A rainbow appears to come down on pumpjacks drawing out oil and gas from wells near Calgary, on Sept. 18, 2023.Jeff McIntosh/The Canadian Press
One of the death rattles of the struggling Trudeau government is its pledge to bring an emissions cap on oil and natural gas production into force. But Alberta is showing it’s not waiting around for a potential Poilievre government to follow through with its promise to kill the key climate policy.
Alberta Premier Danielle Smith will try to use her confrontational-by-design Sovereignty Act for just the second time, making clear her government will do whatever it can to obstruct the federal plan to cap greenhouse gas emissions from Canada’s oil and gas sector well below 2019 levels by 2032.
Alberta believes Ottawa’s emissions cap is a de facto production cap, and an existential threat to the province’s main industry. The Alberta Sovereignty Within a United Canada Act motion coming this week sets the stage for the province acting to bar federal officials from oil and natural gas sites in 2026, when the system would officially start up by requiring emissions data from producers.
This is an escalation of the conflicts between Edmonton and Ottawa. It’s not yet clear what would happen in real life – whether this could mean a physical confrontation between provincial and federal officials at the fence beyond a pumpjack. A draft of the motion said oil and gas sites could be deemed “essential” under Alberta’s Critical Infrastructure Defence Act, a Kenney-era law aimed at stopping environmental blockades at railways and pipelines.
The United Conservative Party government will also instruct provincial entities that they’re not allowed to help implement the cap. And to control the flow of key information, the government wants to declare all Alberta data on greenhouse gas emissions collected at facilities as proprietary.
Ms. Smith’s Sovereignty Act was passed in 2022 to allow Alberta to push back against what it deems to be federal overreach, even before the courts weigh in. (The Alberta government will launch a relatively more conventional constitutional challenge if the cap becomes law, too.) However, critics say the law itself could be unconstitutional because it seeks to block the regular operation of federal law.
Uncertainty about how this plays out could scare away the very investors Alberta wants to attract, and producers might take issue with their emissions data becoming part of the fight. However, Alberta Environment Minister Rebecca Schulz said in an interview that the federal government started this with an unreasonable climate agenda, and her government will work with industry in implementing Sovereignty Act plans. Some companies, she said, “don’t want to give the federal government data they have no business having, that they can take and use against them.”
This week’s motion is also partially performative, as it lays out some actions that could be done by government any day of the week. This includes the discussion of using the royalty-in-kind program, through which the Alberta government receives oil in lieu of royalty payments, to sell oil directly to U.S. customers.
Ottawa argues that the proposed rules for capping the emissions from the energy sector reflects what is technically feasible, especially if companies come through with carbon-capture promises. But there is also substance behind the province’s complaint that the cap targets one particular – and massively large – Canadian sector.
This is a legal grey area. According to the law firm Osler, there are clear constitutional questions as to whether parliament has jurisdiction to regulate emissions in this manner. The federal government has acknowledged it must tread carefully, with Environment Minister Steven Guilbeault saying implementation of the cap was delayed to ensure that Ottawa is not overstepping its authority to regulate emissions, and going into the realm of provincial jurisdiction over natural resources.
Add to this the quandary that Canada’s biggest customer and competitor, the United States, continues to consume and produce fossil fuels at record levels, with no contemplation of any kind of emissions cap.
Then the world changed again on Monday, when U.S. president-elect Donald Trump promised to impose 25-per-cent tariffs on products from Canada and Mexico until both countries crack down on drugs and immigrants entering America illegally. His threat casts a shadow across the entire economy, and could blast apart assumptions about Canada’s climate and energy policies.
In response to Mr. Trump, Ms. Smith immediately signalled her willingness to accept his worldview, posting that Ottawa should move quickly to address Mr. Trump’s concerns. “Fortunately, the vast majority of Alberta’s energy exports to the U.S. are delivered through secure and safe pipelines which do not in any way contribute to these illegal activities,” she added.
Many saw this as abasing herself before the incoming Trump administration. On the other hand, it is a reflection of how Alberta’s industry and government feel targeted by Canada’s own federal leaders, and how they will continue to stand apart from the current powers-that-be in Ottawa.