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Canada's energy future is green(er)

by Mark Sabourin
EcoLog, 11/9/2018 10:34:00 AM

The decoupling of energy use from economic growth is a continuing trend, according to the just-released long-term energy outlook from the National Energy Board (NEB). Canada’s energy mix will continue to become greener, but there is a good chance fossil fuel production will also grow, according to the NEB, even if domestic consumption falls.

The report, “Canada’s Energy Future 2018: Energy Supply and Demand Projections to 2040”, is part of the NEB’s annual Canada’s Energy Future series, which this 2018 year projects energy supply and demand to 2040 under four scenarios:

  • a Reference Case based on the current economic outlook, a moderate view of energy prices and technological improvements, and climate and energy policies announced at the time of analysis
  • High and Low Price Cases that consider the impact of uncertain commodity prices on the Canadian energy system
  • a Technology Case based on stronger global climate policy action and rapid adoption of low carbon technology.

In the business-as-usual Reference Case, energy use grows slowly. By 2040, it is only 5% above current levels. Canadians will be using more renewables and more natural gas, less coal and less refined products. Canada’s electricity mix will be greener even as crude oil and natural gas production grows. Energy use per dollar of GDP will be nearly 30 percent lower than current levels, and energy use per person will be down nearly 15 percent.

However, production in the oil and gas sector will be affected by energy prices, as demonstrated by the High Price Case and the Low Price Case. The High Price Case assumes a world price of US$120 per barrel for oil and US$5.26/MMbtu for natural gas. The Low Price Case drops oil to US$40 per barrel and gas to US$2.15/MMbtu. Production of oil and natural gas soars under the High Price Case and falls, albeit not as precipitously, under the Low Price Case.

The Technology Case projects the impact on Canada of stronger long-term carbon policies, faster uptake of technologies, and lower cost of renewables. Under that scenario, energy use in Canada in 2040 is 15% below current levels, and fossil fuel consumption falls by 30% below current levels.

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