Let’s talk about B.C. LNG and global emissions

September 21, 2018


When we talk about reducing our greenhouse gas emissions, “carbon leakage” is an important factor to consider.


Carbon leakage happens when one country’s, or province’s, climate policies cause greenhouse gas emissions (GHGs) to move to another state, province or country. Instead of reducing greenhouse gas emissions, the emissions just move somewhere else.


For example, a company producing a product in “Country A” is told by that country’s government that it must reduce its emissions to meet strict new climate targets. But the company looks at the cost and work involved to reduce its emissions and instead decides to move next door to “Country B” where there are more lax emissions rules.


The end result is that the product is now produced with more emissions than before because the company no longer operates under strict climate rules put in place to reduce emissions.  The carbon emissions just “leak” somewhere else. That’s “carbon leakage.”


A state, province or country can lower its own emissions through strict policies but they haven’t actually lowered global emissions at all if the goods or services that were produced move to other states, provinces our countries. The strict policies in one country could actually lead to HIGHER global emissions if the goods or products instead supplied from countries with lax emissions regulations.


When it comes to global emissions, there hasn’t been any reduction and, in fact, we’re worse off because combatting climate change requires a reduction in global emissions.


LNG produced here in B.C. will have 50 percent fewer emissions than LNG produced anywhere else in the world because we have both strong emissions regulations and a carbon tax. B.C. is the only place in the world, aside from Norway, to put a carbon tax on LNG production.


In B.C., emissions from LNG facilities are limited to an amount lower than LNG facilities anywhere in the world. When it comes to extracting natural gas, the province has set out a goal to further reduce emissions from oil and natural gas extraction by 45 percent by 2025. That includes reducing or eliminating fugitive methane emissions.


We also have strict rules regulations in B.C. for hydraulic fracturing, the method we have used to produce our domestic natural gas for 60 years, with measures in place to protect the environment such as water recycling and energy from solar panels. Combined, these actions and regulations will result in B.C. having the lowest-carbon footprint LNG anywhere in the world. This is important because demand for LNG around the world is expected to nearly double by 2050 as countries use LNG to switch from coal to natural gas or use natural gas to provide backup power for renewable energy.


Supplying the world with the lowest-carbon-footprint LNG will go further in reducing global emissions when LNG from B.C. is used to replace coal. We need to look at the big picture -natural gas from one large LNG plant in B.C., exported to Asia, could provide enough energy to replace or displace up to 40 coal-fired power plants with cleaner-burning natural gas. This could reduce global GHG emissions by 60 million to 90 million tonnes of CO2 per year — an amount greater than B.C.’s total annual emissions and roughly 10 per cent of Canada’s annual GHG emissions.


Carbon leakage also leads to the leakage of jobs and revenue that could benefit British Columbians to other parts of the world. If LNG is not produced in B.C., this means jobs and revenue we could have benefitted from going elsewhere- likely the United States- where their lax regulations will see the world supplied with LNG with higher emissions.


B.C. can be a global example in producing the lowest-carbon footprint supply of an energy source the world clearly wants. If we don’t lead the way and demonstrate the best practices to produce LNG for the world with the lowest emissions – who will?


David Keane, President and CEO, BC LNG Alliance

CLICK HERE to read about how LNG gives British Columbians a fair return for our natural resources