ESAA Environmental Summit
April 1-3, 2025
Kananaskis Mountain Lodge
The 2025 ESAA Environmental Summit (‘The Summit’) will feature all of the things you expect from an ESAA event: great talks, great location and
great networking.
The 2025 edition will take place at the Kananaskis Mountain Lodge. The completely modern getaway nestled amidst the pines and mountains. Room rates at the Lodge start at $255.00 + taxes.
The format will be a series of panel discussions over the two-days of the conference. Full event details can be found at: https://esaa.org/summit/
Registration is now OPEN. Early bird rates end January 24st – Register now at: https://esaa.org/summit/register/ ** Day passes are also available (limited quantity)
Sponsorship is now OPEN. See our Website for all Sponsorship opportunities https://esaa.org/summit/sponsors/
ESAA invites you to submit proposals for panel discussions to be held during The Summit.
Proposals for panels are encouraged in, but not limited to, the following areas:
- Risk Management
- Disaster Management
- The Future of Water
- Evolution of Energy in Alberta
- Climate Resiliency
- ESG and the Environment Sector
- Indigenous Engagement and Inclusion
- The Future of the Environment Industry Workforce
- Other topics will be considered
To propose a panel, please submit the following:
- The panel’s topics
- The panel’s overall goal
- A summary of each panelist’s topic/contribution to the panel discussion. Note: Each panel must have 3 speakers and one moderator.
- Panel should include a variety of presenters representing not just individuals from company submitting the proposal. Example: a panel ideally would include, a consultant, a supplier and a client with one of these possibly being replaced by a regulator.
- Limit the proposal to 750 words not including the speaker bios
- Deadline January 10th, 2025.
- Submit to ciezki@esaa.org
Note: The individual submitting the proposal and organizing the panel should act as the moderator and be comfortable with moderating a panel discussion. The moderators registration will be complimentary. Panelists will be required to register at a discounted rate.
ESAA truly appreciates your support of world-class events and looks forward to welcoming you to ‘The Summit’ at the amazing Kananaskis Mountain Lodge.
Office Space For Sale
- 2,140 sq.ft.± main floor office space featuring 3 private offices, open work space, boardroom/ kitchenette, reception area
- Rear storage area with 10’ x 10’ grade loading overhead door
- Professionally Managed
Alberta launches tire-derived fuel pilot at new Lafarge facility
(Source: esemag.com) Alberta’s new tire-derived fuel (TDF) pilot project will test the viability of turning 1.5 million used tires into some 15,750 tonnes of shredded rubber that can be converted into fuel at Lafarge Canada’s new low-carbon fuel facility in Kananaskis, west of Calgary.
The pilot will be led by the Alberta Recycling Management Authority (ARMA), which since 1992 has recycled some 150 million tires as manager of the province’s tire recycling program.
While similar TDF projects have been launched in Ontario, British Columbia and Quebec, the pilot will be a first for Alberta.
Scrap tires are currently used in municipal landfills, playground surfaces, and landscaping materials, but new markets are needed to avoid tire stockpiles, Alberta’s government stated.
“The Tire-Derived Fuel Pilot program is another step in resource recovery,” announced ARMA President and CEO Ed Gugenheimer in a statement. “This pilot initiative not only addresses near-term tire stockpile reduction needs from our Tire Recycling Program, but also brings the potential to further boost economic opportunities across the province.”
The new $38-million Lafarge facility already burns wood-based construction demolition waste for fuel that replaces half of its natural gas use. Project officials say they save 120,000 tonnes of material from landfill and reduce emissions by some 30,000 tonnes annually. Geocycle Canada, also a member of Holcim Group, is responsible for co-processing the waste into low-carbon fuels.
In a related announcement, Alberta’s government is also investing $10 million from the industry-funded Technology Innovation and Emissions Reduction (TIER) fund to help launch the new Strategic Energy Management for Industry program. The program will cover the cost of energy assessments and capital retrofits to save Alberta-based industrial and manufacturing facilities money on energy bills.
“We are investing in lower-emission fuels and facility upgrades to set our energy sector up for continued success,” announced Alberta Minister of Environment and Protected Areas, Rebecca Schulz, in a statement. “These new initiatives will keep our province at the forefront of technological advancement and ensure Alberta continues to lead the way to reduce emissions and turn waste into energy.”
