As a result, Alberta’s energy sector has struggled to complete projects and access markets overseas, leading to a significant decrease in capital investment in Alberta’s oil and gas industry, from $58.1 billion in 2014 to $21.5 billion in 2022. And this drop in investment can’t be explained away by the 2014 oil price collapse, as prices more than fully recovered in 2022.
Alberta’s overall net capital stock — perhaps the broadest measure of investment as it includes the depreciation of existing assets — shows a similar trend. According to a 2020 study, after recording the fastest growth in net capital stock of any province by far from 1990 to 2014 , Alberta recorded the slowest growth from 2014 to 2018 .
Moreover, according to energy investors, costly and uncertain regulations are a key reason Alberta has become a less attractive place to do business. And on that front, Alberta’s challenges are far from over. In the recent federal budget, the Trudeau government introduced a slew of new policies meant to reduce carbon emissions and aggressively continue Canada’s mandated transition to a “clean economy,” which will undoubtedly cost the Albertan economy.
It’s important for provincial and local leaders to prioritize policies that improve economic growth, but spending millions if not billions of taxpayer dollars “revitalizing” Calgary’s downtown won’t fuel an economic turnaround. Instead, policymakers at all levels of government must collaborate and address Alberta’s investment problem.Share this article in your social network