Environmentalists deconstruct B.C. Liberals' new rules for LNG emissions, argue it's all about optics

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      By 2020, B.C.’s LNG sector could emit enough air pollution to rival the Alberta oil sands, and the B.C. Liberal government’s proposed legislation to regulate industry emissions does nothing to stop that, critics of the bill have warned.

      “There are major loopholes, and greenhouse gases are going to be emitted through those loopholes at a massive number,” said Spencer Chandra Herbert, Opposition critic for the environment. “If B.C. gets five plants, that could potentially double the amount of greenhouse gas emissions in the province.”

      When Bill 2 (Greenhouse Gas Industrial Reporting and Control Act), which received a second reading on October 29, was tabled in the legislature, Environment Minister Mary Polak said the new rules will ensure B.C. “will have the cleanest liquefied natural gas facilities in the world”. But NDP and Green MLAs as well as academics and environmentalists say the legislation is more about optics than enforcement.

      Both the NDP and the Green Party’s lone MLA in the B.C. legislature tried their best to prevent Bill 2 from passing. Chandra Herbert, the NDP MLA for Vancouver-West End, spoke against the legislation for more than 90 minutes. And Andrew Weaver, the Green MLA for Oak Bay-Gordon Head, proposed amendments.

      Benchmarks with no limits

      In a telephone interview, Weaver said in its current form, Bill 2 will fail to control greenhouse gas emissions because it acts as an “intensity scheme” that places no actual limit on how much an LNG plant can pollute.

      According to an October 20 government release, Bill 2 establishes an “intensity benchmark” that allows for plants to emit 0.16 tonnes of carbon for every one tonne of LNG produced. Companies that produce LNG within that threshold will earn carbon credits that they can then sell to others. Businesses that fail to keep emissions within that limit could be fined up to $1.5 million.

      As far as benchmarks go, that ranks among the lowest in the world. But, Weaver noted, it is still a benchmark measured in terms of intensity, or as an amount relative to LNG produced. That means the more LNG a plant generates, the more greenhouse gases it is permitted to release into the atmosphere.

      Inadequate offsets

      If a company can’t produce LNG at that relatively clean intensity of 0.16 tonnes of carbon for one tonne of LNG, the legislation offers “flexible options”. Those include contributing to a “technology fund” and purchasing offsets.

      Chandra Herbert questioned how one defines an offset.

      According to the legislation, an offset is defined as an “emission offset project accepted by the director”. A director is defined as an “employee appointed under the Public Service Act”; in this instance, a civil servant named by the minister of environment.

      A director will accept an emissions offset project if a validation body is satisfied it meets certain criteria. The legislation defines a validation body as “a person that meets the prescribed requirements”.

      On the matter of criteria, the legislation says an offset should reduce greenhouse gases emitted into the atmosphere or reduce greenhouse gases present in the atmosphere.

      Chandra Herbert questioned how all of that will actually play out on the ground.

      He noted the province already has a poor record in this area. As examples, Chandra Herbert pointed to flawed Pacific Carbon Trust projects such as the Encana Underbalanced Drilling project and the Nature Conservancy of Canada's Darkwoods forest project.

      “We’ll never know 100 percent if an offset is real or if it was something somebody already planned to do,” he said. “You can really game the system.”

      Weaver expressed similar skepticism.

      “There are powers essentially given to government to create regulations to call whatever the heck they want an offset,” he charged.

      “It is not the world’s cleanest LNG; it is an accounting game,” Weaver continued. “We have a premier going out making hype messages and then the civil servant is left scrambling to develop policy, to deliver on the hype.”

      Wellhead-to-waterline emissions

      Both MLAs also called attention to the proposed regulations only applying to greenhouses gases emitted at liquefaction facilities and therefore omitting points of extraction and pipelines.

      The same issue was raised by Matt Horne, the Pembina Institute’s associate regional director for B.C.

      “The estimates that we’ve made point to those terminals only being responsible for about 30 percent of the [greenhouse gas] footprint,” Horne explained. “The shale gas [extraction points] and the LNG pipelines are responsible for the other 70 percent, and those are not addressed by the legislation.”

      Horne argued the province must enact legislation that deals with the entire LNG supply chain, wellhead to waterline. “You’ve got a ‘cleanest LNG’ commitment and legislation that only deals with one-third or less of the problem,” he said.

      A February 2014 Pembina report states that without strict environmental regulations, greenhouse gas emissions from B.C.’s LNG industry “could be on par with emissions from the oil sands by 2020”.

      B.C. emissions in a global context

      More recently, a Pembina report released on October 27 placed those emissions in an international context. While Premier Christy Clark describes LNG as “part of a global climate solution”, Pembina argues that B.C.’s LNG industry is unlikely to do anything to alleviate the onset of climate change and will not help humans transition away from fossil fuels.

      “The B.C. government is missing a key point when it comes to recognizing the value of LNG in fighting climate change,” Horne said during a teleconference convened for the report's publication. “Without a global push for low carbon energy sources and efficiency, LNG will likely worsen rather than ease global warming.”

      Pembina Institute

      An article published in Nature two weeks earlier presented very similar conclusions.

