A new initiative by the provincial government to reduce Alberta's environmental impact could do exactly the opposite, while causing unwanted affect on energy producing areas, according to local politicians.
On Nov. 1, the provincial government introduced the Oil Sands Emissions Limit Act, which, if imposed, would put a cap on oils sands emissions.
The legislation limits oil sands greenhouse gas emissions to a total of 100 megatons annually.
Currently, Bonnyville-Cold Lake MLA Scott Cyr said Alberta only uses a total of 80 megatons.
“I do understand that by putting a cap in the intent is to reduce our carbon footprint, but the question is how is a cap going to do that when we are currently sitting at around 80 megatons?” he said. “Our carbon footprint is actually going to grow over the next few years, not be reduced.”
He added the possibility of the NDP enforcing the cap is unlikely, and said once implemented the NDP government is likely to raise the cap again once conflict arises.
“Two years from now, when we have oil companies struggling because of the cap, they are just going to raise it up anyway,” Cyr gave as an example.
Another concern he has is how the calculation completed came to a total of 100 megatons, as the provincial government has not yet released a study.
“I don't know where they came up with the 100 megatons, and that is one of our big questions. It does appear that they just pulled it out of the air,” he said, adding he would have preferred for the government to complete an impact study on the industry, prior to moving forward with the act.
“I do believe the better route is to work with the industry and see how they can be more efficient, and they will work on their own to bring their carbon footprint down.”
Currently, there is no cap on oil sands emissions. Once implemented, the cap would apply to in-situ sites, processing plants, primary production, enhanced recovery and experimental schemes, and buildings, equipment, structures, and vehicles associated with those sites.
“There are some concerns that it will limit the small to medium sized oil companies from participating in exploration in Alberta,” said Cyr, noting it could impact future development for some of the local companies.
“If the local oil companies can't grow, than we are not getting well paid jobs in our area, so this will affect us.
Although the act would not be implemented for some time, Cyr expressed his concern that it could hinder industry growth in his constituency.
“It probably won't affect us for a couple of years, but I have concerns that in the end, our growth in Bonnyville and Cold Lake could be hampered by the fact that this cap is in place,” he said.
Wildrose Leader Brian Jean said the cap “is yet another step by the NDP government that will hamper investment and create uncertainty in Alberta's oil and gas sector.”
He added that according to research completed by the Fraser Institute, the policy has the potential to constrain future oil sands production.
“Putting a limit on oil sands emission shows Alberta can be an energy producer and a world leader on climate action,” said Shannon Phillips, minister responsible for the climate change office. “It will drive innovation and reduce emissions per barrel, while still allowing for production growth and development.”
The act is the government's next step in the Climate Change Leadership Plan, and would see a cost of $30 per tonne applied to oil sands facilities.
The cap would take effect after being passed in the legislature, but there would be no obligation for oil sands producers to pay up until after a regulatory system has been designed and implemented.
In the spring of 2017, the Oil Sands Advisory Group will review the implementation and offer their advice.
The group includes CNRL, Cenovus, ConocoPhilips Canada, Meg Energy, Shell Canada, Statoil Canada and Suncor.
Organizations such as GE Canada, Environmental Non-Governmental Organization caucus of the Oil Sands Advisory Group, and Canada's Oil Sands Innovation Alliance, stand behind the implementation of a greenhouse gas emissions cap.
“By investing in emissions reduction technology, the Government of Alberta is not only reducing emissions in Alberta, it is playing a leadership role in the solution space to the global issue of climate change,” said Dan Wicklum, executive chief for Canada's Oil Sands Innovation Alliance. “With the technology being developed in Alberta, we are confident Alberta can grow its industry while reducing emissions.
Cyr begged to differ, and said although he agrees that the province should be conscience of the environment, this may not be the best method.
“I, like every other Albertan, want to protect our environment, but this is just a very poor way of saying the NDP is doing something.”
