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Alberta envoy moves to Ottawa as pivotal new energy rules in the works

OTTAWA - As federal officials hash out how to control greenhouse-gas emissions from the oil and gas sector, Alberta is opening an office in Ottawa to ensure its voice is heard.

Allan Ross, a lawyer with a background in the energy industry, is setting up shop this week in the capital.

The appointment comes at a sensitive time, as Ottawa gears up to announce new rules this year on how oil and gas producers will have to curtail their emissions — and just as Alberta is demanding a larger say.

"This is just going to allow us to be out front in terms of the emerging issues, as they're being discussed in Ottawa, to have an ear to the ground and be proactive in terms of developing and providing an Alberta-based perspective," said Cal Dallas, the province's intergovernmental affairs minister.

In an interview with The Canadian Press, Dallas said the aim is not to persuade Ottawa to water down its controls the oil and gas industry. Rather, he said, Alberta will probably agree to stiffen emissions controls.

"I don't think there's any doubt that Alberta has continued to move the bar on a continuous basis, and that we've been a leader on that."

"And it's more than likely that we will continue to be a leader on that," Dallas said when asked whether Alberta is pushing for an entrenchment of the status quo in oil and gas regulations, as some environmentalists fear.

Environment Canada officials are designing the next set of regulations in their sector-by-sector plan to reduce Canada's emissions significantly by 2020. They expect to have new rules for the oil and gas sector ready this year, with insiders anticipating publication before summer.

Alberta government officials and industry players have been central in the talks to craft the new rules. Indeed, Alberta is widely expected to invoke a provision that would allow the provincial government to administer the rules for itself, as long as they meet or exceed federal standards.

But since Alberta already has a regime that controls the intensity of greenhouse gas emissions, and already has a fund that essentially sets a price on carbon, some environmentalists say they are concerned that Alberta and Ottawa would simply agree that the current standard in Alberta is also the best system for the future.

"I would hope that the federal government ... requires something much stronger from industry, that would then require provinces, if they want to do this themselves, to up their game, so that we create a race to the top. That's what I hope," said Clare Demerse, director of federal policy for the Pembina Institute, an environment think tank.

"We don't know yet whether the federal government is going to be more ambitious than provinces or not, and at this stage of the game, in 2013, that's a bit of a problem. We need to know what it is that the federal government expects from the oil and gas sector."

Without stiffer federal regulations, the oil and gas sector would be the fastest growing source of emissions in Canada, and the country would find it impossible to meet its 2020 obligations to cut emissions to 17 per cent below 2005 levels, Pembina research shows.

Most of the benefits from coal regulations passed last year won't kick in until well after 2020 since they apply mainly to new operations.

"It's no exaggeration to say that the level of ambition reflected in the oil and gas regulations will be the determining factor in whether Canada achieves its 2020 target," the institute says in a recent research paper.

But small measures won't do the trick, the research shows. Rather, industry would have to cut the intensity of emissions by 42 per cent, and face penalties of about $100 a tonne of carbon, for Canada to meet its 2020 obligations, the institute estimates.

The calculations are broadly in line with conclusions reached by the National Round Table on the Environment and the Economy before it was shut down last year.

A large part of the job for the new Alberta envoy to Ottawa will be to show politicians and the public alike that the oil and gas industry is already using leading-edge technology to better manage its environmental impact and bring wealth to Canada, said Dallas.

"Everywhere we go I realize we've got a lot more work to talk about what we are doing. Because there are high expectations on Alberta," he said.

"We've got to think in the context of how to make sure we can continue to develop the resource. We've got to do it in a manner that the world and our customers consider appropriate and acceptable. It won't be a simple conversation but we want to be a key part of that conversation."

News from © The Canadian Press, 2013
The Canadian Press

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