Leaked report reccomends Alberta government spend up to $162M to break natural gas pipeline monopoly

EDMONTON — Premier Danielle Smith's government has allegedly received a report recommending that the Alberta government spend up to $162.6 million and create a pair of Crown corporations to unlock Alberta's natural gas industry, regulate it, and potentially construct a publicly owned pipeline. “Alberta is experiencing rapidly growing demand for natural gas from existing and emerging sectors," reads the leaked cabinet report first reported by the Narwall on Friday and obtained by the Western Standard. "However, limited access to natural gas supply in the province, lack of competition within the natural gas transportation (pipeline) sector, insufficient transportation capacity, and federal regulatory oversight combine to constrain Alberta's ability to realize these value-add opportunities." The report highlights that key investments, such as Alberta’s expansion into the AI data centre industry, could be at risk if the available natural gas cannot be substantially increased. It suggests a trio of recommendations for the government to stimulate natural gas competition, increase pipeline capacity and take regulatory control from the federal government.The Western Standard reached out to Energy and Minerals Minister Brian Jean's office about the report but did not receive a response before publishing. .Alberta's natural gas is predominantly transmitted through and contracted until 2030 to NOVA Gas Transmission Ltd., owned by TC Energy. The report notes that the Alberta government has tried to encourage TC Energy to expand its pipeline infrastructure, as it anticipates projects such as data centres could drive demand beyond TC Energy's projections by up to 5.1 billion barrels per day. TC Energy, however, has been reluctant to do so, claiming it does not build on speculative demand. Further compounding the issue, a lack of competing infrastructure gives TC Energy control over the market and has created a "market failure." The report recommends the government spend between $53.9 million and $162.6 million between 2026 and 2030 to create a pair of Crown corporations: one to oversee planning and coordinating natural gas infrastructure, and the other to construct, own, or backstop a pipeline when the private sector will not do so. ."There are absolutely areas where there is market failure because it's hurting people," said Alberta NDP leader Naheed Nenshi during a press conference on Friday. "But to actually say government wants to step in in order to hurt people, and that government is strong-arming a company to make billions of dollars in investments that they don't want to make, with the threat of competing with them if they don't, that's textbook bullying behaviour. It's also bad economics, and it's bad business." The report also recommends legislation to address these issues, including voiding anti-competition elements of agreements, giving the Alberta Utilities Commission and cabinet power to impose a must-serve/invest obligation, directing infrastructure investment, and establishing a regulatory framework. The bulk of the cost would go to legal consultation and representation, as the report anticipates TC Energy would launch challenges to the legislation, as well as expropriation claims. .The report also acknowledges a risk of rising utility costs associated with the moves, as better gas access could lead to higher prices and elevate costs for industries and consumers. Nenshi took issue with this fact. "The report today says that everyone, all Alberta households and all Alberta businesses, will see huge price increases to their natural gas," Nenshi said. "That means your electricity bill will go up. That means your home heating bill will go up." "But it's not just that; it is a tax on everything. It means everything you buy, including the already outrageous price of groceries, will go up when natural gas goes up, and there is no help coming from the UCP."He said these costs would be a direct result of the UCP's AI data centre strategy, or lack thereof. "This government has been gung ho on these data centres for over two years, and they didn't stop and actually write any regulations," Nenshi said. "This is unfair to residents. It's unfair to Albertans. It's also unfair to businesses that want to invest." Nenshi said he understands that the UCP held a cabinet meeting on Friday to discuss the report.

Leaked report reccomends Alberta government spend up to $162M to break natural gas pipeline monopoly

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