ENVIRONMENTAL DEFENCE and INTERNATIONAL INSTITUTE for SUSTAINABLE DEVELOPMENT

Edmonton, Alta. – Subsidies to Alberta’s oil and gas industry are rapidly rising, despite Canada’s commitment to eliminate inefficient fossil fuel subsidies by 2025. That’s the finding of a new report by Environmental Defence and the International Institute for Sustainable Development, which tallies the amount of subsidies the Alberta government extends to the province’s fossil fuel industry. The report finds that, due to royalty structures, tax provisions, research grants, and programs that have already been announced, subsidies are likely to increase in the future and should be expected to continue to flow toward Alberta’s oil and gas industry until at least 2026.

“At a time when the world is working to end its fossil fuel use, Alberta is throwing money into an industry that provides less value to Albertans each year. Most of the jobs recently lost are not coming back, as any new project that is enticed with taxpayer’s money will provide few long term jobs. At a time when the province is in deficit, the money handed out to oil and gas companies would be better spent in other areas such as education and healthcare,” says Joshua Buck, Alberta Climate Program Manager with Environmental Defence.

The report finds that over the last three fiscal years, the Alberta government has subsidized the fossil fuel industry by $1.6 billion each year, with over $2 billion in subsidies alone in 2017/18. At the same time, Alberta received just $2.37 billion in royalty payments from the oil and gas industry for 2017/18, meaning the industry gets back almost as much as it pays out.

“Fossil fuel subsidies make it easier to produce and consume fuels that lead to pollution and negative health effects. They create an economic disadvantage for renewables, slowing Canada’s move to low-carbon energy. They tie Alberta’s prosperity to a single industry, instead of encouraging the diversification that needs to happen. We would much rather see limited public funds for energy development be committed to a low-carbon transition, including supports for Alberta’s workers and communities to shift to clean energy opportunities.” says Philip Gass, Senior Policy Analyst for the Energy Program at the International Institute for Sustainable Development.

Alberta’s fossil fuel subsidies will lead to a rise in greenhouse gas pollution, at a time when the country is working to lower these emissions. From 1990 to 2016, oil sands emissions grew by a staggering 367 per cent, to 72 Mt. This represents 26 per cent of Canada’s total greenhouse gas pollution. Subsidies to the province’s fossil fuel industry will encourage emissions to continue to climb, and put the rest of the country at risk of being unable to meet its climate goals.

The province must act now to eliminate these subsidies and commit its resources to ensuring the transition to a low carbon economy is beneficial to all Albertans. Alberta must show its blueprint and timeline to eliminate these fossil fuel subsidies.

The full report is available for download here.

The executive summary of the report is available for download here.

About ENVIRONMENTAL DEFENCE (www.environmentaldefence.ca) Environmental Defence is Canada’s most effective environmental action organization. We challenge, and inspire change in government, business and people to ensure a greener, healthier and prosperous life for all.

About INTERNATIONAL INSTITUTE FOR SUSTAINABLE DEVELOPMENT (iisd.org): The International Institute for Sustainable Development (IISD) is an independent think tank championing sustainable solutions to 21st century problems. Our mission is to promote human development and environmental sustainability. Through research, analysis and knowledge sharing, we identify and champion sustainable solutions that make a difference.

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For more information or to arrange an interview, please contact: Allen Braude, Environmental Defence; 416-356-2587; abraude@environmentaldefence.ca