October 29, 2007

Smoking in the Greenhouse

Tar sands growth makes meeting Kyoto targets less likely

by Yuill Herbert

The Dominion - http://www.dominionpaper.ca

Projected Greenhouse Gas (GHG) emissions by province. Source: "Canada's Energy Outlook," Natural Resources Canada, 2006

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The Kyoto Protocol is a legally binding agreement to the international treaty called the United Nations Framework Convention on Climate Change. Its objective is “the stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system.”

The Kyoto Protocol aims to reduce global emissions by five per cent by 2010. The UN's Intergovernmental Panel on Climate Change states that reductions of 50 to 85 per cent by 2050 are needed to stabilize the climate at safe levels.

Under the Kyoto agreement, Canada is committed to reducing emissions to 563 megatonnes. At current trends, Natural Resources Canada projects Canada's emissions will exceed this level by 36 per cent--or 265 megatonnes--by 2010. By international law, countries that exceed their targets are required to make up the difference, plus an additional 30 per cent, in the next commitment period.

In a detailed analysis, the Pembina Institute concluded in 2005 that oil sands are the single largest contributor to greenhouse gas (GHG) emissions growth in Canada, with a rapidly increasing share of the country's total emissions. Emissions from the oil sands are projected to increase between 450 and 560 per cent between 2003 and 2020.

Commercial development of the oil sands began in 1967. In 1995, the Alberta Chamber of Resources laid out a strategy that envisioned tar sands production doubling or tripling by 2020. This timeline was exceeded by 16 years--oil sands production more then doubled by 2004 to 1.1 million barrels per day. Current projections range from the Canadian Association of Petroleum Producers' estimate of 2.7 million barrels per day by 2005 to the government of Canada's estimate of 6 million barrels per day by 2030.

Sources: "Canada's Energy Outlook," Natural Resources Canada 2006. "The Climate Implications of Canada’s Oil Sands Development," Pembina Institute 2005.

Greenhouse gas emissions projections for the oil sands are complex. For example, high pressure steam is used to melt the bitumen so it can be extracted from the sand--for this reason, producing oil from bitumen results in three times the greenhouse gas emissions compared with the equivalent barrel of light or medium crude. While relatively clean-burning natural gas is currently used to provide the steam, proposals for coke or bitumen could double the emissions, while nuclear power would lower greenhouse gas emissions but produce nuclear waste.

The federal government has not publicly released its projections of future GHG emissions from the oil sands since December 1999. However, the rapid growth of the oil sands corresponds with the dramatic increases in the government's estimate of how much Canada will overshoot its Kyoto target. In 1997, Canada anticipated its emissions would exceed its Kyoto target by 137 MT, whereas the most recent estimate in 2005 was 270 MT, a one hundred per cent increase.

Pembina Institute offers the only concrete numbers. In 2003, emissions from the oil sands accounted for 3.4 per cent of Canada’s total. As the oil sands continue to grow, Pembina projects that by 2010 they will account for 7.5 to 8.2 per cent of Canada's total emissions, under current trends.

Between 2000 and 2020, the Canada Research Energy Institute anticipates that development and production activities in the oil sands will lead to an increase in GDP of $885 billion, reaching three per cent of the country's total GDP by the end of 2020. As Stéphane Dion famously stated in an interview when he was environment minister: "There is no minister of the environment on Earth who can stop this [oil sands development] from going forward because there is too much money in it."

At the UN emergency meeting on climate this October, Stephen Harper stated, “The core principle of Canada’s approach to climate change is balance. We are balancing environmental protection with economic growth.”

Harper's greenhouse gas emissions strategy is based on carbon intensity. This means that instead of reducing overall GHG emissions, oil sands projects can successfully meet the Harper government targets while, reports Pembina, quadrupling output with the end result of tripling emissions. The regulations also give new oil sands projects a three-year grace period from any emissions restrictions, with an unknown impact.

The Pembina Institute is calling for the oil sands to be carbon neutral by 2020 by using a combination of offsets and carbon capture and storage. Such a strategy has its detractors; organisations such as Carbon Trade Watch argue that offsets encourage a business-as-usual approach, when in reality dramatic changes are required.

Source: The Climate Implications of Canada’s Oil Sands Development Matthew Bramley, Derek Neabel and Dan Woynillowicz. 1995- the Pembina Institute.

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