AER: New Edition of Directive 020
Today, we released a new edition of Directive 020: Well Abandonment. We have amended the requirements for cased-hole well abandonment for routine commingled abandonment, layered cement plugs for remedial cementing, and retrievable plugs or packers. These changes were reflected in the draft directive released on August 8, 2024, and on which public feedback was received (see Bulletin 2024-21). A summary of the feedback we received and our responses is available on the Directive 020 webpage.
We made the following changes to section 5 of the directive:
- Retrievable plugs or packers may remain in place during non-level-A abandonments when zonal abandonment requirements are met (section 5.4.5.2).
- A “Layered Cement Plug Variance Submission” template is required when cement squeezing multiple intervals at the same time using layered cement plugs for remedial cementing (section 5.2.3).
- Licensees must review offset well operational activities (for wells with publicly available information) in the routinely approved subsurface geological strata within a 1.6 km radius of the subject well (section 5.6.2).
- Reorganized section 5 and grouped the requirements for routine commingled abandonment into a new section (section 5.6).
- Added content on commingling regions to section 5.6, including information on new qualified pools for commingled abandonment in central Alberta and a map of a new routine commingled abandonment region. This information was previously on our website (www.aer.ca).
The revised edition of Directive 020 is available on our website at www.aer.ca. If you have any questions, contact our Customer Contact Centre by phone at 1-855-297-8311 or by email at inquiries@aer.ca.
Banff cuts emissions under new deal to haul solid waste to Calgary
A three-year agreement was signed in July to deliver the municipality’s solid waste to the Spyhill Regional Landfill following lengthy negotiations with the City of Calgary, with the first delivery starting on Aug. 1.
Chris Marvell, manager of resource recovery for the Town of Banff, said this change reduces the distance for every truckload by 500 kilometres, which saves about 250 litres in diesel fuel every trip, representing a reduction in greenhouse gas emissions of more than 722 kilograms per trip.
“Additionally, the decreased travel time enables the reallocation of internal resources to haul materials from the drop-off yard, eliminating the need to outsource these services to a third party, as is currently the practice,” he said.
Since 2013, the Town of Banff’s solid waste had been shipped to West Dried Meat Lake Regional Landfill (WDMLL), which is located 30 km south of Camrose, and was an approximately 750-km round trip. The Spyhill landfill is about 125 km away.
Marvell said transitioning to different landfill operations also allows the Town of Banff to further reduce methane emissions from municipal solid waste disposal.
He said organic waste buried in a landfill decomposes in an oxygen-free environment, producing methane—a greenhouse gas he said is approximately 28 times more potent and harmful than carbon dioxide.
The Spyhill landfill in Calgary, Marvell said, is equipped with gas capture technology, which prevents a part of these methane emissions from reaching the atmosphere.
“A conservative estimate from the landfill operator shows that about 60 per cent of the methane is captured at Spyhill,” he said.
“At the current composition of Banff’s waste, every tonne landfilled creates emissions of about 1.29 tCO2e [tonnes of carbon dioxide equivalent] without gas capture. Using the Spyhill landfill with gas capture, the emissions per tonne are reduced to about 0.51 tCO2e.”
While the annual fuel consumption for hauling is reduced by more than 80,000 litres, Marvell said the larger impact is the avoidance of methane emissions.
“With about 2,800 tonnes of avoided emissions annually, this operational change is likely the largest single measure of reducing community emissions for the Town of Banff without any additional cost to the ratepayers,” he said.
Although the tipping fees at the Spyhill landfill are significantly greater than the WDMLL fees, Marvell said the total cost of the municipal solid waste collection and transportation falls within the current approved budget.
Information on the rates under the new agreement with the City of Calgary isn’t publicly available.
Council went in camera under the Freedom of Information and Protection of Privacy Act (FOIP) on sections related to advice from officials and disclosure harmful to economic and other interests of a public body to get those details.
Coun. Hugh Pettigrew, who requested the information, voiced support for the new deal.
