Photo: Something for nothing, and the credit's for free — the federal government's attempt to take credit for emissions reductions


Federal Environment Minister Peter Kent made a splash this week when his department released a report on Canada's greenhouse gas (GHG) emissions trends. It stated that we are halfway to meeting the government's 2020 greenhouse gas emission target. Good news, right? Kent thinks so. He says that this achievement is "the result of the Harper government's realistic, sector-by-sector approach" that is both "reducing emissions while continuing to create jobs and encouraging economic growth." Although the story may make the Conservative government feel good, it's delusional.

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Reducing emissions requires leadership and tough decisions. For Canada to reach the 2020 targets, we will need much more than a "sector-by-sector" (in other words, piecemeal) approach. We'll need to implement real policies that will put a price on carbon and slow down the pace and scale of fossil fuel use and development.

The government stated in 2009 after the Copenhagen climate summit that it would reduce emissions 17 per cent below 2005 levels by 2020. In 2005 our emissions were 731 million tonnes (Mt) of GHGs, so a 17 per cent reduction would mean we'd have to reduce 124 Mt to get our total emission levels to 607 Mt. Based on 2010 emissions levels (the most recent reporting period), we'd have to reduce emissions an additional 85 Mt, an additional 12 per cent. Canada has reduced 40 Mt of emissions, just 33 per cent, of the 124 Mt absolute reduction from 2005 levels. So why is Minister Kent saying that we are halfway to the target?

Canada's emissions from 2000 to 2010 in Mt of GHG
The government is using a reference projection of where emissions would be in 2020 if we didn't employ any additional measures to reduce emissions. This "business as usual" scenario attempts to project what emissions would be when we account for systemic changes between now and 2020, such as population and economic growth. This is a standard approach to modelling emissions trends in that it attempts to project changes to our economy, energy system and energy use patterns. Without any energy-efficiency improvements, emissions regulations and the like, Environment Canada's model predicts that emissions would be 850 Mt in 2020, as represented in the first column in the chart below. Environment Canada then builds in the expected impact of various federal and provincial policies on emissions, as represented in the second column. The third column shows the cumulative impact of both policy and larger outside factors affecting emissions. EC states that these outside factors are slower economic growth, de-industrialization of the economy (moving to less energy intensive service-based economic output), and businesses and consumers responding to higher energy prices through energy efficiency adoption and other measures to reduce energy use. This secondary effect on emissions represents another 65 Mt and happens largely independently of government action.

2020 emissions projection

EC's model predicts that among the current basket of policies and larger socio-economic trends we have changed the trajectory of the emissions projection out to 2020, making the anticipated growth in emissions smaller. This "reduction" of 130 Mt represents reduction from our prediction of a fictitious world in 2020 where we don't have any climate policy and where our energy use activities and patterns have not changed from 2005 levels. In other words, we've made an academic reduction from a made-up future. And there is Minister Kent's halfway target.

More concerning is the fact that the government seems to be accepting all of the credit for the reduced emission projection. If we accept that the government has little direct influence on the outside factors affecting emissions, such as economic growth, then it cannot claim credit for the 65 Mt chunk of reductions that it represents or, in other words, half of the 130 Mt reduced from the business-as-usual scenario. Looking at the other half, the 65 Mt reduced from government policy, the report states that it is the combination of federal and provincial actions. As we've recently reported at DSF, Canadian provinces are often leaders on climate policy and inducing emissions reductions. Federal programs and policies have had a small impact.

For proof of federal ineffectiveness to reduce emissions, look no further than the government's own reports. Looking at the 40 Mt of real reductions from a high of 732 Mt in 2005 and to 692 Mt in 2010, the federal government itself claims little credit. The 2011 National Inventory Report states that these reductions are from:

  • Coal-powered phase-out due to Ontario's provincial policy (22 Mt)
  • Lower manufacturing output due to global economic downturn (17 Mt)
  • Commercial emissions falling due to higher winter temperatures (8 Mt)
  • Lower natural gas production due to economic downturn (5 Mt)

These emissions reductions were partially offset by 16 Mt of increases from the transportation sector. This sector was also identified by Kent as an example of federal success in reducing emissions.

