Its thesis is simple: Don’t allow the oilpatch to share any greenhouse gas emissions data with Ottawa, unless the province specifically approves it
The Alberta government is set to adopt a new tool box of measures under its sovereignty act to fight a federal emissions cap on the oil and gas industry — with one device designed to impede the incoming policy right from the get-go.
Its thesis appears simple: Don’t allow the oilpatch to share any greenhouse gas emissions data with Ottawa, unless the province specifically approves it.
If successful, it raises the question of how the federal government could successfully operate its program to limit the sector’s overall emissions if it can’t get individual data from operators. But could such a policy put companies in the difficult spot of possibly disobeying federal reporting requirements?
It’s one of several measures being contemplated under the Alberta Sovereignty Within a United Canada draft motion, unveiled by the Smith government on Tuesday — and being introduced in the legislature next week.
“Ultimately, these numbers are being used to put a production cap on our industry that’s an area of provincial jurisdiction, so we will collect that data and then report it to the federal government,” Alberta Environment Minister Rebecca Schulz said in an interview.
“They are asking companies to report their emissions. From everything I know about this federal government, they can’t be trusted . . . It is one tool that we have.”
The motion is the latest front in the energy clash between Ottawa and Alberta, and it will include an array of steps designed to frustrate the federal emissions cap, which is designed to come into force in 2026.
Other measures include a proposal that Alberta immediately launches a challenge over the constitutionality of the federal plan once it becomes law.
Alberta argues the federal policy is designed to cap oil and gas production in the province, and points to several third-party studies indicating it would restrict future growth in the sector.
Under Section 92A of the Constitution, provinces may exclusively make laws primarily focused on the exploration, development and management of non-renewable natural resources.
However, it could take years before such a legal challenge is launched and works its way through the courts.
The province’s new motion could also put in place other short- and medium-term measures to thwart Ottawa’s objectives, setting up a legal battle with Alberta.
The government will consider changes to ensure no provincial entity — such as the Alberta Energy Regulator or Environment Department — co-operates or participates in enforcing the federal initiative.
It would ensure all oil and gas facilities are protected under Alberta’s Critical Infrastructure Defence Act, and would prohibit entry by any individuals — including federal employees or contractors — to them. The province also wants to work with other governments and First Nations to double pipeline capacity to tidewater and to the United States.
It will also declare all information directly or indirectly related to greenhouse gas and collected at various facilities — such as upgraders or oilsands operations — as “proprietary information” exclusively owned by the government of Alberta. It would mandate that data would be reported and disclosed “at the province’s discretion.”
It’s unclear how the feds would react to such a measure, but it could instigate a legal fight between Ottawa and the province.
According to the federal government, all industrial facilities that emit more than 10,000 tonnes per year of greenhouse gases must report annually under the Canadian Environmental Protection Act.
“The provincial government cannot legislate to exempt people from federal law,” said Andrew Leach, a University of Alberta professor in the department of economics and the faculty of law.
“I can’t see how that would fly.”
Another proposed move by Alberta would see a current program that allows conventional oil producers to pay their royalties in production — which is then sold by the province — instead of cash. This could be extended to include bitumen and potentially natural gas, underscoring that the province owns the resources.
“All of these pieces that we’d be putting in place, I think, have significant teeth,” Schulz added.
“Having this motion in place is our constitutional shield.”
The federal government has rejected the assertion the policy is designed to restrict output by the sector. Ottawa says its own models forecast oil and gas production could increase by 17 per cent without the cap in place — but 16 per cent with it, if companies undertake “technically achievable decarbonization measures” such as investing in carbon capture and storage.
The proposed federal regulations would use emissions data that operators must submit each year, beginning in 2026, for the first compliance period in 2030-32. Final regulations will be published by Ottawa in 2025.
Alberta business groups and energy producers have been adamant the emissions cap would hammer the province’s economy and drive away investment, as Canada would be the only major oil and gas exporter with such a policy.
“We need the government to understand, federally, that the emissions cap is a bad idea, it’s bad policy,” Yedlin said.
Tristan Goodman, president of the Explorers and Producers Association of Canada, said it’s clear the province doesn’t have a willing partner to work with in Ottawa.
“We would need to see the details of what the province is doing but, overall, we appreciate the premier is stepping up and defending the sector,” he said.
“Is now the time that the federal government should be pursuing something that’s detrimental to one of its most important balance of trade (and) economic contributors?”
Chris Varcoe is a Calgary Herald columnist.