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Home World Concerns grow that Alberta’s Sovereignty Act will drive investment from province when it’s needed most

Concerns grow that Alberta’s Sovereignty Act will drive investment from province when it’s needed most

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On Wednesday, on the 15th floor of an office tower in downtown Calgary, a new clean tech fund aimed at decarbonizing the energy sector was launched. But much of the talk at the event was about the controversial Alberta government’s sovereignty law. It was introduced into the state legislature in less than 24 hours.

Some organizers couldn’t help but tilt their heads at that timing.

Ironically, while the announcement was made to promote cooperation between industry and government, much attention has been focused on militant new policies in the state.

So, in the business world, the new law could scare people and businesses away from locating or investing in Alberta when the oil patch is finally back in shape after years of recession. There is growing concern because of The state is trying to sustain economic growth in a possible recession.

Deborah Yedlin, president of the Calgary Chamber of Commerce, said there was not a shred of evidence that the move would lead to economic growth.

“This is happening as we deal with high inflation, supply chain challenges and labor shortages. This isn’t going to set the table for people to see Alberta as a place to invest or come inevitably to find economic opportunities,” she said Wednesday.

“We believe this could pose a very significant element of risk and uncertainty for Alberta businesses.”

Watch | Daniel Smith introduces the Alberta Sovereignty Act.

Controversial Sovereignty Bill Introduced in Alberta

Alberta’s premier followed her leadership campaign pledges by introducing the controversial Alberta sovereignty into the United Canada bill in an attempt to veto federal law. Additionally, Rosemary Barton mentions the risks the federal government is trying to avoid.

Collaboration is key

On Wednesday, Avatar Innovations launched a new $3 million fund to provide cash to startups pursuing energy transition technologies. The company works with companies ranging from traditional oil and gas producers and pipeline companies to technology companies.

Avatar is also expanding to the US to expand its network. The more people and companies involved, the more opportunities and funding are available to scale up new technologies.

CEO Kevin Krausert said, “Conversations other than how to drive investment and technology and cooperation in this state will hinder those efforts.

Kevin Krausert, CEO of Avatar Innovations, says industry and government cooperation is key to growing the cleantech industry. (Nick Brizuela/Radio Canada)

Investors will not be attracted to Alberta unless it is a safe and sound jurisdiction governed by the rule of law, said Krausert, who has spent most of his career in the oil and gas drilling industry. rice field.

Meanwhile, there are concerns that Alberta Prime Minister Daniel Smith’s Sovereignty Act could build a wall around Alberta and target certain federal policies.

“I hope we don’t have to use this bill,” Smith told reporters on Tuesday. Stated.

For decades, Alberta politicians of all stripes have routinely criticized the federal government. Call it political entertainment. But arguably, choosing not to enforce federal rules is a more aggressive type of opposition to Ottawa.

internal opposition

Smith became prime minister after winning the lead of the United Conservative Party in October. During his leadership campaign, no policy was discussed more than sovereignty law.

Then-Prime Minister Jason Kenny called the proposal “risky, dangerous and half-baked” and said it would “would be devastating to jobs, the economy and pipeline prospects”.

Sonya Savage, then-Energy Minister, said the law could be detrimental to Alberta’s future, much like Prime Minister Justin Trudeau’s policies have been in the province’s past, and said the law would endanger Alberta’s assets. Concerned international investors forced her to submit to sovereignty law.

Sonya Savage has been criticizing the sovereignty law in recent months, but on Wednesday said her concerns were allayed now that the law was in place. (Kyle Backes/CBC)

Savage currently remains in Smith’s cabinet as environment minister. On Wednesday, she said her original concerns were addressed as the law was put in place.

Your average oil and gas company may not worry about sovereignty laws. This is because the sovereignty law does not directly affect the sector’s day-to-day activities, especially given strong earnings and rising commodity prices.

However, there are concerns about the short-term and long-term implications of this law.

The largest oil patch lobby groups seemed uneasy about supporting the law.

“We are concerned about government policies that may create uncertainty for investors,” Lisa Baiton, chief executive officer of the Canadian Petroleum Producers Association, said in an email.

“It is important that governments at all levels work with industry to bring investment back to Canada.”

Oil Patch wants billions of dollars to build dozens of carbon capture and storage projects in Alberta. (Kyle Backes/CBC)

lobbiing ottawa for money

The sovereignty law comes at a time when many companies in the oil patch are seeking investments to decarbonise the sector and spur the growth of new industries such as hydrogen and carbon capture and sequestration.

We need to raise a lot of money not only from private investors, but also from the federal government.

In other words, Oil Patch is seeking help from Ottawa at the same time that the Alberta government is fighting the battle.

The largest oil patch company wants tens of billions of federal dollars to design and build a massive facility that will capture harmful greenhouse gases and inject them underground. While announcing funding for the project, Oil Patch wants more.

Even small businesses are looking for federal cash.Just last week, a group of oil and gas drillers new tax credit It aims to help decarbonize the industry.

Watch | Trudeau on Alberta Sovereignty Law:

Prime Minister Trudeau says ‘not seeking a fight’ with Alberta over sovereignty law

Prime Minister Justin Trudeau plans to follow the controversial bill but says his government will focus on “helping the people of Alberta”.

Ottawa is also the largest government funder of large new projects. hydrogen production Among projects large and small, facilities are under construction in Edmonton.

Sovereignty legislation could hit the clean energy sector, which is already struggling to attract investment, especially from venture capitalists.

Many of the participants are SMEs looking to research, develop and commercialize their technology. Without sufficient funds, it will be difficult to overcome these challenges and ultimately scale up production.

Along with Avatar Innovations, Krausert explained that the federal government is providing huge amounts of funding to the world’s envy of clean tech start-ups and companies.

“I would be very nervous about putting any of them at risk,” he said.

Krausert believes that playing well with others is the way to build Alberta’s future.

“Let’s hope this is the political drama of the day.”

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