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There Will Be Much Less Gas in Canada’s Energy Future

natural gas rig

The recent release of the Canada Energy Regulator’s  Canada’s Energy Future 2023 report provides us with a powerful tool to look into the future of energy and the economy in Alberta. As I mentioned before, EF2023 is a big step forward, the first national model of Canada’s energy transition in a world aligned with the Paris Agreement of 2015.

In my last post, I examined the crude oil production scenarios envisioned in EF2023 and the life cycle emissions of the crude oil that would be produced under those scenarios.

In this post, I’ll do the same for methane gas.

Methane Gas, Fossil Gas, Natural Gas … What’s the Difference Anyway?

The colourless, odourless gas we use to heat our homes and generate electricity goes by many different names. Methane gas, fossil gas, natural gas — what’s the difference?

None, really. The commodity known as natural gas is basically methane — typically around 95 per cent. Methane consists of four carbon atoms and one hydrogen atom (CH4). No matter what we call it, it’s a powerful contributor to global warming.

Get the lowdown on gas.

Canada’s Energy Future 2021 in Review

Before we dig into the EF2023 gas scenarios, let’s look back at EF2021, which envisioned gas production for the period 2021–2050. We’ll focus on the Evolving Policies Scenario of EF2021 — the more conservative of the two scenarios examined that year, which envisioned rising levels of climate action worldwide and thus lower levels of production and emissions.

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EF2021 Gas Production

In EF2021, the CER projected that Canada’s gas production would rise until 2032, when it would peak at 161,878 million cubic metres. 

The CER also projected that Alberta’s gas production would peak in 2021 at 101,393 million cubic metres.

At the time of the report, Alberta was producing about 62 per cent of Canada’s gas. This proportion would gradually decline to about 35 per cent in 2050, with production rising in British Columbia.

You can review the EF2021 numbers here. The production chart for EF2021 looked like this:

Canada & Alberta Natural Gas Production, Canada's Energy Future 2021 Evolving Policies Scenario, 2021-2050

EF2021 Gas Emissions

Gas produces emissions at every stage of its life cycle, from production to refining to combustion. The bulk of these emissions — typically around 80 per cent — occurs during downstream combustion.

In 2021, Alberta sent 29 per cent of its gas to other parts of Canada. It exported an additional 36 per cent to the United States. (I calculated these percentages from the Alberta Energy Regulator report ST3: Alberta Energy Resource Industries Monthly Statistics, Supply and Disposition of Natural GasPDF icon).

Together, these facts mean that about half of our gas emissions count against other provinces and the United States. But as I’ve mentioned elsewhere, the emissions from our exported fuels contribute to the global heating that impacts our province so heavily, even if they don’t count against Alberta’s total. So I calculate emissions over the full gas life cycle.

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Under EF2021’s Evolving Policies Scenario, Canadian gas would contribute 10,520 megatonnes of CO2. Of this total, Alberta would contribute 4,574 megatonnes.

EF2023 Gas Production Scenarios

CEF 2023 considers three scenarios for energy markets — Current Measures, Canada Net-zero, and Global Net-zero.

  • Current Measures Scenario: Canada and the rest of the world continue to produce and consume fossil fuels under the policies that are in place today. This scenario assumes “limited future action to reduce GHG emissions.”
  • Canada Net-zero Scenario: Canada achieves net-zero emissions by 2050, but the rest of the world moves more slowly in limiting emissions.
  • Global Net-zero Scenario: Canada achieves net-zero emissions by 2050 and the rest of the world “reduces emissions enough to limit global warming to 1.5℃.”

Let’s see what EF2023 tells us about our future gas production and the resulting emissions. We’ll consider each scenario in turn.

Current Measures Scenario

Under the Current Measures Scenario, Canada’s gas production rises in fits and starts until 2050, when it peaks at 607.44 million cubic metres per day or 221,715.60 million cubic metres per year.

Alberta’s gas production peaks in 2023 at 301 million cubic metres per day, or 109,978 million cubic metres per year. It declines until 2035 (238 million cubic metres per day, or 86,713 million cubic metres per year), then rises again until 2050 (276 million cubic metres per day, or 100,616 million cubic metres per year). The chart looks like this:

Canada & Alberta Gas Production (2023–2050) Canada's Energy Future 2023 Current Measures Scenario

Canada Net-zero Scenario

Under the Canada Net-zero Scenario, Canada’s gas production fluctuates before finally peaking in 2030 at just over 500 million cubic metres per day. It then falls steadily until 2050, when it reaches 310 million cubic metres.

Alberta’s gas production peaks in 2023 at 301 million cubic metres per day, then falls to 149 million cubic metres per day in 2050.

