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Climate Change

Meeting world energy demand in the most responsible way.

In order for Canada to continue its role in responsibly meeting the world’s energy demand, the country must take a balanced approach to climate change policy; encouraging emissions reductions while also supporting growth and innovation in the energy sector.

Increasing world population and the growing global economy mean energy demand is rising. While solar and wind energy production is increasing, forecasts indicate oil and natural gas will still provide the majority of the world’s energy in 2040 (IEA, World Energy Outlook 2018, New Policies Scenario). The Canadian Energy Pipeline Association (CEPA) members recognize a key challenge; the need to reduce greenhouse gas (GHG) emissions while also ensuring people and businesses around the world have access to reliable and affordable sources of energy.

Meeting domestic and international energy demand in the most environmentally responsible and least GHG intensive way possible is something our industry and country take great pride in. The world is demanding cleaner, more responsibly produced energy and is looking to Canada not only as a source to meet this growing demand, but also as a potential avenue to displace other higher emissions intensity energy sources. In fact, the 2017 Global Energy Pulse survey found that Canada topped a list of 11 oil and natural gas producing countries as the place people around the world preferred importing their oil and natural gas from.

In order for Canada to continue its role in meeting the world’s energy demand, in which pipelines play a critical role, the country must take a balanced approach to climate change policy; encouraging emissions reductions while also supporting growth and innovation in the oil and gas sector. This approach should recognize that Canada’s pipeline industry provides access to reliable and affordable energy across Canada and around the world and that the pipeline industry is part of the country’s energy future.

 

Pipelines meeting energy demand

Canada’s transmission pipelines offer the most economically and environmentally sensible option for moving large volumes of our country’s oil and natural gas to domestic and international markets. The majority of Canada’s energy comes from oil and natural gas – approximately 65 per cent. Of all the oil and natural gas Canada produces, 97 per cent is transported by transmission pipelines. Pipelines, as the safest, most efficient and least carbon intensive means of transporting hydrocarbons, are a critical part of the energy equation, and will continue to play a role in Canada’s and the world’s transition to a lower carbon economy.

As the world addresses climate change, Canada’s energy will be an important part of the solution – oil and natural gas play an important part in the current energy system and the transition to a lower carbon-emissions economy. Oil is relied on to produce energy and consumer products that fuel life for Canadians and people around the world. Natural gas is an abundant, safe, versatile and affordable form of energy with the potential to replace higher emissions intensity energy sources. Having policies that encourage and enable the continued responsible and efficient development and transport of Canada’s oil and gas resources to world markets using best in class emissions reduction technology, serves to support global efforts in reducing GHGs from less responsibly produced and higher emissions intensity sources.

 

Pipelines as part of the energy future

The global energy mix is changing, but the need for Canada’s pipelines to safely transport energy products will remain. As the world transitions to a low-carbon energy future, responsibly produced Canadian oil and natural gas will continue to play a role in the energy mix for decades to come. For example, liquified natural gas from Canada, transported to export facilities via pipelines, can help lower global GHG emissions when it is used to displace higher-emitting fuels for power generation.

The domestic energy transition is also fueled by the safe and reliable transportation of oil and natural gas. The billions of dollars in government revenues and taxes generated from pipeline companies is used by investors and governments to support a variety of investments and social programs, many aimed at GHG reduction technologies and initiatives.

 

Renewable Natural Gas

Not all natural gas comes from underground. Renewable natural gas can be harvested from organic waste and biomass. Reusing this waste keeps it out of landfills and reduces emissions. Methane is released from organic waste when it decomposes and state of the art technology that is able to capture and clean this methane, turning it into renewable natural gas, continues to advance. This technology allows companies to transport gas via existing pipelines and use it as fuel and for powering homes.

Renewable natural gas and its associated technologies can utilize the existing gas grid to move energy. So, in addition to reducing emissions, they have the opportunity to use the reliable, safe, cost-effective and extensive pipeline infrastructure in Canada as an alternative to electric infrastructure to deliver energy.

 

Natural Gas

Renewable sources of energy like wind, solar and hydro are a growing part of the energy mix, but their ability to economically and efficiently meet global energy needs is still limited. That’s why natural gas is becoming a more important source of electricity around the world. In Canada, natural gas provides about a third of the energy demand in Canada (significantly more than electricity (21 per cent)) and accounts for just nine per cent of the total energy spending budget of Canadians (Source: Statistics Canada).

