Centre aims to help Calgary retain its title of 'energy capital of Canada'

Amanda Stephenson, The Canadian Press

Nov 8, 2022

Across from the headquarters of some of Canada's largest oil and gas companies, a new initiative aims to ensure that Calgary and its largest industry aren't left behind in the global pursuit of a low-carbon economy. 

The "Energy Transition Centre," a $4.2 million office space that marked its grand opening Tuesday, is meant to be a place where academics, start-ups, and the traditional oil and gas sector can work together on the development and commercialization of new energy technologies — everything from emissions reduction to hydrogen to carbon capture to renewable fuels.

The facility is a partnership between the University of Calgary, Innovate Calgary and Avatar Innovations, a local company that works with the oil and gas sector to promote innovation and technology, and has received funding from the federal government as well as CIBC.

Ed McCauley, president of the University of Calgary, said the purpose of the centre is to help ensure "the title of the energy capital of Canada will never leave town."

While Calgary still ranks oil and gas as its number one industry, climate change and the global push to achieve net-zero greenhouse gas emissions represent a major challenge to the city's dominant sector. And though oil prices are currently high, the city is still dealing with the after-effects of eight years of low commodity prices, layoffs and consolidation. For example, Calgary has a downtown office vacancy rate of around 30 per cent, the highest in the country.

But many in the city believe Calgary, because it already has the energy infrastructure and engineering talent pool in place, is better poised than most cities to benefit from the coming global energy transition. 

“I’m very positive on the energy transition in Calgary. Everybody knows Calgary is one of the biggest energy centres in the world," said Ling Bai, founder and CEO of VL Energy Ltd., a start-up with office space in the Energy Transition Centre, working in the area of emissions reduction.

"For myself, I started my career working in the traditional, conservative, oil and gas industry," Bai added. "To me, we have the biggest foundation to do the energy transition here."

A 2021 study commissioned by provincial economic development groups concluded the global energy transition could create 170,000 jobs in Alberta and contribute $61 billion to the province's GDP by 2050. 

The report also suggested Alberta will have to swiftly ramp up investment in clean tech or risk missing out. It said Alberta will need to invest more than $2.1 billion a year in clean tech by 2030, increasing to $5.5 billion in clean tech by 2040 in order to fully capitalize on the opportunity.

The current level of cleantech investment in Alberta is less than $1 billion annually.

Last week, Finance Minister Chrystia Freeland announced the creation of two new tax credits for clean technology and low-emitting hydrogen production. The government also previously announced an investor tax credit for carbon capture and storage projects.

Kevin Krausert, CEO and co-founder of Avatar Innovations, said there is a growing recognition that countries won't be able to meet their climate commitments through electrification and renewables alone. 

"The cheapest, fastest and simplest way to get (to net-zero) is by working with existing systems," Krausert said. "The oil and gas industry, and its multi-trillions' worth of dollars of energy infrastructure, can and must drive the emissions reductions needed to get to net-zero by 2050."

Krausert said thanks to 2022's high oil prices, this country's large-cap energy companies have the financial capital to deploy some of the solutions that are currently being developed by start-up entrepreneurs and university researchers. He said many of the start-ups working out of the Energy Transition Centre are already working on contracts or collaborations with some of Calgary's biggest corporations.

“The oil and gas industry has a once-in-a-generation opportunity to come out as the hero in the energy transition, by responsibly delivering abundant and affordable energy and investing in the technologies that are going to get us to net-zero," Krausert said.

"This forum – immediately across the street from Suncor, Cenovus, TC Energy — provides a direct daily interface between the customer who can deploy (the solution), and the technology developer or entrepreneur who develops it," Krausert said.

Canada's economy seen taking 5.8% hit on climate change by 2100

Danielle Bochove, 

The Canadian Press

Nov 8, 2022

Higher temperatures and more extreme weather are likely to lower Canada's real gross domestic product by 5.8 per cent in 2100, assuming countries around the world fully meet their climate commitments.

Changing precipitation patterns, along with higher temperatures, affect the economy through their impact on agricultural output, labor productivity, human health, coastal sea levels, energy use, property damage, and tourism, according to report released Tuesday by the Parliamentary Budget Officer in Ottawa.

“Some climate effects like longer growing seasons and warmer weather could increase Canada’s GDP while more frequent days over 30 degrees Celsius, droughts, and severe storms will have a negative economic impact,” the budget watchdog says in the report. 

