Alberta’s Current Carbon Strategy

Alberta's Current Carbon Strategy No Match for Keystone's Emissions, Figures Show

In the tiny hamlet of Hairy Hill, Alberta, a highly energy-efficient grain-fed distillery does what it can to offset some of the greenhouse gas emissions spewed by the province's dirtier industries—mainly the tar sands.

The upstart company called Growing Power Hairy Hill turns grain, manure and household waste into liquid fuel and electricity while emitting essentially no greenhouse gases. It says it is Canada's first "integrated biorefinery."

Hairy Hill is one small gear in Canada's carbon-control strategy as the nation struggles to rein in its soaring greenhouse gas emissions. And it is one among more than four dozen government-funded projects that officials hope will help persuade President Obama to approve the Keystone XL, the cross-border pipeline that has been immobilized for years as the Obama administration considers its environmental and climate consequences.

But despite its low carbon footprint, the emissions credits the plant earns under Alberta's complex carbon offsetting scheme are a drop in the bucket compared to what the Keystone would add to the atmosphere.

A close look at the scale of all these offsetting projects—and how they stack up against emissions from the Keystone—reinforces the view of environmental groups and other tar sands opponents that the government is offering far too little.

"The bottom line is, we don't think it adds up," said Hannah McKinnon, national program manager for Environmental Defence, a Canadian advocacy group.

Sometime next year Obama is expected to decide whether it's in the U.S. national interest to let TransCanada, the pipeline's builder, carry 830,000 barrels a day of tar sands oil to U.S. refineries. In an interview with The New York Times, the president repeated that the Keystone would pass or fail on its global warming merits, taking into account that tar sands production emits several times more greenhouse gases than conventional oil.

"I'm going to evaluate this based on whether or not this is going to significantly contribute to carbon in our atmosphere," he said. "And there is no doubt that Canada, at the source in those tar sands, could potentially be doing more to mitigate carbon release."

If Obama was putting an extra burden on Canada, it may be one that Prime Minister Steven Harper is willing to talk about. Harper wrote the president this summer suggesting that as part of a Keystone deal, Canada would be willing to work together with the United States on reducing emissions. The goal: to meet the two nations' mutual commitments to cut their carbon output sharply by 2020.

Details of the letter, reported by the Canadian Broadcasting Corporation, have not been released. But increasingly, in public speeches and documents, Canadian and Alberta officials are signaling that they would like to arrange a deal in which measures to hold down Canada's emissions of greenhouse gases could offset the increased emissions that would come from expanding tar sands shipments through the Keystone.

It's an approach that the U.S. Environmental Protection Agency specifically encouraged when it reviewed the State Department's draft environmental impact statement on the Keystone, issued in March and now being finalized.

Alberta, in particular, has been emphasizing that it is already moving to control carbon emissions with projects like the one at Hairy Hill, which are financed by revenues from the province's carbon penalties.

20 Million Tons of Extra CO2 a Year

The tar sands crude that the Keystone would carry accounts for roughly one billion extra tons of carbon dioxide over the pipeline's 50-year lifetime, compared to if it were to carry conventional fuel, according to EPA figures. That's at least 20 million tons a year.

By comparison, the Hairy Hill project would save a mere 100,000 tons a year. The largest project subsidized by Alberta so far, a carbon-capturing plant known as Shell Quest, would save about one million tons a year.

Alberta's requirement that industry reduce carbon emissions per unit of production, or offset them by buying credits or paying fines, shrunk emissions by 34 million tons in the first four and a half years that the rule was in force, compared to business as usual. But that's still small, both compared to the additional output that the Keystone would allow, and compared to the growth in tar sands production during those years.

Even though per-barrel emissions in the Alberta oil patch have dropped 26 percent since 1990, tar sands production increased much faster, so the net effect has been rapid growth in total emissions.

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