B.C. Implementing ‘Backstop’ To Federal Oil And Gas Emissions Cap

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The B.C. government will implement a backstop to the federal cap on emissions from the oil and gas sector, it announced this morning.

The province is in discussions with the federal government to align the federal cap with B.C.’s specific goals and commitments, including meeting B.C.’s sectoral greenhouse-gas-emission-reduction targets and to avoid regulatory duplication and administrative burden for the oil and gas sector.

B.C. will introduce regulatory measures in 2025, to take effect in 2026, as a backstop to the federal cap. The backstop is intended to be additive (if needed to ensure B.C. will achieve its sectoral greenhouse gas emissions targets) and not duplicative, and will only apply in the event there are gaps between federal coverage and B.C.’s targets.

The backstop regulation will also apply in the event that the federal cap is not implemented or is cancelled.

The B.C. backstop regulation will recognize operations with lower emissions intensity and be reviewed regularly to ensure B.C. is on track to achieve its sectoral greenhouse gas reduction targets.

Government will consider various tools for compliance, including: absolute emission reductions; technology applications; verifiable tradeable carbon credits; verifiable carbon offsets; and compliance payments. The purpose of compliance payments is to support further emissions reductions within B.C.

Consultation with First Nations, industry and interested stakeholders took place throughout 2023, and further discussions will happen as the engagement with the federal government and the development of the B.C. regulation take place.

CAPP response

An emissions cap in British Columbia would be a duplicative and unnecessary step that will only drive more investment out of the province, dragging down economic development and investment in clean technologies, while making little impact to global climate emissions, said Lisa Baiton, the Canadian Association of Petroleum Producers (CAPP) president and CEO.

“B.C. has just finalized climate policy systems that will have a meaningful impact on the delivery of emissions reductions. The government should give these systems time to work and focus efforts on collaborative solutions that continue to drive down emissions, improve performance and position B.C. for long-term success and prosperity.

“Over the past decade, Canadian natural gas producers have reduced carbon dioxide equivalent emissions by 22 per cent, lowered methane emissions by 38 per cent while growing production by 35 per cent.”

An emission cap on one sector of the economy is an inefficient approach that harms the overall economy, she added.

“Put plainly, it needlessly increases the cost of achieving B.C. climate objectives and reduces the opportunities for B.C.’s leading export sector.

“This will have a significant impact across many other sectors starting with higher energy costs which will increase the price of essential goods for British Columbians, including food, heating and transportation. The emissions cap would also have a direct impact on Indigenous communities with a decline in employment opportunities currently available and also hindering opportunities for economic reconciliation through equity partnerships.”

Any emissions cap, nationally or provincially, will jeopardize B.C.’s prospects of becoming a globally significant energy trading hub for Canada while making virtually no impact on the rise of global emissions, the CAPP CEO added.

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