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Canada’s program to reduce greenhouse gas emissions is failing, the audit shows




Canada’s environmental commissioner says a federal pandemic aid program for the oil and gas sector that was supposed to save jobs and reduce greenhouse gas emissions has not been set up to actually do any of these things.

“This is a program that needs major improvement,” Commissioner Jerry DeMarco said Thursday about a program called the Earth Emission Reduction Fund.

The $ 675 million program was announced in April 2020 to help the industry stand amid a massive reduction in fossil fuel use in the first weeks of the COVID-19 pandemic.

The program funds projects to help oil and gas companies meet or exceed regulations that require them to reduce methane leaks or deliberately extract them from production facilities.

The program audit by DeMarco published Thursday says the process the Department of Natural Resources used to calculate emissions lacked transparency and that companies had to report whether they were retaining jobs, but that was not a requirement to receive funding.

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He also said the alleged emissions cuts were based on outdated data about existing emissions and the program did not ensure companies used the money for new projects they would not have done otherwise.

Two-thirds of applicants for the 40 projects funded in the first round also fully stated that the funds would allow them to boost production. But neither they nor the federal government accounted for the increase in emissions they would generate, and it is possible, DeMarco said, that increased production would produce more emissions than the program is able to cut.

Conservative party critics said in a joint statement that “the funding may have actually led to an increase in carbon emissions is ridiculous”.

Julia Levin, a senior climate and energy manager at Environmental Defense, said this is clearly an inefficient fossil fuel subsidy, something the government claims it will phase out gradually by the end of 2023.

“Ministers who are coherent with the promises they made just two weeks ago would cancel this program, but I doubt they will do so,” she said.

Natural Resources Minister Jonathan Wilkinson and Environment Minister Steven Guilbeault said they welcomed the audit, along with others released by the DeMarco office on Thursday.

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This includes a condemnation report that looks at Canada’s overall progress on climate change.

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DeMarco said Canada started promising to cut emissions three decades ago and since then emissions have increased by 20 percent.

“Canada was once a leader in the fight against climate change,” DeMarco said. “However, after a series of missed opportunities, it has become the worst performer of all the G7 countries since the adoption of the historic Paris Agreement on Climate Change in 2015. We cannot continue to go from failure to failure; we need actions and results, not just more objectives and plans. ”

The ministers said that the climate plans presented since 2015 have started to show results.

“We are confident that we have laid the groundwork, including one of the strictest pricing and pollution reduction programs in the world, to take Canada’s climate war to the next level,” they said.

The Wilkinson Department was less welcoming of the emissions reduction fund audit findings, agreeing only in part with many of the recommendations and not directly addressing some of the biggest concerns about double counting and overestimating cuts. emissions.

DeMarco said this is disappointing.

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“They did not tell me that the department was willing to fully acknowledge the scale of the problems,” he said.

He said he knows the fund ran “in a hurry” in the pandemic, but said this is not an excuse for poor work and there is still time to fix what bothers him before more money comes out the door.

Two rounds of applications have been completed so far, while the deadline for the third round comes in January. All told, the fund has paid $ 134 million to 26 companies for 81 projects, which the government claims reduced more than 4.6 million tonnes of emissions.

DeMarco audited only the first round of applications – 15 companies, 40 projects and $ 71.5 million. He said the program design is so flawed that it cannot assess what emissions it has actually cut. He believes the government is greatly overestimating what this program can achieve.

The department itself acknowledged that its emissions targets would require that almost all 610 companies eligible for the fund participate in the maximum benefit. In the first two of the three rounds, only 26 companies applied.

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