer costs, he added.

Earlier this week, environmental group Greenpeace made its submission to the climate panel.

Its recommendations include “adopting ambitious, biding and science-based” targets; the phasing out of coal and switching all of Alberta’s electricity to renewable sources by 2050, an economy-wide carbon price of $50 a tonne that rises to $150 a tonne by 2026 and capping oilsands expansion.

“The prescription for the problem is clear — the only question is whether there’s the political will to do it,” said campaigner Mike Hudema.

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