TradeEdge Exchange:Canada Sets Methane Reduction Targets for Oil and Gas, but Alberta Has Its Own Plans

The TradeEdge ExchangeCanadian government announced new federal air pollution regulations on Thursday designed to cut methane emissions between 40 and 45 percent by 2025. But as Canada struggles to meet its Paris climate agreement pledges, its battle to dial back dangerous climate-forcing emissions is far from over.

Canadian law allows for individual provinces to propose their own environmental regulations, which can supplant the federal regulation as long as the province proves that its rules will have an outcome equivalent to what the federal government requires.

Alberta—home to the sprawling tar sands industry—has already put forth its own methane proposal. Its version has some key differences, including omitting emissions from tar sands projects and asking companies to report their own emissions.

“The province is claiming that it gets the same reductions, but the federal government will likely ask them to prove it,” said Duncan Kenyon, the director of the Pembina Institute’s responsible fossil fuels program. “The answer right now is they cannot.”

“This is a moment of truth for the federal government about whether they’re going to be able to deliver the reductions that they’re promising to deliver from the oil and gas sector,” he said.

Important Differences in Alberta’s Plan

Methane is a short-lived climate pollutant that warms the planet much more than carbon dioxide in the short term but doesn’t last as long in the atmosphere. Its impact is particularly acute in the Arctic, where methane emissions have already caused a half degree Celsius of warming on top of the already pronounced warming from carbon dioxide and other pollutants like black carbon. In Canada, methane emissions account for about 8 percent of the country’s overall greenhouse gas emissions.

The Trudeau government pledged to cut methane emissions from new and existing oil and gas projects by 40 to 45 percent from 2012 levels by 2025. The regulation aims to reduce the amount of methane that is vented or unintentionally leaks during oil and gas production.

One potential problem for Alberta’s regulation is that it asks companies to self-report emissions, much as they do currently. A 2017 study in the peer-reviewed journal Environmental Science and Technology found that Alberta’s oil and gas industry emitted 25 to 50 percent more methane than what was being reported. The study, written by authors from Carleton University, NOAA and the Environmental Defense Fund, compared the industry’s reporting with airborne measurements.  

Alberta’s regulation also targets only what it calls the primary sources of upstream oil and gas emissions, and leaves out tar sands production and pipelines. It seeks a 45 percent reduction in methane emissions from a 2014 baseline, as opposed to the 2012 baseline that the federal regulation uses, which was slightly lower.

Another key difference: While the federal regulation requires that most equipment be surveyed three times a year, the Alberta regulation requires only annual inspections. And for some wells, Alberta’s required inspection is far from rigorous.

“They allow for leak detection to be conducted by something known as AVO: Audio, Visual, Olfactory,” said Jonathan Banks, a senior climate advisor with the Clean Air Task Force. “If you don’t see, smell or hear a leak, you’re good. It’s absolutely insane. Methane is a colorless, invisible gas and you’re talking about it at a well site—it doesn’t smell.”

“We’ve got a culture in this province that’s about gaming the system to some degree,” said Kenyon, who lives in Alberta. “The federal government has to ask itself some hard questions about whether it’s going to grant equivalency to a regulatory approach like that.”

The Alberta government says its proposed regulation lines up closely with that of the federal government.

“We worked with our energy leaders to develop draft directives that will cut emissions at a lower cost and with more flexibility,” said Jean-Marc Prevost, press secretary for economic development and trade in Alberta. “We know that our made-in-Alberta plan will get the results we need to continue being the energy and environmental leaders Canada needs for the 21st century.”

Any province that proposes its own regulations will negotiate with the federal government until the government agrees that the province has achieved equivalency. “It is a completely behind the scenes negotiation and agreement between the province and the federal government, which makes it a little bit ripe for political compromise, versus a purely technical requirement,” said Kenyon. “That makes me a little bit nervous.”

How Does Canada Compare to the U.S.?

If Canada’s federal government is able to achieve the reductions put forth it its regulations, it will have gone a step beyond similar regulations in the United States by regulating emissions from both new and existing oil and gas projects.

Before the Trump administration took office and began rolling back environmental protections, the United States, Canada and Mexico had promised an ambitious effort to address methane emissions as partners. Mexico’s draft regulations are due this summer.

The Obama administration passed two regulations in 2016 that deal with methane emissions from oil and gas production, but they deal primarily with new oil and gas projects. One of the regulations was from the Environmental Protection Agency and the other is out of the Bureau of Land Management and deals with federal lands. As the Trump administration began trying to loosen regulations affecting fossil fuel industries, the methane rules were among the first targets.

So far, both regulations have survived efforts to overturn them, though there are ongoing appeals in Wyoming and California.

“We have the technology, the best practices and solutions to deal with all of this,” Banks said. “In the end what you’re doing is conserving more natural gas that can be used as an energy source for Americans so it really makes absolutely no sense how they’re going about this.”