Canada's Phase Out of Coal Still Decades Away

 

 

By Daphne Bramham

November 13, 2021 - From the heat dome that killed 595 British Columbians this summer to wildfires that burned Lytton to the ground, destroyed homes in other communities and ravaged thousands of hectares of forest, it’s hard to deny climate change is real.

But for everyone celebrating Canada’s commitment to end the use of thermal coal, the single biggest contributor to climate change, and Canadian exports of it by 2030, here’s a reality check.

Canada is still in the coal business.

Most of what is produced and exported isn’t thermal coal. A small amount of mostly U.S.-produced thermal coal does get shipped through Roberts Bank port south of Vancouver, but the railways are already planning to phase out shipping of it before the 2030 deadline.

Canada mines, sells and exports metallurgical coal for steel making and demand for steel is forecast by the International Energy Agency to increase by more than a third by 2050.

Demand for steel is driven by the transition to zero-carbon. Things like wind turbines, electric vehicles and high-speed trains need steel.

And for now, nothing produces the superheated temperatures required in steel mills more cheaply or reliably than coal.

Vancouver-based Teck Resources — the world’s second largest seaborne exporter of metallurgical or met coal — forecasts demand to continue growing until at least 2030 and possibly 2040. Yet even if demand starts to decline after 2030, the amount needed will still be more than in 2020.

“For the coal industry, the met coal demand boom has been a lifeline,” Greenpeace noted in a 2017 report on the future of Australia’s coal industry.

But it doesn’t mean that it’s good for the environment.

Metallurgical coal generates the same amount of carbon dioxide as thermal coal, according to Australian government data. Both produce an average 2.5 tonnes of carbon dioxide for every tonne burned.

Bruce Ralston, B.C.’s minister of energy, mines and low carbon innovation, acknowledged both the emissions problem as well as the economic benefits that British Columbia and Canada gets from coal mining, not least of which are thousands of well-paid jobs.

Canada is the world’s third largest exporter. British Columbia, along with Alberta, accounts for 90 per cent of Canada’s production with coal accounting for 45 per cent of B.C.’s total mining revenue.

North America’s busiest coal port, Westshore Terminals, handles more than 33 million tonnes annually from its docks at Roberts Banks, although it has already begun its transition to other commodities including potash.

Meantime, Teck Resources, one of the world’s largest producers, reported in October that its third-quarter profit was $816 million.

Part of that was due to metallurgical coal hitting US$237 a tonne, up from US$102 during the same quarter last year.

Although it will eventually transition out of coal mining, Teck has proposed a sixth mine at Castle Mountain in southeastern B.C. It would be the largest mine in British Columbia and one of the largest in Canada.

The environmental concerns raised haven’t centred on emissions. Instead, they’re focused on impacts on Indigenous rights, endangered species, loss of fish habitat and increased selenium leaching into downstream watersheds.

Teck’s carbon use in coal extraction and shipping is among the lowest in the world as it uses carbon capture and storage technology. Its goal is a further 30-per-cent reduction in carbon emissions by 2030 with big and small measures.

Last week, for example, it contracted with the German company Oldendorff Carriers to use energy-efficient carriers for its shipments of steelmaking coal from Vancouver. That’s expected to yield a 30 to 40 per cent reduction in emissions or the equivalent of taking nearly 10,000 cars off the road.

While “realistically” it will be decades before coal is phased out entirely, Ralston said that B.C. has real opportunities for becoming a leader in hydrogen energy production, which has been described as “essential” to achieving carbon neutrality by 2050.

“Given our proximity to export markets, we could capture a significant portion of the global hydrogen market estimated to be greater than $305 billion by 2050,” according to B.C.’s hydrogen strategy released in July.

Canada is already one of the world’s top 10 hydrogen producers with close to three million tonnes produced each year using natural gas.

Its hydrogen strategy , released at the end of 2020, said Canada has the potential to expand exports create as many as 350,000 “good, clean jobs over the next three decades all while dramatically reducing our greenhouse gas emissions” and direct revenues of over $50 billion a year by 2050.

Of course, history has shown that transitions aren’t always smooth.

Before anthropological climate change was recorded back in 1981, Canada, British Columbia and two mining companies invested $2.6 billion in the world’s largest coal mine at Tumbler Ridge.

The investment included the cost of a townsite planned for 10,000 people and $500 million for a rail line to get the coal 1,130 kilometres to port and ship 100 million tons of coal over 15 years to Japanese buyers.

The work had barely begun before coal prices tanked, followed by layoffs and eventually the mine’s final closure in 2015.

Today, Tumbler Ridge’s population is 1,987.

Its hopes for a revival now rests on dinosaur tourism following the discovery of their tracks and bones 20 years ago.