Can Trudeau Possibly Square New Pipelines with the Paris Agreement?

On Nov. 29, the federal government granted conditional approvals for the twinning of Kinder Morgan’s Trans Mountain pipeline and the Enbridge Line 3 pipeline replacement project.

If built, the two pipelines will add just over one million barrels per day of export capacity from Alberta’s oilsands. Expectedly, many Canadians cried climate foul.

And, equally as predictably, there’s been a litany of arguments criticizing people for protesting the approvals.

The University of Calgary’s Trevor Tombe penned a thoughtful essay for Maclean’s contending that “blocking pipelines achieve less emissions reductions, at substantially greater cost, than the most efficient approach of pricing carbon.” In another vein, former Alberta Oil Magazine editor Max Fawcett suggested in an op-ed for Vancouver Is Awesome that “if you oppose the expansion of the Trans Mountain pipeline, you’re effectively being an environmental NIMBY.”

It’s true not all anti-pipeline rhetoric gets the numbers right, especially when it comes to the slippery practice of predicting emissions growth.

There’s no guarantee, for instance, that the two pipelines will generate 23 and 28 megatonnes (Mt) of new emissions as suggested by some. There’s also no guarantee oil in the expanded pipeline network won’t simply displace oil from rail transport. So when it comes to emissions counting, the incremental impact of these projects on overall emissions is hard to pinpoint.

But even despite those vagaries, Canadians concerned about climate change, or concerned about our international climate commitments, have some very legitimate reasons to protest the federal approvals.

Paris Agreement Requires Canada To Cut 291 Megatonnes of Emissions by 2030

Of course, that’s assuming Canada intends to honour international climate commitments. Some Canadians might even oppose those commitments — but that’s a very different story.

Under the Paris Agreement, Canada committed to reducing greenhouse gas emissions to 30 per cent below 2005 levels by 2030, which would drop the total to 524 megatonnes (Mt) of carbon dioxide equivalent a year.

The government also loosely committed to the “high ambition” goal of keeping temperatures below 1.5 degrees Celsius of warming, which would require a reduction to 400 Mt by 2030. In addition the federal government committed to an 80 per cent reduction in emissions by 2050, a goal that requires dropping emissions all the way down to 150 Mt per year.

So, how do new pipelines and the oilsands, Canada’s fastest growing source of greenhouse gas emissions, fit into those promises?

In its submission to the UN Framework Convention on Climate Change, the National Energy Board (NEB) estimates Canada’s emissions will hit 814 Mt per year by 2030. The oilsands are predicted to account for 115 Mt of that, up 43 per cent from 70 Mt in 2015.

Those numbers are “baked in” to the NEB’s 2030 estimates according to Erin Flanagan, federal policy director for the Pembina Institute.

“The reference case is bullish on fossil fuel development,” Flanagan says. “These numbers are not consistent with the Paris Agreement. These are not numbers that are aligned with Canada doing its fair share to address global climate change.”

“That’s the unfortunate reality of the NEB reference case,” she says.

“That’s why people call it a ‘coin toss on the climate.’ It’s not a Paris Agreement-aligned reference case.”

Oilsands to Expand with Global Oil Price Rebound

The Canadian Association of Petroleum Producers anticipates 3.7 million barrels per day of oilsands production by 2030, up from 2.4 million barrels per day in 2015.

(A July 2015 report by the Canadian Energy Research Institute pegged the 2030 higher, at 4.3 million barrels.)

Right now, oilsands producers aren’t moving enough oil to fill Canada’s pipelines. There’s currently 400,000 bpd of spare capacity in the pipeline network.

But that surplus could be rapidly filled with a recovery in global oil prices.

Brent oil prices are currently hovering around $53/barrel USD. In October, the National Energy Board predicted that Brent oil prices will hit $68/barrel USD by 2020, rising to $90/barrel USD in 2040.

But prices aren’t the only factor determining oilsands production in Alberta.

As part of Alberta’s Climate Leadership Plan, the provincial government introduced a 100 Mt cap on oilsands emissions. If per-barrel intensity remains the same, that cap would allow for about 3.4 million barrels per day of oilsands production, which could be accommodated via existing pipeline and rail networks with room for maintenance and outages.

