The Dual Challenge: Energy and Environment

Scott Tinker

The world faces two important and interrelated challenges. Affordable and reliable energy for all, and protecting the environment. The energy-environment challenge is not simple, but it is solvable if we understand and address the complex fabric of energy security, scale of energy demand, physics of energy density, distribution of energy resources, interconnectedness of the land, air, water and atmosphere, and the extreme disparity in global wealth and economic health. The truth is that there are no good and bad, clean and dirty, renewable and nonrenewable energy sources. They all have benefits, and they all have challenges. Climate change is an important issue, but it is not the only environmental issue. Solar and wind are important low carbon solutions, but they are only part of the solution. We must put our best minds to the task of addressing the dual challenge, working together to better the world.

From the Fraser Institute

By Elmira Aliakbari and Julio Mejía

Doubling Canadian natural gas production and exporting to Asia could reduce global emissions by up to 630 million tonnes—nearly as much as Canada produces in a year

Canada could help significantly reduce global greenhouse gas emissions by increasing natural gas production and exporting the additional supply to Asia in the form of liquefied natural gas (LNG), according to a new study from the Fraser Institute, an independent, non-partisan Canadian public policy think tank.

“As countries like China and India continue to burn coal for power, Canadian LNG offers a lower-emission alternative with the potential for major global impact,” said Elmira Aliakbari, director of natural resource studies at the Fraser Institute and coauthor of the study, Exporting Canadian LNG to the World: A Practical Solution for Reducing GHG Emissions

The study estimates the impact from Canada doubling its natural gas production and exporting to Asia to replace coal-fired power. In that scenario, global emissions could drop up to 630 million tonnes annually, which is the equivalent of removing approximately 137 million cars from the road. More specifically, replacing coal-fired power in China with Canadian LNG could cut emissions by up to 62 per cent for every unit of power produced.

“Focusing only on domestic emissions ignores Canada’s potential to support global climate goals,” said Aliakbari. “By displacing coal abroad, Canadian LNG can play a critical role in cutting total global emissions even if domestic emissions were to increase.”

However, regulatory uncertainty and a range of federal and provincial policies continue to hinder LNG development in Canada, despite strong global demand.

“Policymakers need to clear a path if Canada is going to play a meaningful role in reducing global emissions,” Aliakbari added.

Exporting Canadian LNG to the World: A Practical Solution for Reducing GHG Emissions

• Coal, a major source of greenhouse gas (GHG) emissions, remains a leading energy source in many Asian countries, especially China and India. Some European countries have also turned back to coal as sanctions on Russian energy intensified following the invasion of Ukraine.
• As the world seeks practical solutions for reducing greenhouse-gas emissions, natural gas, with its lower carbon footprint, offers a promising alternative to coal.
• With abundant reserve, Canada is well positioned to help reduce global reliance on coal. By exporting Canadian liquified natural gas (LNG) and helping Asian and European countries reduce their reliance on coal, Canada can lower net global GHG emissions.
• Exporting LNG from Canada to China and substituting LNG for coal in the generation of power there can eliminate between 291 and 687 gCO₂eq per kWh of power generated, a reduction of between 34% and 62%.
• If Canada were to double its current natural gas production and export the additional supply to Asia as LNG to displace an equivalent amount of coal used to generate power, global GHG emissions could be reduced by up to 630 million tonnes annually, a significant reduction equivalent to 89% of Canada’s total GHG emissions.
• Canada enjoys several competitive advantages, including cooler temperatures that reduce liquefaction energy costs and a strategic location that offers shorter shipping routes to Europe and Asia compared to many other suppliers.
• Regulatory challenges and a mix of federal and provincial policies, however, have slowed or blocked LNG developments in Canada.