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To hit net-zero, Canada Energy Regulator must get its modelling right

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The following is excerpted from an article that appears in the Energy Mix. It first appeared in Policy Options and was republished under a Creative Commons License. Read the full article here.

Climate change is now undeniably personal for most people in Canada. Throughout the country, rising global temperatures have been connected to record-breaking heat, sparking worse and earlier-than-ever wildfires, alongside unprecedented flooding, storm surges, melting sea ice in the North, and more. Public pressure is on the federal government to act. But how? One critical task will be to correct deeply flawed emissions projections and instead map Canada’s net-zero emissions future.

Drawing out what a net-zero future looks like in Canada is critically important for industry, investors, regulators, policy-makers and residents to confront the intensifying climate crisis and seize energy transition benefits. Yet right now, one of the most relied upon guides—produced annually by the Canada Energy Regulator (CER)—models a future in which low-carbon policies are essentially static.

Worse, CER projects Canadian emissions will remain high for decades instead of falling to zero by mid-century, as required by Canadian law. That goal is also consistent with what scientists tell us needs to happen globally to limit global warming to 1.5°C, a goal Canada has embraced under the Paris Agreement.

The CER (and its predecessor, the National Energy Board) has only modelled scenarios that imply the Paris Agreement’s goals will not be met, where the world does too little to reduce its production and consumption of oil, gas, and coal, and where Canada’s climate policies lack ambition and fail to achieve net-zero emissions by 2050. Put simply: there’s a big discrepancy between the future CER is modelling and a future we’d want to live in.

Why isn’t CER already modeling net-zero scenarios? 

Historically, CER’s predecessor, the National Energy Board, was charged with ensuring safe operation of Canada’s oil and gas pipelines, but it did not question the safety of oil and gas for the global climate. And before climate policy ambitions ramped up internationally, existing policies might have been a reasonable baseline for demand.

Neither justification holds today.

Canada’s commitment to reach net-zero by 2050 poses a grave challenge to the sector that accounts for the largest share of national emissions. At the same time, growing climate ambition in other countries, including a proliferation of zero-emission vehicle mandates, threatens global fossil fuel demand and thus Canada’s exports.

It’s urgently important for both Canada’s climate commitment and economy to get these models right.

Read the full article in The Energy Mix.