Calgary: Provincial Green Line estimate misses $1.3B in costs

Key Takeaways:

• Calgary officials estimate the revised Green Line LRT alignment would cost $7.5 billion, $1.3 billion more than Alberta’s $6.2 billion estimate due to additional costs and risks identified by the city.
• The project faced significant hurdles, including the Alberta government withdrawing its $1.53 billion funding commitment in September 2024, citing concerns over rising costs and a reduced project scope. This forced the city to temporarily wind down the project, with associated costs estimated at $2.1 billion.
• In October 2024, Calgary and Alberta’s government reached an agreement to proceed with Phase 1 of the Green Line, focusing on a segment from 4th Street S.E. to Shepard, highlighting ongoing efforts to advance the project despite earlier challenges.

The Whole Story:

Calgary officials say the province’s revised Green Line LRT alignment would cost $7.5 billion, $1.3 billion more than Alberta’s estimate.

The city has conducted an analysis of costs and risks for its Green Line Project included in the confidential report provided by the Province of Alberta, on their new elevated downtown alignment, from the Elbow River to 7 Avenue S.W.

Based on the $6.2 billion rough order of magnitude estimate provided by AECOM, the province’s external consultant, the city says it has identified $1.3 billion in known costs and risks that were not included in their work.

At $7.5 billion, this exceeds the $7.2 billion cost estimate, based on the city’s 60% design for the Shepard to Eau Claire tunneled alignment, presented in July 2024.

As the report remains confidential, the details of the analysis will be included as part of further negotiations and decisions within the Reimagined Green Line Working Group.

The alignment is only one component of the due diligence that the city needs to undertake before making a decision on a reimagined Green Line.

The city says it remains committed to working collaboratively with the Province of Alberta towards a solution that delivers for Calgarians.

Calgary Mayor Jyoti Gondek stated on Tuesday that AECOM’s report lacks critical details about costs that have already been invested in the project. She emphasized that Calgarians must understand the province’s proposal before council can agree to the new plan, noting that downtown residents and businesses remain unaware of the potential impact of the revised alignment.

“We’ve been very clear that risk is a very real issue for our city, and we’ve been very clear that we think there’s some errors with the numbers,” Gondek said.

“We’re trying to be as transparent as we can in indicating what it is that we need to discuss further. If the province chooses to walk away now, if they choose to take their funding and kill this project for a second time, that’s on them. We’re still here.”

Initially proposed as the city’s largest infrastructure project, the Green Line was meant to be a significant expansion of Calgary’s public transit system. However, it has faced numerous challenges, especially regarding its financing. The project’s costs have escalated over time.

In September 2024, the situation reached a critical point when Alberta decided to withdraw its $1.53 billion funding commitment. This decision was based on concerns about the project’s rising costs and reduced scope, with Transportation Minister Devin Dreeshen calling it a “multibillion-dollar boondoggle”. 

The funding withdrawal left the City of Calgary unable to afford the project, forcing the city council to vote for winding down the Green Line. The wind-down costs were estimated to be at least $2.1 billion, including $1.3 billion already spent and an additional $850 million needed to wrap up the project. 

In October it was announced that the City of Calgary and Alberta’s Government had reached an agreement to move ahead with Phase 1 of the Green Line LRT project, extending the line from 4th Street S.E. to Shepard.