The chart looks like this:

Canada & Alberta Gas Production (2023–2050) Canada's Energy Future 2023 Canada Net Zero Scenario

Global Net-zero Scenario

The Global Net-zero Scenario is where we see the sharpest decline in gas production, both for Alberta and Canada.

Canada’s gas production peaks in 2023 at 492 million cubic metres per day, then falls to 156 million cubic metres per day in 2050.

Alberta’s gas production peaks in 2023 at 301 million cubic metres per day, then falls to just 78 million cubic metres per day in 2050.

Here’s the chart:

Canada & Alberta Gas Production (2023–2050) Canada's Energy Future 2023 Global Net Zero Scenario

EF2023 Production Data

As I’ve mentioned before, you can download the CER data for each scenario in EF2023. That’s what I did. It’s a simple procedure, but I provide detailed instructions if you need help.

You can also view this Google sheet where I compiled the data and ran the calculations.

And if you’re curious, use the CER’s interactive tools to explore the various scenarios, regions, energy sources, and emissions.

Greenhouse Gas Emissions

The most important question is how much CO2 Alberta gas will produce overall — not just within our province, but worldwide, at every stage of its life cycle. Climate change harms us as much as it does others, and we’re responsible for the damage caused by our fuels, so we have to consider life cycle emissions.

Let’s look at the emissions for each of the scenarios under EF2023.

Here’s the equation I use to calculate emissions:

units_of_fossil_fuel x energy_content x emissions_factor = GHG_emissions

where:

  • units of fossil_fuel = units of fuel produced — for example, barrels of oil or cubic metres of natural gas
  • energy_content = joules of energy per unit of fossil fuel
  • emissions_factor = grams of carbon per joule

Benchmarks

As with my original gas calculation, I use realistic yet conservative benchmarks to calculate the life cycle emissions of Alberta gas.

Energy Content

For energy content, I use a figure of 39.03 megajoules (MJ) per cubic metre. This figure comes from Statistics Canada, Report on Energy Supply and Demand in Canada, Preliminary 2016 (PDF icon).

Upstream Emissions

Based on a literature review, I used two separate emissions factors in two separate calculations — one for an “average Alberta gas” and one for an “average United States gas”:

Downstream Emissions

For downstream emissions, I used an emissions factor of 49.7 kilograms of CO2-equivalent per gigajoule of gas, which is calculated from the 2021 National Inventory Report — Canada’s greenhouse gas inventory. This report is submitted annually to the United Nations Framework Convention on Climate Change (UNFCCC).

EF2023 Emissions

With two jurisdictions, two benchmarks, and three scenarios, a table is the best way to express the range of possibilities.

Alberta Life Cycle Emissions (Mt)Canada Life Cycle Emissions (Mt)
ScenarioAB Avg BarrelU.S. Avg BarrelAB Avg BarrelU.S. Avg Barrel
Current Measures5,918.526,590.8512,146.8513,526.70
Canada Net-zero4,960.425,523.919,908.9311,034.55
Global Net-zero3,879.854,320.597,399.008,239.51

If we put all these possibilities together:

  • Alberta gas will emit 3,880 to 6,591 megatonnes of CO2.
  • Canada gas will emit 7,399 to 13,527 megatonnes of CO2.

How much CO2 is that?

At 4.6 tonnes per vehicle, Alberta’s gas emissions will be equivalent to the annual emissions of 843,478,261 passenger vehicles. On the high end, our gas emissions will be equivalent to the annual emissions of 14,328,260,870 vehicles.That’s better than the emissions we would have seen under EF2021, but it’s still a lot of CO2, Alberta.

The Story of EF2023

EF2023 gives us a tool we can use in predicting the emissions from our fuels. But it also tells a story of accelerated energy transition — of rapidly declining fossil fuel demand in world markets, including that of our largest trading partner, the United States. Alberta will have no choice but to adapt.

There is also a positive feedback loop hidden within this story. Oil sands production requires large quantities of natural gas. In situ facilities use gas to generate steam. Oil sands mines use it to heat water to separate bitumen from sand. Many oil sands facilities use gas for cogeneration, which produces heat for process use and electricity for project operations and sale to the power grid.

Excluding cogeneration, oil sands operations use over a quarter of Alberta gas. If we include gas used for cogeneration (counting only the heat and power used by oil sands operations), the figure is probably closer to one-third of Alberta gas demand.

This positive feedback loop ensures that declining oil demand in the United States will lead to declining gas demand within Alberta.

The decline of fossil fuels will lead to far-reaching change in our province. We’ll have to replace the jobs, taxes and royalty revenue previously supplied by the oil and gas sector.

Fortunately, the GHG emissions coming from our oil and gas will also decline. However, Alberta’s oil and gas will still use up part of the global carbon budget for 1.5℃. How much? I’ll explore this topic in my next post.

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Alberta and the Carbon Budget: An Update

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