Today an oil tanker carrying between 500,000 and 600,000 barrels of western Canadian oilsands (also called tarsands) bitumen arrives in Bilbao, a port city in northern Spanish. It is the first shipment of Canadian bitumen to the European Union and a sign the federal government’s “pan European oilsands advocacy strategy” is succeeding.

“This shipment could open the door to more imports of dirty tarsands," says Franziska Achterberg of Greenpeace from Brussels. "Europe can’t be both a climate champion and a market for climate-wrecking tar sands. The EU must uphold its environmental credentials and stand up to the intense lobbying by the oil industry and the Canadian government."

Prime Minister Stephen Harper's government has been lobbying the EU since 2009 to keep its markets open to bitumen. Internal documents have shown the federal government has used its embassies in Europe “to protect and advance Canadian interests related to the oil sands.”  

EU Could Lose Credibility As World's Climate Leader

The European Union has set ambitious but necessary targets to reduce its production of global-warming greenhouse gas emissions by 40 per cent by 2030 (based on 1990 levels). No other developed country including Canada has even come close to matching this. If the EU continues to import more bitumen it will undermine its credibility as a world leader on climate change, experts say.

“The landing of massive amounts of dirty tar sands to our shores runs counter to Europe’s stated aspirations to decarbonize transport and curtail its addiction to oil. European drivers will be forced to fill up their tanks with tar sands that will raise emissions – not lower them – and push up the costs of decarbonization by billions of euros,” says Laura Buffet of Transport & Environment.

Fives Years On, Fuel Quality Directive Still Not Implemented

For years, the EU has wanted to pass legislation encouraging European transport fuel suppliers to decrease the carbon footprint of their product. The Fuel Quality Directive confirms fuels produced from bitumen have a higher carbon footprint (12 to 40 per cent higher) than fuels from conventional oil. Because bitumen is a heavy unconventional tar-like oil it requires vastly more energy to extract and process, resulting in more greenhouse gases than conventional oil.

The Fuel Quality Directive would be a disincentive for purchasing highly polluting fuels, such as oilsands. Fearing a “dirty oil” label being slapped on Canadian bitumen if the Fuel Quality Directive is passed, the Canadian government has lobbied against it in a manner one EU politician describes as something never seen before:

“There have been massive lobbying campaigns by the car industry, by the chemicals industry, banks, food giants, etc. But so far I have not seen such a lobbying campaign by any state,” Satu Hassi, a Finnish Member of European Parliament told Reuters in 2012 about the Canadian lobbying against the directive.

7% of EU's Fuel Supply Could be Bitumen by 2020

With the Fuel Quality Directive still in limbo (the last vote on the directive ended in a stalemate), Spanish oil company Repsol’s bitumen shipment will most likely not be the last. Repsol has reportedly been investing in upgrading its refineries to process heavy bitumen. Much like Canada, very few refineries in the EU have the necessary refining equipment to turn bitumen into fuels.

“To the refiner, it’ll just be the price you can get and the product you get after refining it, so they wouldn’t care what the source is. They wouldn’t think about the carbon content at all,” Torbjørn Kjus, an oil analyst at DNB Markets told the RTCC news service.

A report earlier this year by the Natural Resources Defense Council estimates bitumen could make up nearly seven per cent of the EU’s total transport fuel supply by 2020 if oilsands pipeline projects such as Keystone XL in the U.S. and Energy East from Alberta to Saint John, N.B., are approved. Combined, the two TransCanada pipelines could pump approximately two million barrels of bitumen every day. Much of this will be exported out of North America.

Image Credit: Transport Canada

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This is a guest post by energy and environment economist Mark Jaccard. It was originally published on his blog, Sustainability Suspicions.

Prime Minister Harper promised in 2006 to reduce Canadian emissions 20% by 2020 (in 2009 he changed it slightly to 17%). Only two policy approaches can achieve this: emissions pricing or regulations (or a combination). But he rejected emissions pricing, whether carbon tax or cap-and-trade. So this leaves regulations on technologies and fuels, which he promised. However, he has not implemented regulations to achieve his 2020 target, and, according to Canada’s Auditor General, even an immediate aggressive effort is unlikely to succeed – he only has 7 years left after doing virtually nothing since making the promise 7 years ago.

