Category Archives: Environment

The chickens have come home to roost for Alberta Premier Jason Kenney. Kenney bet around $1.5 billion of public money on a very risky prospect — the highly controversial Keystone XL pipeline.

U.S. President Joe Biden, to the surprise of no one but Kenney, followed through on an election promise and cancelled a key permit for the pipeline on the first day of his administration. Now the premier is scrambling for a way to recoup some of Alberta’s losses, and he sees a trade agreement as offering some hope.

The former North American Free Trade Agreement (NAFTA) contained a chapter on investment that allowed foreign investors to sue governments in international arbitration. The owner of Keystone XL — TC Energy (previously TransCanada) — used NAFTA to launch a US$15 billion lawsuit in 2016 after President Barack Obama cancelled the project.

At the time, some legal experts thought the company had a reasonable chance of winning. We will never know, because the case was dropped when President Donald Trump indicated he was willing to let the project proceed.

Donald Trump flanked by other lawmakers in the Oval Office of the White House. — President Donald Trump approves a permit to build the Keystone XL pipeline on Mar. 24, 2017.
(AP Photo/Evan Vucci)

This time may be different if TC Energy chooses to proceed with a claim. NAFTA has been replaced by a new agreement — the U.S.-Mexico-Canada Agreement (USMCA). Unlike NAFTA, USMCA does not permit Canadian investors to sue the U.S. government (or American investors to sue the Canadian government).

Legacy claims for investments that had occurred prior to the USMCA coming into force are permitted until 2023. But TC Energy’s claim may now be weaker because the permit issued by the Trump administration explicitly stated that it could be rescinded, essentially at the president’s whim.

Nevertheless, many investors have proceeded with claims on the basis of much weaker cases. Investors bet on positive outcomes in arbitration, as much as they bet on governments not taking action to halt catastrophic climate change. This is because the anticipated rewards, in both instances, are high.

Risky business

One example of an incredibly dubious investor claim is the one launched by Westmoreland Mining Holdings against Canada in 2018. Ironically, this case concerns action that the previous Alberta government took to address climate change.

Alberta’s 2015 Climate Leadership Plan included a provincial phaseout of coal power, which left Westmoreland — an American coal mining firm — without a future market for its coal. The company is arguing that Alberta’s failure to provide Westmoreland with “transition payments,” like those that power companies received, is a breach of NAFTA.

The case is ongoing and outcomes of arbitration are very difficult to predict. But it demonstrates a concerning trend, as do other cases that have emerged in Europe.

Fossil fuel companies have been well aware of the damage their industry causes for decades, yet they have exerted substantial efforts to try to slow climate action. They have taken bets on risky investments in the hopes that governments would continue to dither as the planet burns. Now that climate action is starting to ramp up, they want to be “compensated” for their losses.

A news conference in the Roosevelt Room of the White House — President Barack Obama, accompanied by Vice President Joe Biden and Secretary of State John Kerry, announces he’s rejecting the Keystone XL pipeline because he does not believe it serves the national interest, on Nov. 6, 2015.
(AP Photo/Susan Walsh)

A global problem

Climate activists may be tempted to dismiss the threat that investment treaties pose to action on climate change. After all, the Canadian and U.S. governments have the resources to rigorously defend themselves in arbitration and they often win. Indeed, the U.S. has never lost a case. Furthermore, governments already subsidize the industry to the tune of hundreds of billions of dollars per year, so is a few more billion in “compensation” really going to make much of a difference?

The problem is that climate change is a global issue and so too is the coverage of investment treaties. Many of the fossil fuel reserves that need to stay in the ground and assets that need to be stranded in order for us to remain below 1.5C of warming are in the Global South.

Number and percentage of foreign-owned coal plants protected by at least one treaty with investor-state dispute settlement (ISDS) in place, by host state.
(Kyla Tienhaara and Lorenzo Cotula), Author provided

For example, a large number of planned and newly operating coal-fired power plants are in countries like Indonesia and Vietnam. A recent study found that many of these plants are protected by investment treaties. These countries have fewer resources for fighting claims and a much poorer record of success in arbitration.

