A report by the C.D. Howe Institute shows that liquefied natural gas exports from Canada could help reduce global greenhouse gas emission by displacing coal as a power source in coal-dependent countries.
The report by the independent research institute, claims that exporting Canadian LNG “could lower emissions in some Asian countries but raise emissions in other countries.”
It suggests that exporting LNG to China, India, Japan and Taiwan could lower global GHG emissions as these countries depend on coal and oil for power generation.
However, it notes that Canadian LNG exports to other potential markets, such as South Korea, UK, Argentina or Belgium, among others, could increase global GHG emissions as these markets focus on low-GHG sources for power generation.
On the positive, gas-fired power plants could facilitate the expansion of renewable sources by ramping up or down to complement the intermittent output of solar or wind sources.
In addition, the report urges the Canadian policymakers, that are close to ruling on environmental assessments of LNG exports from facilities proposed in British Columbia, to use appropriate metrics to assess the project’s merits and align the policy with the economic and environmental goals.
The report argues that assessing how individual LNG facility would affect overseas GHG emission is impractical for regulators due to market uncertainty making it nearly impossible to predict where the exported gas would be consumed, or which power sources it would displace.
In recommending steps to policymakers, that would maximise the GHG benefit of Canadian LNG exports, the report notes that importers should be encouraged to displace coal-fired power generation.
Additionally, Canadian regulators are recommended to control GHG emissions within their own jurisdiction and reduce domestic upstream emission from the development of natural gas projects.
Under these circumstances, Canadian LNG could have a positive effect on global environmental and economic issues, the report concludes.