Fossil Fuels – At What Cost?

The report estimates that the federal and provincial governments of Alberta, Saskatchewan, and Newfoundland and Labrador provide over $2.8 billion in annual subsidies to the upstream oil sector. Using a definition based on the WTO's Agreement on Subsidies and Countervailing Measures, the study identifies 63 subsidy programs, with development subsidies (reducing capital expenditures) comprising 59% of the total value. Alberta receives the largest share of support (73% of total subsidies), which exceeds its share of crude oil production (67%). Macroeconomic modelling suggests that these subsidies increase national oil production by approximately 5% and GHG emissions by 2% by 2020, while negatively impacting government balances in the federal government, Alberta, and Saskatchewan.

• Provincial and federal governments provide over $2.8 billion in annual subsidies to the oil sector in Alberta, Saskatchewan, and offshore Newfoundland and Labrador, covering 97% of Canada's oil production.
• The study identified 63 targeted subsidy programs: 18 in Alberta, 19 in Saskatchewan, nine in Newfoundland and Labrador, and 17 at the federal level.
• Development subsidies, which encourage companies to bring new oil resources into production by reducing capital expenditures, account for 59% of total subsidies, valued at $1.68 billion.
• Federal subsidies total $1.38 billion, representing 49% of the total estimated subsidies.
• Alberta receives 73% of total federal and provincial subsidies, a proportion higher than its 67% share of crude oil production.
• The average subsidy as a share of production value across Canada is 5.2%, peaking at 5.7% in Alberta and reaching a low of 3.7% in Newfoundland and Labrador.
• In Saskatchewan, subsidies for new wells average $139,000 per well or $143 per m3 produced, representing approximately 27% of the estimated future production value.
• Macroeconomic modelling indicates that subsidies increase national oil production by approximately 5% by 2020, with Alberta seeing a 6% increase and Newfoundland and Labrador a 0.3% increase.
• Subsidies are projected to increase national GHG emissions by about 2% by 2020, with Alberta's provincial emissions increasing by approximately 5%.
• The oil sands disproportionately benefit from subsidies, with an estimated 6% to 7% increase in production and a 12% increase in emissions attributable to the support.
• Government balances are negatively impacted by subsidies: the federal government's balance is lower by 1%, Alberta's by 5%, and Saskatchewan's by 4%.
• Subsidies contribute to a projected 14% national increase in the oil trade surplus (net exports).

APA

Sawyer, D., & Stiebert, S. (2010). Fossil Fuels – At What Cost? International Institute for Sustainable Development. https://www.iisd.org/gsi/sites/default/files/ffs_awc_3canprovinces.pdf

Chicago

Sawyer, Dave, and Seton Stiebert. Fossil Fuels – At What Cost? International Institute for Sustainable Development, 2010. https://www.iisd.org/gsi/sites/default/files/ffs_awc_3canprovinces.pdf.

Wikipedia

{{cite report |last1=Sawyer |first1=Dave |last2=Stiebert |first2=Seton |title=Fossil Fuels – At What Cost? |publisher=International Institute for Sustainable Development |date=November 2010 |url=https://www.iisd.org/gsi/sites/default/files/ffs_awc_3canprovinces.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{sawyer2010fossil, author = {Sawyer, Dave and Stiebert, Seton}, title = {{Fossil Fuels – At What Cost?}}, institution = {International Institute for Sustainable Development}, year = {2010}, month = nov, url = {https://www.iisd.org/gsi/sites/default/files/ffs_awc_3canprovinces.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }