Shell is one of the companies pushing the federal government to create a national greenhouse gas offset program, which Ottawa announced last year with no specific timeline to start.
Carbon offsets allow businesses and individuals to invest in environmental projects in order to balance their own greenhouse gas emissions.
Increasingly, energy companies are setting climate targets to achieve net zero emissions by 2050. While companies expect technological innovation to play an important role in achieving these targets, in addition to sequestering emissions underground, the purchase of offsets is a means of securing at least one path to achieve ambitious environmental objectives. While innovation is likely to occur, the technology being developed may not prove to be as effective as expected.
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The federal government has spent the last few years developing a national greenhouse gas offset system. Environment and Climate Change Canada is targeting 2021 to complete the first federal compensation protocols. The office of the federal Minister of the Environment did not respond to a request for an interview.
Carbon offsets are not a quick fix to the greenhouse gas problem, but some businesses and environmentalists see it as a tool to fight climate change.
Reforestation in the area affected by forest fires
The Shell project will plant trees in an area of British Columbia that was ravaged by forest fires in 2017. Reforestation is a partnership with Central Chilcotin Rehabilitation, a Tsilhqot’in forestry company, to plant 840,000 native trees .
“Sooner or later people will realize that they have to start doing business in a different way,” Chief Joe Alphonse, president of the Tsilhqot’in National Government Tribe, said in an interview.
“We hope this becomes a model for other First Nations and businesses to follow,” he said.
The cost of the two-year tree planting project is not announced. About 500 full-sized trees are needed to absorb the carbon dioxide produced by a typical car traveling 20,000 km per year, according to the nonprofit Tree Canada.
There are plenty of other opportunities across the country to tackle climate change, according to Shell.
“What we are looking for from the federal and provincial governments are protocols that set the rules of the game on how these types of investments could be used as a means to offset emissions in other sectors of the industry. the economy, ”said the head of Shell Canada.
“It requires a lot of science, it must be rigorous, it must be validated by third parties. “
There are many different ways to generate carbon offsets, including building renewable energy projects; capture methane from landfills; and certain agricultural practices such as zero tillage.
Farmers also use carbon offsetting
Alberta has had its own carbon offset program since 2007, which covers many sectors, including agriculture.
Initially, there were concerns, as some farmers were collecting considerable sums without making changes to their operations. As technology evolves, it becomes easier to verify the actions a farmer takes to improve the environment.
“Carbon, for a farmer, is a cost,” Nutrien CEO Chuck Magro said of carbon taxes and fuel taxes.
The Calgary-based international fertilizer company is among companies that have developed digital data tools to track how much carbon is emitted by individual farms and how much air is absorbed into crops and soil.
“Tools to help farmers really understand their digital footprint, their environmental footprint, and then hopefully we can evolve that to be able to pay them to sequester carbon while producing healthy and abundant crops. “
An Iowa farmer expects to receive a check for US $ 290,000 for the carbon he sequestered over five years. The credits were purchased by Shopify, the Ottawa e-commerce giant, through a carbon credit marketplace run by Nori LLC of Seattle.
Shopify buys carbon credits to offset its own emissions.
Carbon offset systems have been criticized in the past, including overestimating the amount of carbon removal and the efficiency of certain activities, such as tree planting.
Environmental groups in favor
A group of eight environmental organizations are supporting the creation of a national carbon offset program, including the David Suzuki Foundation and Environmental Defense.
As part of their joint submission to the government, the groups said a federal agenda would help ensure national coherence and national fungibility.
“Carbon offsets can have a legitimate role to play in providing compliance flexibility,” the organizations wrote in the submission. “However, we would like to emphasize that offsets are not a way to avoid direct reductions in greenhouse gas emissions, including activities that cause emissions resulting from the loss and degradation of ecosystems. “
Husky Energy has both bought and sold credits under Alberta’s carbon offsetting program, but the company wants the federal government to put in place a national system so it can offset emissions from its operations. in different parts of the country where no compensation program currently exist.
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The company cites its West Wild Rose oil project off Newfoundland and Labrador as an example of a facility that could have net zero emissions. Husky plans to use the technology to ensure the facility produces oil with emissions 50 percent lower than the average barrel of crude produced domestically.
If Husky were able to purchase reasonably priced offsets, officials say it could be a zero rate installation.
“The only way for businesses and indeed the Government of Canada to achieve its net zero goals is to unleash and unleash the power of assets throughout our economy. We need to be able to invest in one area and encourage emission reductions in another. Said Janet Annesley, senior vice president of corporate affairs and human resources at Husky.
Achieving net zero goals on a project, she said, would send a message to investors and governments that the industry is taking climate change seriously.
“We have to unleash the power to work together or else we will fail together,” Annesley said.