Canada’s draft coal regulations: a half-hearted approach to climate change

Blog - Oct. 26, 2011 - By P.J. Partington

In 2010, then Environment Minister Jim Prentice announced that the federal government intended to regulate greenhouse gas emissions from coal power, and we were cautiously optimistic. Perhaps, after scrapping several plans, the federal government had finally settled on an approach to tackling Canada's emissions growth and meeting our international commitments — one that it would begin implementing without delay.

Minister Prentice made the case that these regulations would be a big step forward:

"Today's announcement positions Canada one step closer to reaching its goal of being a clean energy superpower. A responsible, clear phase-out of the electricity sector's inefficient coal-fired generation will allow ample time for the implementation of cleaner generation technologies. This will create new jobs in the clean-energy sector, while helping Canada meets its commitment to greenhouse gas reductions."

On the one hand, the announcement sounded promising, considering that we strongly support an end to conventional coal-fired power in Canada and have long advocated for a swift transition to low-carbon, sustainable energy.

On the other, we had (and continue to have) major reservations about some of the details and questions about how the regulations would stack up against Canada's commitments to cut greenhouse gas pollution. We had hoped that the draft regulations could be improved to deliver a significant environmental benefit for Canadians, and we wrote to Environment Canada that autumn to share our praise, and our concerns.

One year later

One year, and several Ministers, later, the draft regulations have finally been published. We have looked through them in detail and have found that none of the major concerns we raised have been addressed. Environment Canada's modelling of the regulations' impacts also reveals the limited effect the regulations will have on emissions levels and clean energy, especially in the coming decade.

No progress on non-emitting generation

Environment Canada's modelling finds that the regulations will have a "negligible impact" on non-emitting generation, which includes wind, solar, bioenergy, hydro, nuclear, etc. Even in 2030 — a decade late — the share of electricity generated without emitting greenhouse gas pollution will only be 83 per cent. 

This is important given that the federal government has committed that 90 per cent of the country's electricity will be generated from non-emitting sources by 2020. Instead of powering a transition to clean energy, these regulations will shift virtually all coal-fired generation to natural gas, with no noticeable increase in renewable power whatsoever.

Inadequate contribution to climate change commitments

The proposed regulations are expected to reduce greenhouse gas pollution emissions by 5.3 million tonnes (Mt) by 2020, beyond what is already being achieved by other provincial policies. While any reduction in emissions is a step in the right direction, the aA coal plant next to wind turbinesdequacy of reductions can only truly be assessed within the context of a national climate change plan that, unfortunately, doesn't exist. If that plan did exist, and it required the electricity sector to make an equitable contribution to the national effort, reductions from the electricity sector would be more than seven times greater (closer to 40 Mt) by 2020.

While reductions from natural gas-fired generation can pick up some of the slack, regulators clearly need to require greater reductions from existing coal-fired electricity generators. If these additional measures are ignored, Canada will need to rely on other, much more expensive options for reducing greenhouse gas pollution in other sectors of the economy. Either that or these coal regulations, as they currently stand, will be putting Canada on track toward another set of missed climate change obligations.

Strengthening the regulations

These inadequate results stem from the slow application of the regulations, issues with the performance standard and the lack of requirements or incentives for electricity generating units to do anything about emissions until they reach the end of their life. These are issues that can be fixed.

In our submission, we lay out detailed recommendations for strengthening the regulations. They include tightening the standard so that it requires the best achievable technologies, ensuring it applies immediately to new units, and adding measures to encourage coal plants to cut their emissions ahead of schedule and to exceed the requirements of the regulations.

As a package, these improvements would help avoid two scenarios:

  1. Where companies are allowed to rush the construction of facilities that don't meet the regulatory requirements. As evidenced by Maxim Power's proposed 500 MW expansion that was recently approved by the Alberta Utilities Commission, this is not a hypothetical scenario.  Under the draft regulations, a unit built in June 2015 would not be held accountable for reducing its emissions until 2060. To his credit, Minister Kent has spoken out against "short-cutters" seeking to circumvent the rules and, "get a half-century licence to emit greenhouse gases." More recently, however, his spokesperson stated, "At this time, we have no plans for further action" regarding new units before 2015. This ambiguity must be resolved in the final regulations by clearly applying the standard to all new coal plants, effective immediately. 
  2. Where companies are allowed to continue operating old plants without any changes until as late as 2056 (this is when the regulations would apply to the Keephills 3 plant in Alberta that was commissioned in 2011).

Still waiting

Minister Prentice concluded his June 2010 speech by declaring: "We are well on our way to meeting our objectives. One thing is clear. Canada is serious about climate change."

It is now well over a year later and while Minister Kent has reinforced those sentiments, limited progress has been made towards meeting our climate change objectives. Implementing the proposed regulations for coal-fired power would be a small step in the right direction, but it would fall well short of the level of ambition needed. If the federal government is actually "serious about climate change" it needs to step up and significantly strengthen the proposed regulations for coal-fired power.

Pembina's comments on the proposed federal regulations for coal-fired power are available here.

P.J. Partington
P.J. Partington

P.J. Partington was a senior analyst with the Pembina Institute's federal policy group until 2015.


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