10 Handy Facts About Canadian Energy that You Actually Probably Want to Know

Every day, we’re assailed with dozens of facts and figures about energy issues in Canada: how many jobs or royalties will come from a new pipeline, the annual growth rate of renewables, our per-person energy consumption.

But it’s often tricky to decipher truth from fiction.

That’s where the new 176-page encyclopedic report by veteran earth scientist and expert in coal and unconventional fuels David Hughes is meant to come in.

“Hopefully what it does is it provides the foundation of facts,” Hughes said in an interview with DeSmog Canada. “There’s a lot of rhetoric when it comes to energy. I wanted to make that quantitative so we actually had that bottom line of facts, rather than conjecture. I’m not trying to be prescriptive. I don’t have a magic answer. But I think we need to start with the facts.”

Over the course of 132 graphs and another 34 tables, Hughes — who worked for the Geological Survey of Canada for more than three decades as a scientist and research manager — meticulously chronicles and illustrates close to every imaginable part of Canada’s energy system.

There are four components to the report: 1) Canada’s actual energy production and consumption compared to the rest of the world, broken down into all the different sources; 2) the supplies and money from fossil fuel production; 3) electricity sources and trends; 4) emissions trajectories and targets.

Sounds like a few metric tonnes of info, right?

Well, while we highly recommend perusing through the report in its entirety, we’ve broken down some the 10 most noteworthy facts Hughes highlights in the report.

1. Canada uses a massive amount of energy

It might not come as a surprise to many, but Canada uses a lot of energy: more than five times the world’s average on a per-capita basis.

Hydroelectricity makes up a bigger proportion of our energy mix than other countries, but we have the exact average of dependence on oil and gas as everyone else.

When it comes to natural gas — used for heating and electricity generation — Canada uses 5.8 times the global average.

On the bright side, Canada’s coal consumption has been on the steady decline since the phase-out in Ontario. We’re already using half as much on a per-capita basis as the United States — and that trend will continue as Alberta shuts down its 18 coal-fired power plants in the coming years, with massive reductions in greenhouse gas emissions and air pollution.

2. There’s an incredible amount of hydro power in this country

Canada is the second largest hydropower producer in the world, trailing only China with its colossal Three Gorges Dam.

On a per-capita basis, Canada harnesses 20 times the power from dams as the global average — only beat out by Norway, which somehow generates 51 times the per-capita average (you’ll start to notice that Scandinavia excels at a lot of these things).

Plenty of forecasts of low-carbon futures predict that Canada will have to add a lot more hydro to the grid in the coming decades. But Hughes isn’t convinced, based on recent precedent.

“I don’t think there’s any way we’re going to build all those Site C sized dams and nuclear reactors [modelled in various reports],” he said. “Economics, ecology and public protest would be off the rails.”

3. But we kind of suck at non-hydro renewables

Unfortunately, that dam-building habit has meant Canada isn’t nearly as good at non-hydro renewables: sources like solar, wind, geothermal and biomass.

Compared to Denmark (23.7 per cent of energy from non-hydro renewables), Portugal (15.5 per cent) and Germany (12.7 per cent), Canada only generated a tiny 3.1 per cent of its energy from such sources in 2016.

That’s slightly below the world average.

This is expected to change in the coming years as provinces and territories shift towards renewables.

4. Industry uses most of the energy in Canada

While we’ve been talking about per-capita consumption, it’s not really that accurate because 51 per cent of Canada’s energy is used by industry for things like oil and gas, refining, mining, pulp and paper and chemicals. Another 23 per cent is used in transportation: freight trucks, passenger cars, airplanes.

That leaves only 14 per cent for residential and 12 per cent for commercial. In other words, it’s the big factories, mines and refineries that are using most of our energy — yet they’re often the same entities which receive exemptions or subsidies for emissions.

Given the industrial sector’s large dependence on fossil fuels to make or extract stuff, this has meant that Canada has an extremely high amount of energy required per dollar of GDP — higher than even China.

While Canada’s GDP is being slowly “decoupled” from emissions, we’re still a long ways from the lower carbon likes of Denmark or the UK.

5. Western Canada is littered with an unbelievable number of old wells

Most people will understandably picture the oilsands when they think about the Canadian oil industry. But the massive growth in extracting bitumen from Alberta’s northern boreal forest is actually a fairly new phenomenon, really kicking off around 2007.

Up until that point, conventional oil — the stuff you drill for in wells — had reigned. But production from that method peaked in 1973. That’s meant that steadily rising production has required more and more wells, as declining well productivity means that companies have to keep finding and drilling more.

“With conventional oil and gas, you’ve just got to keep drilling and pouring capital into it all the time, otherwise it goes down,” Hughes said. “Companies always drill their best land first. You always got for the sweet spots, where the best economics are.”