“Catching the methane is the right thing to do and certainly travelling makes sense from an optical point of view and cost … so I appreciate that,” he said.
Banff also hauls solid waste for the Town of Canmore and Parks Canada.
Canada releases draft regulations to cap pollution, drive innovation, and create jobs in the oil and gas industry
After years of steady progress, Canada’s climate plan is working to deliver greenhouse gas pollution reductions for Canadians. Across the economy, Canadian workers and businesses are innovating to reduce greenhouse gas pollution while creating good jobs and cleaner air.
Canadians and their communities bear the brunt and pay the costs from increased extreme weather events due to climate change—costs that are reflected in the price of groceries, insurance, and local taxes. They understand that all sectors must do their fair share to decrease pollution and address climate change. The oil and gas sector is Canada’s largest source of greenhouse gas pollution, and emissions from part of the sector continue to grow. As an important part of the Canadian economy supporting 400,000 jobs, the oil and gas sector is well positioned to reinvest record profits into projects that drive cleaner production that will help create and sustain good jobs for generations.
Today, the Government of Canada introduced draft regulations to put a clear limit on greenhouse gas pollution from oil and gas production. The proposed regulations work by setting a cap on greenhouse gas pollution within the sector, equivalent to 35 percent below 2019 levels. They would create a cap-and-trade system designed to recognize better-performing companies and incentivize those that are higher polluting to invest in making their production processes cleaner.
The proposed regulations put a limit on pollution, not production, and have been informed by extensive engagement with industry, Indigenous groups, provinces and territories, and other stakeholders. The proposed regulations are carefully designed around what is technically achievable within the sector, while allowing continued production growth. Many oil and gas producers share our commitment to a strong, low-carbon economy, and some have already committed to significant methane emissions reductions and the implementation of carbon capture technology to reduce greenhouse gases.
Canada is the world’s fourth-largest producer of oil and the fifth-largest producer of gas. As demand for oil and gas peaks in the coming decade and begins to decline, the fuels extracted with the least amount of pollution will be in highest demand. The oil and gas greenhouse gas pollution cap will help the sector remain competitive as the global economy continues to decarbonize and allow Canada to quickly and effectively respond to shifting global demand.
The oil and gas greenhouse gas pollution cap is part of a suite of measures to cut pollution, including significant financial supports for carbon capture and storage and other clean technologies that also support workers, namely through the federal Canada Growth Fund and new investment tax credits.
The climate decisions we make today will help contribute directly to a cleaner, safer environment and good jobs for future generations. The oil and gas greenhouse gas pollution cap will stimulate the investment needed to innovate and build a thriving economy that works for everyone. Canada has a historic opportunity to act to combat the climate crisis and create a strong 21st century economy where we continue to be an energy supplier for the world.
The Government will continue to consult to inform the final regulations, which will be published in 2025.
Quick facts
The Government of Canada will continue to consult to inform the final regulations, which it plans to publish next year. Written comments in response to the proposed regulations can be submitted during the formal consultation period from November 9, 2024, to January 8, 2025.
According to Statistics Canada’s latest figures, operating profits in the oil and gas sector increased tenfold after the pandemic, from $6.6 billion in 2019 to $66.6 billion in 2022. Profits have remained strong with consecutive record years, and capital expenditures have been targeting new production rather than decarbonization. The draft regulation will encourage the sector to redirect these record profits into decarbonization.
The Canadian Climate Institute estimates that by 2025, Canada will experience annual losses in economic growth of $25 billion as a result of climate change, underlining the need to take urgent action for the sake of our economy, our environment, and our future.
According to the most recent National Inventory Report, Canada’s oil and gas sector accounted for 31 percent of national emissions in 2022, making it the largest contributor to Canada’s emissions.
Capping the greenhouse gas pollution from the oil and gas sector is one of the key measures outlined in Canada’s 2030 Emissions Reduction Plan, a sector-by-sector roadmap to reduce Canada’s overall emissions to 40–45 percent below our 2005 pollution levels in the most cost-effective way possible while building a stronger economy for the 21st century.
