Developing more of Canada’s energy resources can help in the fight against climate change. How? Sean Speer and Ian Lee, writing in the Financial Post, explain.
By Sean Speer and Ian Lee, Feb. 19, 2016
Canadians pride ourselves on being positive contributors to global affairs. We want to do our part.
The Trudeau government has embraced this national self-image. The prime minister has said that “Canada will take on a new leadership role internationally” and has pledged $2.65 billion to help developing countries tackle climate change as part of this vision of global leadership.
Yet Canada’s real contribution to global climate change isn’t financial pledges. And as the source of less than two per cent of global emissions, neither will major domestic emissions reductions.
It may seem counterintuitive, but our biggest contribution might be to develop our energy resources and sell them to developing countries that rely on dirtier energy sources. A pro-resource development agenda may not only be good for the Canadian economy, it can be good for the planet.
Let’s use China as a case study. China is now the world’s largest energy consumer and largest source of energy-related carbon emissions. Two-thirds of China’s energy consumption derives from coal. Coal has the highest carbon content of any fossil fuel. Projections show that China’s energy consumption will continue to rise, albeit at a slower pace than we have witnessed. Chinese policy is to shift its dependency from coal to cleaner energy sources over the coming decades.
It may seem counterintuitive, but our biggest contribution might be to develop our energy resources and sell them to developing countries that rely on dirtier energy sources.
Here’s where Canada’s energy resources come into play.
Canada is already the fifth-largest natural gas producer and has enough natural gas reserves to meet current national energy demand for 300 years. We have plenty of supply to export. And this matters because natural gas is a far cleaner alternative to coal. Natural gas combustion generates 50 per cent fewer emissions than coal. Gas-fired generating stations are also more energy efficient than coal-fired plants.
Oilsands development is also a cleaner alternative for countries like China that are balancing rising consumption demands and environmental goals. Consider, for instance, that the oilsands are the third-largest source of proven crude oil reserves in the world and projections show that, notwithstanding the sector’s current challenges, production is bound to grow for years to come.
As for its environmental footprint, analysis shows that the emissions intensity of oilsands development is not out of whack relative to other comparable energy sources. According to a 2013 report from the Department of Natural Resources: “Recent independent studies have shown that oilsands emissions are similar to a number of crudes, both heavy and light.” This accords with work by respected climate scientist and B.C. Green MLA Andrew Weaver, far from a proponent of oilsands development, which finds that burning the world’s coal reserves will contribute 40 times as much to climate change as exploiting all oilsands reserves. And the federal government reports that oilsands development is actually becoming more efficient — between 1990 and 2011, oilsands greenhouse gas emissions per barrel were reduced by more than one-quarter and are expected to decline over the coming years.
The point is that the oilsands, too, can provide a cleaner alternative energy source for developing countries.
Remember, the goal is to contribute to addressing global climate change. The question, then, is how can Canada make a meaningful contribution?
We can do our part with respect to curbing domestic emissions, but we must also be cognizant of the limitations of our effort. Canada’s greenhouse gas emissions represent roughly 1.6 per cent of global emissions and the oilsands are 0.15 per cent of our overall share. As the International Energy Agency’s chief economist has put it: “Compared to the major emitting countries, this is not peanuts, it is a small fraction of peanuts.”
The point is that the oilsands, too, can provide a cleaner alternative energy source for developing countries.
Canada’s new government is right to want to play a leading role. The first step is to remember that it’s a global issue and different countries will need to contribute in different ways. Canada is uniquely positioned to help developing countries reduce their dependence on carbon-intensive energy sources. But this will mean more — not less — resource development in Canada.
Ian Lee is an assistant professor in the Sprott School of Business at Carleton University and Sean Speer is a Senior Fellow at the Macdonald-Laurier Institute.
