Exclusive Alberta minister says Canada’s emissions cap blocks other climate action

By Nia Williams and Steve Scherer

(Reuters) – Alberta’s environment minister has said Canada’s proposed cap on oil and gas emissions is a stumbling block in the province’s talks with the federal government over clean energy policies, including carbon capture and storage (CCS), needed to Meet Canada’s ambitious 2030 climate goals.

Opposition to federal climate policy from oil-rich Alberta, where Prime Minister Danielle Smith is gearing up for May’s election, risks putting Canada further behind on its emissions-cutting commitments this year.

Alberta Environment Secretary Sonya Savage told Reuters in a recent interview that the federal government’s proposed emissions cap for the oil and gas industry – due this year – will require work on other issues such as provincial support for carbon capture and storage (CCS).

“We just need to put this cap on a better path and approach it differently before we can really be successful at anything else,” Savage said. It was the first time Savage had discussed stopping Prime Minister Justin Trudeau’s programs to cut carbon emissions.

Canada, the world’s fourth-biggest oil producer, is lagging behind many global competitors in tackling emissions and jeopardizing the Trudeau administration’s goal of cutting greenhouse gases by at least 40% by 2030 from 2005 levels.

In the run-up to the May 29 vote, right-wing populist Smith has capitalized on many Albertans’ hostility to federal environmental policy, accusing Trudeau of phasing out the fossil fuel industry. The Trudeau administration sees the cap as a key element in getting the oil and gas sector to make significant and timely reductions.

Smith also wants Ottawa to halt plans for clean electricity regulations and a “Just Transition” law designed to retrain oil and gas workers for clean energy jobs.

The oil and gas sector is Canada’s most polluting industry, responsible for more than a quarter of all emissions. Alberta is threatening to challenge the cap in court as it would result in a further increase in production cap.

Alberta has already taken the federal government’s carbon pricing policy to court but lost the Supreme Court case.

If Ottawa breaks the oil and gas ceiling before provincial elections, it will be “lost in the spiral of politics,” said Andrew Leach, a professor of economics and law at the University of Alberta.

“But the federal government has to move, because otherwise there would be a delay of six to eight months.”


A spokesman for Germany’s environment ministry said officials are still gathering information to ensure the cap is “ambitious but realistic”.

Polls show Smith has a narrow lead over her New Democratic Party rival ahead of the election.

Officials in Ottawa told Reuters that behind-closed-doors talks with industry and the Alberta government over the various reduction plans are progressing, but political considerations ahead of the vote are undermining final decisions.

Last year, a European emissions database for Global Atmospheric Research showed Canada’s emissions rose in 2021 and fell just 3% since 2005, meaning the country must pack almost all of its decarbonization in eight years to meet its 2030 target to reach.

The EU and the United States have cut emissions by 25% and 20% respectively since 2005.

The size of Canada’s oil and gas industry means the country will struggle to meet its 2030 targets without significant emissions cuts from the sector, and producers are counting on CCS projects to reduce much of their carbon pollution.

Still, the Pathways Alliance, a group of six companies that represent 95% of oil sands production, says only about a 30% reduction in emissions is achievable by 2030, compared to the government’s target of at least a 40% reduction.

“We worked with their economic modelers, and I think they realized that those goals…were probably not entirely based on accurate data and are probably overly ambitious,” said Mark Cameron, vice president of external relations at the Weg alliance.

(Reporting by Steve Scherer in Ottawa and Nia Williams; Editing by Denny Thomas and David Gregorio)


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