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Edmonton’s Industrial Future: The Future Success of the EETP

The Edmonton Energy and Technology Park represents a changing commitment to industry and growth, and charts how the city has adapted to new economic realities.

Rendering of EETP logistics area.

Edmonton and its surrounding areas have long been home to a strong manufacturing and industrial core, but as Alberta’s economy changes, so do the projects and industries that want to call Edmonton home. There is perhaps no better example of Edmonton’s changing economy, and the demands that come along with those changes, than the Edmonton Energy and Technology Park (EETP). The section of roughly 50 square kilometres on the city’s outskirts will be home to the city’s next phase of industry and manufacturing and has undergone substantial change to adapt to Edmonton’s past, present and future.

The EETP was conceived in 2008 as an effort to expand Edmonton’s industrial and manufacturing sectors. According to Ken Mamczasz, the City of Edmonton’s director of economic investment and development, the park represents “a large part of our industrial future” and will “be our industrial land supply for the next 30 to 50 years.”

Currently, Edmonton and the surrounding areas are home to substantial industrial and manufacturing operations. Some “40 chemical and advanced manufacturing businesses representing more than $32 billion in investment” are already in operation, according to the city’s area structure plan for the EETP. Another “$15+ billion in projects announced or under construction” are happening in the area, pointing to the park’s importance, not just as a place to house future industry but to also contribute to sectors that are already thriving in the area.

The original plan was created in the midst of an industrial boom in Edmonton. With ample space for industrial growth, Edmonton eyed breaking into the market with a new industrial park.

“Ten years ago the economy was very different,” Mamczasz explains. “We originally envisioned the area as part of a land rush that was happening. Six or seven upgraders were being planned [in the area] at that time and we were trying to capture part of that market. The original plan was to focus on and develop a petrochemical area here.”

The focus on petrochemical changed with the rise of shale oil and gas followed by the drop of oil prices in 2014. Left with an economy that was “flipped on its head,” Mamczasz and the EETP started to look to other markets for its industry.

“Today, we don’t expect this area to have a strong focus on petrochemical processing even though the industry remains at our core,” he says. “We’ve evolved to try and take the emphasis off petrochemicals and more on traditional industrial activities, like warehousing, logistics, manufacturing, storage and construction services.”

One such sector is already happening on the land in the area: agricultural businesses. Since the park has a 50-year growth plan, Mamczasz envisions the area supporting agriculture and industrial working side-by-side for the foreseeable future. “As we transition the area into industrial, it makes sense to have 20 or 30 years of agricultural usage like hemp production or hemp processing,” he says. “We’re looking at all options currently to help with that diversification.”

The size of the future park is hard to visualize but it is a significant amount of space, something Mamczasz describes as the park’s biggest advantage and challenge.

“It’s so big that it’s hard to get things moving there,” he says. “When you have an area this large and it’s brand new, the challenge is usually for the first few developers because they have to extend services and oversize services for the area, then pay for those services and hope to recoup those costs from future developers. When you have an area this large, those numbers get pretty big. Plus, there’s no guarantee that the next developer will set up shop close enough that they can share in those initial costs.”

Edmonton adheres to a private development strategy, so they cannot directly incentivize developers to work on the EETP. The City has, however, created a unique tax system to help developers with their costs.

“One of the challenges for new developers coming in is they have to front end a lot of their costs,” Mamczasz explains. “We’ve tried to simplify this risk with a plan. If you develop and oversize some infrastructure that will get paid back by future developers, the city will take up to 50 per cent off your tax uplift and give you a rebate.” The plan helps the city compensate early developers without having to find large reserves of money upfront, a win-win for developers and the city.

The new tax structure is just one way the city is helping potential developers. Another is by cleaning up the area’s existing plans and zoning, especially when it comes to roads. “We actually simplified the road network,” he says. “What we proposed nine years ago was a bit more curvy and traditional. What we did more recently was reduce the arterial roads and put it back on a grid. We also reduced the number of roads so that when developers cost share, it reduces their costs.”

Roads have also caused some inter-governmental coordination, specifically between Sturgeon County and the City of Edmonton. Last year, the city worked with Sturgeon County to annex roughly 16 hectares of land in the park’s southwest. As it stood, access to the park was through Sturgeon County, which needed to be cleaned up for zoning and simplicity. The area, which was exempt from taxation for Sturgeon County, was purchased by the City of Edmonton earlier this year as what Mamczasz describes as some “logistical cleanup.” Sturgeon County, for its part, is happy to the see the park happen in such close proximity.

“Sturgeon County values and recognizes the importance of relationship building and collaboration,” says Gwen Wolansky, communications office for Sturgeon County. “Managing lands that connect on our fringes and working with other municipalities helps us all to build better, stronger communities.”

As the project looks to the future, Mamczasz says patience and consistency needed. Even at 10 years in, he and his team are still looking decades ahead. More immediately, however, Mamczasz hopes to see the start of some projects as soon as next year.

“With an area this big that has a 50-year buildout, by next year we will hopefully have some pavement down in one of the pre-zoned areas,” he explains. “We have to be patient because the market in Edmonton is really soft. Last year, we had the slowest absorption rate of industrial of the past 10 years.”

The EETP represents the changing face of Edmonton and the province’s economy. As a long-reaching project that was conceived in a very different climate, the EETP has adapted, evolved and changed to meet the demands of current markets, but with an eye to the far future. Every change the city brings makes the area more enticing to future developers, and the city continues to create new solutions that will help Edmonton grow and succeed.

“As we work through these solutions we will have a space that’s attractive to developers,” Mamczasz says. “And they will start laying the groundwork for the area.”