canada’s carbon conundrum - in1touchs...canada nfld ns pei nb qc on mb sk ab bc terr change in...
Post on 11-Mar-2021
1 Views
Preview:
TRANSCRIPT
Canada’s Carbon Conundrum: Energy and growth in a climate-constrained world
J. David Hughes
Global Sustainability Research Inc.
October 29, 2020
Outline
- Carbon emissions in Canada and the World.
- The emissions reduction target for 1.5C warming.
- Canada’s current emissions by economic sector and province.
- Emissions projections given current oil and gas production forecasts.
- Government policy that guarantees targets will not be met.
- Trends in energy sector contributions to Canada’s economy.
- Realities of renewables and the way forward.
0
10
20
30
40
50
60
70
80
90
100
1850 1870 1890 1910 1930 1950 1970 1990 2010
% o
f 20
17 T
otal
Con
sum
ptio
n R
ate
Year
NuclearGasOilCoalHydro/renewablesWood
Total World Energy Consumption by Fuelas a Percentage of 2017 Levels,1850-2017
(data from Arnulf Grubler, 1998; BP Statistical Review of World Energy, 2018)© Hughes GSR Inc, 2019
55 times
1850-2017
86% N
on-Renew
able
COAL
OIL
HYDRO
GAS
0
10
20
30
40
50
60
70
80
90
100
1850 1890 1930 1970 2010
% o
f 20
17 T
otal
Con
sum
ptio
n R
ate
Year
NuclearGasOilCoalHydroWood
0
10
20
30
40
50
60
70
80
90
100
1850 1890 1930 1970 2010
% o
f 20
17 P
er C
apita
Con
sum
ptio
n
Year
NuclearGasOilCoalHydroWood
0
10
20
30
40
50
60
70
80
90
100
1850 1890 1930 1970 2010
% o
f 20
17 P
opul
atio
n
Year
World Population, Per Capita and Total EnergyConsumption, 1850-2017, as a Percentage of 2017 LevelsPopulation
(data from Arnulf Grubler, 1998; BP Statistical Review of World Energy, 2018; UN Population Bureau, 2019)© Hughes GSR Inc, 2019
Per Capita Consumption Total Consumption
6 times 9 times 55 times
86% N
on-Renew
able
GAS
COAL
OIL
HYDRO
COAL
OIL
WOOD
Oil33%
Gas24%
Coal27%
Nuclear4.4%
Hydro6.8%
0%
1%
2%
3%
4%
5%
1995 2000 2005 2010 2015
Perc
ent o
f Tot
al C
onsu
mpt
ion
Year
Waste/OtherBiofuelsBiomass/GeothermalSolarWind
Wind
(data from BP Statistical Review of World Energy, 2019)
Global Primary Energy Consumption by Source in 2018Comparison to Total Non-Hydro Renewable Energy
Renewable Energy by Source657 MTOE
© Hughes GSR Inc, 2019
Total Energy by Source in 201813865 MTOE
Renewables
4.7%
Large Hydro plus Renewables = 11.5%Total consumption has increased by 63% more since 2010
than all 2018 non-hydro renewables
84% of global energy provided by fossil fuel
0
100
200
300
400
500
600
700
Gig
ajou
les
per c
apita
in 2
018
Per capita primary energy consumption in 2018
(data from BP Statistical Review of World Energy 2019)© Hughes GSR Inc, 2019
OECD17% of world population2.4 times world average
3.4 times non-OECDNon-OECD
83% of world population0.7 times world average
0.3 times OECD
17% of World Population 83% of World PopulationCanada
5.1 times world average3.1 times Europe
17% of the World’spopulation consumes
3.4 times as much energy per capita as the other 83%
Emissions per capita by country in 2019
(BP Statisticall Review of World Energy 2020)© Hughes GSR Inc, 2020
World average
OECD 2.1 times worldaverage, 17% ofworld population
Non-OECD 0.8 times worldaverage, 83% ofworld population
Canada3.4 times world
average
© Hughes GSR Inc, 2020
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1965 1971 1977 1983 1989 1995 2001 2007 2013 2019
