Canada's Emission Trends 2014: chapter 4


Projected Alternate Emissions Scenarios

Given the uncertainty regarding the key drivers of GHG emissions, the scenario presented in the previous section should be seen as one estimate within a set of possible emissions outcomes in the projection period, as events that will shape emissions and energy markets cannot be fully anticipated. In addition, future developments in technologies, demographics and resources cannot be foreseen with certainty. The variation in these complex economic and energy variables implies that modeling results are most appropriately viewed as a range of plausible outcomes. Environment Canada addresses this uncertainty via modeling and analysis of alternative cases that focus on variability in two key factors: future economic growth projections; and the evolution of oil and natural gas prices and production as per National Energy Board high and low scenarios. These assumptions are presented in Table 20 and Table 21 below.

Table 20: Economic Growth Assumptions from 2012-2020
Assumption
Low

Reference

High
Average Annual GDP Growth Rate 1.5% 2.2% 2.7%

 

Table 21: Oil and Gas Price Assumptions in 2020
Assumption Low
Reference
High
Crude Oil Price: WTI (2012 C$/bbl) 72 102 132
Natural Gas Price: Henry Hub (2012 C$/GJ) 3.30 4.72 6.04

The most extreme results of varying economic growth and world oil/natural gas price assumptions are presented in Figure 6. Under the scenario with the highest emissions, emissions could reach 781 Mt by 2020 (excluding the contributions from LULUCF). Alternatively, in the low emissions case, 2020 emissions could be as low as 716 Mt (excluding LULUCF).

The range in total projected emissions from all scenarios rises as we extend our projection further into the future. As a result of the assumptions made about the growth in Canadian GDP and future oil and natural gas price and production, the range is roughly 65 Mt in 2020.

These sensitivities illustrate that Canada’s emissions projections should not be interpreted as a precise estimate of our emissions because, as outlined above, actual emissions will be determined by a range of as yet unknown developments in key drivers. Rather, the projections should be viewed as one plausible outcome for future emissions that provides a reference point for evaluating the impact of economic and technological developments, as well as assessing the impact of future government measures.

Figure 6: Projected GHG Emissions Under Alternative Economic Assumptions

Figure 6 - see description below
Text description of Figure 6

Figure 6 is the same as Figure ES-2 and presents three lines on a graph spanning the years 2012-2020 in one year increments on the horizontal axis. The vertical axis is Megatonnes of CO2e and spans the values 680 to 800 in twenty megatonne increments. All three lines begin at 699 Mt in 2012. From there the top line, representing the highest emissions scenario, peaks at 781 Mt in 2020. The middle line, representing the reference scenario, peaks at 746 Mt in 2020. The lowest line represents the lowest emissions scenario and it peaks at 716 Mt in 2020.

It is important to note that the projection of emissions in this report is based on existing government measures as of the spring of 2014 only and does not reflect the impact of further federal, provincial or territorial measures that are under development or that could be undertaken in the future. Likewise, specific federal, provincial and territorial targets are not directly modeled in these scenarios.

Table 22: Sensitivity of Emissions to Changes in GDP and Price (excluding LULUCF) in Mt CO 2 eq
  2020 Change
2005 to 2020
Slow GDP, Low World Oil Prices 716 -20
Fast GDP, High World Oil Prices 781 45
Baseline Scenario 747 10
Sensitivity Range (including all scenarios examined, see Annex 3) 716 to 781 -20 to 45
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