When UCP candidates Brian Jean and Rebecca Shaw accused the NDP of making the “most expensive” political promise in Alberta history it was predicated on some creative interpretation of some pretty hard facts. .At an elaborately staged press conference in front of a power substation in south Calgary on Wednesday, they accused NDP leader Rachel Notley of making a promise to decarbonize Alberta’s electrical grid by 2035 at a cost of $87 billion to Albertans. .They presented huge numbers and accused Notley of signing on to “an unreasonable policy that will hurt not only the energy sector but every single Alberta family and business.”.There was only one problem: it all depends on how one looks at those numbers and how they’re calculated and then interpreted. And like all things political, that varies.. Jean and SchulzUCP candidates Rebecca Schulz and Brian Jean. .The UCP numbers were based on a report from the Alberta Electric System Operator (AESO) — which actually manages the grid — that projected a $52 billion capital cost to bring Alberta’s electricity system in line with the federal Liberal government’s net-zero by 2035 pledge. .Then they added an additional $35 billion in potential economic impacts as determined by independent macroeconomics firm Navius Research to come up with an eye-popping number of $87 billion, which indeed would have made it the most expensive election promise in Alberta history..Within hours, Navius tweeted out its numbers had been “misrepresented” by the media — and they were. Navius insisted those numbers were supplementary to AESO’s $52 billion figure and amount to about 0.03% of Alberta’s annual gross domestic product out to 2040, not 2035..Then there’s the issue of whether it’s appropriate to simply add them up and come up with an omnibus figure that neatly sums it up. .A quick analogy: If you own a bridge that costs a billion dollars to build and it falls down, it costs a billion to rebuild. You’ve lost two billion dollars. That’s the AESO number. Then you have to add in the billion dollars in lost revenue it cost while it was being rebuilt. That’s the Navius number, and it adds up to three billion. .The question is whether it’s a direct cost to Albertans? The answer is no, it’s not a direct cost at all. Industry and the companies that produce and sell electricity will pay the $52 billion, not taxpayers — although those costs will ultimately be recouped in the form of higher electricity rates..Likewise, the $32 billion economic impact won’t be directly borne by taxpayers, although it may indeed result in higher taxes, lower revenue, and a reduction in economic activity — less disposable income — that will ultimately be felt by everybody in the province..And those aren’t hard and fast numbers, which are further subject to assumptions that may or may not come to pass. Looking out five, ten or even 20 years is by definition ‘forward looking information’ that comes with a certain amount of risk. They could be more — or less — than forecast depending on a lot of variables including macroeconomic conditions and the impact of other government policies such as the carbon tax, which is expected to more than double by 2035..The question is whether it’s fair or even reasonable to attribute them to a single policy promise. For those who lean UCP then there’s a strong chance it does; NDP supporters are just as likely to dispute it on the same grounds. .Representatives from the UCP who contacted the Western Standard agreed that it’s a reasonable debate to have. While they stuck by their $87 billion figure, they also agreed that the overall impact on the Alberta economy is literally, up in the air. They faulted their messaging for the confusion.."We could have handled it better," said the UCP official..Similarly, at a press conference in Calgary Thursday, Rachel Notley said she had seen the AESO numbers and questioned their validity. She thinks AESO has overestimated the true cost of renewable energy by as much as 100% which throws all the ensuing estimates out of whack. When asked how much she thinks it will cost to reach net-zero, she replied it would be a net economic gain owing to the number of jobs created and an unquantified contribution from efficiency and innovation..It’s enough to make any economist’s — much less any ordinary voters’ — head spin..On the Western Standard’s daily Alberta Report segment, WS publisher Derek Fildebrandt agreed the UCP’s messaging was muddled but with merit. Unlike most election ‘promises’ that have a direct price tag to taxpayers, he argued some government policies — dairy marketing boards for instance — have an indirect but very real impact on consumers. He was inclined to call it the most expensive election promise in Alberta’s history..News editor Dave Naylor said “it goes over everybody’s heads,” while WS Opinion editor Nigel Hannaford opined: “At the end of the day, everybody is going to pay more.” Splitting numbers is splitting hairs, he said..To the UCP’s credit, however, decarbonizing the grid by 2035 is an issue that affects not just Alberta but other provinces like Saskatchewan who also rely on fossil fuel to generate power. Saskatchewan Premier Scott Moe reiterated the same sentiments at a conference Wednesday..No matter what side of spectrum, there is universal consensus beyond any doubt, it will lead to higher electricity costs. Bottom line..That much is indeed unreasonable and unnecessary given that Canada is under no obligation to reach net zero until 2050, regardless of what the federal government says..As for the NDP, no it isn’t an $87 billion campaign promise by any measure. It all comes down to how you slice it, and they’re slicing oranges to the UCP’s apples.