The 5.8 per cent scenario assumes that climate pledges by governments around the world are met in full, and on time, limiting the global rise in temperatures to 1.8C compared to pre-industrial levels. The report is meant to be a “first step” in the watchdog’s analysis of the economic impact of climate change.

The planet is on track to warm 2.1C to 2.9C by the end of the century compared to pre-industrial times, according to the UN Nations Framework Convention on Climate Change. Countries, including Canada, that ratified to the 2015 Paris Agreement aim to keep that rise to 1.5C, although the UN said last month there is “no credible pathway” to that goal. 

If governments fail to meet their policy commitments, and instead maintain their current trajectories, Canada’s GDP would fall an addition three-quarters of a percentage point, or 6.6 per cent, the watchdog said.

CANADA

Here are the new cost of living support measures announced in the Fall Economic Statement

Hilary Punchard, BNN Bloomberg

Nov 3, 202

The federal government announced six initiatives in its Fall Economic Statement focused on helping Canadians navigate higher inflation. 

The Department of Finance outlined the new support measures in its Fall Economic Statement that are meant to help at-risk Canadians and “designed to avoid pouring fuel on the fire of inflation.”

Here’s a look at the different announcements Ottawa outlined and how much Canadians could qualify for in the coming months.

ELIMINATING INTEREST ON STUDENT LOANS

Finance officials said it would permanently make all Canada Student Loans and Canada Apprentice Loans interest-free. This includes loans that are currently being repaid by Canadians. The move will cost the government $2.7 billion over five years and $556.3 million annually after that five-year period is over.

ADVANCING THE CANADA WORKERS BENEFIT

The Fall Economic Statement proposed advancing the Canada Workers Benefit (CWB), a refundable credit delivered through tax returns that would impact three million Canadians.

The change would issue advance payments of the credit for workers that qualified the previous year.

“The CWB would provide up to $1,428 for single workers or up to $2,461 for a family this spring through the existing tax return payment, and then new advance payments for 2023 across three quarterly advance payments starting in July, putting more money in workers’ pockets to help cope with the rising cost of living,” it said in the economic statement.

The changes would result in $4 billion in new spending over the next six years.

SLASHING CREDIT CARD TRANSACTION FEES FOR SMALL BUSINESSES

Government officials will also negotiate with credit card payment companies to help lower transaction fees for small businesses and will draft new legislative changes to the Payment Card Networks Act. But the government warned it will take action if the credit card industry doesn’t find a solution to lowering fees next year.

“Should the industry not come to an agreed solution in the months to come, the government will move forward with these draft legislative proposals in the New Year and move forward on regulating credit card transaction fees,” it said in the Fall Economic Statement.

REITERATING PREVIOUS ANNOUNCEMENTS

The federal government also reiterated the cost of living support measures that were announced earlier this fall.

The economic update did not include any new housing affordability measures, however it flagged the Canada Housing Benefit top-up that was announced in September.  

DOUBLING GST TAX CREDIT

Ottawa will also double the Goods and Services Tax (GST) credit for an estimated 11 million low- and modest-income Canadians. The additional one-time payment will start on Friday.

Prime Minister Justin Trudeau announced the additional GST payments earlier this week. The additional credit will cost the government $2.48 billion in its current fiscal year.

“Single Canadians without children will receive up to an extra $234, and couples with two children will receive up to an extra $467. Seniors will receive an extra $225 on average,” it said in the economic statement.

CANADA HOUSING BENEFIT TOP-UP

The federal government also reiterated its plans to top-up the Canada Housing Benefit. In September, it announced a tax-free payment of $500 to 1.8 million low-income renters, who are spending at least 30 per cent of their income on rent.

The federal benefit will be available for families with an adjusted income below $35,000, or below $20,000 for single Canadians. The initiative is expected to cost $1.16 billion in the current fiscal year.

CANADA DENTAL BENEFIT

The Fall Economic Statement also highlighted the federal government’s move to introduce legislation for the Canada Dental Benefit.

The benefit will provide parents or guardians with tax-free payments to cover dental expenses for kids under 12-years-old.

“For those without dental coverage and with an annual family income under $90,000 per year, the Canada Dental Benefit will provide payments of up to $650 per year, over the next two years,” it said.

