A new report from the National Energy Board says Canadians should expect lower crude prices and less oil production in the years to come.
According to “Canada’s Energy Future 2016: Update,” energy use, including energy from fossil fuels, will continue to increase but at a slower pace compared to the NEB’s last projections in January 2016. Much of the slowdown stems from uncertainty around the future of global oil prices.
“Canada’s energy system continues to face a great deal of change and uncertainty. The NEB’s updated energy outlook reflects recent volatility in global crude prices, as well as the ongoing impact of climate policies,” said Shelley Milutinovic, Chief Economist, National Energy Board.
One factor not included in these projections, however, is the Government of Canada’s plan to price carbon pollution, a central component of the Pan-Canadian Framework on Clean Growth and Climate Change. Announced in early October, the new directive represents one of the most significant federal climate policy announcements in Canada and the NEB requires additional time to analyze its effects, it says in a press release. The NEB is expected to update its projections in 2017 to incorporate the new framework.
The report also suggests that hydro, wind and solar energy will become a more dominant part of Canada’s energy mix in the future. Hydroelectric capacity increases by 15 per cent from 2015 levels and the combined solar, wind and biomass capacity more than doubles by 2040.