1. Introduction

As stated in the Notice of Intent on Cleaner Vehicles, Engines and Fuels (PDF 1.4 MB) published in the Canada Gazette (February 2001), Environment Canada proposes to develop new requirements for the allowable level of sulphur in heavy and light fuel oils. If Canada aligned with European Union and some northeastern States, Canadian heavy and light fuel oils would be restricted to a maximum of 1.0% wt¹. sulphur level and 0.1% wt. sulphur level, respectively. This paper discusses options for the approach and design of the new Canadian fuel oils requirements.

When fuel oils are combusted, the sulphur in them is emitted into the air as sulphur dioxide (SO₂) and sulphate particles (SO₄). Emissions of SO₂, along with emissions of nitrogen oxides, are a primary cause of acidic deposition (i.e., acid rain) which has a significant effect on the Canadian environment, particularly in central and eastern Canada. Fine particulate matter (PM_2.5), of which sulphate particles are a significant fraction (30-50%), may potentially affect the health of Canadians.

The objective of this initiative is the reduction of SO_x emissions resulting from the combustion of fuel oils. This will result in the reduction in critical load areas for acidic deposition, particularly in eastern Canada, and it should improve air quality. Implementation of measures to reduce sulphur in fuel oils also has the potential to encourage fuel switching to lower greenhouse gas emitting fuels such as natural gas.

Environment Canada is soliciting the views of interested parties on the appropriate sulphur limits and timing for such limits as well as the design and approach of instruments to reduce the level of sulphur in heavy and light fuel oils. As indicated in the Notice of Intent, complementary measures to regulations, such as economic instruments, are being examined to introduce low-sulphur fuel oils. Specific issues on which Environment Canada is seeking views are presented in Section 10 and in Appendix 6.

In April 2000, Environment Canada invited stakeholders to participate in developing the federal government's approach to cleaner vehicles, engines and fuels. The list of issues included the reduction of sulphur levels in heavy and light fuel oils.

Through the consultation process, the Canadian Vehicle Manufacturers Association agreed that the federal agenda should include reducing sulphur in fuel oils. The Canadian Petroleum Products Institute (CPPI) recommended that, since the issue is related to the program to reduce acid deposition (Acid Rain), Canada and the U.S. should act in concert when setting sulphur requirements. CPPI also stated that it will "support aligning with standards that may emerge in the USA and Europe."

It was noted during these consultations that whereas the countries of the European Union have a pan-national standard, the U.S. does not have a national standard. The U.S. has many different state-by-state standards, which generally have different requirements for fuel oil used in urban and rural areas. Because of this lack of U.S. national standard, Environment Canada focused on the standards of the European Union, which are similar to many of the standards in the northeastern U.S.

On February 17, 2001, the federal Minister of Environment published the agenda for cleaner vehicles, engines and fuels as a Notice of Intent in Part I of the Canada Gazette². The Notice of Intent states that:

"Environment Canada proposes to develop measures to reduce the level of sulphur in both light and heavy fuel oils used in stationary facilities. Environment Canada intends to commence studies in 2001 of the benefits to the health of Canadians and the environment as well as the cost of reducing sulphur in fuel oils, with the view to matching the requirements set by the European Union for sulphur in fuel oils which will be fully implemented by 2008. Complementary measures to regulations, such as economic instruments, will be examined to accelerate the introduction of low-sulphur fuel oils."

¹ Percent sulphur concentration are on mass basis throughout this document.
² Minister of Environment. A Federal Agenda for Cleaner Vehicles, Engines and Fuels. Canada Gazette, Part I, February 17, 2001, pp. 452-457.