Disaster capitalism in Alberta – oil and gas producers exempted from emissions reporting, testing for methane leaks

Although the Green Party of Canada has stirred up the hornet’s nest of oil politics in Canada by the “Oil is Dead” statement in May,  Alberta Premier Jason Kenney  continues to reject that idea, in word and deed.  Since the onset of Covid-19,  Alberta environmental rollbacks have been described as a textbook case of “disaster capitalism” and the government has been accused of “out-Trumping Trump . In April, the Alberta government made amendments to the Environmental Protection and Enhancement Act, Water Act, Public Lands Act and the newly implemented Technology Innovation and Emissions Regulations  – providing exemptions to oil and gas operators from reporting air quality emissions from smokestacks, tailings ponds, transportation and dust until Dec. 31, 2020.  Amendments to the Oil and Gas Conservation Act and the Pipeline Act could allow the Orphan Well Association to use federal and provincial emergency relief funds to  produce and sell oil from abandoned wells and operate abandoned pipelines.  Professor Saun Fluker summarizes the changes in a University of Calgary Faculty of Law blog post, “COVID-19 and the Suspension of Energy Reporting and Well Suspension Requirements in Alberta” (April 10). A broader analysis by two academics from the University of Guelph appears in “Disaster capitalism: Coronavirus crisis brings bailouts, tax breaks and lax environmental rules to oilsands”  (April 29, The Conversation), and Sharon Riley has written an  in-depth article , “8 environmental responsibilities Alberta can skip”  (The Narwhal, April 27).  Randy Christensen of Ecojustice has also written a brief article, “Warning: disaster capitalism”, which argues that “the governments of Alberta and Ontario have now made moves that are more far-reaching and potentially riskier”  than the Trump EPA roll-backs announced in March.  The reference to Ontario is based on the Ontario government’s April 1 regulation which temporarily suspends public consultation under Ontario’s Environmental Bill of Rights. And Newfoundland could also be considered for the list, according to “Newfoundland offshore drilling: a case of bending environmental impact rules” (National Observer, April 3) .

On May 6, the Edmonton Journal  and the Toronto Star  reported further exemptions by the Alberta government:  from the Star:   “A decision by the Alberta Energy Regulator in May, means that Imperial Oil, Suncor, Syncrude and Canadian Natural Resources Ltd. don’t have to perform much of the testing and monitoring originally required in their licences – including monitoring of  most ground and surface water; most wildlife and bird monitoring, and a reduction of air quality monitoring – with the suspension of testing for methane leaks.”    The Star article argues that many of the changes correspond closely to the demands made  by the Canadian Association of Petroleum Producers (CAPP) in March in a 13-page letter sent to federal ministers: Covid-19 Crisis Response – Actions Required regarding federal Policy and  Regulations .  Keith Stewart of Greenpeace Canada is quoted in The Star,  saying he “isn’t aware of any other jurisdiction in the world that has gone as far as Alberta to roll back environmental protections during the pandemic, including the United States under President Donald Trump.”

On May 7, Vice  published “What the hell is going on in Alberta?”, with this opening statement: “It’s safe to say Alberta is in crisis.”

Canada’s report to the UNFCC shows an increase in GHG emissions

ghg emissions_NIR 2018As required by the United Nations Framework Convention on Climate Change (UNFCC), Canada submitted its National Inventory Report on April 14, available from the U.N. website.   The Executive Summary   at the Canadian government website  announces that the Canada’s greenhouse gas (GHG) emissions were 729 million tons of CO2 and equivalent in 2018, (the latest figures available).  This is an increase of 15 million tons from 2017, and a reduction of only 1 million tons from 2005 – making Canada’s Paris Agreement target of a 30% reduction from 2005 levels a very challenging goal. The Executive Summary attributes the 2018 performance  to “higher fuel consumption for transportation, winter heating and oil and gas extraction.” The Toronto Star summarizes the official report in  “Canada’s emissions count jumped 15 million tonnes in 2018 from previous year, report shows” (April 15) ; a summary also appeared in The National Observer, focused on British Columbia.  The federal Green Party press release points out that Canada has missed the February deadline to submit its new target for Nationally Determined Contributions, and calls for Canada  to reduce our GHG’s to 60 per cent below 2005 levels by 2030.  (In comparison, the latest EU target under debate is a 55% reduction by 2030  ).

