A new report by the Energy Information Administration (EIA) has cast a long shadow over the industry’s economic future.
It found that the world’s largest gas-fired power plant — the $7.8-billion Enbridge Energy Inc. facility in northern Alberta — has failed to meet its emissions-reduction targets, leaving it “extremely vulnerable to significant, long-term declines.”
In particular, the EIA found that EIA was still finding “significant, long term declines” in the amount of CO 2 emitted from the company’s existing facility.
The new report also highlighted a number of troubling factors that are affecting the economics of natural gas-fuelled power plants.
“The EIA has identified a number (of) key issues that may significantly impact the economics and operations of the Enbridge facility, including: increased operating costs that are offset by lower operating margins and higher maintenance costs; the continued impact of declining revenues from gas-related sources; the difficulty in implementing changes to the operating and operating-support policies of the facility; and the potential impact of environmental regulations, including emissions limits and the Clean Air Act,” the report said.
The EIA is the only independent U.S. agency that tracks the carbon emissions of the oil and gas industry, and the report found that Canada is one of the largest producers of natural-gas.
“Canada is the third-largest natural- gas producer in the world and is one half of the world share of the global natural-Gas supply,” the EAA said in its summary.
“Although the U.K. has surpassed Canada in terms of natural resource output, it remains the country with the largest share of U.s. natural-Resources output.”
EIA also found that while Canada is the country’s biggest natural-resource producer, the country “is still far behind Canada in the global carbon emissions share of its overall economy.”
“This finding suggests that the economic, social, and environmental benefits of Canadian natural-resources production have been far from reaching the national economy, despite the economic gains, the significant reductions in carbon emissions, and positive economic impacts on the national and local economies,” the authors said.
“Moreover, the economic benefits of Canada’s natural- resource sector remain substantially less than the economic impacts of the country as a whole.”
The EAA also said that while the emissions reductions achieved in Canada’s energy-intensive sectors are substantial, “Canada’s overall economic growth rate is well below the national average.”
“Despite these significant reductions, Canada’s economic performance is still lower than that of the U of S, even though Canada’s total natural-Resource production is twice that of U of s.”
The report noted that the environmental impact of the coal and oil industries is also far below the global average.
“Compared to the global coal sector, Canada is not considered a significant contributor to global emissions,” the paper said.
But while Canada’s coal emissions are on par with those of the United States, the report also said “there is evidence of continued declines in emissions from coal-fired facilities in Canada.”
“The U. S. coal industry continues to be the world leader in greenhouse gas emissions, with annual emissions per tonne of CO2 equivalent nearly eight times higher than Canada’s, according to EIA,” the news release said.
However, the paper noted that EAA “did not consider the impact of these emissions reductions on Canada’s economy.”
As a result, “the economic effects of coal-based generation in Canada are not well understood.”