According to a new report released by the Canada Energy Regulator, fossil fuels will still constitute a substantial part of energy sources over the next 30 years. In the report, the agency alerts much more aggressive measures will be needed to reach net-zero emissions by 2050 in the country.
Fossil fuels will still be necessary for a net-zero country
The Energy Futures report, released Tuesday, projects oil and gas would still make up nearly two-thirds of energy sources (64%) by 2050. Despite the increase in policies to curb emissions, such as the most recent federal bill to enshrine into law Canada’s target to be net-zero three decades from now, the agency foresees those measures won’t be enough.
Gitane De Silva, Regulator CEO, told The Canadian Press that the report’s goal isn’t to criticize any existing policy but illustrate how things could go in the years to come using some current and potential assumptions.
In that regard, the Regulator report presents two potential scenarios for energy use in Canada. The first involves a picture where current policies are the only ones in place. The second one, known as an “evolving scenario,” looks into the effects of expanding those policies through carbon taxes and lower costs in renewables transitioning.
Regarding the evolving scenario, the report looks at what would happen if the carbon tax is hiked to $125 from the existing $50 per tonne of emissions produced cost. With current policies, the Government expects the tax to remain at $50 by 2022.
The report also highlights Canada currently gets 1/6 of its energy from power, about 20% of which comes from fossil fuels. In the proposed scenario, the Regulator projects a 10% decrease in burning fossil fuels reliance on electricity generation.
COVID-19: Uncertainty regarding trends
Canada Energy Regulator’s Chief Economist, Darren Christie, said The Canadian Press COVID-19 added much more uncertainty to their projections. During the pandemic, fuel production and consumption fell substantially.
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According to Christie, it isn’t clear how Canadians will continue consuming through the pandemic’s trends or whether they’ll return to the pre-pandemic normal.
However, in an evolving policy scenario, crude oil, and natural gas production will grow by 2039 (between 17% and 18%) but will start to fall. By 2050 Regulator’s projections foresee a 7% or 8% decrease in these fossil fuels’ production.
The Energy Futures report also suggests the country must accelerate its pace regarding electric vehicles (EV) development. Even in the proposed scenario, only half of the passenger vehicles sold would be electric by 2050.
Finally, De Silva observed Canada would need to stop creating more pipelines to meet its net-zero goals. If the Keystone XL, Transmountain, and Enbridge Line 3 projects are finished, these must be the last ones Canada builds.