The full National Inventory Report presents statistics since 1990, and analyses trends by region and according to industries – including energy, industrial processes, agriculture, land use (forestry) and waste management. It also measures emissions in 2018 by important gases, including carbon dioxide, nitrous oxide and methane. Carbon dioxide (CO2) accounted for 80% of Canada’s total emissions. Nitrous oxide (N2O) emissions (76% of which come from agriculture) accounted for 5%  in 2018, a 2.4% decrease from 1990 levels. Synthetic gases (HFC’s, PFC’s, SF6 and NF3) constituted slightly less than 2% of national emissions.

Canada’s other big polluter: methane

According to Canada’s National Inventory Report, methane accounted for 13% of Canada’s total emissions in 2018, an increase of  1% since 1990.  43% of those emissions are attributed to fugitive sources in oil and natural gas systems and another 31% from agriculture.  The  International Energy Agency  also tracks methane emissions from the oil and gas industry here , and in February 2020 summarized and critiqued Canada’s new policies to reduce methane emissions attributable to the oil and gas industry.   Methane (CH4) is a growing concern for global GHG emissions – as reported in an article in  Scientific AmericanMethane levels reach an all-time high” (April 12) , which summarizes recent reports by the U.S. National Oceanic and Atmospheric Administration (NOAA) .

Review of Alberta’s Climate Leadership Plan and carbon levy; updates on renewables and methane regulations

env defence carbon-pricing-alberta-fbEnvironmental Defence released a report in December 2018, Carbon Pricing in Alberta: A review of its success and impacts  . According to the report, Alberta’s carbon levy, introduced in 2017 as part of the broader Climate Leadership Plan, has had no detrimental effect on the economy, and in fact, all key economic indicators (weekly consumer spending, consumer price index,and gross domestic product) improved in 2017. The report also documents how the carbon levy revenues have been invested: for example, over $1 billion used to fund consumer rebates and popular energy efficiency initiatives in 2017; support for Indigenous communities, including employment programs; a 500% growth in solar installations; funding for an expansion of light rail transit systems in Calgary and Edmonton; and prevention of an estimated 20,000 tonnes of greenhouse gas (GHG) pollution. The conclusion: the Climate Leadership Plan and its carbon levy is off to a good start, but improvement is needed on promised methane reduction regulations , and the regulations to enforce the legislated cap on oil sands emissions need to be released.

Methane Regulations:    The Alberta Environmental Law Centre published a report in 2017 evaluating the province’s methane emissions regulations. On December 13, the government released new, final regulations governing methane. On December 19, the Alberta Environmental Law Centre published a summary of the new Regulations here  

Since the Environmental Defence study, on December 17, the government announced  agreement on five new wind projects funded by Carbon Leadership revenues, through the  Renewable Electricity Program. Three of the five projects are private-sector partnerships with First Nations, and include a minimum 25 per cent Indigenous equity component to stimulate jobs, skills training and other  economic benefits. The government claims that all five projects will generate 1000 jobs.

On  December 19 the government also  announced   new funding of  $50 million from Alberta’s Climate Leadership Plan for the existing  Sector-specific Industrial Energy Efficiency Program , to support technology improvements in the  trade-exposed industries of pulp and paper, chemical, fertilizer, minerals and metals facilities.

Balanced against this, a December 31 government press release summarized how its “Made in Alberta ” policies have supported the oil and gas industry: including doubling of support for petrochemical upgrading to $2.1 billion; creation of a Liquefied Natural Gas (LNG) investment team to work directly with industry to expedite fossil fuel projects; political fights for new pipelines (claiming that “Premier Notley’s advocacy was instrumental in the federal government’s decision to purchase the Trans Mountain Pipeline”), and the ubiquitous Keep Canada Working  advertisements promoting the keepcanada workingbenefits of the Trans Mountain pipeline . The press release also references the November announcement that the province will buy rail cars  to ship oil in the medium term,  and the December 11 press release announcing that the province is  exploring  private-sector interest in building a new oil refinery .

Council delivers recommendations for Canada’s energy transition, including “cleaner oil and gas”

Generation energy council reportThe federal government established a  Generation Energy consultation process in 2017, to inform an energy policy for a low-carbon future.  That process concluded when the appointed Generation Energy Council presented its Report  to Canada’s Minister of Natural Resources on June 28.  The report, titled Canada’s Energy Transition: Getting to our Energy Future, Together, identifies “four pathways that collectively will lead to the affordable, sustainable energy future”: waste less energy, switch to clean power, use more renewable fuels, and produce cleaner oil and gas.  The report outlines concrete actions, milestones for each of these pathways – most problemmatic of which is the pathway cleaner oil and gas.  Each pathway also includes a general statement re the “tools” required, giving passing mention to  “Skill and Talent Attraction and Development”.

