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.