The Government of Canada has supported carbon capture projects such as Strathcona Resources, an oil sands company that has a $2 billion project with agreements to store up to two million tonnes of carbon dioxide per year. The federal government also recently supported Entropy, an Alberta-based company, to scale up its carbon capture and sequestration technology at a natural gas facility, which will reduce emissions by 2.8 million tonnes over 15 years and support more than 1,200 good jobs for Albertans.
Early estimates from the Canadian Climate Institute show that Canada’s emissions have started to decline in 2023, the first year since the pandemic when the economy was back in full operation.
Environment and Climate Change Canada analysis shows that, with the oil and gas greenhouse gas pollution cap, oil and gas production is projected to grow by 16 percent by 2030–2032 from 2019 levels, provided the sector implements technically achievable decarbonization measures.
The oil and gas greenhouse gas pollution cap would regulate upstream oil and gas facilities, including offshore facilities, and would also apply to liquefied natural gas production facilities. These subsectors represent the majority of emissions from the oil and gas sector, with the upstream subsector representing about 85 percent of sector emissions in 2022. The emissions cap will cover activities such as oil sands extraction and upgrading, conventional oil production, natural gas production and processing, and production of liquified natural gas.
The latest analysis from the International Energy Agency shows that global demand for fossil fuels, including oil, will peak by 2030 without any more policy action to reduce emissions. With further policy action, oil demand would peak even sooner.
Related products
Oil and gas greenhouse gas pollution cap – Backgrounder to CGI Regulations
The proposed oil and gas greenhouse gas (GHG) pollution cap will incentivize the sector to invest in technically achievable decarbonization to attain significant emission reductions by 2030-2032. The policy will put the sector on a pathway to carbon neutrality by 2050, while enabling it to continue to respond to global demand.
Oil and gas companies in Canada have proven repeatedly that they can innovate and develop new technologies to produce more competitive oil and gas with less pollution.
While it continues to be a major supplier to global markets, Canada’s oil and gas sector has the opportunity to reinvest in its own competitiveness ahead of the anticipated future decline in global demand for oil and gas in a low-carbon future. Reinvesting in cleaner oil and gas production ensures that the sector contributes its fair share to GHG reductions in Canada and positions Canada for a stronger future for its workers and economy.
The oil and gas sector is experiencing record profits within Canada. Coming out of the pandemic, operating profits in the oil and gas sector increased tenfold from $6.6 billion in 2019 to $66.6 billion in 2022. Despite that, there has been limited and declining overall investment in the sector in Canada over the last several years.
The proposed Regulations would establish a cap-and-trade system that is designed to recognize producers with better emission performance and motivate higher-polluting facilities to reinvest record profits into more pollution-reducing projects.
The oil and gas sector is a major contributor to Canada’s economy. In 2023, the sector generated $209 billion in gross domestic product (GDP) (PDF) and accounted for 25% of Canada’s exports (valued at $177 billion). It is also a major employer across the country, directly employing 181,800 people in 2023.
The oil and gas sector is also Canada’s largest source of GHG pollution, responsible for 31% of Canada’s GHG emissions in 2022. Decreasing emissions in the oil and gas sector by introducing a cap on GHG pollution is necessary to ensure that the sector contributes its fair share to Canada’s ongoing efforts to tackle climate change and reach our GHG emission reduction targets and international commitments under the Paris Agreement.
Strengthening emission performance and carbon management technologies in Canada’s oil and gas sector
Canada’s oil and gas sector has the potential to be a supplier of choice as the demand for oil and gas for combustion declines in a low-carbon future. This would enable the sector to continue to be a major employer and source of economic activity across Canada, particularly in oil- and gas-producing regions.
The proposed Regulations put a limit on pollution, not production. The proposed Regulations are carefully designed around what is technically achievable within the sector, while enabling continued production growth in response to global demand. In fact, modelling shows that Canadian oil and gas production is projected to increase 16% between 2019 and the 2030-2032 period with the proposed Regulations in place.
Major emissions-reduction opportunities are available, and oil and gas producers are already investing in them. Methane is a particularly potent greenhouse gas, and most methane emissions represent a wasted resource because they are from leaks and other unintended sources. Preventing methane emissions is one of the lowest-cost ways to reduce GHG emissions, and the sector’s efforts have resulted in a steady decline in these emissions. New regulations to be finalized later this fall will ensure that the sector continues to cut methane emissions by at least 75% from 2012 levels by 2030.
