Hacker News Reader

Comment by wagwang | Hacker News Reader

alberta is a net tax contributor unlike an annoying unnamed province

For maybe another 10 more years, tops. With the world adding > 1TW of solar every year and > 20 million EV's every year, the demand for oil is going to drop. Alberta oilsands oil has the most expensive production costs of any major oil production area, which means they're the marginal producer, the first to shut down. Saudi Arabia with their cheap light oil is going to be making money on oil for at least 50 years, but Alberta will be lucky to get 10 more.

Alberta is nothing but empty space and sunshine. It is a prime location for Solar

It will continue to be an energy juggernaut

During the summertime maybe? It's pretty far north to generate much from solar in the wintertime isn't it?

I'm not a solar expert, but even during winter we get tons of sun, just fewer hours per day

Northern Alberta would probably not do very good, but southern Alberta would be fine I'm sure

It's not hard to look this up. It's not just fewer hours per day, latitude matters a lot. If you look at yearly totals[1] Alberta looks better than BC but not better than any other neighbors to the South or East. All its neighbors also have plenty of space. Plus, total energy consumption (electricity plus gas) is probably highest in winter when solar input is lowest. I think it's hard to argue Alberta will become an exporter of solar-derived power.

[1]https://en.wikipedia.org/wiki/Solar_irradiance#/media/File:W...

In Calgary I rule-of-thumb 10x less solar energy in December than in June.

Alberta/Canada exports oil which earns it forex. Which allows it to buy stuff from other countries. Exporting solar electricity to earn forex will earn next to nothing.

Not really, the level of production in the winter would be very low, and no batteries can fix that.

They have cheap gas though, and that could be used in the winter.

> the level of production in the winter would be very low, and no batteries can fix that

But overbuilding can. It's already a fairly common idea.

You’d need to overbuild by a ridiculous amount. I don’t think it’s currently close to viable.

Alberta's solar energy might make BC rich. The price of electricity while the sun is shining is very low. The combination of Alberta solar during the daytime and BC hydro at night is valuable, but it's the hydro that'll get the vast bulk of the dollars.

And Alberta is quite far from big electricity markets. It's far cheaper to put overbuild solar in places with poor sunshine than it is to build a HVDC line.

Plus Alberta will have to compete with Arizona and neighboring states, which have even more sunshine than Alberta does.

> Alberta oilsands oil has the most expensive production costs of any major oil production area, which means they're the marginal producer, the first to shut down

This has not been true for years. Oil sands costs are lower than US shale costs: https://calgaryherald.com/opinion/columnists/varcoe-canadian...

The oil sands projects are longer-lived (no need to continually dig new wells), and labour costs have been optimized after the price shock of 2014.

Admittedly they are benefiting mostly from American refining tech in this sense. They would have a tough time negotiating advantageous trade terms on their own and not many refineries can handle it, meaning they are mostly dependent on pipelines to America to make their oil saleable.

A lot of this may hinge on whether the US's drive to end subsidies for solar and EVs stick and if they take hold elsewhere.

Gas car sales peaked in 2018 globally. EVs are already >20% of new car sales worldwide, and the US is a joke when it comes to EV sales compared to Europe or China.

https://ourworldindata.org/electric-car-sales

The US is just a small fraction of oil use. There world will be consuming oil for many decades. Some by industries with hard to replace uses (plastic, planes etc), and some by backwards countries (US, Russia). But it'll just be a small fraction, so will be supplied by the low cost producers like Saudi Arabia. High cost producers like Alberta will be shut out.

People have been saying that for decades. Oil isn’t going anywhere anytime soon

They've been saying it "will be replaced" for decades. I'm saying it "is being replaced". Big difference. 1 TW of solar and 20% of car sales are massive numbers we've never seen before.

It’s not being replaced yet. Oil demand is higher than ever.

Solar doesn’t compete with oil, it competes with other electricity generation like coal and gas. But even that is not declining yet, globally.

Global coal demand may finally have reached its peak, if we’re being optimistic.

Natural gas and oil demand are still increasing.

Oil demand is down in 2025. ICE car sales are down substantially since 2017.

Oil demand is still increasing worldwide. It won’t peak for at least a decade, but probably much longer.

There are more ICE cars on the road than ever.

> Global oil demand is projected to increase in 2025 compared to 2024, but the growth rate is expected to slow down. The International Energy Agency (IEA) anticipates a decrease in global oil demand growth for the remainder of 2025, but expects demand to reach 104 million barrels per day (bpd) in 2025, a notable increase from 2024.

Perhaps you meant the pace of growth is slowing this year. But that has a lot to do with the macro economic situation, with central banks around the world cutting rates as growth slows (and some countries enter recession.) The global economy is slowing, when it rebounds again, so will growth in oil demand.

We're still far from peak demand.

All this means is that the average income of citizens in Alberta is dramatically higher than other provinces and so Alberta pays more in the federal taxes that are applied uniformly to everyone.

I'm sure the other provinces also wish they had such high paying jobs and contributed more in taxes!

Avg individual income Alberta: 74,237

Avg individual income New Brunswick: 57,336.

Yeah, this whole "Alberta gives Quebec money" complaint is in fact just how federal income, in the form of income tax, is distributed and is like getting upset that your provincial taxes are paying for something in Red Deer when you live in Calgary.

Wait how are you calculating this?

I’d expect that even the least wealthy province is a net tax contributor. Equalization is only ~5% of the total budget.

Reply on news.ycombinator.com