Ottawa to Require Oil and Gas Emissions to Be Cut by One-Third by 2030

Environment Minister Steven Guilbeault says the emissions cap on oil and gas will ‘establish a pathway to carbon neutrality by 2050.’

Minister of Environment and Climate Change Steven Guilbeault speaks during media availability at the Climate Positive Energy Initiative conference in Toronto on Aug.10, 2023. Arlyn McAdorey/The Canadian Press

Environment Minister Steven Guilbeault has unveiled the federal government’s oil and gas emissions cap, which will cut emissions in the sector by at least one-third by 2030.

“A promise we took to the Canadian people in the 2021 election was to put a cap on the amount of pollution from Canada’s oil and gas sector, and reduce it at a pace and scale needed to reach carbon neutrality in Canada by 2050. And unlike almost every other sector of our economy, pollution from the oil and gas sector is still going up,” Mr. Guilbeault said during a press conference on Dec. 7 from the United Nations Climate Change Conference (COP28) in Dubai.

Natural Resources Minister Jonathan Wilkinson said Ottawa is proposing to set the oil and gas cap at 35 to 38 percent below 2019 levels in 2030. “This is an important part of Canada achieving its goal of a 40 to 45 percent reduction across the economy by 2030. We certainly intend to consult on this approach in the coming months,” he said.

The oil and gas sector will also be able to buy a limited number of carbon offset credits or contribute to a decarbonization fund, lowering the requirement to 20 to 23 percent.

Mr. Guilbeault said the emissions cap on oil and gas would “establish a pathway to carbon neutrality by 2050” and help to “unlock the kinds of job-creating projects that will guarantee the industry’s record profits are used to secure a bright future for our communities and workers.”

Mr. Guilbeault said while Canada was on a path towards emissions to be 9 percent higher in 2030 back in 2015, “thanks to the work of so many Canadians, we are ahead of our initial 2030 target, and firmly on track to meet the targets of our 2030 emissions reduction plan.”

The environment minister also said Ottawa would finalize regulations in the coming weeks to ensure that 100 percent of new cars sold in Canada are zero-emissions vehicles by 2035.

Alberta Says Cap ‘Intentional Attack’ on Province

In response to the emissions cap announcement, Alberta Premier Danielle Smith called it an “intentional attack by the federal government on the economy of Alberta and the financial well-being of millions of Albertans and Canadians,” adding that the province has the constitutional right to own and develop its own resources.

“With his pronouncement today singling out the oil and gas sector alone for punitive federal treatment, Justin Trudeau and his eco-extremist Minister of the Environment and Climate Change, Steven Guilbeault, are risking hundreds of billions of investments in Alberta’s and Canada’s economy and core social programs, are devaluing the retirement investments of millions of Canadians, and are threatening the jobs of hundreds of thousands of Albertans,” Ms. Smith said in a press release.

The Alberta premier said that in response to the announcement, her cabinet would develop a “constitutional shield in response to this and other recent attacks on our province by what is fast becoming one of the most damaging federal administrations in Canadian history.”

Back in 2022, Ottawa announced it aimed to reduce the country’s emissions from oil and gas by 40 to 45 percent below 2005 levels by 2030, putting the country on the path to “achieve net-zero emissions by 2050.” The federal government said it heard from over 30,000 Canadians when developing the plan, which also involved $9.1 billion in investments in measures like carbon pricing, clean fuels, incentives for zero-emission vehicles, and tax breaks for fossil fuel companies that embrace carbon capture technologies.

Earlier in the week, Mr. Guilbeault unveiled draft regulations around accelerating the reduction of methane emitted by Canada’s oil and gas sector by at least 75 percent by 2030. While the Environment Minister said the announcement was the result of collaboration between the provinces, Alberta Premier Danielle Smith said Ottawa had imposed the new rules “unilaterally.”

“Given the unconstitutional nature of this latest federal intrusion into our provincial jurisdiction, our government will use every tool at our disposal to ensure these absurd federal regulations are never implemented in our province,” Ms. Smith said in a statement following the announcement, adding that the province has a “constitutional right and responsibility” to manage its emissions without federal overreach.

Ottawa’s announcement around the oil and gas cap comes as it recently lost two court cases involving its proposed ban on plastics and environmental impact assessment legislation, both of which were deemed to be unconstitutional.

When asked by reporters how Ottawa could be sure that the new regulations would survive a constitutional challenge, Mr. Guilbeault said they were going after pollution and not production.

“The Supreme Court said that our ability to intervene on climate change issues is not an open bar, and we can’t impede on provincial jurisdiction, and that’s not what we’re doing. We’re staying in our lane,” he said.

On Nov. 27, Alberta invoked its new sovereignty act for the first time in response to the federal government’s proposal for a net-zero electricity grid by 2035, with the province claiming it would impact the reliable supply of power and increase costs for Albertans. Mr. Guilbeault has said he will not challenge Alberta’s use of the sovereignty act in court, as it is “a largely symbolic gesture.”