Canada’s energy regulator turns a blind eye to dangerous global warming

The Canada’s Energy Future 2021 Report released last week by Canada’s Energy Regulator (CER) projects that the country’s oil production will peak seven years earlier than previously expected, but nonetheless offers reassurance: “Canadian crude oil production levels are resistant up to 2050 “. However, the CER report does not examine a path to reduce greenhouse gas emissions to zero by 2050, in line with the Canadian and international target. In doing so, CER has underestimated the risks to Canada’s economy and failed to inform the political decisions that lie ahead.

Failure to recognize dangerous global warming

In 2015, Canada and 200 other countries adopted the Paris AgreementThe goal of limiting warming to “well below 2 C”, ​​ideally 1.5 C. The commitment to 1.5 C was strengthened at last month’s climate summit in Glasgow in response to a 2018 report from the Intergovernmental Panel on Climate Change which warned of devastating and potentially irreversible impacts on humanity at 1.5 C. In Canada, we have already experienced death, suffering, and severe economic impacts from extreme heat, wildfires and floods at just 1.1 C.

CER forecasts Canadian fossil fuel production under different assumptions for global policies and energy prices. The scenarios that anticipate the growth of Canadian production are associated with higher levels of warming, but the CER does not highlight to what extent. The only stage at the International Energy Agency (IEA) World Energy Outlook 2021 which roughly aligns with CER’s “current policy” scenario anticipates 2.6 C of warming, well beyond the Paris target.

Do not analyze a zero net future

Limiting warming to 1.5 C requires a 45 percent reduction globally by 2030 and net zero by 2050. This year, Canada passed legislation setting a binding target to reduce its own emissions by 40 to 45 percent. percent below 2005 levels by 2030 and net zero by 2050. Canada is just one of the 136 countries They have set zero net targets.

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Although it is an agency of the federal government, CER has simply ignored Canada’s legal goal of net zero by 2050. The report also does not consider the global goal of limiting warming to 1.5 C.

The CER includes “towards net zero” scenarios, but only for electricity generation. And even that limited analysis lags behind the federal government’s commitment to achieving zero net electricity generation in Canada by 2035.

Overly optimistic scenarios

CER scenarios do examine current unrealistic projections for oil and gas production. Under CER’s “current policies” scenario, Canadian oil production is projected to continue to increase to 6.7 million barrels per day in 2040 before declining slightly thereafter. Gas production is constantly increasing, up to 40% above current levels by 2050.

This scenario assumes that the climate policies of Canada and other countries will remain unchanged until 2050. It is simply implausible that climate policies will not increase their ambition in the coming decades. In fact, the federal government has already announced plans for a number of new regulations, including a mandate that all new vehicles sold must have zero emissions by 2035, stricter methane standards by 2030, and a cap on production emissions of oil and gas with net reduction. -zero by 2050. These policies will increase production costs and reduce demand for Canadian oil and gas.

CER’s “evolving policies” scenario assumes that the ambition of Canadian and international climate policies is increasing, but at the same rate as in the past. Under this assumption, oil production is projected to peak lower and earlier, to 5.8 million barrels per day in 2032, before declining by one million barrels per day by 2050. Rather than increasing, the Gas production slowly declines to 16% below current levels in 2050.

However, even these evolving policies do not align with Canada’s new 2030 target and corresponding political commitments. Climate policies in other countries are also being implemented at a much faster rate than ever before.

Economic risks

Failure to anticipate the rapidly evolving policies of Canada and other countries and their commitments to net zero obscures the growing risks for Canada’s oil and gas sector.

Canada’s oil sands are among the most carbon-intensive sources of crude oil in the world. Therefore, efforts to reduce extractive emissions in Canada disproportionately hamper our country’s international competitiveness. Additionally, efforts by other countries to lower their emissions by reducing oil and gas consumption have implications for Canadian exports. As global demand contracts, prices will fall. New investments will be made in the unconventional oil sands of Canada. discounted from a contracting market ahead of other sources of crude due to relatively high production costs.

This message was brought home by the IEA’s 2021 World Energy Outlook, which unlike Canada’s Energy Future report, included a net zero scenario (1.5 C). The IEA’s net zero scenario anticipates deep reductions in global consumption of all fossil fuels. Although the IEA projects significant carbon capture and sequestration (CCS), it is primarily used to offset emissions from hard-to-reduce sectors such as steel and cement. The CCS does not save the demand for fossil fuels because, in a carbon-constrained world, they can be replaced for most purposes more cheaply by renewable energy.

The IEA report offers a sobering picture for Canada. As global ambition increases between your scenarios for 2.6 C (current policies) and 2.1 C (announced promises before COP26), Canada will experience a significant decline in oil production by 2030. It is the only country to do so, although others see reduced growth. The implications would be more dramatic assuming a future that keeps warming within 1.5 C to 2 C: academic modeling Based on these warming limits, he anticipates that Canadian bitumen exports will quickly disappear.

It is encouraging that Natural Resources Minister Jonathan Wilkinson has asked CER to include Canada’s net zero target in its 2022 report, but CER must also consider the net zero implications globally. Canadians need expert analysis to guide the momentous economic transformation that this country must undertake over the next three decades. Canada’s Energy Future 2021 falls short of that goal.

Kathryn Harrison is Professor of Political Science at the University of British Columbia.

Mark Jaccard is a climate change expert and professor of sustainable energy at Simon Fraser University.

Nicholas Rivers is Associate Professor in the Graduate School of Public and International Affairs and the Institute of the Environment at the University of Ottawa.

Angela Carter is Associate Professor in the Department of Political Science and the Balsillie School of International Affairs at the University of Waterloo.