VICTORIA, British Columbia, March 25, 2024 (GLOBE NEWSWIRE) -- Expanding LNG in B.C. comes with risks to B.C.’s economy and energy system, finds a new report from Clean Energy Canada, An Uncertain Future.
B.C.’s nascent LNG industry has a number of proposed LNG projects, some of which have not yet been built or even approved, but the business and environmental case for expanding the industry is built on questionable foundations.
Specifically, it is unclear who will be buying B.C. LNG in the coming years and decades as forecasts for future LNG demand vary significantly. Japan's LNG imports, for one, have steadily declined over the last decade and fallen to their lowest level in 14 years as the country restarts nuclear power plants and builds out renewables. Meanwhile, global LNG export capacity is anticipated to increase by 43% by the end of the decade, just as many of B.C.’s export projects are planned to come online, with LNG oversupply set to be most pronounced in B.C.’s intended export markets.
Expansion would also come at a cost to the province’s electricity system. If all six LNG facilities were to be built, they would require around 43 TWh of electricity per year—equivalent to the electricity from more than eight Site C dams. In the past, B.C. could rely on neighbouring provinces and states for electricity imports, but they are now also facing shortages. What’s more, importing just one Site C's worth of electricity would cost B.C. ratepayers, or potentially taxpayers, around $600 million annually.
Despite being touted by proponents as a coal-displacing climate solution, the climate case for LNG is also far from clear. Abroad, LNG will not necessarily reduce global emissions when accounting for factors such as methane leakage and the risk that it could compete with renewables and nuclear.
And here at home, aggressive LNG development would jeopardize B.C.’s abilities to meet its climate targets. The combined emissions of all proposed projects would make up 40% of B.C.’s total emissions in 2030, assuming the province met its climate target. It is far more likely that B.C. would greatly miss its target with LNG adding so much climate pollution to the province.
As the report articulates, there are a number of steps governments should take to ensure B.C. is taking the best path on LNG, including aligning industrial strategy and electricity-related decision-making around a net zero future. Amending the environmental assessment process to account for emissions at all points of the supply chain, not just those in B.C., would also reveal a clearer climate picture.
The report concludes that B.C. should be highly skeptical of investing in the expansion of an industry whose market is far from guaranteed, and which risks crowding out public and private investments in cleaner industries better poised for growth in the coming decades.
KEY FACTS
- The International Energy Agency holds that there is no need for investment in new fossil fuel supply in a world that reaches net zero by 2050.
- Global LNG export capacity is anticipated to increase by 43% from today by the end of the decade (as B.C.’s export projects are planned to come online). B.C.’s key competitors—namely Australia, Qatar, Malaysia, the U.S., and Russia—are projected to add around 50% more export capacity by 2030 compared to today.
- If all six LNG facilities were to be built, they would require around 43 TWh of electricity per year. That’s 69% of B.C.’s total 2022 demand, or the equivalent of the electricity from more than eight Site C dams.
- Importing just one Site C’s worth of electricity would cost B.C. ratepayers, or potentially taxpayers, around $600 million annually.
- The U.S. government anticipates that LNG exports could cause domestic natural gas prices to increase by up to 28% over the next 25 years.
RESOURCES
Report | An Uncertain Future
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