New Working Paper: Driving Global Heating to 1.7° C and Above

This blog provides a glimpse into the Centre for Law and the Environment's newest working paper, "Driving Global Heating to 1.7° C and Above: The New Canada’s Energy Future 2023 Report and Canada’s Projected Oil Production to 2050", written by David Gooderham. The CLE's working papers can be accessed through our publications page.

The Canada Energy Regulator published its new report, Canada’s Energy Future 2023, on June 20, 2023. This is the first time the Federal Government’s energy agency has directly addressed whether the currently planned growth of oil production in Canada to 2030 and 2040 is compatible with keeping global warming to 1.5°C.

In recent years, studies by climate scientists have repeatedly shown that the current levels of global oil production put us on a pathway to a warming increase of 2.6°C by the end of this century. The International Energy Agency’s (IEA) “Net-Zero by 2050 Scenario” (NZE), which was first published in May 2021 (and updated in the IEA’s World Energy Outlook 2022 report on October 27, 2022), warns about the immediacy of the need to halt any further expansion of oil production and provides detailed findings about the rapid pace and severity of the deep cuts in oil use needed as early as 2030 and deeper cuts required by 2040 to give the world a realistic chance to keep the heating of the earth to within the 1.5°C threshold.

Global oil demand and oil prices by scenario

The IEA’s report includes the above graph which depicts the rapid decline of global oil production that would be required between now and 2050 to limit the rise in global average surface temperature to less than 1.5°C. It also compares two other scenarios which project much higher levels of continued oil use over the next two decades, neither of which are aligned with staying within the 1.5°C global heating limit.

The IEA’s Net-Zero Emissions by 2050 Scenario (NZE) determined that within this decade a 25% reduction in global oil production would be required, down to 72 million barrels per day (bpd) by 2030, and a 50% cut to 44 million bpd by 2040. It concluded that global production must decline to 24 million bpd by 2050 (a 75% reduction) to meet the 1.5°C goal. The bottom green line depicts the NZE Scenario, showing very deep cuts in the near-term by 2030 and 2040.

After refusing to do so for many years, and facing growing criticism from leading Canadian climate scientists and energy system experts, on December 16, 2021, the government finally instructed the CER to develop a scenario showing a path for Canada’s future oil production aligned with the IEA’s 1.5°C study. The CER’s new report was publicly released on June 20, 2023. It offers three different scenarios.

Only the CER’s first scenario, which it calls its “Global Net-zero Scenario” (stated to be modelled on the IEA’s Net-Zero by 2050 Scenario), is aligned with limiting warming to 1.5°C. That would require a very dramatic reduction in Canada’s existing oil production levels which, according to the CER, reached a record 5.2 million bpd in 2022. Under the Global Net-zero Scenario, starting after 2030 Canada’s oil production must decline sharply to 2.8 million bpd by 2040 (which would require a 50% cut below the CER’s projected level of 5.7 million in 2026) and falls to 1.2 million bpd by 2050. In fact, the IEA’s analysis makes clear that to meet the 1.5°C goal, cuts in global oil production must begin now, well before 2030.

The CER’s second scenario, the “Canada Net-zero Scenario”, envisions a much slower global transition away from oil. It assumes that after about 2040 countries will begin to adopt more stringent climate policies. Based on this assumption of ‘delayed’ action, the CER acknowledges that its second scenario aligns with warming of 1.7°C. But that rise in heating could be in the higher range of 1.8°C or well above that, depending on the actual timing and plausibility of promised future action to reduce reliance on oil, gas, and coal, which under this scenario will not even begin to happen for another 20 or 30 years. That gives Canada another few decades of higher oil production.

The CER’s new report is not the result of a public inquiry process. It was prepared “behind closed doors” by the staff of the government’s energy agency.  We have no idea what scientific evidence they looked at in concluding that the future level of warming under the second scenario could be limited to 1.7°C and it provides no assessment of what that level of global heating means in terms of the breakdown in natural systems and consequences for human lives.

There is also a third scenario, the “Current Measures Scenario”, that leads to warming in the range of 2.6°C to 2.8°C. It assumes no significant new policies to curb oil, gas, and coal use beyond those already in place.

The CER report offers no advice suggesting which path we should follow or that we should “cap” Canada’s oil production and align our future production level with the 1.5°C warming limit. It is silent on what we should do.

The Federal Government’s declared position, clearly stated in its 2030 Emissions Reduction Plan, is that it will adopt new policies to “cap” emissions during the oil extraction process in Canada, but it will not limit production levels. The government’s plan is clear: Canada’s oil production will continue to increase until other countries eventually begin to consume less oil. In the meantime, Canada’s production levels will be guided solely by “global demand”.

Given that the Federal Government’s own energy regulator has now acknowledged that the NZE-aligned Global Net-zero Scenario is the only scenario that offers us any remaining chance to keep further warming within the 1.5°C threshold, the question is whether the government is prepared to abandon its approach that leaves these consequential decisions to the oil producers and their shareholders.