Political price tag: fossil fuel fall out in Alberta

The unimaginable happened last night in Alberta, Canada’s oil patch province. After decades of conservative rule, the left leaning New Democratic Party (NDP) swept the election, winning a decisive majority government.

Alberta Premier Elect Rachel Notely (Nathan Denette, The Canadian Press)

I think I speak for most Canadians when I say that if you had suggested that this was a possibility a year ago, or even a month ago I would have assumed you to be ‘just a touch’ naïve about Alberta politics. The outgoing Progressive Conservatives have ruled the province since 1971 – and in the most recent election in 2012 faced a serious electoral threat from Alberta’s even further right-wing party: the Tea Party-esque Wildrose.

So why the historic shift? No doubt pundits and coffee shops will be deliberating for months, but one certain factor is the tar sands. Albertan governments have been notorious cheerleaders for the tar sands sector in as many ways as you can imagine. From aggressive lobbying and PR on the industry’s behalf, to keeping royalty rates and taxes as low as possible, to ignoring and steamrolling environmental regulations to pave the path for rapid expansion, to paying little heed to the rights of First Nations who live on the frontlines of one of the world’s largest industrial projects – the last four decades have been perfect politics for Big Oil in Alberta.

But as cracks have started to show in the tar sands industry over recent years and months, instead of recognizing the shifting grounds underneath it, the Alberta government pandered to industry and did everything in its power to maintain the perfect storm of conditions that has allowed the industry to grow at unprecedented rates over the last decade. But this is like trying to fix a crumbling dam with bandaids – it won’t hold. And when it all started coming down, people have been absolutely right to be infuriated.

This is exactly what has happened in the tar sands. The industry has been showing signs of weakness for a number of years, with cancelled projects, serious market access challenges (hello pipeline campaigns!), and growing concerns about the future of high-carbon, high-cost, high risk oil in a world where climate action is taken seriously. But instead of serious consideration of what a just economic diversification strategy could look like, the provincial and federal governments buckled down and tried to lock in the status quo for the industry.

And then the oil price crashed. The dam broke and it became painfully clear to Albertans that their government’s insistence on betting it all on the tar sands left them at the losing end of the stick. The outgoing Premier, Jim Prentice, now infamously told Albertans to “look in the mirror” when it came to making cuts in his so-called “bad news budget” a couple of months ago. And while everyday citizens bore huge cuts and tax hikes – the tar sands industry got off scott-free. Prentice’s ‘Why kick-em while they are already down’ attitude ignored the fact that decades of low taxes and royalty rates on the oil sector has left Alberta facing a massive deficit, and the voters have finally called him out. The province is clearly ready for a stable, diverse, prosperous economy and that means diversifying away from oil.

And while Prentice presumably assumed there was nothing he could do to risk his or his party’s future, it was a tipping point for Albertans: a political price tag that has served as a wake up call.  An election lost because a government utterly failed to manage a crisis of its own making as oil prices plunged and exposed the industry’s weaknesses and the reckless risks of betting everything on a volatile resource.

So what now? Premier elect, Rachel Notley, has already confirmed that the Enbridge Northern Gateway pipeline will come off of the table and her victory speech last night made it clear that Alberta will no longer be a one trick pony:

“It is time to diversify our economy and end this boom and bust cycle in Alberta…To the indigenous peoples in Alberta we will work to be better neighbors and better partners.”

While Alberta is still Alberta, and the tar sands will undoubtedly continue to play a role in the province – the winds are shifting, and there may very well be space in the province and the country for a serious conversation about what a tar sands-free future looks like and how we get there in a fair, just way for Albertans and their economy.

And finally – among the political posturing and analysis today – above all is the striking reminder that change is possible even where it seems least likely. People power took the reigns in Alberta and did something no one would have thought possible.