After years of intense lobbying from Canadian fossil fuel interests and government officials, the European Union has abandoned plans to label Canadian tar sands, or oil sands, as dirtier than other forms of crude oil. A European Commission proposal released on Tuesday would make it so that no transportation fuel used in the E.U. would be penalized for the carbon intensity of its production. This redefinition would make it easier for oil suppliers to export energy intensive tar sands to the 28-country block, whereas in previous proposals the fuel was designated as 25 percent more carbon intensive than conventional crude oil.
The law is part of the E.U.’s broader strategy to reduce greenhouse gas emissions 20 percent by 2020, compared to 1990 levels. This change could lead to GHG intensity of European fuels actually increasing by around 1.5 percent in 2020, according to an analysis by the Natural Resources Defense Council (NRDC). Environmentalists blamed the concession on leaders valuing trade over the environment and saw it as a blotch on the path towards the major United Nations’ climate summit scheduled for Paris next year where hopes of a new climate treaty are high.
The decision could also add momentum to the recently proposed Energy East pipeline from Transcanada, which would link Alberta’s tar sands with ports on the Canadian east coast. The pipeline would be able to transport 1.1 million barrels of tar sands crude oil per day, with Europe being considered as a priority destination.
The proposed law would apply to fuels used for transport, such as cars and trucks, and is part of a 2009 fuel quality directive aiming to cut lifecycle greenhouse gas emissions of road vehicles six percent by 2020 compared to 2010 levels. The original proposal, which would have singled tar sands out as significantly more polluting, incited a “vigorous lobbying effort” from the Canadian government, according to the Globe And Mail, a Canadian newspaper. After the E.U. failed to approve the first proposal, the Canadian government’s lobbying effort started to pay off. The E.U. will now have to vote again on the revised proposal.
“It is no secret that our initial proposal could not go through due to resistance faced in some Member States,” said E.U. Climate Action Commissioner Connie Hedegaard in a statement. “However, the Commission is today giving this another push, to try and ensure that in the future, there will be a methodology and thus an incentive to choose less polluting fuels over more polluting ones like for example oil sands.”
Adding punctuation to the changes, the year’s second cargo ship of Canadian tar sands arrived on the Italian island of Sardinia this week, carrying 700,000 barrels of the crude. The first tanker arrived in Spain in June. Tar sands require more energy and more water to extract than conventional oils and are harder refine. They also involve surface mining and are detrimental to local environments.
The new proposal still requires refiners to report average emissions of the source of the fuel in their products, but no longer requires tar sands to be singled out. Under the new methodology, oil supply companies can use a default average for the carbon intensity of all their petrol or diesel when reporting fuels — previously oil sands would have had a value of 107, far above conventional crude’s 93.2.
Canada and the E.U. are in the midst of working out a long-running trade agreement, and environmental groups viewed the latest decision regarding the labeling of tar sands as giving the negotiations precedence over environmental concerns. “The Barroso Commission has chosen to put trade deals like the Transatlantic Trade and Investment Partnership before the environment,” said Greenpeace E.U. energy and transport policy director Franziska Achterberg, referring to the current president of the European Commission, Jose Manuel Barroso.
According to a report released this summer by Friends of the Earth Europe, both Canada and the U.S. aggressively lobbied the E.U. to water down the transport requirements by using pending free trade agreements as leverage.
“Since the adoption of the revised Fuel Quality Directive in 2009, the International Oil Companies, petroleum refiners, the Canadian government and the Albertan provincial government have spent enormous resources and used aggressive lobbying tactics to delay and weaken the implementation proposal,” reads the report.
Back in June, Canadian Prime Minister Stephen Harper pointed to other global events in changing the fortunes of the tar sands industry in Europe. “We don’t see the crisis in Ukraine as simply an opportunity to market Canadian products, but obviously we’re deeply engaged in a discussion with our allies on how we can make sure that globally our energy supplies are secure and stable,” he told reporters.
While the Canadian government tries to paint short-term domestic economic gains in terms of stable energy supplies, the lasting impacts of this proposal shift will be seen in a rise in GHGs. The group Transport and Environment cited research showing the the proposed legislation could lead to tar sands making up about 6.7 percent of Europe’s transport fuel by 2020, up from barely anything today.
“That is the equivalent of adding six million cars to Europe’s roads by 2020,” Laura Buffet from T&E; told the Wall Street Journal. “On the contrary, the initial idea of the target was to decrease the carbon intensity of E.U. transport fuels.”
The analysis by the NRDC found that unless Europe takes action, 5.3 to 6.7 percent of its crude oil and transport fuels will likely come from Canadian tar sands by 2020 and that European imports of tar sands will raise from around 4,000 barrels per day in 2012 to 700,000 bpd in 2020.
With major hope of a new climate treaty pinned on the upcoming 2015 United Nations’ climate summit in Paris, this semantic change to a fuel proposal could could have lasting impacts for national and international discussions around commitments to limiting carbon pollution. The E.U. is currently in the midst of negotiating 2030 climate targets, and the European Commission has proposed targets of 40 percent GHG reductions, 30 percent energy efficiency and 27 percent renewable energy improvements by 2030. The proposal will be voted on later this month, with ministers from the Czech Republic, Slovakia, Hungary, Poland, Bulgaria and Romania — some of the poorer, more fossil-fuel reliant states — currently opposing the renewable and energy efficiency targets.