Thank you for the invitation to participate today.
Last month the world's scientists delivered their starkest assessment yet of the frightening future that awaits us if we fail to act on the climate crisis and limit temperature rise to 1.5 degrees.
We know that, to avoid catastrophic climate change, we must transition our economies off fossil fuels in the next decade. We have the solutions to build a clean energy future, and we know that the transition away from fossil fuels will bring far greater energy affordability, security and better jobs.
Today Environmental Defence released a new report on fossil fuel subsidies. We found that in 2021 the Government of Canada provided at least $8.6 billion to the oil and gas sector through direct subsidies and public financing from Export Development Canada. That's at least $8.6 billion in taxpayer money that went in one year towards making it cheaper to produce and transport the fossil fuels that are destroying our planet. For context, that's a similar amount to what was announced in the ERP, which is to be spent over seven years.
Our report also provides the first estimate of public funding for carbon capture, utilization and storage projects in Canada. The Canadian public has spent $5.8 billion since 2000, and collectively those expensive projects are capturing only 3.5 megatonnes of carbon per year, which is 0.05% of Canada's greenhouse gas emissions, and 70% of that captured carbon is used for enhanced oil recovery, i.e., more production; therefore, those huge public subsidies are resulting in more emissions, not less.
Oil and gas companies know these dead-end technologies won't make a dent in emissions but are using them to justify continued and even expanded fossil fuel production.
Unfortunately, as evident in the ERP, the government is falling for it. Carbon capture handouts are set to grow exponentially. Despite raking in massive profits, oil and gas companies are asking governments to pay over $50 billion to equip the oil sands with carbon capture and have been lobbying for a carbon capture tax credit.
If Minister Freeland goes through with the tax credit next week and makes it available for oil and gas projects, including fossil hydrogen, it would create a significant new fossil fuel subsidy and be difficult to repeal.
The most important steps for decarbonizing Canada's economy are increased electrification, wide-scale use of renewable energy and better energy efficiency, yet these sectors have received limited government support, a fraction of what oil and gas companies receive.
All fossil fuel subsidies are inefficient and must be phased out and, to that end, we are urging the Government of Canada to eliminate all subsidies, public financing and other fiscal supports provided to the oil and gas sector by the end of this year on the timeline that the IEA has said. That includes financial support provided through Export Development Canada without any loopholes for gas, fossil hydrogen or CCUS, redirecting all of that support to the proven kinds of solutions that will do the lion's share of the emissions reduction that are needed and provide a fair transition for all towards a renewable energy economy.
The pathway to zero emissions and a climate-safe future does not include subsidies or public financing for the oil and gas industry.
Thank you, and I look forward to your questions.