Canada Proposes Emission Caps for Oil and Gas Sector

The Government of Canada has introduced draft regulations aimed at reducing greenhouse gas emissions in the oil and gas sector. These regulations propose a cap-and-trade system to limit emissions to 35% below 2019 levels. The initiative is part of a broader strategy to address climate change and is expected to be finalized in 2025 after further consultations.

The oil and gas sector, which is the largest source of greenhouse gas emissions in Canada, accounted for 31% of national emissions in 2022. The proposed regulations are designed to encourage companies to invest in cleaner technologies, such as carbon capture and storage, to meet the new limits. The government claims this approach will help maintain the sector's competitiveness as global demand for low-pollution fuels increases.

The draft regulations are part of Canada's 2030 Emissions Reduction Plan, which aims to cut overall emissions by 40-45% below 2005 levels. The government has also highlighted the potential for these regulations to create jobs and stimulate economic growth through investments in clean technology.

Public consultations on the draft regulations will be open from November 9, 2024, to January 8, 2025. The government plans to publish the final regulations in 2025.