EU's Call of Duty: Probe Microsoft-Activision Blizzard deal

Matt O'brien and Raf Casert, 

The Associated Press

Nov 8, 2022

Attendees play the "Call Of Duty: WWII" video game by Activision Blizzard Inc. during the E3 Electronic Entertainment Expo in Los Angeles, California, U.S., on Tuesday, June 13, 2017. , Troy Harvey/Bloomberg

The European Union has launched an investigation into Microsoft's planned takeover of video game giant Activision Blizzard, fearing the US$69 billion deal would distort fair competition to popular titles like Call of Duty.

Microsoft, maker of the Xbox gaming system, first announced the agreement to buy the California-based game publisher in January, but it still awaits scrutiny by antitrust regulators in the U.S., Europe and elsewhere. If it goes through, the all-cash deal would be the largest in the history of the tech industry.

Members of the European Commission, the 27-nation bloc's executive arm, said in a statement Tuesday that "the point is to ensure that the gaming ecosystem remains vibrant to the benefit of users in a sector that is evolving at a fast pace."

"We must ensure that opportunities remain for future and existing distributors of PC and console video games, as well as for rival suppliers of PC operating systems," the commissioners said. They have until March 23, 2023, to decide whether to approve the deal.

At the heart of the dispute is who gets to control future releases of Activision Blizzard's most popular games, especially the first-person military shooter franchise Call of Duty. Activision this week said its latest installment, Call of Duty: Modern Warfare 2, has already made more than US$1 billion in sales since its Oct. 28 launch.

Microsoft's console rival Sony, maker of the PlayStation, has brought its concerns about losing access to what it describes as a "must-have" game title to regulators around the world. In response, Microsoft has promised to keep Call of Duty on the PlayStation "for at least several more years" beyond its current contract with Sony. It also has said it might make it available on Nintendo's Switch console, where the game isn't currently available.

In a preliminary probe, the EU found potential antitrust issues with the distribution of video games and halting access to Microsoft's rivals. The bloc said it "has concerns that the proposed acquisition may reduce competition on the market for PC operating systems."

Microsoft said it will keep working with the European Commission on next steps "and to address any valid marketplace concerns."

"Sony, as the industry leader, says it is worried about Call of Duty, but we've said we are committed to making the same game available on the same day on both Xbox and PlayStation," Microsoft said in a statement Tuesday. "We want people to have more access to games, not less."

Activision Blizzard CEO Bobby Kotick said in an email to employees Tuesday that global competition in the video game industry makes it "understandable that regulators are trying to better understand the games business." But he said the "process is moving along as we expected" and foresees the deal closing by June.

"We will continue to cooperate with the European Commission where, in the countries they represent, we have many employees," Kotick wrote.

He highlighted Brazil's recent approval, saying the country's competition authority understood "we operate in a highly dynamic and competitive industry, and that the merger will not harm competition in any way."

Saudi Arabia also has signed off on the deal, but it still awaits important decisions from the U.S. Federal Trade Commission and authorities in the U.K. and EU.

Tuesday's decision was another example of how the EU has led the way on regulating Big Tech companies, opening antitrust investigations, enacting strict regulations on data privacy and pushing through landmark rules that threaten online platforms with billions in fines unless they respect fair market conditions and crack down on harmful content like hate speech and disinformation.

It's possible regulators could impose conditions on the gaming deal that force Microsoft to keep access open to Call of Duty for longer and ensure that its rivals aren't getting a lesser version.

Among those listening to Sony's concerns are antitrust regulators in the United Kingdom. Last month, they escalated their investigation into whether Microsoft could make Call of Duty and other titles exclusive to its Xbox platform or "otherwise degrade its rivals' access" by delaying releases or imposing licensing price increases.

“These titles require thousands of game developers and several years to complete, and there are very few other games of similar caliber or popularity," according to a September report from the U.K.'s Competition and Markets Authority.

FedEx parks planes as weak demand prompts cost-cutting steps

Thomas Black, Bloomberg News

Nov 8, 2022

FedEx Corp. has reduced the frequency of flights and parked some of its planes, following through on the courier’s plan to reduce costs in response to weak demand for package delivery.

The company has halted 23 domestic flights and about nine international ones, Chief Financial Officer Mike Lenz said Tuesday at the Baird 2022 Global Industrial Conference. FedEx has also reduced sorting points and consolidated loads at the Ground unit, he said.

The efforts are in line with those laid out in September, when FedEx said it would reduce costs by as much as US$2.7 billion in its current fiscal year due to a variety of issues, including weakness in Asia and challenges in Europe. The company withdrew its forecast at the time.