A real concern is that even the threat of a big investor claim could be enough to dissuade one of these governments from taking action to phase out coal.

A global solution

We need climate action to happen everywhere, not just in the countries where governments can afford to fight legal challenges. This is one of the reasons why many are calling for radical reform or complete abolition of international investment treaties.

In Europe, campaigners are making headway on efforts to remove protection for fossil fuel investments from the Energy Charter Treaty. Countries like South Africa are pushing for investment treaties to be aligned with the Paris Agreement and the UN’s Sustainable Development Goals. Researchers have also suggested that the problems with investment treaties could be addressed with a Global Green New Deal.

In the meantime, the Canadian public should make it clear to TC Energy and Jason Kenney that they should drop any plans to pursue a legal challenge, and own up to the fact that they alone are responsible for their own poor investment decisions.

Kyla Tienhaara, Canada Research Chair in Economy and Environment, Queen’s University, Ontario

This article is republished from The Conversation under a Creative Commons license. Read the original article.

New Offshore Drilling Permits Could Put Canada’s Climate Targets Out of Reach, Endangered Right Whales at Risk

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Photo by FlickreviewR, (CC BY 2.0)

The federal government is putting its own climate targets out of reach, triggering higher carbon dioxide and methane emissions, putting endangered North Atlantic right whales at further risk, and undercutting the new impact assessment process it adopted less than two years ago, according to environmental groups reacting to the approval of three new fossil exploration projects off the coast of Newfoundland and Labrador earlier this week.

“In approving projects like this, the federal government likes to say the project-specific emissions are insignificant,” said Gretchen Fitzgerald, Halifax-based national program director with the Sierra Club Canada Foundation (SCCF). But “the reason for exploratory drilling is to get to production drilling, and this approval is a precursor for projects that are designed to result in decades-long investments in fossil fuels, which is inconsistent with the need to taper off production.”

“Exploration drilling in this area will affect ecologically or biologically significant areas, marine refuges, and even areas closed to fisheries,” said Mark Brooks, WWF-Canada’s senior specialist, sustainable resource development. And “despite the federal government’s declaration of a climate emergency and its commitment to reducing greenhouse gases, the assessments lacked analysis of the climate impacts of these operations and subsequent production drilling operations.”

“Expanding the offshore oil industry would make it virtually impossible for the province, or Canada, to meet its climate commitments,” said Julia Levin, climate and energy program manager at Environmental Defence. “The approval of three offshore exploration drilling projects highlights a lack of a framework for aligning energy decisions with what must be done to tackle the climate crisis.”

“These projects will create good jobs,” declared Natural Resource Minister Seamus O’Regan, whose St. John’s constituency is some 350 to 375 kilometres from the drill sites, in a release issued by the Impact Assessment Agency of Canada (IAAC). “They’ll also meet the highest standard of environmental protection. This is good news for our Offshore.”

The three approvals, issued to BHP Petroleum (New Ventures) Corporation, Equinor Canada Ltd., and Chevron Canada Ltd. by Environment and Climate Minister Jonathan Wilkinson, “will allow the proponents to determine the presence, nature, and quantities of the potential hydrocarbon resources within their exploration licences,” IAAC said. “The decision on the projects follows thorough environmental assessments, which concluded they are not likely to cause significant adverse environmental effects when mitigation measures are taken into account.”

Those project conditions cover fish and their habitats, migratory birds, species at risk, and resource use by Indigenous peoples.

“Environmental assessments which are based on science and meaningful consultations with Indigenous peoples and the public are key to responsible resource development,” Wilkinson said. “These resource projects will provide economic opportunities for many Canadians, and the legally-binding conditions imposed throughout the life of the projects will protect the environment for generations to come.”

None of which reflects the estimated 52 million barrels of oil and 200 trillion cubic feet of fossil gas in the Newfoundland offshore, according to a 2019 assessment cited by Fitzgerald, equating to 33.38 billion tonnes of carbon dioxide equivalent (CO2e)—the same as 43.44 years of emissions from the entire Canadian economy, or the annual tailpipe emissions from more than seven billion cars.

