Global energy transition could be a $61B opportunity for Alberta, new study finds
Alberta must invest more than $5.5 billion in clean tech by 2040 to capitalize on opportunity, study says
The global energy transition could create 170,000 jobs in Alberta and contribute $61 billion to the province's GDP by 2050, according to a new study released Tuesday by provincial economic development groups.
The report — commissioned by Calgary Economic Development and Global Edmonton — suggests the global pursuit of climate goals and net-zero greenhouse gas emissions by 2050 could be a major boon for the province that still ranks traditional oil and gas as its No. 1 industry.
But the report also warns that if Alberta continues on a "business as usual path," it will be on track to a materially lower 20,000 new jobs and just $4 billion in GDP from clean technology sources by 2050.
The study — conducted by Delphi Group, Foresight Canada and Cleantech Group — suggests the province has the opportunity to leverage its existing assets and infrastructure, as well as its highly educated workforce, to capitalize on clean tech opportunities such as carbon capture and storage, hydrogen production and electrification.
"Alberta's proven track record of using collaboration, capital deployment and resource mobilization to execute large-scale transformational projects should not be underestimated," stated the report's authors. "These strengths set the province up to successfully take on its next great challenge, the energy transition."
Alberta risks missing out
The report also suggests Alberta will have to swiftly ramp up investment in clean tech or risk missing out. It says Alberta will need to invest more than $2.1 billion a year in clean tech by 2030, increasing to $5.5 billion in clean tech by 2040 in order to fully capitalize on the opportunity.
The current level of cleantech investment in Alberta is less than $1 billion annually.
The report's release Tuesday coincided with the World Petroleum Congress in Houston, Texas, one of the world's largest energy industry events. Calgary Mayor Jyoti Gondek and provincial Energy Minister Sonya Savage are among the Alberta officials who travelled to the event to meet potential foreign investors and talk up the progress the province is making on the clean energy front.
"It's about changing the narrative. Making sure that people understand the value proposition that's happening in Alberta, and Calgary specifically around the energy transition," said Brad Parry, interim president and chief executive of Calgary Economic Development, in an interview from Houston, where he is also attending the event.
Parry pointed out that there are already 945 clean-tech companies in Alberta, working on everything from energy efficiency to sustainable fuel development to high-tech agricultural solutions.
He added in 2020, Alberta posted a record year for venture capital investment, with 51 deals representing a total of $455 million in investment — a 100 per cent increase over 2019.
Still, he acknowledged attracting significantly more foreign direct investment will be required in order to significantly scale up companies and technologies and create jobs.
"It's not going to happen overnight. This is a marathon, not a sprint. But the capital investment has to happen for us to thrive," Parry said.
As well, Mayor Gondek says it's not all about big companies, and points out about half of Alberta's clean-tech companies have been formed by people who are new to the field.
"Twenty-eight per cent of folks are born outside of Canada and 22 per cent of these companies are female-led, so you can see that diversity and inclusion are something that's playing out in the clean-tech sector and we need to keep advancing that."
Positive signal to investors
According to the report's authors, Alberta is sending a positive signal to clean tech investors through strong public funding programs for emerging technology and leading research institutions.
The report also suggests the traditional oil and gas industry is helping by signalling its commitment to decarbonization through initiatives like the Oil Sands Net Zero Alliance.
However, the report is critical of moves by the current Alberta government to close the province's Energy Efficiency agency and to repeal the consumer carbon tax implemented by the former NDP government.
"Less positive signals are also being sent to investors that may indicate that the energy transition and a serious pursuit of clean technology development are not a priority for Alberta," the report said.