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Market Snapshot: EF2017 Fossil Fuel Consumption Projection Varies by Fuel and Region
Release date: 2017-11-22
A key finding in the recent Canada’s Energy Future 2017: Energy Supply and Demand Projections to 2040 (EF2017) report is that Canadian fossil-fuel demand could peak in 2019. While total fossil fuel use peaks in 2019 in all EF2017 scenarios, consumption trends differ across individual fossil fuels, as well as across provinces and territories.
The figure below breaks down fossil fuel use by category: coal, oil products, and natural gas.Footnote 1 It shows three distinct trends. Canadian coal use has been declining for the last decade, driven by declining demand in power generation and the industrial sector. Use of oil products peaked in 2007. Demand dropped off in 2008 and 2009, in part due to the impact of the economic recession. Demand growth has been limited by a variety of factors, such as renewable fuel blending requirements for gasoline and diesel, and improving vehicle efficiency. Natural gas use projections differ in the three scenarios considered in EF2017. Natural gas use continues to increase over the projection period in the Reference Case, led by industrial and power generation. In the EF2017 Higher Carbon Price and Technology scenarios, natural gas use eventually decreases, peaking in 2025 and 2024, respectively.
Source and Description
Description: This chart shows the EF2017 fossil fuel use projection from 2005 to 2040 for the Reference Case, broken down by coal, oil products, and natural gas. Coal use in Canada has been declining since 2005, and by 2030 makes up less than 2% of the fossil fuel used in Canada. Oil product use has varied year to year, but is overall relatively flat and declines towards the end of the projection period. Natural gas use increased over the last 10 years, and this trend continues in the projection, although at a slower rate than recent history.
Fossil fuel use trends also differ across regions. The figure below illustrates fossil fuel use for the three provinces with the highest fossil fuel demands in 2015, along with the rest of Canada combined. Alberta’s fossil fuel use continues to increase for most of the Reference Case projection. The increase is due to various factors, such as a 2.1 million barrel per day increase in crude oil production from 2016 to 2040, and economic growth higher than the Canadian average. Alberta demand eventually flattens out in the longer term, reaching its maximum in 2037. Fossil fuel use in Ontario and Quebec remains below their peaks prior to the 2008-2009 recession. Reasons for this include improving efficiency across the economy, renewable fuel blending requirements for gasoline and diesel, reductions in industrial economic activity associated with the recession, and a significant share of electric vehicles over the long term. The year in which EF2017 projects fossil fuel consumption will peak for other provinces and territories varies, but all provinces peak by 2025.
Source and Description
Description: This chart shows EF2017 Reference Case fossil fuel use projections for Alberta, Ontario, Quebec, and the rest of Canada combined. Alberta fossil fuel use continues to increase in the projection to 2020, at which point growth slows, with use peaking in 2037. Ontario and Quebec fossil fuel use have already peaked, and gradually decline in the long term. Fossil fuel use in the rest of Canada peaks in 2018 and gradually declines afterwards.
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