In any case, he is instead promoting rapid expansion of the Alberta oil sands, which, according to Environment Canada, will leave Canadian emissions in 2020 at least 7% above rather than 17% below their 2006 level.

In contrast, both the European Union and California have adopted serious fuel and technology regulations that independent experts agree will achieve the more aggressive 2020 emissions targets of these jurisdictions. Both governments also recognize that it is futile and foolish to spend money on domestic emission reductions if these are offset by higher emissions elsewhere.

It makes no sense to switch to hybrid-electric cars in California if the resulting increased demand for electricity is provided by coal-fired power plants in Arizona or Alberta. And it makes no sense to improve vehicle efficiency if a growing amount of gasoline sold in California is produced from high emitting production processes, like that of the Alberta oil sands.

This is why California has adopted a renewable portfolio standard for electricity, that restricts imports of high emission electricity, and a low carbon fuel standard for vehicle fuels, that restricts imports of high emission gasoline and diesel. There really is no other way to act responsibly in a world in which global-scale emissions pricing is unlikely to happen any time soon.

In the same vein, Europe is trying to finalize the implementation of a Fuel Quality Directive that looks upstream to consider the emissions caused by producing a given fuel, and restricts market share for high emitting sources, including oil from the Alberta oil sands.

If one takes a regulatory approach to climate policy, as Stephen Harper professes to support, these are the kinds of regulations you have to implement. They are messy.

But there is no alternative to such regulations that try to distinguish and restrict higher emission fuels and technologies, whether the high emissions occur at the point of consumption or production.

This is why it is so ironic that the Harper government, with its “apparent” preference for regulations, has undertaken an aggressive lobbying campaign to convince Europeans to emasculate their Fuel Quality Directive so that Canada’s high emission oil sands are treated no differently than low emission sources. It has been joined in this effort by the Alberta government and, of course, the oil industry.

All together, the Harper government’s approach can be summarized as follows:  (1) It promises to reduce emissions by a specific amount. (2) It promises to use regulations to meet its emission promises. (3) In 7 years, it has not implemented regulations that would meet its emission promises. (4) Instead, it lobbies Europeans to prevent regulations that would actually help Canada achieve its targets.

Tired of this hypocritical position of the Canadian government, some European politicians invited Jim Hansen and me to Europe in early May of this year to provide an alternative perspective, one that focuses on how to achieve the promise that Harper and other global leaders made in 2009 to prevent global temperatures from increasing more than 2° C in this century. [For Jim's perspective on this, see this post].

In Brussels we spoke to an audience of European parliamentarians (as well as Canadian and Albertan government lobbyists who seemed to be tracking us). In Berlin, Paris, London and The Hague we met with elected officials, senior bureaucrats, and senior political advisors to Chancellor Merkel of Germany and President Holland of France. We also met in London with the UK Minister of Transport and appeared before a parliamentary committee.

As a climate scientist, Jim explained that the 2 °C promise of Harper and other leaders means that most fossil fuel resources on the planet cannot be burned; virtually all leading climate scientists agree that these are “unburnable assets” if we are not to exceed a 2 °C increase. As an energy and environment economist,

I explained that virtually all leading energy system analysts agree that the oil sands, and other unconventional oils, should not be rapidly expanding. As a team from MIT said in a recent report, “The niche for the oil sands industry seems fairly narrow and mostly involves hoping that climate policy will fail.”

How was our tour?

To be honest, I was shocked at how warmly we were received. I think every person we met mentioned several times how happy they were to finally meet a Canadian who was not trying to convince them that expanded oil sands production (and hence greater carbon pollution and climate change) was in their interests. I left feeling that many European politicians will work hard to sustain their climate policy, difficult as this is with economic concerns so dominant.

But will the Europeans have the fortitude to stick with their policy? That’s more difficult to say. Lobbyists for oil companies with a lot of money can wield a lot of influence. And when they have a national government using all sorts of trade threats and diplomatic pressure on their behalf, their power is that much greater.

Still feels like these are very dark times for us all.

Image Credit: Kris Krug via flickr.

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