Environment and Climate Change Canada Clean Fuel Standard for - ISCC Stakeholder Meeting North America Lorri Thompson, Head Regulatory Development ...
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Environment and Climate Change Canada
Clean Fuel Standard
for
ISCC Stakeholder Meeting North America
Lorri Thompson, Head Regulatory Development
Fuels Section, Oil Gas and Alternative Energy Division
December 5, 2017Pan-Canadian Framework on Clean Growth and
Climate Change and the federal Clean Fuel Standard
• In March, 2016, the First Ministers agreed to take ambitious action in support
of meeting or exceeding Canada's 2030 target of a 30 percent reduction
below 2005 levels of greenhouse gas (GHG) emissions
• First Ministers met again on December 9, 2016, to release the Pan-Canadian
Framework on Clean Growth and Climate Change – a plan to grow Canada’s
economy, reduce GHG emissions, and build resilience to the impacts of a
changing climate
• On November 25, 2016, Minister McKenna announced that the Government
of Canada would launch consultation to develop a Clean Fuel Standard as
one of the key federal action to support the Pan-Canadian Framework
– http://news.gc.ca/web/article-en.do?nid=1160579
• Minister McKenna highlighted that the Clean Fuel Standard that “will be a
made-for-Canada approach that will provide flexibility to industry in how they
innovate and how they reduce emissions throughout the fuel system.”
Page 2 – Dezember 6, 2017Canadian Context: Renewable, Clean and Low
Carbon Fuel Standards
• Federal Renewable Fuels Regulations require petroleum fuel
producers and importers to have minimum renewable fuel content
– 5% based on their volume of gasoline 2% based on their volume of
diesel fuel and heating distillate oil
• Some provinces also have renewable fuel mandates equal to or
higher than the current federal requirements: British Columbia,
Alberta, Saskatchewan, Manitoba, and Ontario
– Renewable fuel performance criteria in addition to volume mandates in
Ontario (diesel fuel) and Alberta
• British Columbia is currently the only province with a low carbon fuel
standard (LCFS) in place, in addition to its renewable fuel
requirements
– Requires fuel suppliers to reduce the carbon intensity of gasoline and
diesel fuels by 10 percent by 2020 from a 2010 baseline
– Consulting on the feasibility to increase the carbon intensity reductions
to 15 to 20 percent by 2030
Page 3 – Dezember 6, 2017Key Elements of the Clean Fuel Standard
(announced Nov. 25, 2016) …1
• Modern, flexible and performance-based approach to reduce the GHG
emissions from the fuels supplied in Canada
• Outcome-oriented: the overall objective is to achieve 30 megatonnes of
annual reductions in GHG emissions by 2030
– Reductions are incremental to what is being achieved as a result of current
measures
• Reductions in the lifecycle carbon intensity of fuels supplied in a given
year would be required, based on lifecycle analysis
– Overall lifecycle carbon intensity reductions of approximately 10-15% by
2030 are being considered
– Would not differentiate between crude oil types produced in or imported into
Canada
• Non-prescriptive, market-based approach
• Regulatory requirements to be developed under the Canadian
Environmental Protection Act, 1999
Page 4 – Dezember 6, 2017Key Elements of the Clean Fuel Standard
(announced Nov. 25, 2016) …2
• Would include a broad suite of liquid, gaseous and solid fuels used
for transportation, industry, homes and buildings
• Regulated party proposed to be the fuel supplier (producer, importer,
distributor) rather than the fuel user (except for fuels where user is
also supplier)
• Approach would incent the use of lower carbon fuel pathways and
alternatives (e.g. renewable fuels, electricity, natural gas, biogas/
renewable natural gas) and drive technology and innovation to
achieve the desired outcomes
• Regulations would be designed to provide flexibility to fuel suppliers,
while ensuring objectives are met
• Would be complementary to the Pan-Canadian approach to pricing
carbon pollution
• Carbon pricing will price fossil fuels, as well as emissions from industrial activities,
to send a price signal to markets and further incent GHG emission reductions
