Behind the Numbers

Comparing two carbon bombs: LNG plants vs Enbridge pipeline

February 8th, 2012 Marc Lee · 3 Comments · British Columbia, Environment

With the spotlight on the federal government’s aggressive push to export tar sands bitumen via the Enbridge Northern Gateway Pipeline to Kitimat, and from there by tanker on to China, the BC government reclaimed some attention on the energy file when it released its Natural Gas Strategy last week. With lots of glossy pages, but little detailed content, it is reflective of Premier Clark’s signature style. The short of it is that shale gas from BC’s Northeast is to be pipelined to Kitimat and loaded onto tankers in liquid form (LNG) to be exported to China. Between LNG and Enbridge, little Kitimat, is poised become an export platform for the two most environmentally controversial practices of the oil and gas industry, shale gas and tar sands extraction, all to appease the endless appetite for energy coming from the curious blend of totalitarian police state and unbridled capitalism that is modern China.

But while the Enbridge pipeline has huge swaths of BC up in arms, particularly First Nations and “radical environmentalists”, the LNG plans, which already have been approved and have an export permit, have not. Bitumen from the tar sands has a bad name, but natural gas does not. Perhaps because we call it “natural” gas not methane; perhaps because of its familiarity from being piped into many BC homes. Natural gas has long been touted as the cleanest of the fossil fuels – about half the greenhouse gas (GHG) emissions on a lifecycle basis as coal. The advent of hydraulic fracking in deep shale gas deposits closes that GHG gap considerably (according to one study, there is no difference), but it also raises huge local environmental justice issues in the form of contaminated aquifers (water supplies), tailings ponds and even earthquakes (see a great report by my colleague Ben Parfitt).

A review of the numbers, though, shows that the LNG plants will be even worse than the Enbridge pipeline in terms of GHG emissions. Last summer, I crunched the numbers on carbon content of the fuel that will go through the LNG plants — just the emissions from combusting the fuel, whether that is in China or BC, NOT including the extraction, processing and transport emissions — and found that when all of the plants are up and running by 2020, emissions between 81 and 112 million tonnes (Mt) of CO2 per year. The uncertainty relates to the throughput of the pipes; if anything, the true figure by 2020 will be closer to the latter.

I did a similar calculation for the Enbridge Northern Gateway pipeline, and came up with 70 Mt of CO2. So just in terms of carbon content the LNG plants are actually a bigger carbon bomb than the Enbridge pipeline. Those emissions will happen in China, so they won’t count in BC’s or Canada’s GHG inventory, but the atmosphere cares not what land mass emissions come from. In both cases, I’m assuming this is incremental activity relative to a status quo of leaving the fuel in the ground.

We also have to count extraction and processing emissions – the energy and emissions it takes to get the fuel out of the ground and to market. In the case of Enbridge, adding in those emissions will make the total impact on the order to 90-100 Mt per year. For the LNG plant we get into controversies about just how much process (or fugitive) emissions will be (see debate here). Our friends at the BC Sustainable Energy Association have taken a crack at estimating those fugitive emissions, and they come up with a range of 54 to 370 Mt per year. The reason for the wide range is that annual emissions are lower if you take a 100-year timeframe than if you take a 20-year timeframe. This is because methane breaks down in the atmosphere into carbon dioxide and water over time, but while it is up there it has a much higher warming potential. The shorter time frame is arguably more relevant because we don’t have the luxury of waiting 100 years, and that shorter-term additional warming will have impacts on ecosystems, glaciers, permafrost, forests, sea ice and so forth that would launch us into a catastrophic feedback loop or rising temperature.

In any event, those production emissions DO COUNT in BC’s GHG inventory (which totaled 66.9 Mt in 2009), so even if we take the lowest amount, the LNG plants make it impossible for BC to meet its 2020 legislated GHG target of 33% below 2007 levels. In fact, it probably makes it impossible for BC to fall below 2007 levels, period. And the counting is not even done yet, as we still need to factor in the energy used for fracking the ground, processing facilities; transporting gas by pipeline; compressing it; and then transporting it again by tanker. It is hard to say how much annual GHG impacts will be for all of this activity, and some if it will be powered by electricity, but conservatively figure another 5-10 Mt per year (please jump in with your own math!).

Putting all the LNG pieces together, we are looking at a minimum of 140 Mt and possibly up to 492 Mt per year (by comparison, Canada’s emissions were 734 Mt in 2008). Someone recently questioned my claim that this represents a carbon bomb because we are just so small relative to total global emissions, but clearly these numbers are sobering if you care at all about climate change. (These days it feels like I’m the one in denial that humanity can pull itself out of its fossil fuel addiction, since we seem to be upping the dose.)

