New LNG Projects Would Stop B.C. from Meeting Climate Targets

Doubling down on liquefied natural gas (LNG) exports to Asia could destroy British Columbia’s chances of meeting its emission reduction targets and make the province vulnerable to a rapid drop in global gas demand, two expert authors argue in a recent op ed for the Vancouver Sun.

The idea of a sustained LNG “boom” is questionable, write Mark Zacharias and Merran Smith, respectively executive director and chief innovation officer at Clean Energy Canada, after the International Energy Agency warned that Russia’s war in Ukraine has sped up renewable energy deployment. [Even before the war, there were major doubts about demand for Canadian LNG from potential buyers in Asia—Ed.]

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But the bigger question for B.C. is where the electricity will come from if the province’s LNG industry makes good on its promise to decarbonize production by electrifying its operations, Zacharias and Smith write. Just one investment decision—building the second phase of the LNG Canada megaproject in Kitimat—would require three times the electricity the province expects to generate from the Site C hydropower project.

“In order for the LNG industry to fit within B.C.’s climate targets and meet the federal government’s impending emissions cap for the oil and gas sector, nearly every part of the LNG supply chain, from wellhead to the export facility, must be electrified,” the two analysts explain. “The problem is that B.C. isn’t planning to generate enough electricity to meet its 2030 climate targets,” before even factoring in additional demand from the LNG industry.

Provincial utility BC Hydro is already calling for new generating capacity equivalent to 1½ Site Cs by 2030, they add, 12% more power than the province is planning to generate. “Should the LNG industry consume all of B.C.’s available electricity, there will be no power left for other economic opportunities, from sustainably mining battery materials to producing green hydrogen. The number of ‘transition-opportunity companies’ in B.C. has grown by nearly 500% over the past two decades, from approximately 30 in 2000 to around 170 in 2020, but what if we can’t power the next 500%?”

BC Hydro’s plan to cover the difference through the end of this decade is to buy clean electricity from neighbouring jurisdictions. “The problem with this plan is that it is also everyone else’s plan,” Zacharias and Smith say. “Like B.C., most western states have climate plans requiring massive amounts of clean electricity to power EVs and heat pumps and to switch industry off of fossil fuels.”

But not one of the electricity grids in the western U.S. and Canada has plans to generate enough electricity to meet its own peak demand, much less export to others, according to the Western Electricity Coordinating Council. The likely end result, Zacharias and Smith say, will be a hefty cost for imported electricity, leading to higher costs for consumers.

The op ed urges Ottawa to consider the opportunity cost for B.C. before “rushing headlong into LNG expansion,” adding that “there are better way to help our friends” in an era of tenuous global gas supplies.