Regulating coal will be a challenge, says Neudorf

By Al Beeber - Lethbridge Herald on January 30, 2025.

LETHBRIDGE HERALDabeeber@lethbridgeherald.com

The potential impact of American tariffs, the state of Alberta’s electricity system and other topics were discussed on Tuesday by MLA for Lethbridge East  and Minister of Affordability and Utilities Nathan Neudorf in a  fireside chat hosted by the Lethbridge Chamber of Commerce.
The event at the Sandman Inn on Mayor Magrath Drive South in Neudorf’s  riding attracted about 60 people from different sectors of the  community to hear Neudorf and ask questions of him.
Neudorf and host Cyndi Crane, Chamber president, sat at the front of the crowd in armchairs during the session which was designed to be a  casual chat.
The MLA openly told the audience he knows he and his government have faced criticism and that he wishes all the challenges being faced by Alberta on a daily basis were simple.
But they aren’t. They include potential lawsuits by the coal industry over the moratorium that was introduced by a previous government that could cost up to $22 billion. And he said there is a strong likelihood of success for those lawsuits in the courts which could potentially see Albertans pay more in provincial taxes for years.
When Canada built the coast-to-coast rail lines, all coal rights were transferred from government ownership to private ownership on railways and over decades, that ownership was transferred to other companies, he said.
“So unlike oil and gas, which is owned by Albertans through the government of Alberta, coal is owned by private entities and anybody  who doesn’t think that makes a difference on a legal basis and access, the law would say you’re wrong. Restricting access to coal mining in  the Eastern Slopes which we currently have under a moratorium which  we’re lifting, has resulted in lawsuits against the government of  Alberta and the people of Alberta — taxpayers — of somewhere between  $14 billion and $22 billion. The likelihood of success should that go  to court is almost certain.
“So do you want to choose coal mining with higher than ever regulatory thresholds for any environmental infractions” or do people want a 10 to 20 per cent tax increase, Neudorf asked.
“Those are not fun decisions to make.”
He said his position for Lethbridge East has never wavered, that the agriculture and food processing sectors can’t be sacrificed for another industry.
“But how do we manage that? Through regulation and existing legislation,” he said. “It’s a challenge.”
He said the province has a potentially challenging budget coming up.
Neudorf noted the province normally spends about $7 billion a year in capital requests and this year those requests came in at over $12  billion.
“We’re cutting a minimum of $6 billion. Not easy decisions. And none are particularly right or wrong. We just can’t do it.”
With tariffs from the U.S. looming, Premier Danielle Smith, said  Neudorf, has spent a considerable   amount of time in Washington  recently advocating on behalf of Albertans and Canadians to the Trump  administration  to not implement the 25 per cent tariffs that have  been threatened against Canada and Mexico.
 He tried to explain the American rationale for such action saying  the U.S. Feels the main markets for its goods are threatened by China  which puts American business at a disadvantage.
And he said border security is a reason for the comments made by new  president Donald Trump about Canada becoming a 51s state and his  efforts to purchase Greenland from Denmark.
While Alaska is highly fortified against potential threats from China  and Russia, he noted Canada’s north and Greenland are both unprotected.
And the U.S.’s priority is protecting the interests of the U.S., not  Canada’s said Neudorf.
“Donald Trump’s concern is Canada has a permeable border.”
Nobody wants to see 25 per cent tariffs, said the MLA, adding Alberta  would weather such action better than other provinces. He also pointed out the low value of the Canadian dollar is beneficial to the U.S.
Neudorf warned against the potential for retaliation against its  southern neighbour, citing the fact the U.S. has an economy 10 times  that of Canada.
“Let’s try not to have tariffs at all,” he said in response to a question noting that efforts are being made to see the American  decision pushed back to April 1 and to have natural resources exempt  from such action.
“If we ratchet it up,” he said about retaliatory tariffs, “they’ll  ratchet it up more.”
Canada , he said, can’t win a trade war with the U.S.
He bluntly noted “you can try to pick a fight with someone bigger than you but you’re still going to get beat up.”
And he said if a scenario exists in which a customer doesn’t like a  commodity’s price, “you better have another customer.”
That idea was addressed by Crane who cited the need for better  inter-provincial trade to reduce barriers in Canada that impact  businesses from accessing markets elsewhere in the country. The local  Chamber has a motion it will be putting forward on this matter in  spring to the Alberta Chamber.
“We want Alberta to take the lead in this. The solution isn’t to  panic. We need to take a deep breath and see what we can do to help  each other,” added Crane.
Neudorf also stated Canada needs to reduce provincial trade barriers  and increase its own manufacturing capacity “so we aren’t so dependent  on the U.S.”
His discussion also focused on the electricity and transmission costs to get power to Alberta  consumers. Those transmission costs are the single cost on Alberta utility bills, regularly averaging 65 per cent of those bills.
And while the UCP government supports renewable energy, Neudorf said it’s imperative such initiatives are built near transmission lines and substations because  the construction costs of those lines are borne by Alberta electricity users.
“Location matters,” he said.
If projects are being built without ready access to transmission and causing a lot of costs “why should Albertans have to pay for it?”  Neudorf asked the audience.
Currently 40 per cent of electricity in Alberta is generated by wind and solar, he noted.
Electricity is essential and without it, “you’re not developing your economy.,” he stated.
He also addressed the government’s initiatives to create a policy on data centres, which he pointed out, consume an enormous amount of electricity.

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