The Canadian Federal Government, led by Environment Minister Steven Guilbeault, has unveiled a new framework designed to constrain emissions in the oil and gas sector by 2030.
The ambitious plan includes a cap-and-trade system, obliging the industry to reduce emissions by 35 to 38 percent from 2019 levels. The system also provides an avenue for the sector to purchase offset credits, a move that has been met with mixed reactions.
A Divisive Reaction
Alberta Premier Danielle Smith has been strongly critical of the initiative, denouncing it as an 'intentional attack' on Alberta. Smith has vowed to create a 'constitutional shield' against the policy. Conversely, environmental groups have lauded the policy as a crucial step in the fight against climate change.
Industry Stakeholders Unimpressed
Industry stakeholders, such as the Explorers and Producers Association and the Canadian Association of Energy Contractors, have expressed their discontent. They argue that the policy is detrimental to investment and job creation in Canada, positing it as 'unnecessary and unacceptable.' According to them, this could tarnish Canada's reputation on the global stage.
Climate Groups Applaud the Move
Climate groups including the Canadian Climate Institute and Clean Energy Canada have thrown their weight behind the cap. They underline that it is a quintessential move if Canada is to meet its climate commitments. However, they have simultaneously voiced their concerns about the absence of detailed implementation and enforcement plans, stressing the need for long-term clarity to keep investors in the loop.