The priorities for the “cleaner oil and gas” pathway include: “reducing emissions per unit of oil or natural gas produced; • improving the cost competitiveness of Canadian oil and gas; and • expanding the scope of value-added oil and gas products and services for both domestic and export markets.”  The report lauds the potential of Carbon Capture Use and Storage (CCUS), as well as the economic value of the petrochemical industry. Amongst  the milestones in this pathway: “By 2025, reduce methane emissions by 40 to 45 percent from 2012 levels, with ongoing improvements thereafter.. …By 2030, reduce life-cycle greenhouse gas emissions for oil sands extraction to levels lower than competing crudes in global markets…Develop a trusted and effective regulatory system, including a life-cycle approach to greenhouse gas emissions, as measured by objective third party assessment of key attributes relative to competing jurisdictions…  By 2030, a more diversified mix of oil and gas products, services and solutions to domestic and global markets has a measurably significant impact on industry and government revenues.”

The Council was co-chaired by Merran Smith (Clean Energy Canada and Simon Fraser University)  and Linda Coady (Enbridge Canada); members are listed here . The Council heard from over 380,000 Canadians in an online discussion forum and in person. An impressive archive of submissions and commissioned studies, some previously published and some unique, is available here . Authors include government departments, academics, business and industry associations, and think tanks.

Methane regulations: a path to lower emissions and more jobs for Alberta

Dont Delay BlueGreen 2017 coverA July 2017  report by Blue Green Canada,   argues that the Alberta government should implement methane regulations immediately, rather than wait for the proposed federal regulations to take effect in 2023.    Speeding up regulations “could reduce air pollution, achieve our climate targets more cost-effectively, and create thousands of high-paying jobs in a single step”, according to Don’t Delay: Methane Emission Restrictions mean Immediate jobs in Alberta .  Blue Green estimates that Alberta’s oil and gas operations release $67.6 million worth of methane annually, and recovering it for energy use could create more than 1,500 new jobs in the province – well paid jobs,  including work in engineering, manufacturing, surveying, and administration.

Environmental organizations, labour groups and technology companies sent a joint Open Letter to Premier Rachel Notley in August, urging her to view the proposed federal methane regulations   as a floor, not a ceiling, and reiterating the argument for economic opportunity: “There are a number of innovative companies in Alberta ready to supply methane capture and detection technologies and services and a large majority of these companies report being poised for strong growth given the right regulatory signals.” The letter, from Blue Green Canada, Canadian Association of Physicians for the Environment, Iron and Earth, Keepers of the Athabasca, Pembina Institute, Peace River Environmental Society, Progress Alberta, Questor Technology, Unifor, and United Steelworkers is here.

Accelerating the target date for regulations is not the only concern.  “Five Ways Alberta Can Raise the Bar on Methane Regulations” at DeSmog Blog, (August 1) makes recommendations for tighter rules for venting and flaring, improved monitoring, and expanded scope. Also in August, the Environmental Law Centre of Alberta released Methane Reduction under the Climate Change Leadership Plan , the latest paper in its Climate Change Legal Roadmap series, which makes recommendations for improvements to both the provincial and federal regulations.  The task of developing methane regulations in Alberta falls to the Alberta Energy Regulator (AER), which has said that it is currently reviewing the feedback from its draft regulations, and will release a document for public comment in Fall 2017.

Alberta’s Climate Leadership Plan in 2015 called for 45 per cent reduction in methane emissions from the oil and gas industry by 2025. The Pan-Canadian Framework included a commitment to reduce methane emissions from the oil and gas sector by 40 to 45 per cent from 2012 levels by 2025, and in May 2017, the federal government released draft regulations beginning in 2020, with a second phase beginning in 2023.

Earlier, related reports:  In April, Environmental Defence released  Canada’s Methane Gas Problem: Why strong regulations can reduce pollution, protect health and save money , which demonstrated that methane emissions are higher than reported by industry: 60% higher in Alberta. Research funded by the David Suzuki Foundation and released in April, found that methane emissions in B.C. are 250% higher than reported.  The Cost of Managing Methane Emissions,  a June blog from the Pembina Institute, sheds light on the GHG savings to be had by instituting regulations.