Carbon capture is also going to play an increasingly important role in reducing emissions from oil and gas production, and Canada is well placed to cement its position as a global leader in this critical technology. According to both the Intergovernmental Panel on Climate Change (IPCC) and the International Energy Agency (IEA), there is no credible path to carbon neutrality without carbon management technologies, such as carbon capture and storage, and their deployment must be rapid and immense, scaling up by nearly 200 times by 2050.
The shift toward a low-carbon economy has created a rush of capital toward carbon management technologies worldwide. In the United States, there are many new carbon capture projects being deployed, with 150 currently under review at the U.S. Environmental Protection Agency.
Canada has already established itself as a first mover and leader in the global carbon management sector, with some of the world’s first large-scale projects; favourable geology; cutting-edge innovators and start-ups; early investments in research, development, and demonstration; deep technical expertise; a robust policy and regulatory environment at the federal and provincial levels; and active international collaboration. The Government of Canada has launched a suite of policies with a mix of financial supports and regulatory measures to better position Canada’s economy for success.
Approximately one-sixth of the world’s active large-scale carbon management projects, which use a range of approaches to capture carbon dioxide from point sources or directly from the atmosphere to be reused or durably stored, can be found in Canada, with a growing number in the construction, design and development phase across multiple sectors and regions.
The continued development and deployment of carbon management technologies to help achieve Canada’s climate objectives will form the basis of a world-leading, multi-billion-dollar carbon management sector in Canada that supports inclusive, high-value employment, significant export opportunities and a more sustainable economy.
Point-source carbon capture is a leading option for deep emissions reductions from the upstream oil and gas sector. Given the long lifespan of many existing heavy industrial facilities and the value of these industries to the Canadian economy, public-private collaboration is critical to advance strategic, economical, and regionally appropriate decarbonization pathways.
The GHG oil and gas pollution cap adds to a suite of policy measures, which are designed to shift the oil and gas industry increasingly toward cleaner production through the use of carbon management systems and other technologies, including to reduce methane emissions and to switch to cleaner fuels. Those include other successful regulatory measures, such as federal, provincial, and territorial carbon pricing systems for industry, including Alberta’s TIER system, the federal Output-Based Pricing System, federal and provincial methane regulations, and the Clean Fuel Regulations.
They also include a wide range of financial supports to support deployment and help develop the innovation ecosystem for carbon reduction technologies in Canada, including:
- $319 million over 7 years for RD&D to advance the commercial viability of emerging carbon management technologies.
- Refundable CCUS Investment Tax Credit (ITC), expected to provide $12.5 billion between 2022-2023 and 2034-2035, for eligible projects that enable permanent CO2 storage.
- The Canada Growth Fund, totalling $15 billion, offers investment tools such as contracts for differences designed to address risk and accelerate private sector investment to grow Canada’s clean economy, including in the carbon management sector.
- Strategic Innovation Fund, with $8 billion in funding to help companies reduce emissions and grow their business sustainably.
- The Canada Infrastructure Bank (CIB) invests in CCUS infrastructure projects, including through its Project Acceleration funding for front-end engineering and design (FEED) capital expenditures.
Increasingly, large-scale carbon capture projects are being built in both the oil and gas sector and other sectors. Recent projects include:
- Strathcona Resources, an oilsands company with assets in Saskatchewan and Alberta and Canada’s fifth-largest oil producer, is launching a $2 billion project to store up to two million tonnes of CO2 per year, while creating hundreds of new jobs. The project has received support from the Canada Growth Fund.
- Entropy, an Alberta-based company, is working on a project that will enable emissions reductions of approximately 2.8 million tonnes over 15 years and support more than 1,200 good jobs for Albertans.
- Shell announced two new projects in Alberta: the Polaris Carbon Capture project and the Atlas Carbon Storage Hub. These projects aim to reduce industrial emissions by transitioning to cleaner technology. The Polaris project will capture approximately 650,000 tonnes of carbon a year while the Atlas project will store the captured carbon from Polaris and potentially other industrial facilities in the future. Once complete in 2028, these projects are expected to generate up to 2,000 jobs for Albertans.
