Opinion: Caisse’s oil divestment policy will hurt Quebecers

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Quebecers and Albertans have more in common when it comes to public policy than many would expect. Along with our mutual struggle for autonomy within Canada, we also agree on two fundamental principles: a commitment to responsible energy and the livelihood of our families and communities.

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An advertisement for Caisse de dépôt et place du Quebec to get rid of oil the production of assets by the end of 2022 is directly contrary to those principles.

Some Quebecers may applaud these actions, believing that we can starve the industry and stop climate change, with minimal impact on their way of life. But this fantasy will have profound repercussions for Quebecers, create hardships for billions of vulnerable people, and have the potential to significantly delay the global decarbonization effort.

It is with this in mind that, as a friend and ally, I want to address this very important topic: future investment in Canada’s oil industry, which is the most ethical and climate-focused among the world’s oil-exporting countries .

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The most immediate effect of the Caisse’s policy to phase out well-performing oil and gas stocks will be to undermine the pension returns of Quebecers. That means they can see lower benefits and higher premiums.

Second, Quebecers derive much of their “government” income from the Alberta oil and gas industry. In the past 10 years alone, Alberta has paid nearly $ 200 billion more in taxes to the federal government than it received in federal spending and transfers, helping fund programs like matching. During this same period, Quebec has received more than $ 100 billion in compensation payments, and will receive another $ 13.1 billion this year alone .

Divestment in the Canadian energy industry will reduce the economic output of Alberta and the nation. If Alberta is prevented from making this huge economic contribution, taxes will have to go up and Quebecers will have to pay more for their health care, education and social services.

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Some might be willing to accept a lower standard of living and less personal wealth if they believe divestment will improve climate outcomes, but that is not the case.

Divestment from fossil fuels in the short term will increase carbon emissions, not reduce them. With natural gas shortages around the world, some electricity producers are converting from cleaner burning natural gas to coal-based power generation. This will result in an immediate pushback in the effort to decarbonize, but there are longer-term implications as well.

Public oil companies based largely in Western democracies, like the ones the Caisse points out, produce only a fraction of the world’s oil. The rest is manufactured by state-owned companies in less than fully democratic nations (Saudi Aramco, National Iranian Oil Company, Gazprom Russia, China National Petroleum Corporation, and Petróleos de Venezuela, SA), which are largely immune to the divestment trend in the West. world. They don’t need your money and they certainly aren’t going to give up profits in the name of climate change. As global demand for oil and gas rises and production declines in the Western world as a result of “divestment”, market share will shift from the world’s most responsible producers to those with a much heavier carbon footprint.

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Meanwhile, divestment is also creating the conditions for an energy crisis that will disproportionately affect the most vulnerable, including billions of people around the world living in energy poverty. The cost of heating homes and feeding families will increase dramatically as transportation costs rise and production of agricultural inputs is disrupted.

I ask that Quebecers work with us as we manage our ethical and climate-focused energy industry. Invest with us in innovative, job-creating energy technologies that will reduce emissions and create high-paying jobs that support a healthy economy.

Supporting Canadian oil and gas is choosing environmental responsibility.

Travis Toews is the minister of finance and chairman of the Alberta treasury board.