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Canadian Energy Centre

Canadian renewable propane could be a fuel of the future

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6 minute read

From the Canadian Energy Centre

By Deborah Jaremko

‘We want to make sure we reduce emissions while keeping in mind affordability and reliability’

Four years ago, Craig Timmermans’ two Ontario radio stations became Canada’s first to go on the air from off the grid 

Faced with an $80,000 connection fee and ongoing electricity delivery costs, Timmermans opted for another solution: solar and propane.  

“I did our power calculation: five staff, hot water tank, heating system, etc., right down to a coffee maker…then we need a heating source, so it made sense to go with propane,” he said. 

“When I looked at all the different heating systems, I found that propane is hands down the most efficient.”  

Now Timmermans is building a new home that will run exclusively on propane. He says he wanted propane appliances due to their efficiency. 

Ontario radio operators KT and Craig Timmermans power their off-grid business with propane and solar. Photo supplied to the Canadian Energy Centre

“A propane cooking stove is the best cooking appliance…The heat is continuous, it’s instant. It just works so well.” 

Lower environmental footprint 

Propane serves many purposes in Canada, from supporting mining and oil and gas operations to fueling heating, cooling, cooking and power in remote, off-grid communities. 

In these communities, propane can replace diesel with a lower environmental footprint. Propane’s carbon intensity is estimated at 72 grams of CO2 equivalent per megajoule, compared to 100 grams for diesel.  

That could be slashed by more than half with a move to renewable propane, according to the Canadian Propane Association (CPA). The CPA has commissioned a new report that looks at potential pathways to producing renewable propane in Canada.  

Propane storage tank. Getty Images photo

Pairing with heat pumps and hybrid energy systems 

The report serves as the foundation of the CPA’s roadmap for scaling up renewable propane production in Canada.  

The CPA says the fuel is ideal for pairing with electric heat pumps to provide back-up heat in low temperatures, especially in remote regions that are not near natural gas grids.  

It’s also promising for hybrid systems where solar or wind provides baseload energy and renewable propane provides support when renewables are not available. 

Part of propane’s appeal – renewable or otherwise – is that it’s easily liquefied and stored in pressurized cylinders, making it a versatile energy source used almost anywhere, the CPA says. 

“We want to make sure we reduce emissions while keeping in mind affordability and reliability as key pillars in any energy transformation,” said CEO Shannon Watt. 

“Propane goes where other fuels can’t go.” 

Producing renewable propane 

Today, most propane produced in Canada comes as a byproduct from natural gas processing.  

Among other sources, renewable propane can be co-produced with renewable diesel and sustainable aviation fuel, made primarily from plant and vegetable oils, animal fats or used cooking oil. 

Cost is the barrier to renewable propane production – about double what it takes to produce conventional propane, the CPA says.  

The United States is offering incentives for renewable propane that are not available in Canada.  

Through the Inflation Reduction Act, Renewable Fuel Standard and Low Carbon Fuel Standard, renewable propane producers can receive C$20 per gigajoule (or more than C$30 per GJ in California).  

Through Canada’s Clean Fuel Regulations, the incentive is just over C$5 per GJ, or about C$10 per GJ in British Columbia.  

“In order to attract investment the same way as the U.S. under the Inflation Reduction Act, we need to have competing measures in place,” Watt said.  

“We’ve got the technology and we’ve got the feedstocks. We’ve got a lot of those big puzzle pieces that we need. Now we need the dollars to flow.” 

The Ridley Island Export Terminal in Prince Rupert, B.C. ships Canadian propane to overseas markets. Photo courtesy AltaGas

Exporting renewable propane to the world 

A large-scale renewable propane industry wouldn’t just benefit Canadians, she said.  

That’s because global demand for propane is growing.  

Market research firm IMARC Group projects world propane use will rise to nearly 250 million tonnes by 2032, more than one-third higher than demand last year.  

The transition to cleaner energy sources is a major factor propelling growth, analysts said. 

Until recently, Canada’s only propane exports went to the United States. That changed with the startup of two export terminals at Prince Rupert, B.C.  

Since 2017, Canada’s propane exports outside the U.S. have grown substantially, reaching 42 per cent of total propane exports in 2023, according to the Canada Energy Regulator. 

“We export more and more propane to non-U.S. locations,” Watt said.  