- The North West Redwater (NWR) Sturgeon Refinery, also operating in the Alberta Industrial Heartland, is the world’s first bitumen refinery built with carbon capture.
- The Alberta Carbon Trunk Line (ACTL), which transports captured carbon from facilities for storage in oil fields, will be used by new carbon capture projects throughout the province to transport captured CO2 to final storage sites.
- Linde announced an investment of more than $2 billion to build a clean hydrogen facility that will supply Dow’s Path2Zero production complex in Alberta. The facility will capture more than 2 million tonnes of carbon dioxide emissions per year for sequestration.
Extensive consultation to date on the oil and gas GHG pollution cap
The Government of Canada has engaged a broad range of partners and stakeholders on the oil and gas GHG pollution cap, including provinces and territories, Indigenous partners, industry, environmental groups, and Canadians. The government has held webinars, convened meetings, and published discussion papers to seek input and feedback. Since November 2021, the government has received over 250 written submissions from organizations, held over 100 meetings, and hosted seven public webinars.
The government published a Regulatory Framework to Cap Oil and Gas Sector GHG Emissions in December 2023. This Framework confirmed the government’s intent to implement the oil and gas GHG pollution cap through a new cap-and-trade system, and proposed various regulatory design features, including which subsectors would be covered by the oil and gas GHG pollution cap, the level of the GHG pollution cap, and rules about flexible compliance options.
The proposed Regulations are carefully designed based on what is technically achievable in the sector, setting a limit on pollution, not production. Technically achievable emissions reductions were estimated based on an assessment of the abatement technologies that could feasibly be deployed within the upstream and LNG activities in the oil and gas sector by 2030-2032, considering the status of available technologies, projected levels of production, the availability of equipment and labour, and timelines for permitting and approvals.
Estimates of technically achievable reductions included reductions related to compliance with the strengthened methane regulations, installation of carbon capture and storage technology, and electrification. The risk that not all technically achievable reductions would be implemented in time for the first compliance period was also taken into consideration.
The government has now published proposed Regulations (PDF) to implement the oil and gas GHG pollution cap, and invites input from November 9, 2024, to January 8, 2025. The government will continue to engage with partners and stakeholders in the development of final regulations.
Key components of the proposed national cap-and-trade system for oil and gas greenhouse gas pollution
The proposed Oil and Gas Sector Greenhouse Gas Emissions Cap Regulations (proposed Regulations) would establish a national cap-and-trade system that would apply to upstream oil and gas activities including onshore and offshore oil and gas production; oil sands production and upgrading; natural gas production and processing; and the production of LNG.
The proposed Regulations have been developed under the Canadian Environmental Protection Act, 1999 (CEPA). Since 1988, CEPA has been used to address a wide range of environmental issues, including air pollution, chemicals, plastics and GHG emissions.
- The cap-and-trade system will freely allocate emissions allowances to facilities covered by the system. At the end of each year, each facility will need to remit to the government one allowance for each tonne of carbon pollution it has emitted. Over time, the government will give out fewer allowances, corresponding to the declining emissions cap.
- Operators will face an ongoing incentive to reduce their emissions. If an operator does not have enough allowances to cover their emissions, they will be able to buy allowances from other operators that have invested in pollution reduction. Operators can also contribute to a decarbonization program or use GHG offset credits to cover a small portion of their emissions (up to 10% for the decarbonization program and up to 20% for offsets, for a maximum of 20% for both options). The decarbonization program would fund projects that support the reduction of emissions from the sector. The total of all allowances and the overall 20% limit on compliance flexibility creates a legal upper bound on emissions from the sector.
- The oil and gas GHG pollution cap will limit emissions, not production, and will encourage industry to reinvest into projects that lower pollution while providing flexibility to respond to changes in the global market.
- To make sure the oil and gas GHG pollution cap accounts for current activity levels, the proposed Regulations would use data reported by operators for 2026 to set the first oil and gas GHG pollution cap level. The oil and gas GHG pollution cap for the first compliance period, 2030-2032, would be set at 27% below emissions reported for 2026, which is estimated to be equivalent to 35% below 2019 emissions.
