Lobby group says emissions cap could cost oil and gas sector $75B in lost investment
CALGARY — A brand new report commissioned by an trade foyer group on the federal authorities’s proposed emissions cap stirred up sturdy reactions from each oil and fuel supporters and environmental teams on Monday.
The report, by S&P Global Commodity Insights, was commissioned by the Canadian Association of Petroleum Producers to look at the affect of varied proposed emissions-reducing insurance policies on Canada’s standard (non-oilsands) oil and fuel producers.
Its conclusions Monday had been used to assist the trade argument that legislating an emissions ceiling will inhibit funding and development, at the same time as opponents argued the report’s methodology was flawed.
The commissioned report concludes that if oil and fuel drillers had been required to chop greenhouse fuel emissions by 40 per cent by 2030, trade may see $75 billion much less in capital funding over the course of the subsequent 9 years in contrast with present coverage circumstances.
The examine says that will translate to at least one million barrels of oil equal much less of manufacturing per day by 2030 in contrast with present forecasts, and 51,000 fewer jobs by 2030 than beneath present authorities insurance policies.
The findings align with what Canada’s oil and fuel sector has lengthy been saying — that the federal authorities’s proposed cap on emissions from the trade will quantity to a de facto cap on fossil gasoline manufacturing.
On Monday, CAPP president Lisa Baiton stated the brand new report is proof {that a} federally mandated emissions cap “should not proceed.”
“Declines in production forced on the industry by a stringent emissions cap will result in significant job losses for Canadians, severe impacts on the economy and our GDP, and have the potential to compromise Canada’s energy security and prosperity,” Baiton stated.
But the federal authorities has stated all alongside that the oil and fuel emission cap can be designed to restrict emissions, not oil and fuel manufacturing.
The authorities has stated the design of the emissions cap will take note of different laws, similar to Canada’s dedication to cut back oil and fuel methane emissions by at the least 75 per cent by 2030, in addition to complementary local weather insurance policies by federal and provincial governments.
And the hypothetical eventualities the CAPP-commissioned report examines don’t use the identical targets the federal authorities really proposes in its draft emissions framework, launched final December.
Under the proposed framework, the sector must reduce greenhouse fuel emissions by 35 to 38 per cent from 2019 ranges by 2030. The sector would even have the choice to purchase offset credit or contribute to a decarbonization fund that will decrease that requirement to chopping simply 20 to 23 per cent.
“CAPP has commissioned an analysis of a non-existent scenario. Everything in it flows from false assumptions that make it so deeply flawed, it amounts to disinformation,” stated Oliver Anderson, spokesman for Environment Minister Steven Guilbeault, in an e-mail.
CAPP says its sponsored examine provides within the projected affect of the federal authorities’s draft methane laws, which might require at the least a 75 per cent discount of oil and fuel methane emissions under 2012 ranges by 2030, and takes under consideration that the insurance policies haven’t been finalized and stay unsure.
Environmental teams had been fast to criticize the report’s methodology. Clean power think-tank The Pembina Institute stated the CAPP report consists of solely standard oil and fuel drillers and leaves out oilsands manufacturing, which accounts for the overwhelming majority of the trade’s emissions profile.
The Pembina Institute added that relating to methane, which is the place the majority of standard drillers’ emissions come from, important reductions may be made utilizing already present, cost-effective applied sciences.
“Pembina Institute research demonstrates that the proposed 2030 emissions cap can be feasibly met by the oil and gas industry, almost entirely through a combination of methane reductions (which would mostly come from the conventional sector) and the Pathways Alliance’s 2030 emissions reduction plan (for the oilsands),” the think-tank acknowledged in a launch.
While the oil and fuel sector is Canada’s heaviest-emitting trade, the majority of these emissions come from the oilsands sector — the place rising manufacturing is contributing to elevated to complete emissions.
Emissions from the standard sector, which the CAPP studies focuses on, have been declining since 2014.
Alberta Premier Danielle Smith additionally waded in Monday, issuing a joint assertion with the province’s surroundings and power ministers by which she referred to the proposed cap as a “reckless gamble that will devastate Canadian families and do nothing to reduce global emissions.”
This report by The Canadian Press was first revealed May 27, 2024.
Amanda Stephenson, The Canadian Press
