Climate test for resource projects would likely scuttle oilsands growth

If Canada and the United States are serious about the climate commitments they made in Paris, they need to establish a common climate test for major resource projects that takes into account a low-carbon future, environmental groups said Tuesday.

And they believe any such test is likely to rule out long-term infrastructure, such as pipelines, that leads to expansion of Canada's oil sands production.

"It's incompatible to be talking about being a leader on climate change and adhering to international commitments like the Paris agreement and, at the same time, expanding our high-carbon infrastructure and projects," Dale Marshall of Environmental Defence said Tuesday at a news conference, flanked by four other environmental group representatives.

"The two don't fit together."

The challenge comes a week before Prime Minister Justin Trudeau sits down with the premiers in Vancouver to begin laying the groundwork for a national climate policy and two weeks before Trudeau visits Washington and his fellow climate campaigner, U.S. President Barack Obama.

The new Liberal government made a splash at December's U.N.-sponsored climate negotiations, where Environment Minister Catherine McKenna was among those who successfully lobbied for an aggressive pledge to limit global warming to near 1.5 degrees Celsius.

But since that climate conference, much of the political heat in Canada has been generated by pipeline policy, with the Liberals under constant attack over Alberta's ailing oil patch, a stalled national economy and interprovincial sniping over pipeline routes.

Late last month, McKenna and Natural Resources Minister Jim Carr announced that resource projects will now face an assessment of upstream greenhouse gas emissions — but didn't say how those assessments would affect the government's final decision.

The new Liberal measures were pitched as both environmentally responsible and as a means of winning social licence for major resource projects, notably a new oil pipeline to tidewater.

"Canada's oilsands are an important contributor to the economy, but they must be developed in a manner that is environmentally sustainable and helps Canada meet its climate change obligations," McKenna said Tuesday in an email.

"That is why we are committed to rebuilding the trust of Canadians in our environmental assessment process, as we announced a few weeks ago."

But five environmental groups, including the U.S.-based Natural Resources Defence Council, say the real project measure should be against the low-carbon future Trudeau and Obama agreed to in Paris.

"In fact, long-term infrastructure decisions are still evaluated against business-as-usual or reference case scenarios that assume a global market consistent with catastrophic levels of carbon emissions," said Anthony Swift of the NRDC.

Energy forecasts by the National Energy Board and the U.S. Energy Information Administration, said Swift, assume future energy markets consistent with the planet warming between four and six degrees Celsius — in other words, continuing failure to do anything about the Paris deal.

Erin Flanagan of the Pembina Institute said the shortcomings in the NEB's existing energy models are illustrated by the last decade.

In 2006, the NEB projected that oil sands production would be between three million and 4.4 million barrels a day by 2015. Current production is about 2.2 million barrels a day, she noted.

Flanagan believes the NEB should conduct a "needs assessment" for major resource infrastructure, which takes into account promised national and global actions on climate change. Indeed, it's part of the current NEB mandate to assess future market demand for a project.

Flanagan noted that neither the TransMountain pipeline expansion assessment nor the Northern Gateway pipeline assessment "considered a case in which Canada meets its national climate change goals." Neither looked at the viability of the projects under more stringent future carbon policies at home and abroad.

Sidney Ribaux of the group Equiterre noted the Liberals have repeatedly stressed their climate and resource decisions will be based on science.

"We feel that once you've said that, it makes it extremely difficult for these projects to go forward," said Ribaux.

Bruce Cheadle, The Canadian Press