Strong methane regulations are the cheapest, most effective way to reduce emissions in Canada’s oil and gas industry and meet the expected targets in the federal government’s oil and gas emissions cap—all without hindering economic growth, the Canadian Climate Institute (CCI) reports.
“Cost-effective methane reductions can do a third of the work required to align the oil and gas sector with Canada’s 2030 target,” writes CCI’s 440 Megatonnes project.
By curbing oil and gas emissions—which have risen 12% since 2005 and make up 28% of the national total—the federal cap will help keep Canada’s climate ambitions in sight, but only with support from other policies, the institute says. Stricter regulations to limit methane venting and leakage, combined with the emissions cap, can cut fossil emissions to 110 megatonnes (Mt) in 2030, with the methane regulations delivering one-third of the reduction.
“The regulated cap and the methane regulations work together,” the institute explains, “with more work by one policy requiring less by the other.”
440 Megatonnes and Navius Research developed two scenarios to determine the share of the 2030 emissions target that could be met by tougher regulations on methane, a climate super-pollutant with about 84 times the warming potential of carbon dioxide over a 20-year span. The first scenario called for a 45% reduction below 2012 levels, the regulated target that fossils are already supposed to meet by 2025. The second one raised the 2030 target to 75%, in line with regulations expected this fall.
In the more ambitious scenario, methane controls delivered one-third of the reductions the industry will have to achieve, leaving less work for other, often more challenging and expensive, emission-cutting measures.
Deeper methane reductions also bring economic benefits, writes 440 Megatonnes. “Despite claims from industry that the emissions cap is not achievable without major production cuts, our analysis shows that the emissions cap can be compatible with continued economic growth.”
That growth is larger when the industry embraces low-cost methane abatement solutions like detecting and repairing leaks, stronger limits on venting and flaring, and replacing equipment with low- or zero-emission alternatives. Cutting back on methane that is released accidentally or for safety or operational reasons is one of the sector’s most cost-effective options, and it’s easily done, “especially compared to more expensive options like carbon capture utilization and storage.”
The analysis concludes that the federal emissions cap and strict methane regulations have complementary roles to play in bringing Canada closer to its 2030 climate target. 440 Megatonnes stresses that 75% should be the minimum level of ambition for reducing methane, “more of a regulatory floor than a ceiling.”
But even if methane reductions are the “low-hanging fruit” for the oil and gas sector’s efforts on emissions, the potent greenhouse gas makes up only one-fifth of the industry’s climate pollution—so there is much more work to be done.
