Canada’s Climate Priorities

Renewable Industries Canada's chairman explains how biofuels will help his country meet its GHG reduction goals as part of its Paris climate change commitments in the March EPM Global Scene column.
By Jim Grey | February 10, 2017

Climate change and greenhouse gas (GHG) emission reductions are genuine priorities for Canada’s federal government. Canada’s ambitious commitments expressed in the Paris climate accord are to support the goal of keeping global warming below 2 degrees Celsius this century and to reduce GHG emissions 30 percent from 2005 levels by 2030. 

Given its geographic breadth, it is not surprising that the transportation sector is responsible for 23 percent of Canada’s GHG emissions. Canada will not achieve its Paris commitments without substantial reductions in transportation sector emissions. 

For more than three decades, Renewable Industries Canada has been the lead association representing Canada’s biofuels and bio-based industries, which provide clean and innovative technologies that have contributed to curbing the growth of GHG emissions. Ten years ago, the federal government introduced renewable fuels regulations that required gasoline to be retailed in a blend that included 5 percent ethanol and petroleum diesel to be blended with 2 percent biodiesel.  Some provinces have set their own volumetric requirements for ethanol in gasoline that exceed the federal government’s requirements, such as Manitoba at 8.5 percent and Saskatchewan at 7.5 percent.

The existing volumetric requirements on renewable fuels have had an effect equivalent to removing 1 million vehicles from Canada’s roads every year. These gains have been achieved without any required change in driving behavior or increased consumer cost. Analysis of life-cycle GHG emissions has shown that ethanol can burn up to 62 percent cleaner than pure gasoline and that biodiesel is up to 99 percent cleaner than petroleum diesel, not to mention the economic benefits that our $3.5 billion industry has brought to the Canadian economy. Renewable Industries Canada is therefore advocating for the increased volumetric requirements with an inclusion of up to 10 percent ethanol, and 5 percent biodiesel. These measures would remove the equivalent of an additional 1 million vehicles from Canada’s roads.

In the United States, the renewable fuel standard (RFS) has been a remarkable success. According to a 2015 study by California-based Life Cycle Associates, “the RFS2 has resulted in the cumulative CO2 savings of 354 million metric tons over the period of implementation.” And the Jan. 12 USDA report found that “GHG emissions associated with corn-based ethanol in the United States are about 43 percent lower than gasoline…comparable to reducing GHG emissions in the U.S. transportation sector by as much as 35.5 million metric tons per year.” The study will be useful to policymakers tasked with reducing U.S. GHG emissions.

Increased volumetric requirements also provide market certainty and business opportunity. In Ontario, Canada’s largest province, biodiesel producer BIOX acquired an additional facility that had been shuttered, thanks to the province’s Greener Diesel Mandate. At IGPC Ethanol Inc., construction begins this spring on a project that is intended to double production, due to the province’s announced intention to increase renewable fuel content in gasoline as part of its climate action plan. Ontario also recently launched consultations aimed at further reducing emissions from gasoline by an additional 5 percent.

Ethanol is sure to figure prominently in this equation, and our industry looks forward to continued momentum on both sides of the border.

Author: Jim Grey
Chair, Renewable Industries Canada
CEO, IGPC Ethanol Inc.