“Now, roughly 50 per cent of Canadian propane is shipped to South Korea, Japan and Mexico, displacing higher emission intensity sources, namely coal and timber.” 

Exporting renewable propane would take the benefits a step further, she said.  

“That carries the conversation on about reducing global emissions and not just what’s happening in our own backyard.” 

Alberta

New children’s book demonstrates how the everyday world is connected to natural resources

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From the Canadian Energy Centre

‘Today’s youth have the opportunity to lead us into the future with innovative solutions for environmental challenges’

After a 24-year career in oil sands land reclamation, author Tanya Richens is sharing her knowledge with young minds.

Her new book, From the Earth to Us: Discovering the Origins of Everyday Things, explores the relationship between natural resources and the things we use in everyday life, from computers and water bottles to batteries and solar panels.

“There is a gap in society’s understanding of where things come from. We are a society driven by consumerism and immediate gratification. We order something online, and it arrives on our doorstep the next day. We don’t stop to think about where it really came from or how it was made,” Richens says.

“There’s an ever-increasing societal position that mining is bad, and oil is even worse… But there’s a simple hypocrisy in those beliefs, since so many things in our lives are made from the raw materials that come from mining and oil and natural gas,” she says.

The book, illustrated by reclamation artist Shannon Carla King, follows young Hennessy Rose and her Cavalier King Charles Spaniel Riley on a trip to a children’s summer camp.

Hennessy’s mom is a guest speaker on the origin of everyday items and the relationship between humans and the earth. Through detailed explanations of items surrounding her, Hennessy’s mom teaches the kids how rocks, minerals, oil and gas from the earth are used to power and aid our lives, creating items such as building supplies, food and hair products, camping and sports equipment, and cell phones.

Author Tanya Richens poses with her two books for children about natural resources. Photo for Canadian Energy Centre

“I thought a simple and fun book explaining the raw materials needed to make everyday items would be valuable for all ages,” Richens says.

“When people feel personally connected to natural resources, they are more likely to promote sustainable practices. Today’s youth will have the opportunity to lead us into the future with innovative solutions for environmental challenges.”

Richens‘ career began with Alberta Environment, where she was a coordinator of reclamation approvals in the oil sands. She oversaw technical reviews of oil sands reclamation applications, communicated with statement of concern filers, coordinated public hearings and provided support for legislative changes.

She moved from government to Suncor Energy, ensuring the company’s compliance on reclamation projects and led initiatives to obtain reclamation certificates. She now works as an independent consultant.

Drawing on her wealth of experience in the field, Richens’ first book, Adventures in Land Reclamation: Exploring Jobs for a Greener Future, seeks to excite kids aged 9-12 years about jobs related to the environment and land reclamation.

Hoping to get From the Earth to Us into the hands of teachers, Richens is heading to the Edmonton Teachers Convention in late February. She says the book supports multiple learning outcomes in Alberta’s new science curriculum for grades 3, 4, 5 and 6.

“Ultimately, I’d like people to understand and acknowledge their individual part in the need for mining and oil and natural gas development. Until the naivety and hypocrisy in the world is addressed, I’m not sure that real environmental change is possible.”

Richens’ books can be purchased on her website at tcrenvironmental.com.

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Alberta

U.S. tariffs or not, Canada needs to build new oil and gas pipeline space fast

Published on

From the Canadian Energy Centre

By Grady Semmens

Expansion work underway takes on greater importance amid trade dispute

Last April, as the frozen landscape began its spring thaw, a 23-kilometre stretch of newly built pipeline started moving natural gas across northwest Alberta.

There was no fanfare when this small extension of TC Energy’s Nova Gas Transmission Limited (NGTL) system went online – adding room for more gas than all the homes in Calgary use every day.

It’s part of the ongoing expansion of the NGTL system, which connects natural gas from British Columbia and Alberta to the vast TC Energy network. In fact, one in every 10 molecules of natural gas moved across North America touches NGTL.

With new uncertainty emerging from Canada’s biggest oil and gas customer – the United States – there is a rallying cry to get new major pipelines built to reach across Canada and to wider markets.

Canada’s Natural Resources Minister Jonathan Wilkinson recently said the country should consider building a new west-east oil pipeline following U.S. President Donald Trump’s threat of tariffs, calling the current lack of cross-country pipelines a “vulnerability,” CBC reported.

