Imagine an old friend calls you up one day and offers you $1 million to clean up and organize your backyard. This will create jobs, the friend says.
Your backyard also contains some hazardous materials that are polluting your neighbours’ yards. You have four years to use the money, but problem after problem arises and when times up, a fifth of the money is left unspent.
That’s what happened this past September when our province had to give $137 million of a $1 billion abandoned well cleanup grant back to the federal government.
Sources have pointed their fingers in various directions to explain why the money the Alberta government received in 2020 went unused. Some say the UCP did not organize themselves quickly enough to distribute the funds to those who applied.
Others blame Ottawa, saying the Liberal government should have granted Alberta’s request for an extension on the deadline.
The return of the money is a mismanagement of funds and is a lost opportunity for Albertans. $137 million is enough to pay thousands of Albertans a handsome year’s salary. Not to mention the benefits that come with an oil well cleanup.
Well cleanup leads to healthier soils to grow vegetables and raise livestock, and gets rid of pollution that can harm our health.
Taxpayers Pay Burden of Cleanup Costs
Returning this grant money to the federal government is yet another example of Alberta’s misuse of our province’s financial and natural resources. For those who don’t enjoy paying taxes, the very existence of the grant is frustrating to begin with.
Legally, the companies that drill the wells must also pay for their cleanup. Despite this, Alberta’s total number of abandoned and orphan wells sits somewhere around 170,000.
Many companies go bankrupt before they’re able to clean up, and others simply ignore their obligation to return the site to its natural state.
Rather than doubling down on measures to ensure that companies pay for the cleanup of these thousands of wells, both the provincial and federal governments have been handing out money to cover the costs.
One analysis shows that this federal grant didn’t even increase oil companies’ cleanup efforts. A quarter of the money went to the same five companies – Smith’s government gave $100 million to Canadian Natural Resources Limited, one of the world’s largest producers of crude oil and natural gas.
Most companies who received the grant money spent the same amount per year on cleanup as in previous years. Oil companies replaced the money they would have spent on cleanup with our money.
Creative Solutions for Cleanup
If ordinary citizens are paying for cleanup, then ordinary citizens should directly benefit from cleanup efforts. Our government could use future cleanup money to transform wells into geothermal energy.
Geothermal is a renewable resource and, by some reports, reduces energy costs by 50 percent. Those with geothermal pumps on their property or in their community could significantly reduce their energy bills and have more of a say in the production of the energy that they use.
There are currently several challenges in the way of pursuing geothermal energy. One of the biggest hurdles in developing geothermal energy is drilling, a stage that will be eliminated by retrofitting old wells.
The other is societal and government investment, a problem that would easily be solved by directing future cleanup grants toward retrofitting projects. The third is that engineers need to perfect geothermal technology.
Still, considering all the other technological advancements Alberta has achieved in the last decade, if we want to use our can-do attitude to perfect geothermal energy plants, we will succeed.
If we are creative, the next time the government hands out money to clean up wells in Alberta, this money can be used to directly benefit Albertan citizens.
