CALGARY, Oct 26, 2016 /CNW/ - The National Energy Board (NEB) has updated its long-term energy outlook, lowering both the future price of crude and the estimated increase in Canadian oil production by 2040.
Canada's Energy Future 2016: Update incorporates rapidly evolving energy market conditions and policy developments over the past year. The report suggests that energy use, including energy derived from fossil fuels, will continue to increase but at a slower pace compared to the NEB's last projections and at a much slower pace than Canada has seen over the last 25 years.
In the report's reference case, Canadian crude oil production continues to grow, but at a slower rate than in the previous report released in January, 2016. The global price of oil remains a key uncertainty for future growth.
In the electricity sector, recent policy announcements have a large impact going forward, with more growth in renewables than projected in the NEB's January report. By 2040, coal-fired generation without carbon capture and storage technology accounts for a very small part of Canada's electricity mix.
Earlier this month, the Government of Canada announced its plan to price carbon pollution, a central component of the Pan-Canadian Framework on Clean Growth and Climate Change. The plan represents one of the most significant federal climate policy announcements in Canada and the NEB requires additional time to analyze its effects. This plan is not included in this update but the NEB will update its projections in 2017 to reflect the evolving climate policy frameworks in Canada.
As the only publically available, long-term energy supply and demand outlook covering all energy commodities and all provinces and territories, the NEB's Canada's Energy Future series provides Canadians with a key reference point for discussing the country's energy future.
In addition to the report, Canadians can review this information through the NEB's leading edge data visualizations tool. With a few clicks, Canadians can see the type and quantity of energy produced and required in every province and territory, and what that energy mix is forecast to look like decades into the future. These visualizations have about 10 million unique possibilities. With the degree of customization and interaction built into this tool, each user can tell the story that most interests them.
- The reference crude oil price is now $90 US per barrel by 2040, or $17 lower than the NEB's projections released at the beginning of 2016.
- Canadian crude oil production increases from four million barrels per day in 2015 to 5.7 million barrels per day by 2040 – almost 400,000 barrels per day lower than forecast in the January report.
- Electricity generated from coal (a greenhouse gas intensive power source) drops to 10 per cent of current levels by 2040, due to federal regulations and the planned phase-out of coal in Alberta by 2030.
- To replace declining coal generation, considerable natural gas and renewable energy is added over the projection period. Hydroelectric capacity increases by 15 per cent from 2015 levels and the combined solar, wind and biomass capacity more than doubles by 2040.
"Canada's energy system continues to face a great deal of change and uncertainty. The NEB's updated energy outlook reflects recent volatility in global crude prices, as well as the ongoing impact of climate policies. As climate policy frameworks in Canada continue to evolve, the NEB will continue to update our Energy Futures series and provide Canadians with up-to-date, unbiased and factual energy information," said Shelley Milutinovic, Chief Economist, National Energy Board.
The National Energy Board is an independent federal regulator of several parts of Canada's energy industry with the safety of Canadians and protection of the environment as its top priority. Its purpose is to regulate pipelines, energy development and trade in the Canadian public interest. For more information on the NEB and its mandate, please visit www.neb-one.gc.ca.
SOURCE National Energy Board
For further information: James Stevenson, Communications, National Energy Board, Tel: 403.613.6126, Email: [email protected]