Alberta environment minister talks tough with B.C. on Trans Mountain pipeline expansion

In a speech to the BC Chamber of Commerce, Alberta Environment Minister Shannon Phillips highlighted her government's efforts to build a strong economy resilient to climate change—and repeated its threat to turn off the oil taps to B.C.

Credit: Darla Furlani Photography

In a speech to the BC Chamber of Commerce, Shannon Phillips highlighted her government’s efforts to build a strong economy resilient to climate change—and repeated its threat to turn off the oil taps to this province

B.C. may be locked in a battle with its neighbour over the Trans Mountain pipeline expansion, but Alberta got a warm reception last Saturday (May 26) at the BC Chamber of Commerce‘s annual general meeting in Kamloops.

In a lunchtime address hosted by the Canadian Association of Petroleum Producers, Shannon Phillips, Alberta’s minister of environment and parks and minister responsible for the Climate Change Office, made her case for the oil pipeline project. Her remarks came days before federal Finance Minister Bill Morneau announced that his government is buying Trans Mountain from Texan energy giant Kinder Morgan for $4.5 billion.

Cutting to the chase

Phillips began by pointing out that B.C. and Alberta have much in common. Many British Columbians work in Alberta’s energy sector, she said, and the two provinces share everything from a great provincial park system and a growing craft beer scene to a price on carbon and some of the country’s lowest debt-to-GDP ratios.

“Those are very nice things, but I’m not here to talk about pleasantries. I’m here to talk about the problems that we have to solve together,” Phillips said. “We all know that we have a large, looming problem before us, which is the Trans Mountain expansion.”

Phillips then shared what she called the government of Alberta’s perspective on the environmental side of the equation. “Our problem to solve is how to ensure resilient economic growth in the context of a carbon-constrained future, because climate change is real,” she said. “We all share a common challenge because of our shared economy and our shared energy industry. We are all faced, as Albertans, as British Columbians, as Canadians, with the difficult challenge of how to address climate change.”

The whole country suffers when oil prices fall, Phillips contended. “Certainly we saw that suffering in Alberta,” she said. Phillips recalled layoffs during the recent downturn—and in the early 1980s, when her father, an electrician who worked on oil rigs, lost his job.

Alberta found itself in that situation because it was too dependent on one commodity at one price to one market, Phillips said. “The biggest thing standing in our way was market access and the economic benefits of getting full market access for our resources—making sure that our bitumen that is coming out of the ground right now is getting the kind of price that it needs so that people can continue to pull it out of the ground.”

How to pay for a progressive agenda

One obstacle was that Alberta had a reputation for being a climate laggard, said Phillips, whose NDP government assumed power in 2015. “When we took office, we knew that we couldn’t contribute and pay for what Canadians want without achieving market access,” she explained. “But neither, too, did we believe that Alberta should get off scot-free without taking seriously its climate change obligations.”

Over the next 20 years, Phillips said, Trans Mountain will generate $46 billion worth of benefits for the Canadian economy, including $5.7 billion for the B.C. government. “That’s a whole lot of money for schools, roads, hospitals, child care, transit—all of the things that Canadians want.”

Phillips listed her government’s environmental efforts, which include a limit on oilsands emissions that caps them at 100 megatonnes annually, an economy-wide price on carbon and a country-leading commitment to methane reduction, she said. Among other investments, Alberta is also putting $1.4 billion toward cleantech, industrial efficiency, bio-energy and innovation, she added.

“Right now, what we are modelling is a 30-percent [carbon emissions] reduction off the business-as-usual case by 2030,” Phillips said. Alberta projects that with carbon pricing, its total emissions will fall from 317 megatonnes a year—half of Canada’s total by 2030—to 222.

“I have no problem saying of course there is more to do,” Phillips said. “Where we differ is how fast we’re going to get there and how we’re going to get there. But we share the same values, where we want to have a good, strong economy as we ensure that we are resilient to a carbon-constrained future.”

In her first piece of legislation for the government headed by Premier Rachel Notley, Phillips overhauled environmental monitoring of the oilsands, she said. “This environmental agenda has spurred economic growth, but it is important to realize that it has also been accompanied by a progressive social agenda. And you have to have a way to pay for that, and the way to pay for that is through a strong energy industry.”

Phillips highlighted her government’s public spending: $1.4 billion on social housing; $25-a-day child care; a child benefit that she said has lifted 300,000 people above the poverty line; and what she called the largest infrastructure build in Alberta history.

“So when the Alberta government’s energy strategy is undermined, as it is being right now by our neighbours, they are not just undermining an energy industry or an energy strategy,” she said. “You’re not just undermining our ability to pay for an ambitious environmental agenda, the most comprehensive and ambitious climate policies on the continent. You are also undermining all of those advances that we have made with respect to inequality, a better life for kids, for vulnerable people, for those precariously housed, for Indigenous peoples, for women looking for child care.”

Green chatter and buzzwords

Some people don’t believe climate change is real, Phillips acknowledged. “On the other hand, there are people who I think that their definition of environmental progress is to choke the Canadian economy, punish Albertans and justify their lack of perspective or generosity with green chatter and buzzwords,” she said.

“Both of those extreme sides lead us into that dead end…that created so much suffering for B.C. and Alberta families,” Phillips continued. “They do more than that. They undermine investor confidence and certainty for our country and rob us of the resources to pay for the services we need. And they slam the door—this is very important as a message from the environmental side—they slam the door on opportunities in clean technology, in efficiency, in innovation. There is so much more we can do together, our two provinces.”

Phillips called for B.C. to work with Alberta. “This current strategy on behalf of the British Columbia government is a losing one, not just because they continue to lose in the courts and not just because they are losing in the court of public opinion, but also because it is a losing strategy for all Canadians and for the goals that we all share as Canadians,” she said.

“If I have one simple message today, it’s enough of the playing of games and enough of the distractions that divide us,” Phillips concluded. “It’s time to act like Canadians, and let’s not stop until we get the job done building this country together.”

Turning off the taps?

In a Q&A session after her speech, Phillips was asked what she finds most frustrating about the B.C.-Alberta fight.

“First of all, there’s a failure to understand what I was saying, that this affects working people on both sides of the border,” she said. “There is a failure to understand how when a project is approved, it must move forward. If it has gone through all of its approvals in a lawful way, that has to mean something. Otherwise, this whole process is then a referendum on the ability to get any business at all done anywhere in this country.”

The next question to Phillips: with polls showing that most people in B.C. support the Trans Mountain expansion, how can Premier John Horgan and Green Party leader Andrew Weaver be convinced to cooperate?

“I think we keep doing what we’re doing, which is moving the needle on public opinion. Politicians are going to politician, and they’re going to respond to what the public thinks and feels,” she said. “Now, there are going to be certain folks who are elected on a little bit more of a narrow agenda, and that’s not a governance agenda, necessarily; it’s an activist agenda. If you’re a minority coalition holder, that’s your actual role. So I’m not interested in attempting to convince someone like Andrew Weaver about anything at all. But I think what is important is that piece of public opinion, particularly in the Lower Mainland.”

Does Phillips think turning off the oil taps to B.C. will help Alberta’s cause?

“It remains an option for us,” she replied. “We’ve passed that legislation, and if we continue to see a situation where this project is being harassed out of existence, then will we use it. Albertans are paying a price every day and every year—millions of dollars in foregone revenue, in foregone economic activity. So that has to have consequences.”