The recently strengthened provincial climate change regulation (Specified Gas Emitter’s Regulation) has raised some eyebrows and questions as to how these targets will affect Alberta’s economic outlook. We took a close look at the bioenergy sector and found some surprising results, and even more encouraging promise.

Most Albertans would be hard-pressed to describe what bioenergy is, or locate one of the province’s 29 plants on a map. However, the province’s bioenergy sector is a $2-billion industry, supporting more than 5,000 jobs, directly and indirectly, with an impact of more than $300 million on labour income and nearly $800 million on provincial GDP. Over the past decade, the total capital investment in bioenergy facilities exceeded $600 million.

Bioenergy production in Alberta includes the production of liquid transportation biofuels (ethanol, biodiesel or methanol), biogas (used to generate electricity), wood pellets (a heating fuel) and the use of forestry residues for combined heat and power generation.

In 2006, the forestry and agricultural sectors worked with the province to launch a bioenergy plan to develop and expand the production of renewable, low-carbon bioenergy products. A key part of the plan was the province’s Bioenergy Producer Credit Program, which expires in March 2016. While many plans and projects did not make it through the economic recession and a long period of high energy and commodity price volatility and policy uncertainty, we analyzed the production and carbon emissions of those facilities that operated under the program between 2007 and 2014.

If all of the bioenergy produced since 2007 had been used to displace a conventional energy equivalent, the sector would have reduced greenhouse gas emissions by more than 11 million tonnes of carbon dioxide equivalents (across all energy types). The use of the amount of liquid biofuels produced in Alberta equates to taking 191,000 cars off the road, the use of the bio-electricity generated equates to powering 208,000 typical homes, and the use of bio-heat generated equates to heating more than 137,000 typical homes each year. Compared with traditional energy sources, bioenergy products emit 80 per cent less in greenhouse gases, while still providing the desired energy service.

We also investigated the economic impact of 25 of Alberta’s bioenergy companies. The capital investment of these companies exceeded $601 million, representing a 14:1 leverage on the province’s public investment of $43 million under the bioenergy plan. When you apply the Alberta Treasury Board’s economic multipliers to these figures, the bioenergy sector had a $787.9 million impact on GDP between 2007 and 2014.  In that same period, bioenergy production supported 5,281 person-years of employment.

The data are impressive, but the conversations we had with bioenergy producers were even more enlightening. We found that bioenergy producers rarely operate independently of other manufacturing processes. Instead, they are often integrated with agricultural processing, forestry manufacturing and waste management operations. These industries are crucial for the resilience of rural populations, providing value-added manufacturing jobs in agriculture and forestry-based communities. Certain types of bioenergy processing diverts waste away from landfills, farms and industrial processes, which helps reduce waste management costs, odours, and greenhouse gases. Bioenergy heat and power is a stable, dependable energy source, which enhances regional grid stability and can reduce transmission costs.

In addition to the economic benefits and tangible action on climate change, bioenergy production also diversifies the province’s economy away from the volatility of crude oil and gas markets, enhances competition in all energy markets, and helps stabilize energy costs for consumers and industry as a whole.

The potential to make increasing use of the province’s biomass resources is proven, with established environmental and economic benefits. As Alberta looks to renewed energy and climate action policies, the bioenergy sector is well poised to further contribute to reducing greenhouse gas emissions and creating new economic opportunities.