Page 10 - NorthAmOil Week 47 2020

NorthAmOil COMMENTARY NorthAmOil

would be able to ignore future targets. having peaked in 2019. It is projected to drop by
Indeed, Canada has a record of failing to meet 12% by 2030 and 35% by 2050, with coal being
targets in this area. In 2011, former Canadian phased out of power generation altogether.
Prime Minister Stephen Harper pulled the However, both oil and gas production are pro-
country out of the Kyoto Protocol, as it was fac- jected to keep rising, peaking in 2039 and 2040
ing billions of dollars in penalties if it remained respectively thanks to the expansion of existing
after falling behind with its targets. in-situ oil sands projects and growing LNG
Canada is now set to miss its 2020 target exports.
under the Paris Agreement, as well as being on “Achieving net-zero greenhouse gases
track to fall short of its 2025 target. Under the (GHG) emissions in Canada within the next
Paris Agreement, Canada is supposed to reduce 30 years will require stronger policies and
its emissions by 30% by 2030 compared to 2005 greater adoption of low-carbon technologies,”
levels. the CER said in a statement accompanying the
release of its outlook. “Canadian and interna-
A role for fossil fuels tional efforts to reduce GHG emissions will be Canada is now
The CER’s energy outlook, which was released a critical factor in how energy systems evolve
within days of Trudeau’s bill being proposed, in the long term.” set to miss its
shows that fossil fuel use can decline between While the CER does not rule out the possi- 2020 target
now and 2050 depending on the speed of the bility that Canada’s fossil fuel consumption has
energy transition. However, it is expected to already peaked and will carry on declining, its under the Paris
continue playing a dominant role in the fuel mix. comments point to the scale of the challenge
The CER’s outlook includes two scenarios – a ahead if this is to be achieved. Given the impor- Agreement, as
reference energy system scenario and an evolv- tance of policy in driving the energy transi-
ing energy system scenario. Under the reference tion in the CER’s view, this could prove to be a well as being
energy system scenario, fossil fuel consumption particular stumbling block for Ottawa unless on track to fall
is relatively unchanged between now and 2050, Trudeau succeeds in winning support for more
with steady improvements in energy efficiency stringent climate change legislation. short of its 2025
offsetting population growth and rising indus- And without a more rapid energy transi-
trial output, particularly in the oil sands. Under tion, driven primarily by tougher policies and target.
this scenario, natural gas plays a larger role in evolving technology, the CER still sees fossil
the electricity mix over time and future pro- fuels accounting for over 60% of the fossil fuel
duction of oil and gas is greater owing to higher mix by 2050. While much of Canada’s oil and
prices and a relative lack of domestic climate gas production is geared towards exports, this
change policies beyond what is already in place. nonetheless suggests that the country’s energy
Under the evolving energy system scenario, transition is not anticipated to kill off the oil and
meanwhile, fossil fuel consumption is shown as gas industry any time soon.™

P10 www. NEWSBASE .com Week 47 26•November•2020