Combine this with the fact that the electricity sector’s emissions dropped from 118 megatonnes in 2000 to 70 megatonnes in 2014 as plants switched from coal to natural gas (Source: CAPP), it becomes apparent that natural gas is not only reliable and affordable, but its use has also already contributed to significant reductions in Canada’s GHG emissions. This success story can be exported around the world if access to international markets via pipelines is made a priority in Canada. Liquefied natural gas from Canada can help lower GHG emissions when it’s used to displace higher-emitting fuels for power generation.

As the world addresses climate change, cleaner-burning natural gas will be an important part of the solution. According to the International Energy Agency (IEA) World Energy Outlook 2018, global demand for natural gas will increase, replacing coal as one of the world’s largest energy sources by 2030.

 

Commitment to collaboration, innovation and technological improvements

Pipelines are part of the overall supply chain and while we account for about one percent of Canada’s GHG emissions, we recognize our role in minimizing impacts where we can. CEPA member companies have made, and continue to make, operational efficiency improvements in their day to day practices while also investing in technology and innovation which improve practices, reduce emissions and contribute to positive environmental outcomes.

Examples of ongoing operational efficiency

More Efficient Engines

Reducing Methane Emissions During Maintenance

Leak Detection

Ongoing Maintenance

Reducing Liquid Pipeline Emissions

Examples of how CEPA members are reducing emissions through technology and innovation

Waste Heat Recovery – TC Energy

In early 2019, TC Energy launched two first-of-their-kind power generation projects with support from Emissions Reductions Alberta. These projects illustrate how companies are realizing new business opportunities that yield economic and environmental benefits. Working in partnership with Siemens, TC Energy is developing the world’s first waste heat recovery power generation facility that will use super critical carbon dioxide to capture waste heat from a natural gas pipeline compressor station, which will be used to generate electricity for Alberta’s power grid.

The facility has the potential to generate enough electricity to power more than 10,000 homes, reducing GHG emissions by 44,000 tonnes per year, the equivalent of taking 9,000 vehicles off the road. TC is also pursuing a novel, utility-scale solar-plus-storage electricity generation facility near Aldersyde, Alberta. This project will utilize innovative bifacial panel solar technology combined with the deployment of flow battery energy storage technology to demonstrate the practicality of renewable generation and viability of long duration battery storage in Alberta. This innovative project will provide direct GHG benefits through the generation of emission-free renewable power to meet the needs of 3,000 homes. The project will also help prove the technical and commercial viability of these technologies for wider scale adoption.

Read more about the projects here.

 

New Vapour Recovery Unit – Trans Mountain

Trans Mountain is committed to working with stakeholders to advance strategies that will minimize emissions, meet air quality regulations and minimize environmental footprint. One of the most important elements of the expansion of shipping operations as part of Trans Mountain’s system is at Westridge Marine Terminal where an innovative new system to control emissions during ship loading is being developed and used.

At the Westridge Marine Terminal, vapours are produced as oil and loaded into double-hulled tankers. As oil rises in the cargo hold, vapours are expelled from the tanks. Currently, vapours are captured and destroyed in a nearby Vapour Combustion Unit (VCU). With the expansion, enhanced vapour recovery technology will capture nearly all of the vapours and cycle them back into the tankers during loading.

Two new Vapour Recovery Units (VRUs) will collect almost all odorous compounds and volatile organic compound (VOCs) emissions from the vapours. When loading one or two vessels, a VRU will compress, liquefy and cool the vapours and then re-inject into the vessel being loaded. When loading three vessels at once (which will be less than five per cent of the time) or as a backup to the VRUs during maintenance activity, a new VCU will be in place for occasional use. The new VCU will be similar to the existing VCU at Westridge, however it will use less than a quarter of the existing VCU’s current usage. This means that even with more vessels being loaded at the terminal, more emissions won’t be released into the air.

Read more about Trans Mountain’s innovations in emissions management here.