“I think we need to reflect on that,” Wilkinson said. “That creates some degree of uncertainty. I think, in that context, we will as a country want to have some conversations about infrastructure that provides greater security for us.”

Many industry experts see the threat to Canada’s economy as a wake-up call for national competitiveness, arguing to keep up the momentum following the long-awaited completion of two massive pipelines across British Columbia over the last 18 months. Both of which took more than a decade to build amidst political turmoil, regulatory hurdles, activist opposition and huge cost overruns.

On May 1, 2024, the Trans Mountain pipeline expansion (TMX) started delivering crude oil to the West Coast, providing a much-needed outlet for Alberta’s growing oil production.

Several months before that, TC Energy finished work on the 670-kilometre Coastal Gaslink pipeline, which provides the first direct path for Canadian natural gas to reach international markets when the LNG Canada export terminal in Kitimat begins operating later this year.

TMX and Coastal GasLink provide enormous benefits for the Canadian economy, but neither are sufficient to meet the long-term growth of oil and gas production in Western Canada.

More oil pipeline capacity needed soon     

TMX added 590,000 barrels per day of pipeline capacity, nearly tripling the volume of crude reaching the West Coast where it can be shipped to international markets.

In less than a year, the extra capacity has enabled Canadian oil production to reach all-time highs of more than five million barrels per day.

More oil reaching tidewater has also shrunk the traditional discount on Alberta’s heavy oil, generating an extra $10 billion in revenues, while crude oil exports to Asia have surged from $49 million in 2023 to $3.6 billion in 2024, according to ATB analyst Mark Parsons.

With oil production continuing to grow, the need for more pipeline space could return as soon as next year, according to analysts and major pipeline operators.

Even shortly after TMX began operation, S&P Global analysts Celina Hwang and Kevin Birn warned that “by early 2026, we forecast the need for further export capacity to ensure that the system remains balanced on pipeline economics.”

Pipeline owners are hoping to get ahead of another oil glut, with plans to expand existing systems already underway.

Trans Mountain vice-president Jason Balasch told Reuters the company is looking at projects that could add up to 300,000 barrels per day (bpd) of capacity within the next five years.

Meanwhile, Canada’s biggest oil pipeline company is working with Alberta’s government and other customers to expand its major export pipelines as part of the province’s plan to double crude production in the coming years.

Enbridge expects it can add as much as 300,000 bpd of capacity out of Western Canada by 2028 through optimization of its Mainline system and U.S. market access pipelines.

Enbridge spokesperson Gina Sutherland said the company can add capacity in a number of ways including system optimizations and the use of so-called drag reducing agents, which allow more fluid to flow by reducing turbulence.

LNG and electricity drive strong demand for natural gas

Growing global demand for energy also presents enormous opportunities for Canada’s natural gas industry, which also requires new transportation infrastructure to keep pace with demand at home and abroad.

The first phase of the LNG Canada export terminal is expected to begin shipping 1.8 billion cubic feet of gas per day (Bcf/d) later this year, spurring the first big step in an expected 30 per cent increase in gas production in Western Canada over the next decade.

With additional LNG projects in development and demand increasing, the spiderweb of pipes that gathers Alberta and B.C.’s abundant gas supplies need to continue to grow.

TC Energy CEO Francois Poirier is “very bullish” about the prosect of building a second phase of the recently completed Coastal GasLink pipeline connecting natural gas in northeast B.C. to LNG terminals on the coast at Kitimat.

The company is also continuously expanding NGTL, which transports about 80 per cent of Western Canada’s production, with more than $3 billion in growth projects planned by 2030 to add another 1 Bcf/d of capacity.

Meanwhile Enbridge sees about $7 billion in future growth opportunities on its natural gas system in British Columbia.

In addition to burgeoning LNG exports from Canada, the U.S. and Mexico, TC Energy sees huge potential for gas to continue replacing coal-fired electricity generation, especially as a boom in power-hunger data centres unfolds.

With such strong prospects for North America’s highly integrated energy system, Poirier recently argued in the Wall Street Journal that leaders should be focused on finding common ground for energy in the current trade dispute.

“Our collective strength on energy provides a chance to expand our economies, advance national security and reduce global emissions,“ he wrote in a Feb. 3 OpEd.

“By working together across North America and supporting the free flow of energy throughout the continent, we can achieve energy security, affordability and reliability more effectively than any country could achieve on its own.”

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