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Tapping the Market to Protect Alberta’s Environment


CALGARY – With Alberta’s population projected to rise and another development boom around the corner, the need to protect the province’s environment has never been more critical. The latest research conducted by the Canada West Foundation shows that market-based instruments (MBIs) have the potential to protect and preserve a variety of Alberta’s environmentally significant areas while balancing economic growth.

In The Invisible Hand’s Green Thumb: Market-based Instruments for Environmental Protection in Alberta, authors Shawna Stirrett, Robbie Rolfe and Stephanie Shewchuk examine three case studies of MBIs in Alberta that provide critical lessons about implementing MBIs and the role of supportive public policy.

“Market-based instruments work by incorporating the economic principles of supply and demand to the management of natural resources. This means that individuals and companies, by relying on market signals, protect the environmental quality of water, ecosystems, forests and so on by having the cost of those natural resources priced in,” author Shawna Stirrett, Senior Policy Analyst explains.

Case studies examined in the report include a Transfer of Development Credits (TDC) program in the Beaver Hills area, a province-wide emissions trading program, and a program that pays farmers in the County of Vermilion River to restore and/or preserve ecologically important areas on their farmland, all of which reveal important lessons about the use and implementation of MBIs in Alberta.

“MBIs are one tool in the proverbial environmental policy toolbox. They are designed to work within a framework of regulations and scientific evidence. The reason they are so interesting is that they have the potential to enable flexibility, equity, and innovation around environmental protection in ways that command and control regulations sometimes do not,” Stirrett notes.

Alberta has a long history of land use planning and some market-based instruments have been in place for years. It remains, however, one of the few provinces in Canada to make legislative room for the use of market-based instruments with the release of the Land Use Framework (LUF) and passing of the Alberta Land Stewardship Act (ALSA). While this new legislation promotes the use of MBIs, their use is still much more theoretical than practical. As such, this report highlights some key ways that government can create an effective policy framework and promote the use of MBIs in Alberta. In doing so, the government could ensure that MBIs are more prevalent and more effective, which could help to ensure that economic growth and environmental protection are better balanced in the future.

Canada West Foundation is the only think tank dedicated to being the objective, nonpartisan voice for issues of vital concern to western Canadians.

This report is part of the Canada West Foundation’s The Living West Initiative, which determines the best way to steward western Canada’s rich stock of natural capital.


For a copy of The Invisible Hand’s Green Thumb: Market-based Instruments for Environmental Protection in Alberta or any other Canada West Foundation research paper, visit www.cwf.ca.

For more information or to arrange an interview, please contact:
Rachael Strathern
Communications Team Lead
403-700-9535 communication@cwf.ca