- Using 2026 for reported data means the oil and gas GHG pollution cap would be based on real-world conditions. The final oil and gas GHG pollution cap level would be published before the end of 2027.
- The proposed Regulations allocate allowances to covered operators using specified distribution rates—defined in allowances per unit of production—for each type of covered activity. Allowances will be distributed before the start of each year (starting in 2029 for 2030, the first compliance year). To ensure that allowances are distributed to the level of the emissions cap for each year, the allowances distributed would be pro-rated across all facilities receiving them.
The system would be phased in for the first four years (2026-2029). During that period, operators would be required to register and report their emissions and production. Large emitters will start reporting in 2027 for their 2026 emissions and production levels. Reporting for small operators would start in 2029 for their 2028 levels. Operators would need to submit verified annual reports to Environment and Climate Change Canada for their facilities for every calendar year. Reports would be due on June 1 of the following year. The reports would be used to identify which operators will be subject to the pollution cap and have remittance obligations.
Annual reports would include the GHG emissions attributed to the facility and the production amount by industrial activity. The Quantification Methods for the Oil and Gas Sector Greenhouse Gas Emissions Cap Regulations (the Quantification Methods) would define methods to calculate each source of emissions and would provide certain default values. In addition to the draft regulations, the government is seeking feedback on the Quantification Methods.
All operators would be required to register and report, but only large operators (producing above an annual threshold of 365,000 barrels of oil equivalent) would have to remit allowances to cover their emissions. Large operators account for approximately 99% of the upstream sector’s emissions. The government would distribute emissions allowances to covered operators annually, before the start of each compliance year. Allowances would be pro-rated across all covered operators’ facilities based on historical production volumes. Allowances would not be able to be used for compliance under other carbon pricing systems, such as the federal Output-Based Pricing System (OBPS). There would be no limits to the number of allowances operators covered under the oil and gas GHG pollution cap could hold, and allowances could be traded among operators.
Emissions allowances and offsets could be banked for use in a limited number of future years. Decarbonization units would not be tradable or bankable.
Economic impacts of the proposed Regulations
Environment and Climate Change Canada undertook an economic cost-benefit analysis of the proposed Regulations. Costs and benefits have been evaluated relative to a baseline that assumes production in the oil and gas sector grows, existing federal and provincial GHG measures remain in place, and the sector achieves the 75% reduction in methane emissions relative to 2012 levels, as a result of the forthcoming oil and gas methane regulations.
The proposed pollution cap Regulations are estimated to result in net cumulative GHG emission reductions of 13.4 Mt above the baseline of reductions between 2025 and 2030-2032 that will be achieved by existing measures. That incremental reduction is valued at almost $4 billion in avoided global climate change damages. When compared to the costs, modelling showed that the proposed Regulations are estimated to have net benefits of $428 million for Canada.
Importantly, this multi-million-dollar benefit does not account for a wide range of additional benefits likely to be associated with the proposed Regulations, including:
- the additional economic activity and jobs associated with post-2032 investments in carbon capture, utilization and storage (CCUS) and other major decarbonization activities;
- the stimulation of innovation and new low-carbon industries, such as clean hydrogen;
- the economic and health benefits of reducing air pollution, which will improve the quality of life for many people and reduce the strain on our healthcare systems; and
- the longer-term competitiveness benefits of a decarbonized Canadian oil and gas sector in a world that continues to take action to fight climate change and adhere to existing international and domestic climate commitments.
The oil and gas sector directly and indirectly supports a significant workforce, especially in British Columbia, Alberta, Saskatchewan, and Newfoundland and Labrador. Modelling for the 2019 to 2030-2032 period shows that labour expenditure in the sectors covered by the proposed Regulations is expected to grow by 53%, which is only slightly below the 55 % growth in the baseline scenario.
Additionally, jobs in clean energy will continue to grow. A 2023 Clean Energy Canada report found that Canada will see 700,000 more energy jobs in a carbon-neutral 2050 scenario than we have today. 419,000 of these jobs will be in Alberta, representing three jobs for every individual worker employed in Alberta’s upstream energy sector as of 2022.
