Archive

June 2021

Browsing

Five of Canada’s largest oil sands producers operating 90% of oil sands production, including Suncor Energy, Canadian Natural Resources, Cenovus Energy, Imperial, and MEG Energy, today announced the Oil Sands Pathways to Net Zero initiative (the Initiative). The Initiative aims to work collectively with the federal and Albertan governments to reach net zero greenhouse gas (GHG) emissions from Canadian oil sands operations by 2050 and help Canada to meet its Paris Agreement and 2050 net zero commitments.  This bulletin provides key highlights from the announcement. Carbon Capture, Utilization and Storage. The Initiative proposes collaborating with industry and government to create a Carbon Capture, Utilization and Storage (CCUS) CO2 trunkline system connecting oil sands facilities in the Fort McMurray and Cold Lake regions to a sequestration hub in Cold Lake with the potential for future links to the Edmonton region, modeled on similar systems in Norway and CCUS projects in the Netherlands, U.K., and U.S. Investment. The Initiative will require significant investment by industry and government in research and development for new and emerging technologies, such as direct air capture, aimed at reducing and removing GHG emissions as well as deploying GHG reduction technology, including hydrogen, process improvements, energy efficiency, fuel switching, and electrification. Indigenous Partnerships. The Initiative will seek to partner and work with the federal and Alberta governments, to ensure that local Indigenous communities benefit from both emissions reductions and Canadian resource development. For further information or to discuss the contents of this bulletin, please contact Lisa DeMarco at lisa@resilientllp.com.

Environment and Climate Change Canada (ECCC) has published proposed amendments to the Output-Based Pricing System (OBPS) Regulations (the Regulations) under Part 2 of the federal Greenhouse Gas Pollution Pricing Act (GGPPA) (read our earlier bulletin on the GGPPA here). The proposed amendments seek to maintain the incentive to reduce greenhouse gas (GHG) emissions in the OBPS and increase the accuracy of the values output and GHG emissions and emissions limits calculated by covered facilities. In addition, the proposed amendments are an attempt to clarify certain provisions of the Regulations to ensure compliance is consistent with the policy intent of the OBPS and GGPPA. This bulletin briefly summarizes the proposed amendments: Rules relating to surplus credits and payments. The proposed amendments provide new rules for when a province is removed from the OBPS including: – increasing the circumstances that allows the Minister to suspend surplus credits; – limiting the use of surplus credits by not allowing them to be used to meet a compensation obligation -for a compliance period during which a province is not participating in the OBPS; and – providing for the lifting of the suspension of surplus credits, provided they are still eligible for use, when they are used to meet a compensation obligation for a compliance period during which a province was part of the OBPS. Rules relating to quantification and verification. The proposed amendments will: – repeal the provisions related to improved precision in a covered facility’s assessment of GHG emissions and replace it with a requirement that the difference between a covered facility’s GHG emissions during a compliance period and its emissions limit during that same period be rounded to the nearest whole number; – update emission factors used in the quantification of GHG emissions from fuel combustion by incorporating the emission factors from the…

Nature United (NU) last week released its peer-reviewed study titled Natural climate solutions for Canada (the Study). The Study outlines and provides substantial research into the mitigation potential for natural climate solutions (NCS) to reduce Canada’s GHG emissions and help contribute to meeting Canada’s commitments under the Paris Agreement and reaching net-zero by 2050. NCS are action to protect, manage, and restore forests, grasslands, agricultural lands, and wetlands. This bulletin provides an overview of the key findings of the Study.   The Study determines that Canada may reduce its GHG emissions by up to 78 Mt CO2e annually in 2030, representing 11% of Canada’s current annual emissions. Specifically, the Study identifies the following NCS and their potential for reducing emissions: Agricultural Land. Improved agricultural practices would reduce emissions by 37.4 Mt CO2e/yr. Grasslands. Protecting and sustaining grasslands from conversion would reduce emissions by 12.7 Mt CO2e/yr. Wetlands. Protecting wetlands as well as peatlands from harvesting and avoiding disturbance would reduce emissions by 13.5 Mt CO2e/yr. Forests. Conserving old-growth forests in managed forests lands, not burning woody residues for conversion into bioenergy, and maintaining and planting trees would reduce emissions by 3.8 Mt CO2e/yr. The Study explored the mitigation potential of protection, management, and restoring pathways for NCS at both $50/t CO2e and $100/t CO2e, noting the expected new jobs and revenue streams for Indigenous communities, farmers, ranchers, and foresters. Key findings include: Protect. The mitigation potential for protection pathways for NCS are 7.6 Mt at $100/t and 6.4Mt at $50/t. Manage. The mitigation potential for management pathways for NCS are 30.3 Mt at $100/t and 19.6Mt at $50/t. Restore. The mitigation potential for restoring pathways for NCS are 1.7Mt at $100/t and 0.3Mt at $50/t. The Study estimated the annual mitigation potential for each province, determining that Saskatchewan, Ontario, Quebec, British Columbia,…