CER net-zero plans rife with ‘optimistic assumptions’: Analysis

But Canada is still a high-emitting country that has consistently lagged on fulfilling its decarbonization pledges, Hughes writes. As of 2021, emissions were down only 8.5 per cent from 2005 levels—a rate that must increase 6.6- to 7.7-fold this decade to meet the country’s 2030 emissions target. And assuming that goal is achieved, emissions reductions between 2031 and 2050 will need to be 5.2 to 5.6 times what Canada achieved between 2005 and 2021 to meet net-zero by mid-century.

Meanwhile, Canada’s economy is still heavily dependent on its oil and gas sector, without any foreseeable shift away from growth driven by fossil fuels, Hughes writes. Canada is poised to be the world’s second-largest developer of new oil and gas extraction to 2050, he says, with projects under development —like the Trans Mountain pipeline expansion and LNG Canada’s export terminal in Kitimat, British Columbia—indicating likely that oil and gas production will likely grow over the medium term

“These expansions will lock in emissions for the next several decades.”

Hughes also warns that several of the CER’s assumptions about Canada’s progress for cutting emissions are overly optimistic. Notably, the regulator’s expectations for scaling up nuclear and hydrogen technologies are likely unachievable, given their current status in the country.

“The growth rates and total capacity of small modular nuclear reactors (SMRs) are perhaps the most questionable” of the CER’s projections, he writes. “Unless costs and construction times can be significantly lowered through the modularity envisaged for SMRs, it is highly unlikely that the number of SMRs needed could be built in the time frames required by the CER projections.”

And while the regulator projected that national hydrogen capacity could grow by 11 to 12 per cent by 2050, Hughes concludes that the technology’s massive draw on electricity systems puts a more realistic figure for that growth at 5 per cent.

Expectations for carbon removal are also overly optimistic, he finds. Though the CER’s scenarios project that natural carbon storage in forests and land will triple to reach net-zero, accounting for natural carbon sinks fails to include emissions from extreme climate events like wildfires that have made Canada’s forests a significant carbon source. Major improvements in forest management will therefore need to be factored into any effective plan for achieving the natural carbon storage the CER anticipates.

But “the weakest link” in the CER scenarios is their excessive reliance on carbon capture, utilization and storage (CCUS) and negative emissions from direct air capture (DAC). “These assumptions are necessary to offset the relatively high reliance on fossil fuels, particularly in the Canada net-zero scenario,” Hughes writes.

“CER’s projections of a 34- to 39-fold increase in CCUS and a several thousand-fold expansion of DAC introduce very high risk, given the cost and slow rate of deployment of CCUS and the very high cost and early stage of development of DAC,” he warns.

“Clearly, there are a lot of optimistic assumptions in the CER scenarios that have to go right if Canada is to meet its net-zero obligations.”

Hughes warns against pursuing slow-scaling technologies at the expense of making actual emissions cuts, expanding renewable energy, and reaching for the “low-hanging fruit” of reducing energy consumption through conservation, efficiency, and behavioural change.

“Canada faces daunting challenges in meeting its net-zero commitments,” he writes. “These are not insurmountable but must be clearly understood and faced head-on, with policies and incentives commensurate with the scale of the problem.”