Oil and gas prices correspond to global market demand, and they do not typically reflect the cost of production. As such, the risk of compliance costs passed through from the oil and gas sector to Canadians is very low, and the proposed Regulations are not expected to affect the cost of everyday items such as fuel or groceries.
Provincial leadership
British Columbia previously announced it will put in place an oil and gas emissions cap to serve as a backstop to the federal policy. The goal will be to meet BC’s greenhouse gas emission reduction targets and avoid regulatory duplication and administrative burden for the oil and gas sector.
Alberta, in its Emissions Reduction and Energy Development Plan (2023), communicated its goal to achieve carbon neutrality by 2050 and signalled it would explore options to achieve a 75-80% reduction in methane emissions from conventional oil and gas by 2030. Alberta has had a price on carbon emissions since 2007, making it the first jurisdiction in North America to price carbon. The province’s industrial carbon pricing system, implemented as set out in the Technology Innovation and Emissions Reduction (TIER) Regulation, recycles its proceeds to invest in emissions reduction projects including in the oil and gas sector, such as methane emissions abatement.
Saskatchewan is a leader in carbon capture and sequestration technology, with several projects aimed at capturing CO2 emissions from oil and gas production. In 2014, the Boundary Dam project became the first power station in the world to successfully use carbon capture and storage technology. The province is also addressing methane emissions, including improving leak detection and repair practices and implementing best practices for gas flaring and venting.
Newfoundland and Labrador’s offshore oil sector is already one of the lowest-emitting in the country. The newest planned production project—Bay du Nord—was approved with the historic requirement for the project to reach net-zero emissions by 2050. Like all other oil- and gas-producing provinces, NL implements a price on industrial carbon emissions via its provincial output-based pricing system.
Note on third party reports
The Government of Canada is aware of third-party reports conducted by Conference Board of Canada, Deloitte and S&P.
These reports are based on a broad range of assumptions including elements of the previously published Regulatory Framework or, in some cases, other assumptions made by the authors. A common assumption found in the reports was that the oil and gas sector would take limited to no additional action to reduce emissions without the regulations.
These reports do not reflect an accurate analysis of the current draft regulations. The Government of Canada welcomes continued sharing of analysis to help refine the proposed Regulations.
Environmental group opposes renewal of emissions exemption for Algoma Steel in Sault Ste. Marie.
Since 2021, Algoma Steel has been surpassing limits on four chemicals: benzene, benzo(a)pyrene, sulfur dioxide and particulate matter.
Kerrie Blaise, a lawyer and the founder of Legal Advocates for Nature’s Defence, said exceeding benzene levels is especially troubling to her.
That is a toxin for which there’s no safe level and that has already been linked to hotspots for acute myeloid leukemia in the Sault Ste. Marie area,” she said.
In an email to CBC News, Ontario’s Ministry of the Environment said that Algoma Steel is currently under an abatement plan that was accepted in August 2024.
The company’s latest application is for a new site-specific standard for air emissions as it transitions from integrated basic oxygen steel making to a cleaner electric arc furnace.
Algoma Steel CEO, Michael Garcia, said the company’s current furnace in Sault Ste. Marie was built in the 1970s and uses iron ore, limestone and coal, cooked at high temperatures in coke ovens to produce steel. However, during an interview on Monday with CBC Radio, he said all that is due to improve.
“Electric furnace technology is a different process for making steel,” Garcia said.
“We use scrap metal to make steel; scrap metal from recycled automobiles, recycled durable goods, as well as other types of virgin metallic units.”
Garcia said Algoma Steel will start making “green steel” with its new furnace in the first quarter of next year.
Although it won’t be fully operational until 2029, Garcia said the electric arc furnace will reduce the company’s emissions by 70 per cent when it’s up and running.
But he added there will be a transition period where both furnaces are running, as the company ramps up its production with the new electric arc furnace.
He said the company’s application for a site-specific standard is to reflect the additional emissions that will come during that transition period.
The comment period for Algoma Steel’s submission ends on Monday, Nov. 4.
But Blaise, of Legal Advocates for Nature’s Defence, said there’s currently no indication as to when the Ministry of the Environment will make its decision.
“So I would say even if you missed Monday’s deadline, continue to submit your concerns,” she said.
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