Yahoo Finance Terence Corcoran: Net-zero fantasies undone by fossil fuel realities
The evidence mounts daily that, regardless of Hurricane Milton and other climate events, neither Canada nor the world are on track to achieve the net-zero fossil fuel emission reduction targets said to be necessary to save the world from the “existential” threat of climate change. Despite the calls for action, oil and gas production continue to increase as energy corporations boost fossil fuel investments.
In Canada, the national effort to reduce carbon emissions is failing, as acknowledged in a recent report by the federal government-appointed Net-Zero Advisory Body (NZAB). In a largely ignored paper published on Sept. 26, NZAB essentially concluded that Ottawa’s plan to reduce carbon emissions to 40 to 45 per cent below 2005 levels by 2030 would not be achieved. At best, Canada might hit 35 per cent below 2005.
To hit the 2030 target, NZAB said, the federal government needed “more aggressive and sustained action.” There is “a gap” in the government’s strategies. “To reach the target, we need to do more, and we need to do it now.” Needed are investment tax credits, emissions caps, clean electricity, green buildings and vehicle sales mandates. Strangely, NZAB does not recommend a consumer-based carbon tax.
A carbon tax also failed to make it into a second NZAB paper that outlined how Canada should set a new carbon target aimed at cutting emissions by 50 to 55 per cent below 2005 levels by 2035 — only 10 years from today. This would be in line with the international Paris Agreement but would require “increased ambition and leadership from all actors.”
To help stimulate action, NZAB held a conference this week, titled “The Net-Zero Edge: Navigating the New Realities for Canadian Competitiveness.” The objective was to review net-zero challenges and opportunities. Any objective review of current energy trends, however, suggests the global sources of carbon emissions are growing —statistically, nationally, globally and at the corporate level.
Earlier this week Reuters reported that U.K. energy giant BP is abandoning plans to cut oil and gas output by 40 per cent while rapidly growing renewables by 2030. BP will focus instead on profitable projects, first and foremost in oil and gas, according to Reuters.
Canada’s second largest oil and gas producer, Suncor Energy Inc., is also ready to boost fossil fuel output. “Canada is blessed with an abundance of oil and gas, fourth globally in oil reserves. An amount Canadians couldn’t consume in more than one hundred years,” Suncor CEO Rich Kruger said in June. “Hence, the opportunity. To provide abundant, affordable and responsibly produced energy, with lower emissions, to people around the world, including allies increasingly concerned about energy security.”
This week Canada’s third largest fossil fuel producer, Canadian Natural Resources Ltd. (CNRL) struck a deal with Chevron to buy the Texas energy giant’s 20 per cent stake in Alberta’s Athabaska Oil Sands Project. CNRL President Scott Stauth gave no indication that net-zero would stop oilsands production. “We are going to continue to do what we do — and that’s focus on driving value through continuous improvement, look at ways to reducing costs, look at ways to optimize production.”
Michael Tims, vice-chair of Matco Investments Ltd., which owns some stock in CNRL, accurately summarized the emerging conflict between net-zero fantasy and fossil fuel reality. “We’re in a world where we’ve got two competing narratives. One is that oil and natural gas have a limited remaining duration, and one where the transition is going to take much longer and we’re going to have considerably longer paths for oil and gas.”
Could it be that there is no path? The gap between the two narratives illustrates the challenge facing agencies such as Canada’s Net-Zero Advisory Body and climate activists. Targets are being set that, in all likelihood, cannot be met. While think-tanks muse about reduction strategies, Statistics Canada reports that Canada’s oil output hit a record 286.4 million cubic metres in 2023, led by gains in oilsands output. Production continued to grow in 2024, placing Canada among the top four oil producers in the world.
Globally, fossil fuel consumption has roughly doubled since 1980 and continues to climb. Our World in Data notes that while coal consumption may be falling in many parts of the world, oil and gas are still growing quickly — as they have for decades (see graph) — and as they may continue to grow for decades to come.
• Email: tcorcoran@postmedia.com
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