Has the fossil fuel industry been engaged in a decades-long illicit conspiracy to kneecap the accelerating transition to clean energy?

The government of Michigan thinks so. State Attorney General Dana Nessel recently filed a 126-page lawsuit against the American Petroleum Institute and four of the biggest oil companies, Exxon, BP, Chevron and Shell, alleging they acted as an anti-competitive cartel to limit consumer choice and protect their polluting industry from cheaper and cleaner alternatives.

According to Nessel, higher energy costs imposed on residents and businesses in her state “are not the result of natural economic inflation, but due to the greed of these corporations who prioritized their own profit and marketplace dominance over competition and consumer savings.” 

Rather than focusing on the environmental impacts of the fossil fuel sector, the state is alleging oil companies and their lobbying associations engaged in an anti-competitive conspiracy that limited consumer choice and drove up energy costs for taxpayers and businesses.

Michigan’s lawsuit alleges that without decades of oil industry effort to repress clean technology, EVs “would be a common sight in every neighborhood – rolling off assembly lines in Flint, parked in driveways in Dearborn, charging outside grocery stores in Grand Rapids, and running quietly down Woodward Avenue”

Many of these same companies such as Exxon, Shell and Chevron are significant players in the Alberta oil patch. How are we to make sense of efforts of the Alberta government to intentionally scupper the previously thriving renewable energy industry in the province, or impose decades of ignored oil industry cleanup costs onto taxpayers?

While Michigan lawmakers are trying to protect taxpayers from alleged oil industry collusion, the Alberta government seems to be an active participant in limiting competing technologies and offloading industry liabilities onto the public. 

Premier Danielle Smith dropped a surprise moratorium on the previously booming renewable energy sector in August 2023. This regulatory rug-pull was followed by onerous land use restrictions on wind and solar that drove almost 11 gigawatts of proposed renewable electricity projects out of the province. Albertans now pay the highest electricity rates of any province by a wide margin with almost eight times the emissions per kilowatt hour compared to Ontario.

Smith’s government later brought in new reclamation rules for wind and solar installations that are the most burdensome out of 27 other jurisdictions in North America and around the world. “The Alberta government’s efforts to stunt the growth of the most promising renewable energy market in the country has been a deeply regrettable success,” Stephen Legault of the non-profit Environmental Defence lamented at the time.

The stated rationale for weaponizing regulations to target clean energy developers was the alleged end-of-life environmental burdens of wind farms and solar installations. “Our government will not apologize for putting Albertans ahead of corporate interests,” stated Alberta Utilities Minister Nathan Neudorf at the time with no apparent hint of irony. 

This laudable sentiment seems laughable when looking at the comparative regulatory scrutiny directed towards the oil patch. The Alberta Energy Regulator (AER) is entirely funded by the oil, gas and coal companies it is supposedly overseeing, and it is an understatement to say that these polluters are getting value for their money.

Under the AER’s lax leadership, highly profitable fossil fuel companies have racked up enormous environmental deficits while contributing almost nothing towards the eventual cleanup of bitumen tailings ponds and abandoned wells.

These unfunded environmental liabilities total at least $55 billion for tailing pond reclamation and another $60 billion for pipelines and abandoned and orphaned wells, of which the AER has collected only 0.5 percent in security deposits. This shocking situation grows worse every day meaning that every Alberta household is on the hook for about $70,000 in oil industry cleanup costs and counting.

Oil sands operators have contributed only a single dollar to the Mine Financial Security Program (MFSP) meant to protect Albertans from footing the bill for oil sands and coal mine clean-up costs that have doubled from an estimated $28 billion in 2018. AER rules do not require companies to make additional deposits until they have 15 years of profitable bitumen reserves remaining. What could go wrong?

The actual numbers could be much worse. Internal documents from 2018 obtained through freedom of information requests revealed the former AER Vice-President of Closure and Liability pegged the true liabilities as likely exceeding $260 billion. For math enthusiasts, that works out to about $160,000 per Alberta household. Even David Yager, Smith’s special advisor and AER board member recently described the province’s abandoned well problem as a “giant stinking pile of shit.”

Such massive regulatory capture need not be the norm. The Michigan state government is courageously using the law to take on the most powerful oil companies in the world to lower energy costs for taxpayers and fight anti-competitive conduct.

Meanwhile, the Alberta government is politicizing the legal system to the point that the Court issued a rare public warning that “The rule of law means no one is above the law, everyone is treated equally before the law, and power is not used arbitrarily.” This statement by leading Alberta Justices was an apparent response to Smith publicly musing about her desire to “direct the judges”, and later threatening to withhold funding to the courts unless Alberta is granted greater oversight of federal judicial appointments.   

And what would Danielle Smith do with even more power? Likely dispense more favours to her friends in the oil patch at the expense of taxpayers and the climate.