Mill
ion
tonn
espe
r yea
r of C
arbo
n D
ioxi
deWorld carbon dioxide emissions from combustion of Oil, Gas and Coal, 1965-2019
Emissions havemore than tripled
since 1965
Up 205%
(data from BP Statistical Review of World Energy, 2020)
(IPCC Chapter 1 annex, October 2018)
IPCC Special Report on Global Warming of 1.5ºC
Higher Probabilityof attaining 1.5C
Lower Probabilityof attaining 1.5C
© Hughes GSR Inc, 2019
0
50
100
150
200
250
300
350
400
1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015
Con
sum
ptio
n (M
illio
n To
nnes
Oil
Equi
vale
nt)
Year
RenewablesHydroNuclearCoalGasOil
Canada Energy Consumption by Fuel, 1965-2016
© Hughes GSR Inc, 2017 (BP Statistical Review, 2017; other renewables include wind, solar, biomass, geothermal and biofuels)
Oil +85%
183% Consumption Growth 1965-2016
Hydro +231%
Coal +21%
Gas +339%
Other Renewables
30%
27%
5.7%7%
27%
3.1%
Oil32%
Gas29%
Coal4.2%
Nuclear6.6%
Hydro25.4%
0%
1%
2%
3%
1995 2000 2005 2010 2015
Perc
ent o
f Tot
al C
onsu
mpt
ion
Year
Waste/OtherBiofuelsBiomass/GeothermalSolarWind
Wind
(data from BP Statistical Review of World Energy, 2019)
Canada Primary Energy Consumption by Source in 2018Comparison to Total Non-Hydro Renewable Energy
Renewable Energy by Source12 MTOE
© Hughes GSR Inc, 2019
Total Energy by Source in 2018344 MTOE
Renewables
3.4%
Waste/OtherLarge Hydro plus Renewables = 28.8%
Total consumption has increased by 68% more since 2010than all 2018 non-hydro renewables
65% of Canada’s energy provided by fossil fuel
0
100
200
300
400
500
600
700
800
1965 1971 1977 1983 1989 1995 2001 2007 2013 2019
Mill
ion
Tonn
esca
rbon
dio
xide
equ
ival
ent
Combustion emissions Other gases and sources
© Hughes GSR Inc, 2020
Canada emissions from combustion and other gases and sources, 1965-2019
Combustion emissions have
more than doubledsince 1965
Up 114%
(data from BP Statistical Review of World Energy, 2020)
Other gases and sourcesare flat since 1990
0
100
200
300
400
500
600
700
800
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018
Meg
aton
nes
per y
ear (
CO
2e)
Natural Gas Production and Processing Conventional Oil ProductionOil Sands (Mining, In-situ, Upgrading) Oil and Gas TransmissionDownstream Oil and Gas ELECTRICITYTRANSPORTATION HEAVY INDUSTRYBUILDINGS AGRICULTURE
Electricity
Transportation
Buildings
Heavy Industry
Oil Sands
Agriculture
Natural GasConventional Oil
Canadian Emissions by Economic Sector, 1990-2018
© Hughes GSR Inc, 2020 (data from Canada’s National Inventory Report 2020)
Oil and G
as Production 26%
Although Canada has committed to a 30% reduction from 2005 by 2030, emissions
were down emissions only 0.14% from 2005 in 2018
Change in Emissions by economic sector from 2005 to 2018 and 2017 to 2018
© Hughes GSR Inc, 2020 (data from Canada’s National Inventory Report 2020 https://unfccc.int/documents/224829)
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
NATIONALGHG TOTAL
Oil and Gas Electricity Transportation Heavy Industry Buildings Agriculture Waste & Others
Perc
enta
ge c
hang
e in
em
issi
ons
over
per
iod
2005-2018 2017-2018
No improvement from 2017-2018 except electricity which is mostly a
result of converting from coal to gas
Emissions by Province and Economic Sector, 2018
