Jack M. Mintz: The least-cost path to net zero needs oil and gas
Note to Trudeau government: In the middle of a deep recession, we need a low-cost carbon plan that will have the least impact on growth
The Trudeau government on Thursday announced legislation, Bill C-12, committing Canada to “binding” five-year targets to achieve net zero GHG emissions by 2050. As the target is to be legislated without an enforcement mechanism, however, it’s not exactly clear what “binding” means. The real danger underlying Bill C-12 is that it gives considerable latitude to the government to bring forward regulations to adjust the target, thereby avoiding further legislation.
These targets are developed without knowing the economic or budgetary costs. Nor do we know the technologies required to achieve those targets. And if other countries fail to achieve the same objective despite their “commitments,” we could incur considerable economic loss with little benefit in terms of reducing climate change threats.
Climate change is a global issue, requiring global co-operative action. If the past tells us anything, the world has reduced both energy and emissions intensity per unit of GDP by substituting cheap natural gas for coal, improving energy efficiency and increasing its use of renewables and bio-energy.
Many false prophets predict the imminent end of oil. Instead, I like to listen to the science
Where technologies are not widely available or affordable, however, especially in the industrial and long-haul transportation sectors, emissions have not fallen. According to the International Energy Agency, global CO2 emissions rose 10 per cent between 2010 and 2019, from 30.2 Gt (gigatonnes) to 33.3 Gt. While advanced countries reduced CO2 emissions by nine per cent, other parts of the world increased emissions by 22 per cent over the same period.
As for Canada, GHG emissions grew seven per cent over these nine years, from 526 Mt (megatonnes) to 565 Mt. This reflects 36 per cent growth in energy production, our largest net export. As a result, emissions have increased even though we have reduced intensity by almost 30 per cent.
Source: Jack M. Mintz | Financial Post