A new provincial government was elected in Alberta on April 16, 2019. The United Conservative Party (UCP) won a strong majority led by Jason Kenney, Alberta’s new Premier. The new government has declared Alberta to be open for business. Here are the new government’s most important policy initiatives for investors interested in doing business in Alberta.
Focus on the Energy Market
The new government plans to re-energize Alberta’s oil and gas industry, with a sharp focus on the development of increased pipeline capacity to get resources to tidewater. The newly appointed Associate Minister for Natural Gas will support LNG developments and enhanced domestic processing, and may take steps to increase access to transportation capacity by providing credit support for long term pipeline commitments. The government also proposes to lock in place royalties on oil and gas wells once a well has been drilled, exempting them from royalty reviews following completion. Abandonment processes are to be streamlined to reduce the number and liability of abandoned wells.
Carbon Tax Repeal Act
The $1.4 billion carbon tax imposed by the former government is slated for repeal, to be replaced by the new Technology Innovation and Emissions Reductions (TIER) program for large industrial emitters. TIER is anticipated to incentivize greenhouse reductions by large emitters and help create efficiencies in the transition to lower carbon emissions. TIER takes effect January 1, 2020, reducing the initial cap by 10%, and 1% annually. The compliance price is to be reduced from $30/tonne to $20/tonne.
Red Tape Reduction Act
The incoming government will work to reduce costs for business, speed up approvals and lessen the regulatory burden faced by all industries in Alberta. New legislated timelines have been proposed. An Associate Minister for Red Tape Reduction has been appointed. Industry panels are to be formed to help identify unnecessary red tape.