- Take the money off the table. Right now Canadian governments live on oil money. Former Alberta Premier Peter Lougheed had a plan (which former Premier Klein cancelled) to take government revenue from oil and put it in a heritage fund. Norway followed the Lougheed plan and now has a heritage fund of about $500 billion. Alberta’s heritage fund is $14 billion, and Canada saved none at all. The International Monetary Fund and the Organization for Economic Cooperation and Development have both recommended that “oil rent” (as oil revenues to government are called) should be set aside for the health of economies.
- End all federal subsidies to fossil fuels — as the Prime Minister promised to do at the 2010 G-20 Summit in Cincinnati, but has failed to put action to his words.
- Stop any new oil sands development. In 1996, when the federal government first created a programme of federal subsidies to the oil sands, via favourable tax treatment called the, “Accelerated Capital Cost Allowance,” and Premier Klein set Alberta royalty rates at the lowest level in the world (one percent), the oil sands were producing 500,000 barrels of oil per day. By the year 2000, production had doubled to 1 million barrels of oil per day. Today, we are nearly double again, at 1.9 million barrels of oil per day. The Prime Minister has stated that his goal is to boost production to 6 million barrels of oil per day.
One of the side effects of this hell-bent-for-leather expansion is an out of control hyper-inflationary bubble that sits on northern Alberta. There are real constraints on labour and capital. It has become the most expensive place on the planet to build anything. That’s why the oil companies would rather build a $6 billion pipeline to refineries on the coast of the Gulf of Mexico than allow the crude to be refined here. By curbing expansion of the oil sands, we can end Dutch Disease, diversify the economy, expand manufacturing across Canada and refine crude oil in this country. According to the Communications, Energy and Paperworkers Union, the Keystone XL pipeline to Texas will cost Canada 40,500 direct and indirect jobs. Let’s keep those jobs here.
- Ensure security of supply. Atlantic Canada, Ontario and Quebec are vulnerable to any global event that stops oil reaching eastern ports. There are already existing pipelines from Alberta to Ontario and Quebec. Many are old and need upgrading, but they are in place. Some take oil from east to west and would need to reverse flow. But if we don’t take the necessary steps, we are very likely to have no refineries left in Canada at all.
- Diversify our energy systems. Invest in energy efficiency, rail and mass transit. Expand options: geo-thermal, photovoltaic and passive solar, tidal power, bio-fuels from non-food sources. Modernize our economy to be ready for a low carbon, healthy future.