© Hughes GSR Inc, 2020 (data from Canada’s National Inventory Report 2020 https://unfccc.int/documents/224829)
0
50
100
150
200
250
300
NFLD NS PEI NB QC ON MB SK AB BC TERR
Emis
sion
s (M
egat
onne
s C
O2e
per
yea
r)
ELECTRICITY TRANSPORTATION HEAVY INDUSTRY BUILDINGS AGRICULTURE WASTE OTHER OIL AND GAS
Oil and gas production
Alberta is the largest emitterdue to oil and gas production
Emissions per person by Province and Economic Sector, 2018
© Hughes GSR Inc, 2020 (data from Canada’s National Inventory Report 2020 https://unfccc.int/documents/224829)
0
10
20
30
40
50
60
70
CANADA NFLD NS PEI NB QC ON MB SK AB BC TERR
Tonn
es C
O2e
per
per
son
per y
ear
TRANSPORTATION AGRICULTURE HEAVY INDUSTRY ELECTRICITY BUILDINGS WASTE OTHER OIL AND GAS
Oil and gas production
Alberta and Saskatchewan are byfar the largest per capita emitters
Emissions change by Province and economic sector from 2005 to 2018
© Hughes GSR Inc, 2020 (data from Canada’s National Inventory Report 2020 https://unfccc.int/documents/224829)
-80
-60
-40
-20
0
20
40
60
80
CANADA NFLD NS PEI NB QC ON MB SK AB BC TERR
Cha
nge
in E
mis
sion
s fr
om 2
005
to 2
018
(meg
aton
nes)
OIL AND GAS ELECTRICITY TRANSPORTATION HEAVY INDUSTRY BUILDINGS AGRICULTURE WASTE OTHER
Oil and Gas production
Buildings
Electricity production
Heavy Industry
Transportation
Oil and gas production is by far the largest source of emissions growth
since 2005.
The Carbon Conundrum:
- Despite committing to the Paris Agreement and net-zero emissionsby 2050, the Federal, Alberta and BC governments are doubling down by ramping
up oil and gas production, the largest source of emissions growth since 2005.
- The Canada Energy Regulator (CER) forecasts continued growth in oil and gas production through 2040.
- The Federal government is spending $12.6 billion to triple the capacity of the Trans Mountain pipeline (TMX).
- The Alberta government is lowering corporate taxes and providing loan guarantees to TC Energy to build the Keystone XL pipeline.
- The BC and Federal governments laud LNG exports and are providing billions in subsidies to LNG Canada.
Canadian Emissions by Economic Sector with oil sands cap, 1990-2050
© Hughes GSR Inc, 2020 (data from Canada’s National Inventory Report 2020; CER Energy Futures 2019 reference case from 2019-2040; assuming flat emissions from 2040-2050)
0
100
200
300
400
500
600
700
800
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Meg
aton
nes
per y
ear (
CO
2e)
Oil Sands (Mining, In situ, Upgrading) Oil and Gas Transmission Downstream Oil and GasNatural Gas Production and Processing Conventional Oil Production ElectricityTransportation Heavy Industry BuildingsAgriculture Waste OtherParis Agreement (30% by 2030; 80% by 2050) Oil and gas sector without oil sands cap
Electricity
Transportation
Buildings
Heavy Industry
Downstream Oil and Gas
Oil Sands (emissions capped at 100 Mt)
Agriculture
Natural Gas
Conventional Oil
Exceeds 2050 target by 81%
Paris Agreement30% below 2005
by 2030
Non-oil and gasmust contract50% from 2018emission levelsby 2030, 88% by2040, and 122%
by 2050
Target80% below
2005 by 2050Oil and gas sectorwithout emissions cap
(Exceeds 2050 target by 101%)
2018 emissions 0.14%below 2005 level CER oil and
productionforecasts doom
Canada’semissions target
if realized.