It’s something made even more frantic with fracking. At last count, fracking now accounts for three-quarters of all oil production from wells in Western Canada. Such wells result in high initial production but decline at an even more rapid pace than conventionals — up to 83 per cent over three years.

As a result, Western Canada is just littered with wells: more than 820,000 in total, including gas, oil and bitumen. Only 235,000 are still active. A full 38 per cent of the wells are listed as inactive, with another 11 per cent as suspended. That means companies haven’t actually dealt with the environmental liabilities — which may cost billions to reclaim in the future.

6. The oilsands still produces some of the highest carbon oil in the world

Politicians and industry often brag about Alberta’s world-class environmental regulations and claim that’s a reason to justify more oilsands expansion.

But the unfortunate reality is that Alberta oilsands crude remains incredibly carbon-intensive, with Suncor’s Synthetic H blend emitting 297 per cent as much pollution as the best-performing oil in the world (in Kazakhstan) and 161 per cent as much as conventional oil in Saskatchewan. Many other oils around the world produce cleaner barrels: Iraq, Kuwait, Brazil, Russia, UK and Norway.

It’s an incredibly energy intensive process, with an energy return on energy investment of 4:1 for in-situ and 8:1 for mining, compared to 17:1 for average global oil.

7. Alberta is receiving astonishingly little return on its oil

Another resounding narrative is that Alberta needs pipelines and oilsands expansion in order to generate massive revenues for government coffers, allowing it to build schools, hospitals and roads. But Alberta is actually receiving decreasing revenues on a per-barrel basis.

Since 1980, oil and gas production in Alberta has doubled. But royalty revenues are down by 90 per cent from that level.

Currently, non-renewable resource revenue makes up a mere 3.3 per cent of the government’s income. The same has happened in B.C., with gas royalties collapsing as production skyrockets. Corporate income taxes from fossil fuel producers have also collapsed by 51 per cent since 2006.

“The concept of high-grading and selling the best of our resources off for declining revenues to governments and people who own the resource doesn’t seem to be very smart,” Hughes quipped.

8. Fossil fuel jobs are also surprisingly low

You’d never know it from listening to Premier Rachel Notley and Prime Minister Justin Trudeau, but long-term fossil fuel jobs have effectively flatlined since 2006. Meanwhile, construction jobs now constitute 52 per cent of all jobs in the sector — but they’re short-term jobs and usually evaporate as soon as a project is completed.

In total, employment in oil and gas extraction totals less than three per cent of total Canadian employment, and around 12 per cent of Alberta’s employment.

Hughes was also intentional not to include so-called “spin-off” jobs in his reporting.

“What the politicians do is say ‘we’ve got to count all of the store owners and money that these workers put into the economy,’ ” he explained. “That sort of assumes the store owners would otherwise be unemployed, which is not accurate. A lot of the jobs numbers that are quoted are huge numbers of spin-off jobs.”

In total, employment in oil and gas extraction totals less than three per cent of total Canadian employment, and around 12 per cent of Alberta’s employment. https://t.co/5uaACUKV81

— DeSmog Canada (@DeSmogCanada) May 1, 2018

9. Meeting climate targets is going to be nearly impossible with oilsands expansion

Thanks to rapidly rising oilsands emissions, scheduled to hit 115 megatonnes by 2030, it’s appearing unlikely that Canada will hit its Paris Agreement target. Currently, we’re overshooting the mark by a full 66 megatonnes — meaning costly emissions credits will have to be bought.

It’s going to get way harder heading towards 2050. By then, oil and gas emissions will require the remainder of the economy to contract by more than 100 per cent. That will require a tremendous amount of low-carbon electricity to pull off, costing anywhere between $30 billion and $70 billion per year from 2017 to 2050.

Hughes is seriously doubtful this will happen — and instead calls for finding efficiencies and reductions from existing systems.

“Investing in reducing consumption will be a very big deal,” he said.

“To me, we have to do as much of that as we can first before spending a lot of money trying to replace business as usual. I don’t think it’s possible. Fossil fuels are just too useful, energy dense and convenient. All of our infrastructure is built based on them. But I think there’s a lot of low-hanging fruit for reducing consumption.”

10. We need to rely on facts to guide us forward

Hughes spent years chipping away at this report, compiling decades worth of knowledge and sources into one place. He said he’s going to continue updating it now that he has a template.

For the rest of us, the mammoth work now exists as an excellent reference and fact-checking resource for when something a politician or industry exec says sounds a bit off.

“I just want to provide a solid factual basis to go forward,” he concluded. “I’m a grandfather. I have a concern for future generations. I’m a little put off by some of the rhetoric I see on TV. We need to start with the facts and go from there. ”