The Canadian government has unveiled a draft framework aimed at capping pollution caused by the oil and gas sector in the country.
The Regulatory Framework for an Oil and Gas Sector Greenhouse Gas Emissions Cap proposes a 35% to 38% cap on 2030 emissions compared to 2019 levels, with compliance flexibilities to emit up to 20% to 23% below 2019 levels. The framework plans to support Canada’s goal of reaching net zero by 2050 while considering rising global demand for oil and gas.
While the framework supports pollution reductions, it does not maintain limits on oil and gas production.
The draft regulations also include rules that would modify existing carbon pricing systems, allowing for carbon offsets to count towards oil and gas facilities’ emissions commitment. Under the Canadian Environmental Protection Act of 1999, Canada’s government plans to implement a national cap-and-trade system allowing regulators to issue emissions allowances.
"Every sector of Canada's economy must do its part to combat climate change and build a safe, prosperous, and healthy future for Canadians,” said Steven Guilbeault, Canada’s minister of environment and climate change. “All sectors of our economy need to reduce their emissions, and that includes oil and gas companies.”
The future of fossil fuels has been an ongoing debate at COP28, and the conference has not yet released a final statement on the matter. Many countries want to avoid limits on fossil fuel development as the industry supports a number of world economies. Other parties, however, call for a phase-out or phase-down of fossil fuels because of the massive impact they continue to have on the climate.
Through this proposal and other recent developments, Canada has attempted to take action towards practically reducing the impact of fossil fuels in the near future. Earlier this year, the country released guidelines to eventually eliminate fossil fuel subsidies, reportedly making it the first of the Paris Agreement signatories to do so.
Canada claims that phasing out fossil fuel subsidies is key to transitioning to a net-zero world and aligning with the country’s net-zero goals.
“The Government of Canada's plan to cap and reduce emissions from Canada's largest emitting sector is ambitious, but practical,” said Guilbeault. “It considers the global demand for oil and gas -- and the importance of the sector in Canada's economy -- and sets a limit that is strict, but achievable. Canadians have always risen to the challenge of building a brighter future, and this greenhouse gas pollution cap will help Canada compete and succeed in a world that is moving to a clean-energy future."
