Alberta
Province of Alberta loaning Orphan Well Association 100 Million to create jobs and accelerate clean up
From The Province of Alberta
Creating jobs, accelerating well cleanup
A government loan to the Orphan Well Association (OWA) will spur the creation of hundreds of green jobs and reduce the number of orphaned wells across Alberta.
As the first step in A Blueprint for Jobs, the province is extending its loan to the OWA by up to $100 million. This loan will bolster the association’s immediate reclamation efforts and generate up to 500 direct and indirect jobs in the oil services sector.
“Today’s investment is part of our Blueprint for Jobs. This taxpayer investment will create good-paying jobs while improving the environment. Actions like this will help to get Alberta back to work.”
“We are getting Albertans back to work while staying true to our province’s reputation as a responsible resource developer. This loan will increase economic activity across our province and is an important step in addressing the pressing issue of oil and gas liabilities – particularly in rural Alberta.”
“By staying on top of the orphaned well inventory, we’re helping to ensure a sustainable energy industry in Alberta. The Orphan Well Association continues to increase our efficiencies while also increasing the number of sites we are addressing. This loan will help us further these efforts while helping Alberta’s service sector and reducing the impact on affected landowners.”
Government and the OWA are currently finalizing specific loan terms and conditions, including establishing a repayment schedule. Both parties have agreed that this investment will be completed before April 1, 2021.
The Blueprint for Jobs is a plan to bring jobs and investment back to Alberta and restore the province’s position as the best place in the country to live, work, start a business, and raise a family. The Government of Alberta is focused on creating jobs, growing the economy and getting Alberta back to work.
Quick facts
- The loan extension will enable the OWA to:
- decommission approximately 1,000 wells
- start more than 1,000 environmental site assessments for reclamation
- The Alberta government previously provided the OWA with a $235 million interest-free loan. The OWA began repaying the loan in 2019, using money received from industry through the annual Orphan Fund Levy.
- In the coming weeks, government will be introducing a full suite of products, covering the entire lifecycle of wells from start to finish.
About the Orphan Well Association
The Orphan Well Association is an independent non-profit organization that operates under the delegated legal authority of the Alberta Energy Regulator (AER). The mandate of the OWA is to safely decommission orphan oil and gas wells, pipelines and production facilities, and restore the land as close to its original state as possible. Funding for the OWA comes primarily from the upstream oil and gas industry, through annual levies administered by the AER.
Key Terms
Inactive well: A well that has not been used for production, injection, or disposal for a specified amount of time – six months for high-risk wells, or 12 months for medium- and low- risk wells.
Orphan: A well, pipeline, or facility that does not have any legally responsible and/or financially able party to conduct abandonment and reclamation responsibilities.
Abandoned well: A well that is no longer needed to support oil and gas development and is permanently plugged, cut and capped according to Alberta Energy Regulator requirements.
Reclamation: The process of returning the site, as close as possible, to a state that’s equivalent to before it was disturbed. Companies are responsible for reclamation liability for 25 years, after which the liability reverts to the Crown.
Alberta
Alberta government should create flat 8% personal and business income tax rate in Alberta
From the Fraser Institute
By Tegan Hill
If the Smith government reversed the 2015 personal income tax rate increases and instituted a flat 8 per cent tax rate, it would help restore Alberta’s position as one of the lowest tax jurisdictions in North America
Over the past decade, Alberta has gone from one of the most competitive tax jurisdictions in North America to one of the least competitive. And while the Smith government has promised to create a new 8 per cent tax bracket on personal income below $60,000, it simply isn’t enough to restore Alberta’s tax competitiveness. Instead, the government should institute a flat 8 per cent personal and business income tax rate.
Back in 2014, Alberta had a single 10 per cent personal and business income tax rate. As a result, it had the lowest top combined (federal and provincial/state) personal income tax rate and business income tax rate in North America. This was a powerful advantage that made Alberta an attractive place to start a business, work and invest.
In 2015, however, the provincial NDP government replaced the single personal income tax rate of 10 percent with a five-bracket system including a top rate of 15 per cent, so today Alberta has the 10th-highest personal income tax rate in North America. The government also increased Alberta’s 10 per cent business income tax rate to 12 per cent (although in 2019 the Kenney government began reducing the rate to today’s 8 per cent).
If the Smith government reversed the 2015 personal income tax rate increases and instituted a flat 8 per cent tax rate, it would help restore Alberta’s position as one of the lowest tax jurisdictions in North America, all while saving Alberta taxpayers $1,573 (on average) annually.