“Canada’s plans to expand the oil and gas industry off Newfoundland and Labrador will ensure the province does not meet its climate targets,” she told The Mix. If the province’s fossil reserves were all extracted, she added, they would use up 14% of the 2019 global carbon budget consistent with 1.5°C average global warming.

Moreover, “there is no realistic plan to deal with a major spill out there, and some of the leases overlap with what is meant to be a marine refuge, and will be prefaced by seismic blasting that harms marine life, including endangered whales,” Fitzgerald added in an email. “So these approvals are reckless from an ocean protection and biodiversity point of view, as well.”

The global population of North Atlantic right whales is down to only 356, groups say. They contend the federal assessments also failed to adequately assess the potential cumulative impacts of all the region’s oil and gas drilling operations, including possible seismic airgun surveys, increased vessel traffic, fishing activities, and climate change impacts. [The link for seismic airgun surveys points to a video that runs less than two minutes. But turn down the sound before you play it.—Ed.]

Coming on the heels of a C$41.5-million subsidy last month to try to salvage Cenovus Energy’s West White Rose offshore drilling project, “these latest drilling approvals are part of a trend,” Brooks added. “The federal government appears to be doing whatever it can to prop up an increasingly unviable industry, including rushing through the Newfoundland-Labrador Offshore Exploratory Drilling Regional Assessment” despite a court challenge by WWF-Canada, SCCF, and Halifax’s Ecology Action Centre.

“These environmental assessments do not inspire confidence that drilling will be conducted safely with the lowest possible risk to human health, the marine environment, and the climate,” he said.

Used with permission from The Energy Mix.

Parade of Alberta Coal Developments Threatens Recreation Areas, Biodiversity

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EDMONTON — At least five popular recreation areas in southern Alberta are surrounded by coal exploration plans and one of them has been partly given over to an exploration lease, raising questions about their future with lovers of the outdoors.

“We’re not leaving a picnic table and a campground on the precipice of an open-pit mine,” said Katie Morrison, conservation director with the Southern Alberta chapter of the Canadian Parks and Wilderness Society. “I can’t imagine that (parks) could continue if some of these mining plans go forward.”

A provincial spokesperson said no development will occur in the parks.

Information released this week by the province shows about one-third of the Oldman North provincial recreation area, a campground north of the Crowsnest Pass, is covered by an exploration lease granted last August to Elan Coal Ltd.

“Any development would require notification to Parks Division,” said a government email. “Any exploration would be expected to avoid any entry into the (provincial recreation area), but you can see that the coal agreement does surround (and enter) parts of the park.”

Morrison notes that Elan’s plans show a mine pit almost on the border of Oldman North.

Maps compiled by environmentalists show four other areas—Livingstone Falls, Honeymoon Creek, Dutch Creek, and Racehorse—have become islands in a sea of coal exploration leases.

Exploration typically involves drilling and road building. Mine construction would only happen after regulatory review.

Alberta Environment and Parks spokeswoman Jess Sinclair said the recreation areas are safe. “No industrial development or exploration will occur within any parks or public recreation areas within Alberta,” she told C, adding that the Oldman North lease “lies outside the boundaries of the (recreation area) itself.”

Elan did not respond to a request for information, but its website says the company is committed to good environmental stewardship. “We acknowledge the potential of our operations to impact water resources and will employ a proactive risk management approach to water management,” it says.

The five recreation areas are popular, said Neil Keown of Backcountry Hunters and Anglers. In good weather, the parking lot for Oldman North is full by 9 AM, he said.

“From the motorized or random camping perspective, that entire region is exceptionally popular. There are hundreds of anglers that descend on that stretch at any given time.”

The Alberta government is promoting metallurgical coal development. It has rescinded decades-old policy blocking activity in a large swath of the eastern slopes of the Rocky Mountains and is reopening water allocation agreements with coal mines in mind. The policy decision is facing a request for a judicial review.

Environment Minister Jason Nixon recently told outdoors blogger and webcaster Michael Short that parks are safe from coal development.

“They’re not being made into coal mines,” he said November 30. “That’s not happening. There’s strong laws to prevent that and rightly so.”

But Morrison wonders.