 

Lowering Global Emissions – Fortis BC

B.C.’s liquified natural gas (LNG) produced at FortisBC’s Tilbury facility is some of the cleanest in the world. Using emissions data from sources such as the Pembina Institute’s B.C. Shale Scenario Tool , the lifecycle analysis shows global GHG emissions could be reduced by up to 800,000 tonnes per year with LNG exported from FortisBC’s Tilbury facility to industrial consumers in China. This is equivalent to removing 170,000 vehicles from the road each year.

Tilbury made history in 2017 by producing LNG for the first shipment of Canadian LNG to China from its legacy LNG facility, which has been operating since 1971. Since then, FortisBC has been producing LNG for spot shipments. Customers from China are purchasing LNG produced at Tilbury to displace coal as a source of energy for heating, industrial processes and power generation. LNG has a significant role to play in the worldwide transition to a lower-carbon economy. It is a flexible fuel that can be used to fuel ships and trucks, heat homes and power industrial processes. But the lifecycle emissions involved in producing the LNG varies. By analyzing the lifecycle emissions of LNG from the Tilbury facility, FortisBC can conclude that on a lifecycle emissions basis, its LNG has significant potential to reduce global GHG emissions and is among the cleanest in the world.

Read more about the Tilbury Facility here.

 

Renewable Natural Gas – ATCO

Renewable natural gas (RNG) presents an opportunity to green the gas grid while utilizing existing infrastructure for renewable sources. G4 Insights has developed a first of its kind gas processing technology that converts forestry waste, which would normally be burned or left to decompose, into RNG. Their demonstration project was funded in collaboration with Alberta Innovates, Natural Resources Canada, FP Innovations and the Natural Gas Innovation Fund (of which ATCO is a member). ATCO’s role was to host the project to test the feasibility of converting woody biomass to RNG and to progress G4 one step closer to commercial viability. After overcoming field assessment tests, G4 was able to successfully inject a small amount of RNG onto ATCO’s distribution system.

Read more here.

Collaboration and research across the value chain are other important vehicles for continual improvement. CEPA and its members work with a variety of organizations and associations across the energy value chain to meet climate objectives and ensure industry is working together for positive change. For example, in March 2017, the Petroleum Technology Alliance of Canada (PTAC) and CEPA signed a memorandum of understanding to work together on pipeline industry advancements in areas such as pipeline integrity, reliability and efficiency to mitigate safety risks, reduce environmental impacts and limit the social impacts of pipelines.

Additionally, CEPA members work collaboratively to share their knowledge and innovations with one another to drive performance improvements in the pipeline industry. One of the key ways they do this is through Integrity First, a management systems approach designed by CEPA members. It supports the setting of collective priorities, plans, assessments and improvements. The Integrity First cycle includes six stages that each priority goes through for successful implementation. Priorities are identified through research and feedback gathered from the public and industry.

A balanced approach
to climate change policy

The energy industry makes up approximately 11 per cent of Canada’s GDP. Our nation and the lives of every single Canadian are supported by oil and natural gas. It is important the pipeline network Canadians rely on to move this vital resource remains among the best in the world. In order to do so, industry must be able to operate efficiently, adapt to market changes and attract investment that enables innovation in a capital-intensive industry. Therefore, working with government and stakeholders across the energy value chain is critical to help ensure our industry remains competitive globally.

Canadian climate change policies should recognize that the access of Canadian energy to international and domestic markets and continued expansion of economic opportunities is consistent with global climate goals. It is critical Canada has the right balance of appropriate and required regulation, which also allows for job creation and economic growth. Canada’s energy is vital to Canadians and the world. CEPA and its members will continue to work with stakeholders across the energy value chain to develop and implement adequate policy to address GHG emissions reduction in a manner that is efficient, effective and economically viable while helping to drive clarity, certainty and predictability in the regulatory system to ensure Canada remains competitive.

CEPA believes the following should be recognized in Canadian climate change policy:

  • The dual objective of reducing GHG emissions while also ensuring people and businesses around the world have access to reliable and affordable sources of energy.
  • Pipelines are critical to meeting domestic and international demand for energy.
  • As the global energy mix evolves, the need for Canada’s pipelines to safely transport energy products will remain.
  • Enabling and encouraging collaboration, innovation and technology in the pipeline industry is critical to addressing climate change.