And a truly integrated flat tax system would not only apply a uniform tax 8 per cent rate to all sources of income (including personal and business), it would eliminate tax credits, deductions and exemptions, which reduce the cost of investments in certain areas, increasing the relative cost of investment in others. As a result, resources may go to areas where they are not most productive, leading to a less efficient allocation of resources than if these tax incentives did not exist.
Put differently, tax incentives can artificially change the relative attractiveness of goods and services leading to sub-optimal allocation. A flat tax system would not only improve tax efficiency by reducing these tax-based economic distortions, it would also reduce administration costs (expenses incurred by governments due to tax collection and enforcement regulations) and compliance costs (expenses incurred by individuals and businesses to comply with tax regulations).
Finally, a flat tax system would also help avoid negative incentives that come with a progressive marginal tax system. Currently, Albertans are taxed at higher rates as their income increases, which can discourage additional work, savings and investment. A flat tax system would maintain “progressivity” as the proportion of taxes paid would still increase with income, but minimize the disincentive to work more and earn more (increasing savings and investment) because Albertans would face the same tax rate regardless of how their income increases. In sum, flat tax systems encourage stronger economic growth, higher tax revenues and a more robust economy.
To stimulate strong economic growth and leave more money in the pockets of Albertans, the Smith government should go beyond its current commitment to create a new tax bracket on income under $60,000 and institute a flat 8 per cent personal and business income tax rate.
Author:
Alberta
Province to stop municipalities overcharging on utility bills
Making utility bills more affordableAlberta’s government is taking action to protect Alberta’s ratepayers by introducing legislation to lower and stabilize local access fees. Affordability is a top priority for Alberta’s government, with the cost of utilities being a large focus. By introducing legislation to help reduce the cost of utility bills, the government is continuing to follow through on its commitment to make life more affordable for Albertans. This is in addition to the new short-term measures to prevent spikes in electricity prices and will help ensure long-term affordability for Albertans’ basic household expenses.
Local access fees are functioning as a regressive municipal tax that consumers pay on their utility bills. It is unacceptable for municipalities to be raking in hundreds of millions in surplus revenue off the backs of Alberta’s ratepayers and cause their utility bills to be unpredictable costs by tying their fees to a variable rate. Calgarians paid $240 in local access fees on average in 2023, compared to the $75 on average in Edmonton, thanks to Calgary’s formula relying on a variable rate. This led to $186 million more in fees being collected by the City of Calgary than expected.
To protect Alberta’s ratepayers, the Government of Alberta is introducing the Utilities Affordability Statutes Amendment Act, 2024. If passed, this legislation would promote long-term affordability and predictability for utility bills by prohibiting the use of variable rates when calculating municipalities’ local access fees. Variable rates are highly volatile, which results in wildly fluctuating electricity bills. When municipalities use this rate to calculate their local access fees, it results in higher bills for Albertans and less certainty in families’ budgets. These proposed changes would standardize how municipal fees are calculated across the province, and align with most municipalities’ current formulas.
If passed, the Utilities Affordability Statutes Amendment Act, 2024 would prevent municipalities from attempting to take advantage of Alberta’s ratepayers in the future. It would amend sections of the Electric Utilities Act and Gas Utilities Act to ensure that the Alberta Utilities Commission has stronger regulatory oversight on how these municipal fees are calculated and applied, ensuring Alberta ratepayer’s best interests are protected.
If passed, this legislation would also amend sections of the Alberta Utilities Commission Act, the Electric Utilities Act, Government Organizations Act and the Regulated Rate Option Stability Act to replace the terms “Regulated Rate Option”, “RRO”, and “Regulated Rate Provider” with “Rate of Last Resort” and “Rate of Last Resort Provider” as applicable. Quick facts
Related information |
-
Brownstone Institute1 day ago
Deborah Birx Gets Her Close-Up
-
Alberta1 day ago
Coutts Three verdict: A warning to protestors who act as liaison with police
-
Justice2 days ago
Ontario Court of Justice says participants must state their ‘preferred pronouns’ during introduction
-
Business2 days ago
Trudeau gov’t pledges $42 million to the CBC to promote ‘independent journalism’
-
Alberta2 days ago
Maxime Bernier says it’s ‘astounding’ Alberta is ‘pushing’ COVID boosters, tells Danielle Smith to stop it
-
Business2 days ago
Canada’s economy has stagnated despite Ottawa’s spin
-
Alberta1 day ago
Alberta moves to protect Edmonton park from Trudeau government’s ‘diversity’ plan
-
Energy1 day ago
Canada Has All the Elements to be a Winner in Global Energy — Now Let’s Do It