But industry is planning for much more production than that. The National Energy Board is forecasting for 4.3 million barrels per day by 2040, an almost 80 per cent increase from 2015.

That’s where new pipelines such as Trans Mountain and Line 3 come in, providing a combined one million barrels in additional capacity to move product to heavy oil refineries in California and the Gulf Coast.

Andrew Leach, energy economist at the University of Alberta and former chair of the Alberta Climate Change Advisory Panel, tweeted back in April: “System will face constraints in the future, which is key to case for new pipes.”

The federal government has also reiterated its support for TransCanada’s Keystone XL pipeline, a project President-elect Donald Trump intends to approve, providing he can negotiate more profits for the U.S.

Keystone would add 830,000 barrels per day to the network, bringing the total pipeline capacity to 4.2 million barrels per day by 2030, exceeding the 3.7 million barrels per day of production.

An additional 1.1 million barrels of transport capacity will be brought online if the TransCanada Energy East pipeline is approved and another 400,000 barrels if the Enbridge Mainline expansion project proceeds (which is uncertain due to the potential approval of the Keystone XL).

These pipeline systems represent a significant potential to scale up production in the oilsands. So what does that actually mean for emissions?

Oilsands Would Account for Nearly 20 Per Cent of Allowable Emissions by 2030

Per-barrel emissions in the oilsands are high and getting higher by the year.

Between 2004 and 2014, per barrel emissions grew by 25 per cent, increasing from 50 to 63 kg of carbon dioxide equivalent per barrel. Most future growth in the oilsands will occur via in-situ extraction, which emits about 1.5 times the greenhouse gases than open-pit mining due to the use of natural gas to create steam.

Industry has hyped up the possibility of using new processes to cut in-situ emissions, but the technology is not expected to come into play for years.

As mentioned above the National Energy Board anticipates Alberta’s 100 Mt oilsands cap will be breached — reaching a total of 115 Mt — before 2030 (assuming, of course, that the cap isn’t simply tossed out by a new government before then.)

Suppose industry miraculously finds a way to cut per-barrel emissions by eight per cent, allowing producers to grow oilsands production to 3.7 million barrels per day — as projected by the Canadian Association of Petroleum Producers — while remaining within the 100 Mt cap.

David Hughes, expert on unconventional fuels and author of multiple reports for the Canadian Centre for Policy Alternatives, calculates that if industry produces up to the 100 Mt cap (a 43 per cent increase in production), oilsands emissions will take up a whopping 19 per cent of Canada’s entire allowable 2030 emissions budget.

“Saying that we’re going to grow oilsands by 43 per cent means our Paris Agreements are a bit Orwellian for me,” Hughes told DeSmog Canada.

“Even if the oilsands didn’t grow, it’s going to be extremely difficult [to meet our targets] given the time that’s left.”

In addition to oil pipeline approvals, Trudeau has also granted federal permits for major liquefied natural gas (LNG) export terminals in B.C. The Pacific Northwest LNG terminal is projected to be Canada’s single largest point source of emissions (11.5 to 14 Mt), producing more carbon pollution than even the giant Syncrude oilsands mine (12.5 Mt).

Assuming only one LNG export terminal is constructed in B.C., increasing oilsands emissions to 100 Mt would require non-oil and gas sectors — i.e. the rest of Canada — to contract by 47 per cent in emissions intensity in order for Canada to meet its climate target.

Federal Climate Policies Uncertain and Insufficient

So is that major reduction in non-oil and gas sectors going to happen?

The federal government insists that a potential increase in oilsands’ emissions will be negated by ‘upcoming climate policies.’

Problem is, no one as of yet knows what those supposed ‘upcoming’ policies are. The Prime Minister will meet with premiers at at First Ministers’ Meeting on December 9 to discuss the details of a much-anticipated pan-Canadian framework for climate action.

Stephen Guilbeault, executive director with Equiterre, said he hopes the government will finally release its climate “balance sheet” at the meeting.

