(C) Reuters. FILE PHOTO: Canada’s Prime Minister Justin Trudeau and Calgary Mayor Naheed Nenshi announce the beginning of construction on the Green Line at the Calgary Transit Oliver Bowen Maintenance Facility, in Calgary, Alberta, Canada July 7, 2021. REUTERS/Mike S
By Nia Williams
CALGARY, Alberta (Reuters) – Prime Minister Justin Trudeau’s narrow election victory this week reinforced Canada’s commitment to reach net-zero greenhouse gas emissions by 2050, but workers in the country’s sizable fossil fuel sector said they also expect him to keep his promises to retrain them for jobs in a clean-energy economy.
Oil worker advocacy group Iron & Earth estimates Canada will need around C$10 billion ($7.8 billion) over 10 years to retrain fossil fuel workers, but is sceptical about government promises to help after past pledges failed to materialise.
“At what point do these stop being promises and start being actions? These are people’s livelihoods on the line,” said Luisa Da Silva, executive director of Iron & Earth.
Da Silva said the country risks losing the skilled labour crucial to a clean energy economy if the government does not prioritise transition funding, which the 2015 Paris Climate Agreement recognizes as important to ensure no workers are left behind as the world decarbonizes.
As the clean energy economy takes off, it will generate some 640,000 jobs by 2030, a 50% increase from 2021, with strong growth in Alberta, industry body Clean Energy Canada forecasts.
But Steve MacDonald, CEO of Emissions Reduction Alberta, a provincial government-funded organization that invests in emissions-reducing technology, said it would be difficult to recreate the sustained economic contribution that was associated with the oil and gas sector.
Two years ago, the Liberal Party announced a “Just Transition Act” to support and retrain oil and gas workers, but only launched consultations to shape that legislation in July, and then put it on hold in August when the election was called. Trudeau announced a similar programme worth C$2 billion during the 2021 election campaign.
The oil and gas industry is Canada’s highest polluting sector, accounting for 26% of all of carbon output. Yet Canada is the world’s No. 4 oil producer and some 450,000 jobs directly or indirectly linked to the industry are at risk over the next three decades as the country slashes climate-warming carbon emissions, TD Bank estimates.
So any talk of shrinking the sector is touchy, particularly in the staunchly conservative energy heartland of Alberta where many oil and gas workers live in remote communities scattered across the prairies and northern boreal forest. Trudeau sparked fury among them in 2017 when he talked about “phasing out” the oil sands.
Those remarks contributed to a wipe-out of Liberals in Alberta during 2019 election, although Liberal candidates are leading or elected in two seats in the just-concluded 2021 election. Failing to help retrain workers could batter local economies and sap support from government efforts to tackle the climate crisis.
“With the loss of any position in the oil and gas industry, the effect trickles down seven times due to the loss of economic spinoff effects,” said Gerald Aalbers, mayor of Lloydminster, a city of 31,000 straddling the Alberta-Saskatchewan border where an estimated 15% of jobs depend on the fossil fuel industry.
“The costs to retool the economy and businesses, let alone employees, will be tremendous.”
Canada’s petroleum sector, which includes oil and gas extraction and refining, contributes about 5.3% to national GDP.
The Trudeau government is working with major producers like Suncor Energy (NYSE:SU) to develop technologies like carbon capture to allow companies to bury emissions underground rather than cut production.
Still, downsizing of the industry seems inevitable if Canada is to meet its 2050 net zero goal, and an interim target of cutting emissions 40-45% from 2005 levels by 2030.
In the oil sands hub of Fort McMurray, where a nearly a third of all jobs are in fossil fuels, workers are nervous.
“We are a one-industry city,” said Dirk Tolman, 59, a heavy equipment operator and union leader at Suncor, who has worked in the oil sands since 2008. “Without the oil sands I don’t know if anybody would be staying in Fort McMurray.”
Even if clean energy jobs do replace oil and gas jobs, they are unlikely to be in the same location.
Sean Cadigan, a professor of history at Memorial University of Newfoundland, who has studied the impact of the collapse of Atlantic Canada’s fishing industry in the 1990s, said oil and gas communities need new industries to develop alongside any shutdown of fossil fuels.
“(Otherwise) it will lead to a profound dislocation of people and that will always have grave impact on communities left behind,” he said.
($1 = 1.2822 Canadian dollars)