Clean Energy Canada | The Vancouver Sun: "B.C. introduces pollution benchmarks for LNG plants, with option to buy offsets"
October 20, 2014

The Vancouver Sun cites Clean Energy Canada in their coverage of British Columbia’s LNG legislation. Here is a copy of the original article by Rob Shaw and Gordon Hoekstra:

VICTORIA – Companies looking to build liquefied natural gas plants in B.C. will need to meet pollution benchmarks for their facilities, or else they will have to purchase offsets or pay into a technology fund, according to new government legislation.

The proposed law, introduced in the legislature on Monday, sets a benchmark of carbon dioxide equivalent tonnes per tonne of LNG produced — which the government says is slightly below the emission standards of most other leading global LNG facilities.

If an LNG proponent can’t meet that benchmark through design of its facility, it can purchase offsets (by investing in other emission reduction projects) or contribute to a technology fund at a rate of $25 per tonne of CO2 equivalent, the government said.

“This will help to achieve the province’s commitment to cleanest LNG facilities in the world,” said Environment Minister Mary Polak.

“We will have to do more to continue reducing emissions.”

The government’s goal is to get at least five LNG plants operational, which the Liberals have promised will generate up to $1 trillion in revenue, fill a $100 billion prosperity fund and pay off the province’s debt.

The new legislation is the government’s attempt to portray the still nascent LNG industry as the “cleanest LNG in the world,” while also addressing how its resulting pollution impacts B.C.’s legislated targets to reduce greenhouse gasses.

The government is bound by law to reduce its 2007 GHG emissions levels by 33 per cent by 2020.

Polak said Monday the government will still meet that law.

Companies whose LNG facilities perform better than the government benchmark will receive credits they can sell to other facilities, according to a government news release that accompanied the legislation.

There is also an unspecified “escalating incentive” from government to companies based on their compliance costs at a certain level.

Pacific Northwest LNG, led by Malaysian-state controlled Petronas, said it had just begun to review the legislation so would not comment on specifics.

But Pacific Northwest LNG spokesman Spencer Sproule said the project has emphasized the use of advanced technologies to minimize its proposed facility’s carbon dioxide output.

“While we are awaiting our final project design, our preliminary estimates indicate that Pacific NorthWest LNG would be one of the most environmentally friendly LNG facilities in the world with a carbon intensity ratio estimated between and ,” he said.

Green party MLA Andrew Weaver, a climate scientist, blasted the government legislation saying it provides “sweeping powers” for later regulations that will rewrite international carbon accounting standards. He said the proposed law will make B.C. the “laughing stock” of the international community.

“This isn’t going to fool anybody. This is not a serious piece of legislation. It’s attempting to try and look like the government still has a plan for greenhouse gas reductions. The reality is if the government’s plan of meeting five LNG plants is realized there will be more greenhouse gases produced in British Columbia than we presently produce today through every single sector of our economy. So there’s nothing here. This is a means and ways of a government trying to save face.”

He said B.C. has moved toward a “taxpayer-pay model” instead of a polluter-pay model with the bill.

“It’s a complicated accounting game which is solely trying to frankly pull the wool over everyone’s eyes that we are actually reducing greenhouse gas emissions,” said Weaver.

“When the reality is, it is what it is. Seventy-three million tonnes of greenhouse gases, of carbon dioxide, coming out with five LNG facilites. That’s more than we produce everywhere in B.C. So we will not, and we cannot, and we cannot even pretend to, make our greenhouse gas targets.”

NDP critic Spencer Chandra Herbert said the government LNG GHG legislation was disappointing.

“What it looks like to us is Petronas and other proponents are writing the legislation that government is putting forward basically with huge loopholes you can drive greenhouse gases through, with bad implications for the future,” he said.

Chandra Herbert pointed to the bill’s proposed technology fund, which he said is similar to an Alberta government initiative that has failed to reduce GHGs.

He also took aim at the requirement companies buy offsets if they can’t meet pollution targets, noting the province’s existing carbon offset system has led to odd support for big industries.

“They claimed that carbon offsets would be the great thing to get us to a carbon neutral government, and what did we have? We had hotels being paid out subsidies to build fancier hottubs out of funds stolen, I argue, from schools.”

Clean Energy Canada lauded the B.C. government for moving closer to its goal of a world-leading liquefied natural gas industry, but said the production emission intensity standard on its own won’t result in the cleanest LNG in the world.

Merran Smith, director of Clean Energy Canada, noted that LNG production releases carbon pollution all the way down the chain of production, including when gas is extracted and transported via pipelines.

“Today’s legislation only addresses the last link in that chain—the port facilities where companies would chill the gas to load it aboard ships. It also allows companies to buy credits rather than actually build cleaner terminals,” Merran said in a statement.

She also noted that even if B.C. does ensure that this industry is built to world-leading standards, it would sharply increase the province’s greenhouse-gas emissions.

Environmental advocates have said the LNG companies could reduce GHG emissions if they used electricity, rather than burning natural gas, to power the motors and other heavy equipment used in the liquefaction process.

However, the government has been reluctant to force companies to use electricity. Energy Minister Bill Bennett admitted last week that, given the choice, most compares are instead likely to choose the cheaper route of burning natural gas for power, though government remains hopeful those proponents will choose electricity for ancillary purposes.

Premier Christy Clark has tried to reframe the LNG pollution issue, saying her government should get credit for “doing the world a favour” and providing cleaner natural gas to countries like China that burn dirty coal.

But critics have said B.C. risks becoming a laughing stock on climate change by trying to take credit for global improvements while failing to address pollution within its own provincial borders.

The government is expected to introduce legislation Tuesday that details its tax regime for the LNG industry, including specific rates companies will have to pay on top of other existing provincial and federal taxes.