“(Nixon) either hasn’t looked closely at where coal exploration is happening in relation to these parks, or he isn’t lining those two things up,” she said. “We can see very clearly that there’s coal exploration and activity happening right around these places, and they will be threatened by coal.”

Research published late last year identified the region being explored for coal mining as one of Canada’s environmental “hot spots”—areas that have a high potential for recreation and which offer environmental benefits such as biodiversity and fresh water for millions downstream.

This report by The Canadian Press was first published January 8, 2021.

This article was reprinted with permission from Energy Mix.

Is Net-Zero 2050 Just Another Spin on Climate Action

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By Rolly Montpellier @Below2C_ – January 5, 2021

Canada and many jurisdictions around the world have committed to achieve net-zero emissions by 2050 or before. But is the setting of climate targets, decades into the future, not just another spin on climate action—an abdication of the climate leadership that the scope of the challenge requires so desperately?

What is Net-Zero 2050?

Net-zero emissions are defined by the Canadian Net-Zero Emissions Accountability Act—tabled on November 19, 2020—as “the anthropogenic emissions of GHGs (i.e. GHGs caused by human activity) into the atmosphere balanced by the anthropogenic removal of GHGs from the atmosphere over a specified period of time.”

Or more simply put, net-zero happens when:

there are no carbon emissions, or
when ongoing emissions are offset by actions that remove carbon from the atmosphere, such as planting trees, or
when carbon recapture technology removes emissions from the atmosphere.

A Long Way to Net-Zero

The rush to net-zero—the carbon neutrality pledge—is gaining strength as countries ramp up their climate ambition. At the recent virtual Climate Ambition Summit, new major commitments from the United Kingdom and the European Union combined with China’s update of its NDC targets have increased momentum going into 2021. This will also be the year the U.S. Biden-Harris administration rejoins the Paris Agreement in time to play a determining role leading up to the Glasgow COP26 climate summit in November.

While we’re seeing some progress, with an increasing number of countries committing to net-zero, these are just “distant hypothetical targets,” says Greta Thunberg. “When it comes to the immediate action we need, we’re still in a state of complete denial…the gap between what we need to do and what is actually being done is widening by the minute.”

My name is Greta Thunberg and I am inviting you to be a part of the solution.

As #ParisAgreement turns 5, our leaders present their 'hopeful' distant hypothetical targets, 'net zero' loopholes and empty promises.⁰⁰
But the real hope comes from the people.⁰
#FightFor1Point5 pic.twitter.com/o9mmFuIoyI

— Greta Thunberg (@GretaThunberg) December 10, 2020

Net-Zero Myths

Popular thinking is that Net-Zero 2050 will solve the climate crisis. Not so according to Climate Home News (CHN). A recent article in CHN exposes 10 myths about carbon neutrality targets and the carbon offsets and unproven technologies that underpin the net-zero concept. “Net-Zero” has a lot of political and emotional appeal but “in practice, however, net zero targets several decades into the future shift our focus away from the immediate and unprecedented emissions reductions needed,” according to the article.

The article (authored by 41 scientists) dispels ten myths about net zero targets and carbon offsetting. You can read the full article here.

“Major and unprecedented reductions in emissions are needed now. Otherwise, our current high emissions will consume the small remaining global carbon budget within just a few years. Net zero targets typically assume that it will be possible to deliver vast amounts of “negative emissions”, meaning removal of carbon dioxide from the atmosphere through storage in vegetation, soils and rocks. However, deployment of the technologies needed for negative emissions at the required scale remains unproven, and should not replace real emissions reductions today.”

Two of the article’s key recommendations follow:

“We must stop extracting and using fossil fuels, the primary cause of the climate crisis. As well as real-zero targets, we need an international treaty for the termination of fossil fuel production.”

“We must shift focus from mid-century net-zero targets to immediate, real emissions reductions in our own high-income countries. Reductions of at least 10% per year are needed”.

Auction of Promises

Forbes contributor Roger Pielke uses the term “auction of promises” to describe how politicians launch “targets and timetables for emissions reductions [that] are easy to state but difficult to comprehend.”

His analysis indicates “that the world, and the United States, are not moving towards net-zero carbon dioxide emissions and in fact, every day, we are moving in the opposite direction.”

