Energy sector strives for sustainable benefits

Suncor is a joint venture partner in the Hibernia oil field located approximately 315 kilometres east-southeast of St. John’s, Newfoundland.  SUNCOR

Suncor is a joint venture partner in the Hibernia oil field located approximately 315 kilometres east-southeast of St. John’s, Newfoundland. SUNCOR

Canada’s natural resource endowment is the third largest per-capita in the world and accounts for 1.82 million jobs and contributes 17 per cent of the country’s GDP, according to Natural Resources Canada. But finding the right balance between the growing global demand for natural resources and increasing domestic pressure to safeguard the environment has become one of the sector’s biggest challenges.

The good news, according to a 2018 report by the resources economic strategy table, an industry-government collaboration to support economic growth, is that Canada already ranks in the global top-quartile in environmental performance and is fourth among Organisation for Economic Co-operation and Development (OECD) member countries in environmental policy stringency. 

However, the report points out that according to the World Bank’s Ease of Doing Business index, Canada ranks 34th out of 35 OECD countries in the average time to get regulatory approval for a construction project. Infrastructure bottlenecks are preventing access to existing and new markets as well as many resource deposits – major impediments to growth and competitiveness and a deterrent to investment.

Canada’s energy sector is particularly constrained by these challenges as evidenced by strong resistance to new projects including pipelines and export facilities, and any expansion of existing operations.

Kate Chisholm, senior vice president, chief legal and sustainability officer at Edmonton-based Capital Power, which generates electricity at 25 facilities across North America, believes the current impasse can be traced back about 10 years when energy companies “dropped the ball” by allowing the conversation to get away from: “How do we all, as a society, work together to reduce carbon emissions?” to: “How do we get off fossil fuels altogether?”

“In electricity generation, for example, there are a lot of people who believe we should just get onto renewables like solar and wind,” she says. “But we still need fossil fuels as a backup power source for when the wind doesn’t blow and the sun doesn’t shine.”

Ms. Chisholm says the industry has been working hard to develop emission-free energy to meet the government vision of a carbon-neutral or carbon-free economy, but has not done enough to get that message out to a broader audience.

“Our perspective, with the greatest respect, is that the federal government needs to be a little bit plainer about the very important role that the energy industry plays in Canada’s economy, including in the central and eastern Canadian provinces,” she says.

But that doesn’t mean energy companies are unaware of the challenges they face. An increasing number are being quite open about the risks and opportunities presented to them by climate change, what it means for their businesses and what they’re trying to do to address it.

“The energy industry needs the public to trust that it is being managed by people who have children and grandchildren and who are every bit as anxious about the future and Canada’s environment as they are,” says Ms. Chisholm.

Oil sands producer Suncor fully understands that the economic, environmental and social dimensions of energy development are deeply integrated and success in one cannot be achieved without success in all, says CEO Steve Williams in the company’s 2018 Report on Sustainability.

“Suncor has been an industry leader in sustainability for two decades,” he says. “Going forward, our commitment to continually improve our environmental, social and economic performance will be more critical than ever. As the world transitions to a low-carbon economy, we intend to be a progressive, cost-efficient and carbon-competitive energy provider of choice.”

To help tackle climate change, Suncor aims to reduce the greenhouse gas emission intensity of its oil and petroleum production by 30 per cent by 2030. 

“We believe this target, together with our ongoing commitment to technology and innovation, puts us on the path to ultimately bending the curve on our absolute GHG emissions as well,” adds Mr. Williams.

But perhaps the biggest challenge facing a company like Suncor is how to continue being a profitable, growing business in a world that demands a much stronger focus on environmental performance and social responsibility, he says.

“There’s no single answer to that question, but there is, I believe, a clear path forward. We need to leave the era of fixed and polarizing positions behind and move boldly into the solution space. Doing so requires a degree of compromise to ensure the perfect does not become the enemy of the good,” says Mr. Williams. “A bit of discomfort shouldn’t deter us from acting in pursuit of a shared ambition to develop Canada’s energy resources in ways that foster economic growth while protecting a healthy environment and advancing social well-being.”

P1-Lead-Carbon-Capture---Kate-Chisholm.jpg
The energy industry needs the public to trust that it is being managed by 
people who have children and grandchildren and who are every bit as anxious about the future and Canada’s environment as 
they are.
— Kate Chisholm, 
senior vice president, chief legal and sustainability officer at Edmonton-based Capital Power

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Tanya Camp