Calgary at the Forefront: Carney-Smith "Grand Bargain" Reshapes Canada's Energy Future
A Landmark Accord for Canada's Energy Future
On November 27, 2025, Prime Minister Mark Carney, who took office in March 2025, and Alberta Premier Danielle Smith signed a pivotal Memorandum of Understanding (MOU) in Calgary, marking a "grand bargain" set to redefine Canada's energy landscape. This agreement, transmitted from the Prime Minister's Office via PR Newswire, aims to diversify export markets, position Canada as an "energy superpower," and achieve net-zero emissions by 2050, aligning with both the federal Canadian Net-Zero Emissions Accountability Act (June 2021) and Alberta's aspiration for a carbon-neutral economy. The move comes as the world's economy faces rapid shifts, urging Canada to build a stronger, more independent economy resilient to global shocks.
Calgary's Economic Boom: Policy Shifts & Major Projects
The MOU introduces significant policy shifts, including a new industrial carbon pricing agreement for Alberta with a minimum effective credit price of C$130 per tonne, a substantial increase from the province's previous C$95/tonne freeze. Crucially, Alberta will be exempted from federal clean electricity regulations upon completion of this agreement. For Calgary, the heart of Canada's energy sector, the economic impact is projected to be immense. The proposed Pathways Plus Carbon Capture and Storage (CCUS) project, a $16.5 billion initiative by the Pathways Alliance, is anticipated to inject over $16 billion into GDP and create more than 40,000 jobs annually. This initiative, aiming to capture 10-12 megatonnes of CO2 annually by 2030, further solidifies Calgary's role as a vital economic hub.
New Horizons, Old Challenges: Diversification and Indigenous Partnership
A cornerstone of the MOU is a commitment to a new privately financed pipeline, designed with Indigenous ownership and benefits, intended to transport at least one million low-emissions barrels per day to Asian markets. This addresses Canada's long-standing strategic goal to diversify beyond heavy reliance on the U.S. While Pathways Plus is a prerequisite for this, ensuring Alberta exports some of the lowest carbon-intensity oil globally, this aspect faces immediate headwinds. British Columbia's Coastal First Nations have already dismissed the pipeline plan, vowing that any new North Coast pipeline will "never be built." The MOU also outlines ambitions for 75-80% methane emission reduction by 2030, the utilization of small modular nuclear reactors to decarbonize Alberta's electricity sector, and expanded transmission interties with BC and Saskatchewan. Minister of Energy and Natural Resources, Tim Hodgson, appointed May 13, 2025, highlighted these efforts will "support our allies, create hundreds of thousands of jobs, and show that our energy sector can lead on a global stage."