Alberta is a place where change often is the only constant. Take the following new, cold realities. Oil is sitting at around US$50 a barrel, alternately causing conniptions among pundits and shoulder shrugs among longtime Albertans who have been through a few downturns.

The recent provincial budget predicts a $5-billion deficit, the result of the province’s overreliance on royalty revenue from oil and gas, which plunges with the price of those commodities. And, now, there’s an election in the works, with voters facing a fractured range of parties from which to choose – none very confidence-inducing.

Premier Jim Prentice has selected May 5 as the election date, almost a year ahead of the legally mandated schedule. He has done so to take advantage of weak Opposition parties. The Wildrose Party has just elected a new leader – the popular and capable Brian Jean – but remains in disarray following the recent defections of former leader Danielle Smith (who failed to win the Progressive Conservative nomination in her Calgary riding and now is out of politics) and eight other Wildrosers.

A recent poll suggests that the Wildrose was in a dead heat with the Tories in popular opinion, but that has more to do with immediate anger over a budget that saw taxes rise and the aforementioned $5-billion deficit than the strength of the Wildrose. That anger is likely to abate over the coming month, and the Tory machine will ensure that the Wildrose will remain on the outside looking in.

The left of the political spectrum is in similar straits. Three parties – the Liberals, the Alberta Party and the New Democratic Party – will battle for votes, each drawing some from the others and thereby ensuring a PC win.

But if a PC government is inevitable, the strength of the provincial economy is not. The talk of the province is the price of oil – and with good reason: a recent poll by ATB Financial found that 70% of small and mid-sized businesses in Alberta draw a direct link between the price of oil and their success.

That price has stabilized, and will climb in the near future. This is hardly Alberta’s death knell; not yet. But look a little farther out, and the concern is profound. That future is one in which carbon emissions are constrained in a variety of ways and, across the world, the price of oil is set at permanently lower levels than we see today. Oil still will be a boom-and-bust commodity – with all the economic challenges that entails – but the vacillation will happen at a lower level.

Evidence is everywhere that measures to reduce greenhouse-gas emissions will continue to shift from being an abstract notion to reality. The U.S. and China recently signed an emissions accord. A recent report from a widely respected group of Canadian economists calls upon the provinces to take their own steps to reduce emissions. Ontario is in the process of introducing a cap-and-trade program. Even the International Energy Agency is calling for action on climate change.

All this means Alberta should be preparing for a future of depressed oil prices. Diversifying the economy has been a stated goal of the province’s governments from time immemorial. That goal soon will become an absolute necessity, and all Albertans had better begin to plan and prepare for that future. The question is: will their provincial government be there to lead them into this new future? IE

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