A recent report by Shell emphasizes the need to promote climate-related policies that support the carbon reduction goals outlined in the Paris Agreement.
Like Shell, the Canadian Association of Petroleum Producers (CAPP) is looking for ways for Canada’s oil and natural gas industry to thrive in a low-carbon world. This includes an emphasis on environmental innovation as well as the creation of effective policies and regulations.
“CAPP supports climate policies that are effective and efficient in managing greenhouse gas emissions while maintaining a vibrant and competitive oil and natural gas sector,” says CAPP president and CEO Tim McMillan.
CAPP notes as an organization that its focus is on policy implementation and outcomes—ensuring that efforts to reduce greenhouse gas (GHG) emissions hit the mark in terms of both effectively reducing emissions while maintaining Canada’s ability to compete on the global stage. Without a recognition of the need for policies to consider industry competitiveness, unintended consequences like carbon leakage could result.
In its report published last summer, Competitive Climate Policy: Supporting Investment and Innovation, CAPP highlighted how inefficient and duplicative climate policies can work to discourage investment in Canada, prompting companies to move operations to other countries with little or no emissions-reduction programs. The net result of such shifting production would be to increase rather than lessen future global GHG emissions.
“Rather than making blanket endorsements of broad initiatives, we are focused on getting the right outcomes for Canada and the world,” says McMillan. “That means policies that both help reduce emissions while maintaining Canada’s position as a global supplier of choice for responsibly produced natural gas and oil.”
Some media reports have suggested misalignment between Shell and CAPP based on Shell’s report which reviewed Shell’s position on climate change policies relative to 19 industry associations around the world. Yet the report itself states that Shell remains “a committed member of CAPP” highlighting shared positions that include a policy to develop low-carbon technology, the importance of natural gas and the need to manage methane emissions.
“We were informed of the report in advance of its release,” notes CAPP spokesperson Tonya Zelinsky, “and Shell has told us that it is not advocating CAPP change its policies with regards to carbon pricing or the Paris Agreement.”
The report is aimed at encouraging discussion and transparency—something CAPP believes in as well.
“CAPP supports the broad mandate of the Paris Agreement to reduce emissions,” says McMillan. “However we know that there are a variety of tools to achieve this outcome, from carbon pricing to regulatory requirements. These tools can be implemented in ways that are effective and efficient, or in ways that are not. Our focus needs to be on getting this right.”