      That study sought to examine if burning more natural gas would, on a global scale, result in an overall decrease in the release of greenhouse gas emissions. It will not, the Nature article states. Models predict that more LNG will not replace the burning of coal at any significant rate, and that LNG instead will only add more emissions to the global energy mix.

      Weaver described the Nature study as especially relevant to British Columbia and asked whether we want the province to continue to be a part of the problem rather than the solution.

      “In every case, what they found is, the availability of cheap, abundant gas in the absence of aggressive carbon pricing will actually do nothing but increase emissions,” he said.

      Government won't answer questions

      The Ministry of Environment refused to answer questions for this story, as it has every time this reporter has requested an interview on LNG.

      Speaking in favour of Bill 2 in the legislature on October 27, one B.C. Liberal MLA argued “the science is not yet settled” on climate change.

      “I'm not naturally inclined to believe in the science of global warming,” said Laurie Throness, MLA for Chilliwack-Hope. “The steps we should take should be careful steps, steps that won't prove to have been wasting time and energy and money if it so happens that climate change turns out not to be global, not to be long term, not to be changeable.”

      An email supplied by Environment Ministry spokesperson David Karn provides some details related to offsets.

      “As LNG facilities begin to look outside their facilities for greenhouse gas offsets, they will find forest management, natural gas vehicles, community energy systems, industrial energy efficiency and waste management projects across the province to invest in,” it’s written there. The email describes B.C. as having a “vibrant offset market”.

      The October 20 release concedes that Bill 2’s provisions “do not end the need for climate action”. It states that government will continue to work with industry “to reduce emissions in the upstream”.

      An industry group called the B.C. LNG Alliance posted on its website a lukewarm reaction to Bill 2.

      “Greater clarity is welcome by proponents, as they require fiscal and regulatory certainty to the overall cost of their projects,” said the alliance’s president, David Keane. “However, GHG legislation is just one component of the fiscal framework and overall cost structure in British Columbia.”

      The statement goes on to describe B.C. as a “high cost environment”.

      “Not only will our members be purchasing carbon offsets, but also paying royalties, GST, PST, payroll, municipal property and corporate taxes,” it continues.

      Alternatives to an LNG industry

      Marc Lee is a Vancouver-based economist with the Canadian Centre for Policy Alternatives. He said that at this point, keeping global warming to a manageable increase of two degrees Celsius is a matter of leaving the vast majority of fossil fuels in the ground.

      “If we are to extract any, we should be very strategic about how we’re using that,” Lee stressed. “And in B.C., we’re seeing exactly the opposites. They want to double or triple production out of B.C., export it to Asia, and for very little public return.”

      He noted that the province has significantly reduced the rate at which B.C.’s industry will be taxed, and asked if LNG will add as much to the province’s economy as the premier claims it will.

      “Here is the question: Do we want, as a society, to invest $10, $15, $100 billion in new fossil fuel infrastructure?” Lee said. “Or do we want to invest that same amount of money…in green infrastructure?”

      Comments

      7 Comments

      pwlg

      Nov 1, 2014 at 10:06am

      Great article.

      The BC LNG Alliance, another PR creation like the Forest Alliance and Coal Alliance drummed up to make us believe there's some sort of massive alliance but truly only a few people make up this Alliance.

      "The statement goes on to describe B.C. as a “high cost environment”.

      “Not only will our members be purchasing carbon offsets, but also paying royalties, GST, PST, payroll, municipal property and corporate taxes,” it continues."

      Ummmm, like every other business in BC who don't get any breaks the Alliance lobbies for even more tax breaks, resists municipal taxes, wants federal rebates on taxes and wants the same healthy royalty tax credits the companies at the well head are getting from BC. But given you already have the 8th lowest corporate taxes in the world, thanks to Harper, and a 30% reduction in corporate taxes in BC as well as over $2 billion received in royalty tax credits at the well head, stop the f-in whining. Either pay up or get the f-in out of BC!

      bill jones

      Nov 1, 2014 at 11:13am

      Note that the Pembina report is now recommending nuke power - a first for Pembina.

      Aaron

      Nov 2, 2014 at 5:39am

      I strongly vote for efficiency in all buildings, small scale onsite renewables, large scale renewables linked to our hydro while we build up cradle to cradle certified products, materials and industries. This way we transition to a 100% clean and renewable energy system and a "circular economy". It is hugely profit and beneficial.
      https://www.youtube.com/watch?v=OcO1O99UoUs

      Lance

      Nov 2, 2014 at 9:35am

      Govts need royalties and revenue from somewhere. I'm actually ok with BC becoming a playland for the worlds wealthy means the value of all my properties just keep going up and up....of course the "locals" hate this as well...go figure.

      Christy Clark is a joke

      Nov 2, 2014 at 9:45am

      Christy Clark waves her arms around pretending LNG is green - it is not - and is the only thing that will keep BC in any revenues at all, yet she dumbs down the tax that would generate the revenues and she low-balls the rules for emissions.

      She is grossly incompetent. Worse even than Harper, and that is saying something.

      Michael

      Nov 2, 2014 at 4:11pm

      I think climate change is real, and it's not going away. We need to learn how to live with it, and deal with the reality, rather than wishing it was not so. We can't go back to the 40's or 50's, so try to make the best of where we are going.

      Women In Red

      Mar 4, 2015 at 6:42pm

      Commie Red goes good with her pro Communist business policies.