In new emissions plan, Ottawa gives oilpatch a pass — for now

Without deep cuts in the oilpatch, there is scant chance Canada will meet its 2030 climate goal, but at least for now, the federal government is giving the sector a free pass from any major new regulations or costs aimed at slashing emissions.

The federal government unveiled its Emissions Reductions Plan on Tuesday; a wide-ranging document covering every source of pollution from electricity production and landfills to agriculture and home heating.

The oilpatch is the largest source of emissions in the country, and the government's modelling shows a need for the sector to make significant strides in less than a decade to help the country hit the 2030 goal.

The oil and natural gas industry produced 191 megatonnes of carbon dioxide in 2019 and, according to the federal plan, those emissions need to fall to 110 megatonnes in 2030. The decline is projected to start relatively small before accelerating in 2029 and 2030.

WATCH | Oilpatch leader calls federal emissions target 'ambitious':

Still, that's more than a 40 per cent drop, and experts note it's an ambitious reduction given that oil production is on the rise, time is tight, and there's a lack of detail for how to reach the target.

"The path to 2030 requires pretty big emission reductions from the oil and gas sector," said Dale Beugin, vice president of research and analysis at the Canadian Climate Institute, a climate policy research organization.

"What are the details of the policies that will drive those emissions reductions and drive that contribution?" 

Alberta reached a record high in oil output this winter, and the federal government recently made an international pledge to increase production this year in response to the European energy crisis.

For now, the oilpatch isn't facing any new regulations as the actual policy is still in development. There are no details yet on how the cap will be set, how it will change over time and how it will be enforced.

On one hand, the industry could benefit from having the policy sooner rather than later considering the 2030 climate target is fewer than eight years away, said Beugin, but it's such an important policy that it makes sense to develop it properly.

"There is some tension between those two things: get going soon enough to get the rules of the game clear for everybody, but get that system designed in a way that makes sense," he said.

The precipitous emission target isn't sitting well with some in the industry.

"It's really, frankly to me, utterly astonishing that this has come out," said former TransCanada executive Dennis McConaghy, referring to the current affordability and global energy security concerns.