0
10
20
30
40
50
60
70
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Meg
aton
nes
per y
ear (
CO
2e)
Conventional Oil Production Oil and Gas TransmissionDownstream Oil and Gas Natural Gas Production and ProcessingLNG Canada upstream emissions reduced by 15% LNG Canada terminal emissionsELECTRICITY TRANSPORTATIONHEAVY INDUSTRY BUILDINGSAGRICULTURE WASTEOther CleanBC Plan (40% by 2030; 80% by 2050)
Downstream Oil and Gas
Natural Gas productionand processing without
LNG reduced by 15%
Conventional Oil
(data from Canada’s National Inventory Report 2020; CER Energy Futures 2029 reference case from 2019-2040; assuming flat emissions from 2040-2050)© Hughes GSR Inc, 2020
BC emissions from oil and gas in CER’s Reference Case with LNG Canada
AgricultureWaste
Oil and Gas transmission
Buildings
Heavy Industry
Transportation
Other
Exceeds target by 160%
CleanBC Plan(40% below 2007
by 2030; 80% by 2050)
LNG Canada terminal emissions
LNG Canada upstreamemissions
Electricity
CER oil and production
forecasts doom BC’s emissions target if
LNG Canada is built
Government rhetoric used to justify these projects is mostly false
- These projects will provide “thousands of jobs” only during the construction phase of 2-3 years. TMX will provide 90 permanent jobs according to Kinder-
Morgan and LNG Canada will provide 350 permanent jobs according to its website, along with some jobs producing the gas required.
- TMX will not provide Canadian producers with a price windfall in Asia, in fact they will likely lose money based on prices over the past decade and transport costs.
- LNG Canada will not save the world from global warming, in fact it will make the problem worse over the critical next 2-3 decades due to fugitive methane.
- Claims that these projects are needed to provide funds for roads and hospitals are belied by the poor economics and the fact that royalty and tax revenue from
oil and gas production has plummeted over the past two decades.
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Ener
gy S
ecto
r per
cent
age
of G
DP
NFLD Manitoba Saskatchewan Alberta BC Other Canada Canada Total
Energy Sector percentage of GDP by province
(Statistics Canada Table 36-10-0402-01 retrieved June 27 2020, https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=3610040201 )© Hughes GSR Inc, 2020
Newfoundland
Canada total
Other Canada
Alberta
Saskatchewan
BC Manitoba
0%
2%
4%
6%
8%
10%
12%
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Ener
gy S
ecto
r per
cent
age
of G
DP
NFLD Manitoba Saskatchewan Alberta Alberta oil sands BC Other Canada
Energy Sector percentage of Canadian GDP by province
(Statistics Canada Table 36-10-0402-01 retrieved June 27 2020, https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=3610040201 )© Hughes GSR Inc, 2020
Newfoundland
Alberta oil sands
Other Canada
Alberta
Saskatchewan
BC
1.7%0.7%
2.8%2.3%
0.9%0.5%
0
1
2
3
4
5
6
$0
$2
$4
$6
$8
$10
$12
$14
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Production (million barrels oil equivalent per day)
Rev
enue
per
bar
rel o
il eq
uiva
lent
($20
18)
Average royalty reveue Non-royalty revenue Total production Oil production Gas production
Alberta gross non-renewable resource revenue per barrel versus production
(production from Canada Energy Regulator, retrieved September 27, 2020; revenue from Alberta Government, retrieved September 28, 2020)© Hughes GSR Inc, 2020
Net royalty revenues
Total production
Land sales, rentals and leases
Revenue per BOEdown 79% since 2005
2
2.6
3.2
3.8
4.4
5
5.6
0
400
800
1,200
1,600
2,000
2,400
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Billion cubic feet per dayR
oyal
ty R
even
ue ($
mill
ion)
Royalties Production
Total BC Royalties Paid
(Data from CAPP Statistical Handbook; production data from CER, current as of October 22, 2019)© Hughes GSR Inc, 2019
Gas production
Total Royalty Revenue
RoyaltyRevenue
Down 84%Since 2005
0
20
40
60
80
100
120
140
2011 2012 2013 2014 2015 2016 2017 2018 2019
Bar
rels
of P
rodu
ctio
n pe
r Em
ploy
ee
All sectors BOE/person Oil Sands bbl/person Conventional O&G E&P BOE/person
Productivity per Employee by Oil and Gas production Sector, 2011-2019
(employment data from Petroleum Labour Market Information,2019; production data from NEB, 2019)
Oil Sands productivity per employee up 72%
© Hughes GSR Inc, 2020
Conventional E&P productivity per employee up 30%
All sectors productivity per employee up 47%
Fewer employees are required due to
Artificial Intelligence and
digitalization
What about renewable energy from solar and wind?
