Canada needs to rethink its climate change strategy

Canada has not done well on meeting its climate change commitments, an industry net zero conference in Calgary was told October 25, and needs to change its approach to the climate file.

In an opening keynote address at Petroleum Technology Alliance Canada’s Net Zero Conference, David Layzell, director of natural gas strategy and engagement at the University of Calgary and head of the Transition Accelerator, said Canada’s failure on climate dates back to the Copenhagen and Kyoto protocols of the 1990s and 2000s.

The problem, he said, is that most stakeholders – governments and industry – have been looking at making incremental changes, and there was no clear vision of what a climate friendly energy system might look like.

Over the last half-decade or so, he said, the world has come to realise a new approach is needed to get to net zero, with greater ambitions to reduce emissions.

“Instead of talking only about a seven to ten megatonne per year reduction, we’re now looking at something like 20 megatonnes per year, and actually even higher than that, given that we’re not quite on track.”

A transformational change in global energy systems is needed, he said, and that needs to start with an understanding of what a net zero energy system might look like, then stepping back to determine how exactly to get there. Hydrogen, Layzell said, offers Canada the chance to get there.

“I think there's an incredible opportunity for the oil and gas sector to start to look at hydrogen being one of its main products and to slowly shift, or maybe rapidly shift, to zero emission fuels and demonstrate this sector is certainly part of the solution to climate change and not part of the problem.”

In a later panel discussion laying out possible pathways to net zero, Layzell said Canada’s oil and gas sector is perfectly positioned to make electricity and hydrogen – the cornerstones of a new, low-emission energy system – and to retain its role in providing these fuels for transportation, heating and power generation.

“But to do this, the oil and gas sector must gain the support of both investors and the broader public by showing that it is a major part of the solution to climate change and not just part of the problem.”

There are four priority areas for achieving this transformational energy system, Layzell said: immensely scaled up carbon capture and storage (CCS) systems, reduced lifecycle emissions from the production of blue hydrogen, accelerated domestic demand for hydrogen as a fuel for heavy-duty transportation, industrial heating and power generation, and enhanced interprovincial and First Nations collaboration to drive the production and export of low-carbon hydrogen and ammonia.

“Alberta has already demonstrated that it’s possible to capture and safely store a couple million tons of CO₂ per year,” he said. “However, the province and the industry need to really up the game and show that Alberta can cost effectively inject and permanently sequester many tens of millions of tons and even hundreds of millions of tonnes of CO₂ per year, every year for the next 50 to 100 years or more.”

Lifecycle emissions associated with blue hydrogen production need to be driven below two kg of CO₂/kg of hydrogen, a target that will require at least 90% CO₂ capture from steam methane reforming or methane pyrolysis – and ideally in the 94-95% range. It will require third-party validation of reduced emissions along the full natural gas value chain, and it will require reducing methane leaks to well below 1%.

“Without all of this, blue hydrogen is not going to be accepted as being on the transition pathway to net zero,” Layzell said.

The last two priority areas, he said, offer the oil and gas industry the chance to be first adopters of hydrogen as a fuel, rather than waiting for others to create the demand, and to reach critical low-carbon energy markets in Asia.

“Japan, South Korea and Germany have all expressed an interest in importing low greenhouse gas hydrogen or ammonia,” Layzell said. “If Canadians are going to actually benefit from this opportunity, we need to work together and have a plan and a strategy to deploy.”