The cutbacks are a response to a large shift of spending toward services rather than goods -- reversing a pandemic trend -- that has particularly hurt the business in Asia. While FedEx knew those spending habits would revert toward services, Lenz said the company didn’t expect it to happen so quickly.

“Unquestionably, the commencement and the speed and depth of that shift was beyond what we certainly had anticipated,” Lenz said. “That’s why we have been taking down trans-Pacific flights.”

Along with the reduced flight frequencies, Lenz said FedEx will temporarily park aircraft because it doesn’t need as much air capacity as anticipated. FedEx is also eliminating older, inefficient planes from its fleet. The company will completely retire its MD-10s by the end of this year and will then look at retiring MD-11s.

FedEx shares pared gains as Lenz spoke and briefly moved into negative territory. The stock was up less than 1 per cent at 3:34 p.m. in New York.

SOFT DEMAND

In Europe, demand is soft because of the impacts of Russia’s war on Ukraine and the energy crunch.

Lenz said the peak holiday season will be “solid,” but more moderate than the last two years when the pandemic was driving people to spend more on goods than services. 

On-time deliveries at the company’s Ground unit have improved in recent weeks and are now at 2019 levels, he said. Even as the company slashes expenses, maintaining pricing power will remain a priority, Lenz said.

Stranded passengers call for more accountability for WestJet flight cancellations

Caitlin Yardley, The Canadian Press

Passengers are calling on airlines to do more for customers stranded due to the latest wave of flight cancellations to impact Canadian travellers.  

A system-wide outage at WestJet on Saturday led to the cancellation of over 200 WestJet, Swoop and Sunwing flights over the weekend. The airline later said the problem was caused by a "cooling issue" in its primary data centre.

WestJet said that it scheduled an additional 10 flights for waiting passengers on Monday.

However, for some, the damage has already been done.

WestJet customer Gemini Clarke was stuck in Calgary Monday, exhausted and wanting answers but still unsure whether she would be placed on a flight back to Kelowna today.

Clarke said at midday she had not received a response and could not reach a representative by phone or email as lines remain congested with customers in similar circumstances.

WestJet said in an emailed statement that it's asking passengers to refrain from contacting the airline until 72 hours before their upcoming flights to ensure staff are able to prioritize calls.

Air passenger rights advocate Gabor Lukacs said many of the affected passengers will be entitled to compensation.

“We are hearing about chaos but I think what we should really be hearing is the passenger's rights in this situation."

Lukacs said that cancellations due to a system-wide outage are within WestJet's control and that the airline is required to rebook passengers on new flights, even if they happen to be with another airline. 

Additionally, he noted WestJet will owe affected passengers compensation of up to $1,000 depending on the length of the delay under the federal Air Passenger Protection Regulations. 

Passenger Bradley Martens said that WestJet has not given advice on what options are available with other airlines or on what refund or compensation passengers are entitled to. 

"There's really no options," said Martens. "It's kind of like a wait-and-see, but really it's just wait." 

In an statement on Sunday, WestJet's chief operating officer said disruptions would continue this week.

"Further delays and cancellations in the coming days will be required, as we work diligently to recover our operations," Diederik Pen wrote.

The fact that the company apparently had a single point of failure is troubling, said Lukacs. 

He said that there are systems in place to provide backups in case system failures occur and that WestJet has not yet provided a satisfactory explanation for the situation. 

The Calgary-based airline said another 31 flights were cancelled Monday due to the effects of the system outage combined with winter weather affecting Alberta and parts of Western Canada.

Communication is the most important thing, Martens said.

"Provide detail of what you're prepared to do for your customers ... that is the biggest issue."

TransAlta reports Q3 profit, raises dividend and financial guidance

The Canadian Press 

Nov 8, 2022

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TransAlta Corp. increased its dividend as it reported a third-quarter profit compared with a loss a year ago and raised its financial guidance for the year.

The power utility says it will now pay a quarterly dividend of 5.5 cents per share, up from five cents per share.

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The increased payment to shareholders came as TransAlta says it earned a profit attributable to common shareholders of $61 million or 23 cents per diluted share for the quarter ended Sept. 30 compared with a loss of $456 million or $1.68 per diluted share a year ago.

Revenue for the quarter totalled $929 million, up from $850 million in the third quarter of 2021.