Page 5 – Dezember 6, 2017Compliance with the Clean Fuel Standard
• A variety of compliance mechanisms are being consider to provide
flexibility in meeting the objective of the Clean Fuel Standard
• A federal standard would consider the use of a credit trading system as
integral to the design of the standard which could include the ability to
bank credits, trade credits and to carry forward surplus credits into
subsequent years
• Compliance options to reduce the average carbon intensity of fuels
supplied that are being considered
– Blending with renewable and lower carbon fuels
– Switching to lower carbon fuels
– Reducing facility emissions
– Obtaining credits from other fuel suppliers
– Generating credits from other actions that have a possibility of reducing the
carbon intensity of fuels or improving market access for lower carbon intensity
fuels
– Recognition for innovative crude oil production technologies
Page 6 – Dezember 6, 2017Consultations Launched in January 2017
• Discussion Paper to help inform the development of a regulatory framework was
released February 24, 2017 for a 60 day public comment period (ended on April 25)
– Sought views on scope (fuels and regulated parties), determination of carbon intensity, compliance
mechanisms, and asked questions on various elements of what could be in a Clean Fuel Standard
• Extensive consultation sessions starting in January and continue, including a face-
to-face workshop, technical webinars and bilateral meetings with various
stakeholders from
• 125 written submissions were received on the discussion paper with quite diverse
views and comments on the various themes of policy objectives, regulatory design,
fuels covered by the regulations, targeting emission reductions, timelines,
interactions with other measures (including the Renewable Fuels Regulations) and
competitiveness
• A report, Clean Fuel Standard: Summary of stakeholder written comments on the
Discussion Paper , summarizing these diverse comments, was prepared by the
International Institute for Sustainable Development
– Link to report
http://www.iisd.org/library/clean-fuel-standard-summary-stakeholder-written-comments-
discussion-paper
Page 7 – Dezember 6, 2017Comments Received on Sustainability
• Views ranging across the spectrum were received, but many respondents
generally agreed on the need for sustainability criteria
Suggestions and views:
• Sustainability criteria should encompass all the potential impacts, including air
quality, biodiversity, fertilizer use, forest management (both area and quality),
soil carbon, water, wastes and social impacts
• Favour for the use of comprehensive LCAs and inclusion of iLUC
• Criteria should be based on internationally recognized schemes
• EU Renewable Energy Directive, U.S. EPA Renewable Fuel Standard, the
Sustainable Forestry Initiative and the Forest Stewardship Council Canada
• Sustainability criteria should be applied to all fuels equally, domestic and
imported
• GHG emissions should be the only quantitative measure, but adopt
“renewable biomass” requirements for eligibility
Page 8 – Dezember 6, 2017Next steps
• A proposed Regulatory Framework is planned for release in fall 2017
• Focused regulatory design discussions with industry winter/spring
2018
• Publication of proposed regulations in Canada Gazette, Part I in
mid-2018
– Public comment period on proposed regulations and consultations on
the proposal would follow
• Publication of final regulations in Canada Gazette, Part II in 2019
Page 9 – Dezember 6, 2017Clean Fuel Standard – Contacts
Contacts
• Clean Fuel Standard team email address: ec.cfsncp.ec@canada.ca
• Cam Carruthers, Executive Director, Oil Gas & Alternative Energy Division
– Cam.Carruthers@canada.ca │ 819-938-5711
• Lynne Patenaude – Manager, Fuels
– Lynne.Patenaude@Canada.ca │ 819-420-7951
• Lorri Thompson – Head, Fuels Regulatory Development
– Lorri.Thompson@Canada.ca │ 819-420-7973
Information
• Clean Fuel Standard webpage:
https://www.ec.gc.ca/energie-energy/default.asp?lang=En&n=EB5AAF7C-1
• Google Drive with consultation documents:
https://drive.google.com/drive/folders/0B5lNNz63xpM_eEx3Y0hSandLSWs
Page 10 – Dezember 6, 2017You can also read
