An analysis of federal accounting records by Postmedia News shows that Prime Minister Stephen Harper’s government has offered these subsidies to money-making companies such as Shell Canada, Suncor, Husky Energy and Enbridge to pursue projects in biofuels production and wind energy as well as new technology to capture carbon pollution and bury it underground.
About $1.4 million in federal government climate change spending has also benefited state-owned oil companies in Mexico (PEMEX) and China (the China National Petroleum Corporation) for projects to reduce greenhouse gas emissions.
Environment Canada said the international funding, part of the government’s global climate change commitment, didn’t directly fund companies, but went through “industry partners with technical expertise” to help Mexico, Colombia and China reduce heat-trapping gases released into the atmosphere.
Suncor was one of the top recipients of federal funding from Natural Resources Canada with nearly $134 million in subsidies since 2007 for biofuels production ($117 million) and wind energy ($16.6 million) projects.
“The subsidies made these projects more attractive for all developers of new, emerging technology, including Suncor,” wrote Suncor spokeswoman Sneh Seetal in an email to Postmedia News.
In some of its recent marketing campaigns, Suncor has featured images of its wind energy projects, promoting its environmental credentials, without making reference to the subsidies it receives from taxpayers.
Natural Resources Canada’s biofuels and renewable power programs, which are being wound down by the Harper government, were meant to offer billions of dollars in incentives to producers, starting in 2007. They have generated a popular response from a variety of energy companies of different sizes and stimulated industrial growth. For example, Natural Resources Canada estimates that local biofuels production grew to over 1.88 billion litres of ethanol and 575 million litres of biodiesel in 2012, up from about 200 million litres of ethanol and no commercial biodiesel plants in 2005.
But department spokeswoman Jacinthe Perras said the biofuels program has been redesigned and will only spend $1 billion out of an original budget of $1.5 billion. While it continues to provide subsidies until 2017, she said the government announced in February 2013 that it would no longer accept new applicants.
Shell Canada also defended its own subsidy of $120 million, noting that it was in support of its Quest carbon capture and storage project that would require the company – which said it paid more than $400 million in 2012 for income taxes and royalties to the federal and provincial governments – to share its technical expertise with other companies. The project was also expected to be one of the first of its kind, capturing heat-trapping pollution equivalent to the emissions generated by 175,000 North American vehicles in a year.
“If you look globally I think you’ll find governments around the world are making similar investments to help make CCS happen,” said Shell Canada spokesman David Williams.
Enbridge, which received about $22.8 million for wind energy projects, noted that it and other energy companies received the incentives based on the amount of power produced over a ten year period. But spokesman Graham White also noted that the company, known for its pipelines and gas distribution services, has continued to build new wind projects – after the federal government stopped accepting new applicants for the funding – in Ontario, Quebec and Alberta, where it would have the largest facility in Western Canada.
Husky Energy received about $103 million in federal subsidies for biofuels and another $20.5 million from Natural Resources Canada to help one of its plants in Saskatchewan reduce pollution and enhance oil recovery, but noted that the economics of producing ethanol were challenging.
“Our ethanol operations are a small part of our overall business,” said spokesman Mel Duvall. “The federal and provincial subsidies are coming to an end and our focus is on doing what we can to improve the efficiencies of the plants and to develop new revenue streams so they remain viable.”
The financial records of Natural Resources Canada also show that Imperial Oil received about $150,500 from the federal government in 2009 to do research on biodiesel.
Putting the numbers in context, Natural Resources Canada spent about $60 million over three years, starting in 2007, to help British Columbia companies and communities cope with the Mountain Pine Beetle infestation which attacked forests in the western province and spread due to climate change and warmer winters.
The Pembina Institute, an Alberta-based think tank that researches sustainable development issues, said that the biofuels subsidies might have helped encourage local production, but that they weren’t as effective at reducing pollution as other programs such as incentives for renovations to lower energy consumption in homes and office buildings.
“Strictly from a greenhouse gas reduction perspective, there are better uses for this money,” said Ben Thibault, a renewable energy policy analyst at the think tank.
Subsidies by the numbers
Suncor: $134 million in support of biofuels production and wind energy projects.
2012-13: $27,720,000 for biofuels and $2,932,650 for wind power
2011-12: $34,692,697 for biofuels and $3,094,956 for wind power
2010-11: $17,425,577 for biofuels and $2,890,500 for wind power
2009-10: $23,139,735 for biofuels and $2,879,794 for wind power
2008-09: $13,763,071 for biofuels and $3,086,500 for wind power
2007-2008: $1,674,451 for wind power
Shell Canada: $120 million in support of Quest project to capture carbon pollution and bury it underground
2011-12: $45 million for Quest project from federal “Clean Energy Fund”
2010-11: $51 million for Quest project
2009-2010: $24 million for Quest project
Husky Energy: $124 million in support of biofuels production and ethanol plant.
2012-2013: $17,297,426 for biofuels
2011-12: $19,614,038 for biofuels and $1,103,831 for upgrades to ethanol plant in Saskatchewan
2010-11:$19,410,209 for biofuels and $12,299,538 for plant
2009-10: $30,443,632 for biofuels and $714,189 for plant
2008-09: $16,530,189 for biofuels
Enbridge: $23 million in support of wind energy projects.
2012-13: $6,264,382 for wind power
2011-12: $5,991,448 for wind power
2010-11: $5,577,308 for wind power
2009-10: $4,659,753 for wind power
2008-09: $287,266 for wind power
Imperial Oil: $150500 for study on biodiesel in 2008-09
International: $1.4 million in funding from Environment Canada to reduce pollution from oil and gas companies, including operations by state-owned oil companies in China and Mexico, as part of international climate change commitments.
Original Article
Source: canada.com/
Author: Mike De Souza
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