In its guidance, TransAlta says its adjusted earnings before interest, taxes, depreciation and amortization for its full year is now expected to be in a range from $1.38 billion to $1.46 billion compared with its original guidance for between $1.065  billion and $1.185 billion.

The company also says its free cash flow is now expected to be in a range of $725 million to $775 million compared with earlier guidance for between $455 million and $555 million.

Maple Leaf Foods still working to recover from outage caused by cyberattack

The Canadian Press 

Nov 8, 2022

Maple Leaf Foods Inc. is still working to restore operations after being hit by a cyberattack over the weekend, the company said Tuesday.

Chief executive Michael McCain said all facilities ran on Monday but problems remain as their business continuity teams figure out process-by-process manual workarounds, while both the team and the company's IT division work to recover the integrity of the system. 

"I don't think we ran optimally for sure. On day one, I can guarantee that. But we all walked away from our calls last night thinking how impressed we were with how much they got done in the matter of one day," said McCain on an earnings call. 

He didn't go into detail on what functions were hit worse than others, but said the disruption was "comprehensive," while noting they do have workarounds.

"This is not something that is unexpected in industry today, as much as it's a scourge of modern technology, but I feel very confident in the team of people that we have in place to ensure the continuity of the business."

Chief financial officer Geert Verellen said a full resolution of the outage will take some time and result in some operational service disruptions, and that the company will work through the issues with customers and vendors. 

He said the company had a third-quarter loss of $229.5 million as it took a one-time charge related to the value of its plant protein business.

The company said the loss amounted to $1.86 per share for the quarter ended Sept. 30 compared with a profit of $44.5 million or 36 cents per share in the same quarter last year.

Maple Leaf said its most recent quarter included a $190.9-million one-time non-cash impairment charge related to its plant protein group and a $31.5-million decrease in the fair value of biological assets.

On an adjusted basis, Maple Leaf said it lost a penny per share in its latest quarter compared with an adjusted profit of 38 cents per share in the same quarter last year as a result of weaker commercial performance due to inflation and labour challenges.

Sales in the quarter totalled $1.23 billion, up from $1.19 billion in the third quarter of 2021.

The company said the increase was driven by higher sales in its meat protein group, partially offset by lower sales in the plant protein group.

Empire tight-lipped as IT problems affect pharmacies at Sobeys and other stores

Lyndsay Armstrong, The Canadian Press  

Nov 8, 2022

Empire Co. Ltd. remained tight-lipped Tuesday about computer system issues that are still impeding customers seeking prescriptions at some pharmacies it operates.

The Nova Scotia-based company issued a brief statement Monday confirming that an "IT systems issue” affecting certain pharmacies has caused “technical difficulties” in filling prescriptions.

Issues at Empire-operated pharmacies, including Sobeys pharmacies and Lawtons Drugs, were first reported over the weekend, and some locations in Halifax Tuesday had signs posted warning customers of the ongoing technical problem. "Unfortunately, at this time we are unable to access your records to fill a prescription," a sign at one pharmacy counter said.

Empire did not respond to questions Tuesday about the cause of the IT problem and has not said when it expects it to be resolved. In its Monday statement, the company said it remains “committed to the continuity of care for all its pharmacy patients.”

Anne Genge, the CEO of Alexio, an Ontario-based cybersecurity company that specializes in health care, said the situation is reminiscent of the cyberattack that targeted Newfoundland and Labrador’s health system last year.

“The issue here is probably the same as what we saw last year in Newfoundland: a ransomware attack,” she said in an interview Tuesday. A ransomware attack is when hackers steal or encrypt sensitive information and demand a payment to release it.

Genge said the scale of Empire's system outage and the lack of public communication from the company lead her to believe that this type of cyberattack may be behind the technical problems.

She said it would not be surprising for Empire to keep relatively quiet about the IT problems if the company were working on a plan to restore the system or negotiate with a possible cyber attacker. “They tend to not talk about things until they’ve got it sorted out,” she said of organizations facing ransomware attacks.

With about $30.5 billion in annual sales and 130,000 employees, Empire's stable of retail outlets include 1,598 stores under a number of different banners, including IGA, Safeway, Foodland, FreshCo, Needs, Thrifty Foods, Rachelle-Béry and Bonichoix.

"Our sole focus right now is on getting this problem rectified and we will provide further updates as relevant information becomes available,"  Pierre St-Laurent, Empire's chief operating officer, said in the Monday statement.