Further, the Kyoto Protocol Implementation Act (which the government repealed earlier this year) required an annual report from the government to estimate the emissions impact of all federal programs that were helping to reduce emissions. In the 2011 report, the government estimated that its programs would reduce an estimated 18 Mt from the business-as-usual scenario by 2012. This represents only 28 per cent of the 65 Mt in emissions reductions from government policy. The table below outlines all of the federal policies that are working to reduce emissions. These emission reduction estimates only represent the emissions that would have occurred had the program not been in place; they do not represent actual emission reductions from 2008 to 2012. In effect, they lowered the baseline but did not necessarily achieve actual reductions year over year.

Federal estimated reductions breakdown

The other important impending federal actions not included in the KPIA report are the proposed coal-fired electricity regulations, which will shift investment from new coal plants over the next 10 years to natural gas plants. Kent uses this example to prove that the government's sector-by-sector approach is working. But let's look at the numbers. We ran the proposed coal regs through our own model, the Canadian Energy System Simulator (CanESS) developed by WhatIf Technologies and concluded that the coal regs would reduce another five Mt by 2020.

Impact of coal regulations on emissions reduction
So, federal policies could be responsible for a possible 23 Mt of reductions from the 65 Mt that come from government policy. The other 65 per cent of emissions are the result of provincial policies such as the carbon tax in B.C. and the Green Energy Act in Ontario. But that's only part of the story. Kent says that Canada is halfway to the target from the business-as-usual high point, meaning that it is the result of the government policy and actions. Not only is Kent taking credit for all of the reductions from provincial policy, he's also taking credit for all the reductions as a result of the changing economy and changing oil and gas prices. (The government does deserve some small credit for the warmer weather, however.) In reality, the federal government could be responsible for 18 per cent of the reductions from the business-as-usual scenario.

Breakdown of impact on emissions reduction
Of course, this has been a largely academic issue so far. We could dream up any possible business-as-usual scenario and reduce imaginary emissions from it. What matters is absolute reductions, of which the federal government has had no credible hand in achieving. We need to reduce an additional 85 Mt by 2020 to hit the target. The government has not outlined, in any credible way, how it intends to do that.

Reductions required to hit 2020 target

Stay tuned for my next piece when I evaluate Minister Kent's second claim that the sector-by-sector approach will work to hit the government's 2020 target and that achieving a 17 per cent reduction from 2005 levels by 2020 will be extremely challenging in light of the government's objectives to expand oil and gas production in Canada.

For further reading check out similar analyses conducted by Marc Lee at the Canadian Centre for Policy Alternatives breaking down the emission trends and Dr. Christian Holz of the Climate Action Network for reviewing the government's accounting tricks to include and take credit for forest sequestration emissions.

August 10, 2012

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1 Comment

Aug 11, 2012
7:47 PM

You can't reduce C02 emissions globally without reducing economic activity, either having higher permanent unemployment or some way to have people voluntarily trade income for additional time off work. Actually the most productive types of work are the ones that should be reduced for the greatest effect.

Of course, the overall effect of this will be to make everyone poorer and I am not sure we can manage that without pushing the lower income parts of the population into starvation, etc.

Charging for CO2 release — carbon tax will only work if the revenues from the tax are simply destroyed, Effectively just another way to make us poorer. It is simply not possible to spend the revenues in any way without simply recreating the same CO2 the tax is designed to eliminate.

The true solution is to reduce the work week by half in a way that allows persons to use the extra time to pursue non consumption activities — they will have to since incomes will be reduced. The economy will also have to restructure somewhat to ensure the same quantity and quality of food (maybe better) within the limits of the lower income.

Most importantly the emphasis will have to shift from artificial environments (shopping malls, office towers, cars/highways, suburban sprawl, swimming pools), to natural environments which can provide similar entertainment and comfort within a much lower GDP. This can also be productive activity, for example, gardening, nurturing, story telling, etc, etc.

The plan that will work and the plan people will support is one that reduces income yet increases quality of life. Basically getting a handle on the rat race. There might be a need for special situations like doctors, and cancer researchers,etc, etc — they would get special permission to work additional hours for little extra pay as they are in non-competitive industries anyway.

Eventually we may learn to produce as much despite the reduced work hours but hopefully by then we will have found a permanent solution to the increasing number of people the planet is required to support.

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