Canadian natural gas is the silver bullet that could both help grow Canada’s economy and reduce global emissions at the same time.
If Canada were to significantly increase the production of natural gas here at home and export it to countries heavily reliant on coal to power their economies, like India and China, the Canadian economy would grow significantly, and global emissions could be cut substantially.
In 2023, both India and China were reliant on coal for more than half of their energy consumption. And both countries plan to massively increase their use of coal in the coming years.
Coal produces significantly more greenhouse gas emissions that clean Canadian natural gas. A new study by the Fraser Institute shows that if Canadian natural gas production were to rise and displace some of the increased use of coal in countries like India and China, Canada could make a major contribution to improving the global environment.
In fact, if Canada were to double its current natural gas production and export that additional supply to Asia, that natural gas could displace the use of coal and could reduce global emissions by up to 630 million tonnes annually, which is equivalent to 89 per cent of Canada’s current annual greenhouse gas emissions.
Stop and think about that for a moment. There’s no punishing domestic carbon tax or energy production cap that could make such a positive impact on global emissions. Only through displacing dirtier energy abroad can Canada truly help lower global emissions.
Leaders around the world have recognized Canada’s potential as a reliable producer of clean natural gas that dozens of countries desperately need.
After the Russian invasion of Ukraine, leaders from countries like Japan and Germany came to Canada and begged the federal government to do more to produce more natural gas here in Canada, only to be told by the Trudeau government that there was no business case.
Because of reliance on natural gas from Russia, some European countries are turning back to and increasing their reliance on coal.
Not only is there a business case for Canadian natural gas: the Fraser Institute study makes it clear that there’s an environmental one, too.
For example, were Canada to export LNG to China and all of it were to displace coal, it would achieve an emissions reduction of between 34 and 62 per cent. That means Canadian natural gas would be, on average, between one-third and two-thirds cleaner than the continued use of coal.
What’s standing in the way of all of this? Canada simply doesn’t have any operational LNG export terminals, which experts have blamed on Canada’s regulatory barriers. Since 2011 there have been 18 LNG facilities proposed here in Canada, and yet only one is near completion.
But there’s a new sheriff in town in Ottawa. Prime Minister Mark Carney has suggested that he’s open to building more pipelines and increasing the production of Canadian energy if there’s a national consensus to do so. And the Fraser Institute’s evidence shows that there’s not only an economic case for increasing Canadian natural gas production – there’s a clear environmental case too. If ever there was an obvious case for consensus around an issue, this should be it.
Critics will say that increasing natural gas production here at home could drive up Canadian greenhouse gas emissions. And they’re right. The problem is that they’re not looking at climate change as a global issue.
By increasing production here in Canada and displacing dirtier forms of energy abroad, Canada can play a key role in helping to lower global emissions and fight climate change by recognizing that it’s a global problem in need of global solutions.
Jay Goldberg is the Canadian Affairs Manager at the Consumer Choice Center. He previously served as the Ontario Director at the Canadian Taxpayers Federation and a policy fellow at the Munk School of Public Policy and Global Affairs. Jay holds a Ph.D. in Political Science from the University of Toronto.
