Josephine V. Yam

Canada Reports Great Progress in Meeting 2020 Emission Target

On August 9, 2012, the Honourable Peter Kent, Canada’s Environment Minister, announced that Canada is half way towards meeting its 2020 greenhouse gas (GHG) emission target. Said Minister Kent: “Using a sector-by-sector approach, our Government has taken action on two of Canada’s largest sources of emissions: electricity and transportation.”

Minister Kent referred to the Canada’s Emissions Trends Report 2012 (the “Report”) that shows a projection of GHG emissions to 2020. When Canada signed the Copenhagen Accord in December 2009, it committed to reduce its GHG emissions to 17% below 2005 levels by 2020, setting a target of 607 Megatonnes (Mt). In 2011, Canada’s GHG emissions were projected to be 785 Mt in 2020. Since then, GHG emissions are now projected to be 65 Mt lower at 720 Mt in 2020.

The Report cites four main factors that have contributed to the decline in projected emissions, when compared to 2011:

The first factor is that GHG emissions are increasingly becoming decoupled from economic growth.

The Report notes that between 2009 and 2010, Canada’s GHG emissions remained steady despite economic growth of 3.2%. The Canadian economy has experienced a substantial decline in energy intensity as industrial processes have become more efficient and lower-emissions and service-based industries have grown. Moreover, GHG emissions from energy generation have declined, primarily due to changes to the electricity generation mix (i.e. from coal to natural gas and renewables) and closure of coal-fired generating units. Thus, economic growth and the level of GHG emissions are becoming increasingly independent of each other. For example, between 2005 and 2010, the Canadian economy grew by 6.3% while its GHG emissions decreased by 6.5%.

The second factor is projected growth for the emissions-intensive sector is now lower, while such growth is now higher for the less emissions-intensive sectors. This reduces projected GHG emissions in 2020, even though total Gross Domestic Product (GDP) is projected to be slightly higher.

According to the Report, emissions intensity continues to improve through 2020 with help from federal, provincial and territorial actions. The projected decline in GHG emissions is associated with a reduction in intensity, implying greater de-coupling between GDP and GHGs. The improvements in emission intensity are partly due to the increased contribution of the services sector, which typically emits less GHG emissions per dollar of GDP and the fact that consumers and businesses are making more progress in reducing emissions while the government helps accelerate the adoption of energy efficient technologies and cleaner fuels.

The third factor is the inclusion in the projections of the contribution of the land use, land-use change and forestry (LULUCF) sector to achieving Canada’s GHG emission target.

The Report notes that, for the first time, there is recognition of the contribution of the LULUCF sector, which has been globally recognized as an important consideration in global accounting frameworks for emissions reductions. Current estimates of this sector’s impact suggest a net contribution of 25 Mt of GHG emissions towards the Canada’s 2020 target.

The fourth factor is that the 2012 projections have a new, lower starting point because the most recent data show that GHG emissions were significantly lower in 2010 than had been previously estimated.

According to the Report, in 2011, GHG emissions were estimated to be at 710 Mt. However, Statistics Canada subsequently reported that Canada’s actual GHG emissions in 2010 were at 692 Mt.

The full text of Canada’s Emissions Trends Report 2012 can be accessed at this link.

U.S. CO2 Emissions Lowest in 2 decades

A recent New York Times article reported that energy-related CO2 emissions in the U.S. from January-March 2012 were the lowest for the first quarter of the year since 1992. The CO2 emissions from energy consumption during this period of 2012 amounted to 1.34 billion metric tons, down by nearly 8% from a year earlier.

According to the federal Energy Information Administration (EIA)’s report, CO2 emissions during the year are generally highest in the first quarter because of the strong demand for heat produced by fossil fuels, such as coal and natural gas. However, the EIA identified the confluence of three factors that contributed to this significant CO2 emissions decline:

The first factor is lower gas heating demand. This is mainly due to a mild winter when temperatures were markedly above the historical average for the season.

The second factor is reduced gasoline demand. This is mainly due to lower economic activity.

The third factor is a decline in coal-fired electricity generation. This is mainly due to utilities using less coal for electricity generation as they burned more low-priced natural gas.

The New York Times article noted that “[t]he extraction of large natural gas deposits in the Marcellus Shale has contributed to the rise of inexpensive natural gas, causing prices to decline in the last four years and making it a far cheaper option than burning coal. In 2005, coal accounted for half of all electricity generated in the country. But the embrace of natural gas, which now accounts for about 30 percent of electricity generation, has caused coal’s share to retreat to 34 percent, a 40-year low.”

However, according to the article, climate scientist Michael Mann warned that when shale gas is extracted from the ground, “fugitive methane”, a far more potent greenhouse gas than CO2, can escape into the atmosphere. He noted: “We may be reducing our CO2 emissions, but it is possible that we’re actually increasing the greenhouse gas problem with methane emissions.”