Ottawa adds detail to fight against fuel quality directive

The federal government used a report it commissioned and released today as an opportunity for more finger-wagging about the European Union's plan to calculate the greenhouse gas value ofconventional oilin its fuel quality directive.

Ottawa,once again,said the directivewill discriminate against Canadian-produced bitumen and argued in the report thatthe EU's methodology for calculating the greenhouse gases of liquid oil from underground reservoirs is flawed. But the report adds a level of detail to Ottawa's argument that, so far, has been lacking.

Canada supports the EU Commission's objective of reducing greenhouse gas emissions for transportation fuels but believes it must be based on science and facts," said Natural Resources Minister Joe Oliver.

The basic argument the report made is that different countries release different amounts of greenhouse gases in the process of extracting conventional oil. By assigning one value for all conventional oil, the EU may fail to achieve its stated goal of reducing climate-changing emissions because it doesn't take into account those differences. The report suggests that coming up with different values based on where the oil comes from would be a more accurate way of calculating greenhouse gas values.

Canada is prepared to contribute to the European Unions emissions targets as a constructive, reliable partner on energy and the environment. We hope the European Union will consider this reports findings as a basis for changes to make the fuel quality directive sound, fair and effective," said Natural Resource Minister Joe Oliver.

Ottawa hired ICF International to research and write the report. ICF also acted as an expert consultant to the EU on the implementation of the fuel quality directive.

How the fuel quality directiveworks

The directive assigns values to three different types of oil:

• Conventional crude oil.
• Natural bitumen [oilsands oil].
• Oil shale.

The values assigned to each will help EU member states calculate the amount of greenhouse gases they release based on the type of oil they use for transportation. The EU's goal is to reduce greenhouse gas emissions from fuel by six per cent by 2020, compared to 2010 levels.

Canada has been engaged in a serious lobbying effort to have the fuel quality directiveeither changed or thrown out altogether for nearly two years. The government has also threatened to take the EU to the World Trade Organization if the directive is passed in its current form.

This report examines the various European studies that went into determining he EU's conventional oilvalue. It compares those studies to other sources of information on conventional oil extraction and its accompanying greenhouse gasemissions. It also looks at greenhouse gas pollution during the various stages that oil goes through to get from the ground to the tank of your car. Finally, it breaks it all down by country.

Ottawa's report is strictly devoted to the fuel quality directiveconventional oil value. It does not take issue withthe values assigned to natural bitumenor oilsands oil.

Coincidentally, the EU plans to introduce a resolution at the UN Climate Change Conference in Warsaw, Poland, that is going on this week. It states that "the EU could fulfil its vital role in reducing emissions through policies to stop the development of highly greenhouse-gas-intensive unconventional fossil fuels such as tar sands."