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Cost of Climate Change, Energy

Are Oil and Gas emissions holding Canada back from reaching its climate goals?

On March 21, Environment and Climate Change Canada issued a press release stating that in 2023 Canada’s greenhouse gas emissions dropped to their lowest level in 27 years (excluding the pandemic years). The exception in this otherwise positive picture was the oil and gas sector, where emissions continue to rise. However there is good news within that sector as well, ‘fugitive greenhouse gas emissions from oil and natural gas have decreased by 33% between 2013–2023, driven in part by Canada’s 2020 oil and gas methane regulations, which have reduced methane venting and leaks.’  

“The two main messages from the National Inventory report last week, which I feel are really important, is that climate policy works. Over the last 10 years, Canada’s greenhouse gas emissions have gone down. Our methane emissions have gone down. Our electricity has become less emissions intensive, and all of that has happened while our economy has grown. This is a significant point to make. And this is something that environmental groups, activists, researchers, community leaders, all of them have been saying for decades,” responded Aly Hyder Ali, from Environmental Defence. 

“The other aspect of the report was that the oil and gas industry is holding us back. The oil and gas industry has failed to do its part when it comes to emissions reductions and if it was able to or willing to do that, Canadians would be in a much better place.”

Aly Hyder Ali, Program Manager, Oil and Gas for Environmental Defence

(Chart courtesy Pembina Institute)

Cortes Currents: Aren’t the emissions increases primarily coming from the oil sands. In the report it says methane emissions really dropped and the Pembina Institute recently stated conventional gas and oil are doing well (graph above). Given that all three of Canada’s largest political parties – the Liberals, Conservatives and NDP – favour further LNG development this gives me some hope for the future.     

Aly Hyder Ali: “Let me paint a larger picture and then I’ll get more precise on tar sands and more conventional oil and gas production.” 

“When it comes to overall oil and gas industry emissions in the last 10 years where overall emissions in the country have reduced, oil and gas emissions have increased by 7%. Now, knowing that the oil and gas industry represents nearly a third of Canada’s domestic greenhouse gas emissions, that does cancel out almost all the progress that other parts of our economy have made, whether it’s electricity, heavy industry waste. All of these sectors have contributed to emissions reductions while the oil gas industry itself has continued to pump out more pollution.” 

“Now, when we speak to the reduction in methane emissions, a lot of that goes to my initial point about climate policy working. The government of Canada implemented methane rules, which forced conventional oil and gas to reduce their methane leakages, and that we can see making an impact.” 

“The tar sands, on the other hand, have increased their emissions by 143% in the last 10 years. That is a preposterous amount of pollution that has been pumped out into our atmosphere when we are in a climate crisis. The companies that work in the tar sands are making billions and billions of dollars when it comes to their annual profits, and yet they contribute the most minuscule amount when it comes to investing in emissions reductions.”

“The point that I will really, really emphasize here is oil and gas as a whole is contributing a lot to Canada’s emissions. Yes, we can segment out which part of the sector is polluting more than the other. But overall, as a whole, and especially focused on tar sands, we do need rules and regulations that force these companies to comply with emissions reductions that they’re not going to do on their own voluntarily.”

“That speaks to policies like the oil and gas emissions cap that is so essential to meet Canada’s climate targets and at the same time safeguarding the livelihood of Canadians.” 

Cortes Currents: A recent report from the government of Alberta states the technology meant to decrease emissions is not cost-effective. If the emissions cap is brought in, companies will simply produce less rather than spending the money.

Aly Hyder Ali: “The government of Alberta, Premier Smith, well ever since she’s come into power in the province of Alberta, has been pushing back against climate policy. The oil and gas emissions cap has been a main target for her whether it’s through disinformation around what the policy in itself is (or something else). It is an emissions cap. It’s not a production cap. It aims to reduce pollution from oil and gas companies. It is based on the research that came out from the federal government themselves.  When the draft rules were released, the production for oil and gas production in Canada is expected to increase by the end of the first compliance period, which was 2032.”

“So the production is continuing to grow. It is the emissions that are being targeted with this policy, and it is the emissions that we need to cut down from the oil and gas industry because those are the ones that are driving climate change. Anything beyond that or anything trying to tie this policy into a way to reduce the production of oil and gas companies is just not acting in good faith and distorting the actual truth.”

Cortes Currents: Given that green technology could definitely pick up more than it is doing, when I hear all these threats about less production  I’m wondering should we care? 

Aly Hyder Ali: “I’ll make two points.” 

“The reason why I differentiate, and I emphasize the differentiation of emissions cap not impacting production, is because the federal government does not have jurisdiction on production.  There’s so much disinformation about this policy impacting the production. So it’s important to clarify what the focus of the oil and gas emissions cap is, which is the emissions.” 

“But to your second point about phasing out oil and gas, the future is renewable energy and we see this across the world. Renewable energy is growing. The trend is positive. Countries are transitioning from fossil fuels to renewable energy. It is the cheapest form of energy.” 

“Obviously. It does not have the same amount of impacts on our climate. There are no emissions associated with it compared to what we see in oil and gas.  It is the direction that the world is moving in and the direction that Canada as a whole needs to be moving in.”

“We do need to phase out oil and gas production because it is holding us back.” 

Courtesy Canada Energy Regulator

“We’ve seen it recently when it comes to the tariffs  that President Trump has implemented on again, off again, because we rely so much on trade with the US,  a lot of our oil, especially what we produce in Canada, is traded to the United States. Our economy is so significantly tethered to the production of oil and gas that  if governments, federal and provincial were able to invest in more renewables and less in fossil fuel expansion, that would just create a better future for Canadians. Not only just by  fighting climate change or keeping us protected from climate impacts, but also making our economy robust and diversified and not being tethered to fossil fuels.”

“So definitely we need to phase out oil and gas and definitely renewables are the future and the present, if we’re being honest.” 

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Cortes Currents: Is there anything else you’d like to say on this topic? 

Aly Hyder Ali: “Obviously in Canada, there is an election happening.  As a charity organization, environmental defense, we don’t compare platforms from each party, but one thing I feel like every party and every Canadian needs to understand is climate action is without a doubt popular amongst the entire country.  A vast majority of Canadians feel like Canada should be investing in renewable energy instead of fossil fuel developments. There are more than two thirds of Canadians that feel like Canadian governments should make climate action and protecting nature a high priority.”

“These are the voices of Canadians that will be voting in the coming month.  It is so important for leaders at the federal level, for our next federal government, for provincial leaders across the country, to be listening to Canadians and considering what we feel is important. Climate action is essential not only to to keep our planet clean, but to safeguard our livelihoods, to safeguard our future generations and to keep our economy diversified and resilient in face of any sort of external crisis like we’re seeing with the tariffs from the United States.” 

Links of Interest:

Top image credit: Environmental Defence – Cap Pollution panel. Jun 19, 2024. Photo: Environmental Defence; unless designated otherwise, charts above are taken from the National Inventory Report

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