- Important to emphasize but there is seasonal and hourly variability that requires backup and/or storage.
- Electricity is only 17% of Canada’s end use energy. 80% of end-use energy is currently provided by fossil fuel.
- According to BP’s 2020 net-zero analysis, electricity could be scaled to 53% of global final consumption by 2050, but that would mean nearly doubling global
electricity generation and a many-fold increase in non-hydro renewables which are currently less than 10% of global generation.
- As a result, we will likely need fossil fuels at some level for the foreseeable future, even with aggressive efforts to build renewables and reduce and electrify
consumption. Canada exports more than half of its oil and gas production so there is a vast opportunity to cut emissions by reducing production.
Liquids43.6%
Natural gas34.4%
Coal1.4%
Electricity17.0%
Renewables3.6%
Canada Delivered Energy by Fuel in 2020
© Hughes GSR Inc, 2020 (data from EIA International Energy Outlook, 2019, https://www.eia.gov/outlooks/ieo/tables_ref.php )
79.4% of Canada’send-use energyis provided by
fossil fuel
Share of electricity in total final consumption
Electricity demand
Change in electricity demand by sector, 2018-2050
0%
10%
20%
30%
40%
50%
60%
2000 2010 2020 2030 2040 2050
Rapid
Net Zero
Business-as-usual
0
5000
10000
15000
20000
25000
Rapid Net Zero Business-as-usual
Buildings
Industry
Transport
79%
BP’s 2020 Energy Outlook – Electricity as share of final end use energy
87% 83%
Increase in global generation by 2050
Hydro59%
Gas9%
Coal9.1%
Nuclear15.3%
Hydro25.4%
0%
1%
2%
3%
4%
5%
6%
7%
1995 2000 2005 2010 2015
Perc
ent o
f Tot
al G
ener
atio
nYear
Waste/OtherBiomass/GeothermalSolarWind
Wind
(data from BP Statistical Review of World Energy, 2019)
Canada Electricity Generation by Source in 2018Comparison to Total Non-Hydro Renewable Generation
Renewable Generation by Source45 TWh
© Hughes GSR Inc, 2019
Total Generation by Source in 2018654 TWh
Renewables
6.9%
Waste/OtherLarge Hydro plus Renewables = 66%
Carbon-free = 81%
18% of Canada’s generation provided by fossil fuel
-1000
0
1000
2000
3000
4000
5000
2010 2011 2012 2013 2014 2015 2016 2017 2018
Tera
wat
t-hou
rs
NuclearOilGasCoalHydroOther Non-renewable
World Electricity Generation Additions by Fuel, 2010-2018
(data from BP Statistical Review of World Energy,2019)© Hughes GSR Inc, 2019
Gas
Hydro
Coal
-1000
0
1000
2000
3000
4000
5000
2010 2011 2012 2013 2014 2015 2016 2017 2018Te
raw
att-h
ours
SolarWindGeo-BiomassOther Renewable
Non-renewable Renewable
WindSolar
Non-renewable generationmade up 71% of total
generation growthfrom 2010 to 2018
Takeaways
- Canada and the world face an EXTREMELY daunting challenge to transition from fossil fuel and contain global warming.
- Reducing energy consumption will be one of the biggest tools in the toolbox hence the need to MAXIMIZE ENERGY EFFICIENCY AND CONSERVATION.
- Current government policy to build more fossil fuel infrastructure and justify it with false narratives is THE WRONG WAY FORWARD.
- The government’s $12.6 billion to be spent on TMX and the billions in subsidies to LNG Canada will exacerbate the emissions problem. These funds would be
far better spent directly on reducing emissions through incentivesfor efficiency, conservation and renewable energy.
- Canada urgently needs a viable energy strategy to provide long-term energy security for Canadians and meet emissions reduction targets.
For further analysis of BC LNG and the TMX project Google:
- BC’s Carbon Conundrum (July, 2020)
- Reassessment of need for the Trans Mountain expansion project (October, 2020)
top related