Using mtoe (million tons of oil equivalent) as a unit of comparison, Pielke claims that the world requires a new nuclear power plant every day to get to net-zero 2050, i.e. to replace fossil energy. That’s one nuclear plant every day for the next 10,587 days to January 1, 2050.

In his recently released new book, Commanding Hope – The Power We Have To Renew A World In Peril, author Thomas Homer-Dixon writes that “Sometime in the not-so-distant future, about 2030 or 2040…humanity will hit a much more unforgiving wall [than COVID]—a series of undeniably disastrous climate events occurs.”

“A switch then flips in the psyches of great numbers of people everywhere…The majority of us…suddenly realize three things at once: the situation is already becoming catastrophic, everything we care about is at grave risk, and most importantly, it’s too late to do anything significant to forestall catastrophe on a world scale.” — Thomas Homer-Dixon.

And that surely is the likely outcome of following the illusory and blue sky Net-Zero 2050 mindset.

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

Reports of Lowered Greenhouse Gas Emission Intensity in Alberta

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An email being circulated by Emissions Reduction Alberta (ERA) is boasts that a new study concludes that when Alberta specific data is used, upstream greenhouse gas (GHG) intensity numbers of oil sands production pathways are 14 to 35 per cent lower than previously published in Masnadi et al. Emerging technologies assessed in the study can further reduce upstream Steam Assisted Gravity Drainage (SAGD) emissions by 14 to 19 per cent.

A link to download the report leads to the Science Direct website, which is well known for its high credibility in publishing factual peer-reviewed science. With the economy trending towards global warming, it’s very important that the entire planet is on a path to reduce emissions.

An article and report on the Canadian Energy Centre website, published in August, certainly seems to agree with this consensus. Key findings support Alberta’s endeavours to reduce emissions:

Canada’s emissions intensity has fallen by 30 percent since 2000
Canada’s emissions intensity is lower than a number of other energy-producing and consuming nations
Canada’s mining, quarrying, and oil and gas extraction sector compares favourably with a number of other industrial sectors in Canada
Fuel combustion emissions intensity in Canada’s industrial sector is also falling and is comparable with a number of other energy-producing countries
Oil sands emissions intensity has been falling over the past decade
Oil sands sector will drive future emissions intensity reductions through 2030]

These are timely reports that are really needed, considering there is a steady run of investors pulling their support out of the oilsands. In October, BNN Bloomberg point ed to five leading Canadian fossils that have lost nearly $100 billion in share value over the last five years, while the Institute for Energy Economics and Financial Analysis (IEEFA) lists 50 “globally significant financial institutions” that have restricted their involvement with tar sands/oil sands projects.

In December, New York State’s pension announced plans to drop the “riskiest” oil and gas stocks from its massive investment portfolio by 2025.

These are not the only ones — more can be found.

The study on Science Direct was funded by the ERA and Alberta Innovates. “Alberta specific data is used,” implies it was invented in Alberta. Alberta Innovates is funded by the provincial government, just as the Canadian Energy Centre (Kenney’s war room) is. It seems this could all be considered a waste of taxpayer money and resources.

It’s true that operational efficiency improvements, oil sands emissions per barrel have decreased 36% from 2000 to 2018, and GHG emissions from oil and gas production have gone up 23% between 2000 and 2018, largely from increased oil sands production. Lowering the intensity numbers of oil sands per barrel doesn’t help when the technology is used so production can be ramped up. Painting a rosy picture of Alberta’s GHG, isn’t fooling anyone. These numbers need to come down, to levels aligned with our global commitments.

Further proof — just follow the money. It’s leaving.

Steve MacLellan

Ramble On

Category Archives: Environment

Keystone XL legal risks highlight dangers of putting investors before climate change

New Offshore Drilling Permits Could Put Canada’s Climate Targets Out of Reach, Endangered Right Whales at Risk

Parade of Alberta Coal Developments Threatens Recreation Areas, Biodiversity

Is Net-Zero 2050 Just Another Spin on Climate Action

Reports of Lowered Greenhouse Gas Emission Intensity in Alberta