Press Release: New report shows carbon offsets from Alberta’s tar sands jeopardize EU fuel quality rules

Brussels, 17 December 2014. Today, the European Parliament adopted the proposal to implement the Fuel Quality Directive (FQD), opening doors for the use of carbon offsets associated with Alberta’s tar sands.  A report launched today shows how the oil companies’ lobby succeeded in watering down the measure, allowing their activities in Alberta’s tar sands to count towards achieving their EU decarbonisation obligations.  

The implementing measure proposes to use savings from upstream emission in the fuel lifecycle as one way to meet the 6% carbon intensity reduction target of transport fuels by 2020. However, the vague language of the implementing measure to define what kind of emission reductions can be used, opens doors to questionable reductions, including those that are already mandated by other compliance schemes, such as the Alberta Offset System in Canada.

“These new rules show once again the heavy lobby efforts by Canada. The language the Commission opted for does not incentivize necessary emission reductions in poor countries but opens doors to double counting mandated reductions, including from Shell’s tar sand operations in Canada” Femke de Jong, Policy Officer at Carbon Market Watch commented. “For example, Shell could claim questionable emission savings from the construction of road sections connecting its tar sand mining activities to the highway and harbor”.

A new report launched today shows that these new rules clear the way not only for the use of reductions under the Kyoto Protocol’s offsetting mechanisms but also for reductions under Canada’s Alberta Offset System, a compliance mechanism for entities regulated under the Alberta’s mandatory GHG emission intensity-based regulatory system.

One way of avoiding double counting or business as usual activities in Canada’s tar sands is for governments to restrict eligible savings to come from offsetting projects in Least Developed Countries. This would not only help ensure real reductions but would also reduce the administrative burden for national authorities to implement the directive” added de Jong.

The report shows that there is sufficient potential from Clean Development Mechanism (CDM) projects in Least Developed Countries to generate upstream emission reductions. For example, an Angolan CDM project to capture and utilize gas from oil wells that would otherwise be flared or vented is estimated to generate more than 137 million carbon offsets during its ten-year crediting period.

ENDS.

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Contact details:

Femke de Jong – Policy Officer, Carbon Market Watch

femke.dejong@carbonmarketwatch.org