All of which drives home some truly deceptive spin on the part of the BC government that their natural gas ambitions are somehow good for the planet and in sync with climate action. Here is Environment Minister Terry Lake (I picture him trying to prevent himself from breaking out laughing) in the BC government news release:

Again, B.C. is demonstrating climate leadership with the world’s first clean-energy-fuelled liquid natural gas plants. These two LNG plants will provide Asia with a cleaner alternative for its immediate energy needs as B.C. natural gas displaces more carbon-intensive fuels like coal and diesel. Our abundant natural gas is a bridging fuel that will contribute to global reductions in greenhouse gas emissions, as we move into the future of clean, greener energy alternatives.

Two things to note here. It is proposed that clean electricity power two of three LNG plants, which met praise from the likes of the Pembina Institute. But this is but one very small piece of the lifecycle emissions from the wellhead to the Chinese market that would displace burning gas in favour of renewable energy. Second, this electricity will be massively subsidized by regular BC households. This is because all of the new demand in the province is coming from industry, most notably mining and oil and gas (the two most GHG-intensive industries), who pay a super-low “transmission” rate of about $40 per MWh. But this new renewable energy supply on the margin costs about $124 per MWh, meaning the Crown corp will lose $84 for every MWh it sells. That means residential and commercial ratepayers must make up the difference in higher rates. Far from climate leadership, the BC government’s plans subsidize the very industries causing the climate problem.

[Aside: The release of the Natural Gas strategy provided some political cover for a decision to abandon a policy of electricity self-sufficiency for BC Hydro. This is a flip-flop and policy failure on the part of the Liberals, but it is, in fact, the right call. The self-sufficiency mandate, while sounding good, meant BC would have had to run huge electricity surpluses every year to guard against shortfalls – again buying expensive renewable power from private corporations that for the most part would have had to be dumped at a loss on the North American market. I should say that the complicity of renewable energy industry in all of this is apalling, and that includes a former climate team member of the David Suzuki Foundation who is now the BC director of the Canadian Wind Power Association.]

Back to Lake, the other notable is that there is only one way his statement could be true. If BC’s shale gas is indeed less GHG-intensive than coal, and if it was to displace China from burning coal (i.e. that coal stayed in the ground) then there would be a modest improvement in GHG terms. But that is not the planet we are living on, and the status quo energy pathway for China suggests nothing of the sort. BC’s LNG exports will be used as additional fuel on top of growing coal burning for power.

There is no way of getting around the fact that the LNG plants are a nightmare in climate terms. They will be extremely profitable to industry (which includes the Chinese state oil company as a partner) and governments will benefit from royalties and taxing those profits (though the trend is continually to lower corporate income taxes). It is increasingly a problem that governments who hate taxes rely on resource revenues to fund public services. There will even be some jobs though not many. According to the strategy document about 1,500 construction jobs and 125 permanent ones. And though the document claims “B.C.’s natural gas sector employs tens of thousands” the BC government’s own statistics state otherwise: 3,200 jobs in oil and gas in 2011, plus a perhaps a couple thousand more in “support activities for mining and oil and gas”.

Forget the rhetoric about competitiveness and market diversification. This is about a short-sighted push for big profits that come at the expense of people in vulnerable parts of the world and in the future. They are externalized costs that lead to odious profits. In that, and in the China connection, there is little difference between the Enbridge pipeline and the LNG plants. For the BC government to state that this is “a climate solution” is beyond belief; the federal Conservatives, at least, are more honest about not caring for the future. The true tragedy in all of this is that we need not go this route at all – the solutions to the climate problem already exist; the barrier is politics-as-usual. If we want a jobs strategy there is a great alternative available in the shift to a green economy. That means BC’s shale gas reserves need to stay in the ground.

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3 Comments so far older updates

  • Anna Wharton

    Fracking will not last long once the earthquakes start or a forest fire launches again. http://www.thedailybeast.com/articles/2012/01/03/youngstown-rocks-is-fracking-causing-earthquakes-in-ohio.html Mixed with the dying trees from the pine beetle a huge decimation of greenery will further advance unstable conditions. Fracking is becoming dangerous to ground water and if we did not have such toothless environmental policies, none of these dangerous practices (fracking, bitumen transport, uranium transport, geothermal engineering, or tankers in the sound) would be considered as viable.

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  • Bruce Litteljohn

    An extremely important and well-researched article. The body of the essay is persuasive, including the math, but it is the writer’s conclusions that should shatter the odious shell of complacency under which our politicians and oil patch profiteers squirm and lie and scuttle .
    Even though we have gone beyond environmental thresholds in some vital areas, he notes that there remains time to solve the energy/carbon crisis by shifting to a green economy. What is lacking in Canada is the political ( and public ) will and courage to face the foe.
    How shameful in a nation whose soldiers were shifted up to the bloody sticking point in so many World War Two battles because of their toughness and valour.

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