“Without a balance sheet there is no way of knowing if this plan is delivering on what it says it does. What is enabling Canada’s emissions to go down? Why are they going up? To be able to adjust that plan over time and to have a genuine understanding and reassurance that we do have a plan that will put us on a path towards emissions reduction is needed for credibility,” Guilbeault says.

“Without the plusses and minuses it’s impossible for us to say whether premiers and the Prime Minister have delivered on that plan.”

He added the 2030 climate target gets a lot of attention but is by no means the end point for Canada’s climate commitments.

“Really 2030 isn’t the end. We have to totally or almost totally decarbonize our economy.”

Adam Scott, senior campaigner at Oil Change International, told DeSmog Canada that plan remains a mystery.

“The federal government has not demonstrated publicly in any way how their plan adds up,” he says.

Erin Flanagan from the Pembina Institute said nearly 100 Mt worth of emissions reductions can be pieced together from various mitigation measures: 30 Mt from a new clean fuel standard, 20 Mt from methane reductions, 18 Mt from the $50/tonne carbon price, 15 Mt from the coal phaseout and eight Mt from hydrofluorocarbon gas regulations.

But most of the meaningful emissions reductions are coming from the provinces, not federal leadership.

When it comes to phasing out coal, for example, only five Mt of emissions reductions will specifically occur due to federal policy (a number which Hughes describes as “absolutely trivial” compared to the anticipated gap from the 2030 target). Alberta and Ontario will take credit for the lion’s share of coal-related reductions.

But despite those gains made at the provincial level, continued oil and gas development, as anticipated by the NEB, means Canada’s emissions will only be reduced to around 715 Mt by 2030.

Under the Paris Agreement, Canada committed to a target of 524 Mt by 2030, leaving a gap of 191 Mt.

“That is a very different than the reality of of Canada living up to the Paris Agreement,” Flanagan says. “To meet that we need to fuel switch our entire economy. We need to run our homes and lives on clean electricity.”

Liberals Have Already Flip Flopped on Key Election Issues

Flanagan says the federal government has an excellent opportunity to present an updated plan at the First Ministers’ Meeting that details all sources of emissions, current and proposed policies, how those policies will reduce emissions and what further measures will be taken to reach the 2030 target.

But the federal Liberals have established quite the track record as of late for ignoring reports and findings, resulting in major flip flops on issues from electoral reform to marijuana legalization.

When it comes to pipelines specifically, cabinet seemed to totally disregard the six questions posted to it by its ad-hoc environmental review panel that asked the federal government how it intends to build new pipelines as well as fulfill its climate commitments.

So what the federal government intends to do nationally to reduce emissions in light of anticipated oilsands production increases is anyone’s guess.

The Liberals may be plan on allowing 115 Mt of oilsands emissions while attempting (somehow) to cut total emissions to 524 Mt by 2030.

Or perhaps they’re planning to dramatically increase carbon pricing to the $150/tonne or $200/tonne range experts say is necessary to bring emissions in line with national climate targets.

At this stage, we simply don’t know.

‘This Takes Us Completely In the Opposite Direction’

Whatever the federal government’s plan, they have plenty to do to show their work.

Sure, in the meantime uncertain, external forces could redefine the playing field.

Global oil prices may never bounce back, resulting in a natural slowdown of oilsands expansion as president-elect Trump expands U.S. domestic production.

Or, amazing new emissions-reducing technologies may be developed in the next year or two, allowing for 4.3 million barrels per day to be developed in 2030 without seriously undermining climate commitments.

The Trans Mountain and Line 3 pipelines may even be constructed but barely used, failing to deliver on promises made to company shareholders.

But one thing is certain: the urgency of the climate crisis will not wane. The power of the oil and gas lobby in Canada isn’t likely to subside and the challenge of increasing emissions from the oilsands while meeting our climate commitments isn’t likely to resolve itself.

“I don’t think it’s possible for Canada to meet its targets if it allows the tarsands expansion that this pipeline will facilitate,” Scott concludes.

“We know Canada’s target is already super weak. They’re really struggling to find all the pieces that would get them to their target.

Building new pipelines, Scott said, “takes us completely in the opposite direction.”

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