2024 Oil & Gas Emissions Cap POLICY TOOLKIT – 9. ACRONYMS

Climate Messengers Canada Policy Toolkit

9. Acronyms & Glossary

Toolkit Contents

    1. Production Emissions
    2. Consumption Emissions
    1. Scope of Application
      1. Covered Facilities
      2. Covered Activities
      3. Covered Greenhouse Gasses (GHGs)
    2. The Emissions Cap Level: The Starting Point
    3. The Legal Upper Bound: How Much Can Really Be Emitted
    1. The 2030 Cap Level Is Not Ambitious Enough – The Numbers
    2. The Cap Proposed by the Framework Will Make It Almost Impossible to Meet Our Canada-Wide 2030 Target
    3. The Framework’s O&G Emissions Cap Will Do Less Work Than It Appears
    4. The O&G Emissions Cap Has Effectively Been Dictated by the Oil and Gas Producers
    5. The Oil and Gas Industry’s Re-investments to Reduce Emissions Has Been Contemptible
    6. The O&G Emissions Cap is based on O&G Production Increasing by 2030
    7. The “Other Compliance Units” Are Mostly a Very Bad Idea
    1. Emissions Trading
    2. Multi-Year Compliance Periods
    3. Banking of Emissions Allowances
    4. Making Contributions to a Decarbonization Fund
    5. Domestic Offset Credits
    6. Internationally Transferred Mitigation Outcomes (ITMOs)
    7. Delayed Reporting and Verification


CEPA Canadian Environmental Protection Act, 1999

CO2e – carbon dioxide equivalent

COP – Conference of the Parties (to the Paris Agreement).  There is a conference almost every year in November or December.  Each year, the number of the COP is one higher than for the previous COP.  The Paris Agreement was made at COP 21, in Paris in 2015.

ECCC – Environment and Climate Change Canada

ERP – 2030 Emissions Reduction Plan

GHGs – greenhouse gasses

ITMOs – Internationally Transferred Mitigation Outcomes

LNG – liquid natural gas

Mt – Megatonne

O&G – oil and gas

UNIPCC – United Nations Intergovernmental Panel on Climate Change


Absolute emissions refers to the total measured quantity of greenhouse gases emitted.

Cap-and-trade is a market-based system where the regulator issues a quantity of emissions allowances that is less than the quantity of emissions expected in the absence of the policy, creating emissions scarcity under a cap. Since each regulated entity must remit one allowance for each tonne of emissions, and the total number of allowances is less than the business-as-usual emissions in the system, the scarcity drives demand in an allowance market designed by the regulator and thus prioritizes low cost abatement first. In Canada, cap-and-trade systems are currently in place in Quebec and Nova Scotia.

Carbon capture and storage (CCS) and carbon capture, utilization and storage (CCUS) are similar processes that use a suite of technologies to capture carbon dioxide (CO2) from facilities that would otherwise be directly released to the atmosphere. Using CCS technologies, the captured CO2 is compressed and transported to be permanently stored in long-term geological formations underground (e.g. saline aquifers, oil reservoirs). CCUS is a form of CCS that utilizes the captured carbon to create products, such as concrete and low-carbon synthetic fuels, or for injection into oil reservoirs for Enhanced Oil Recovery, where the injected gas helps facilitate the flow of oil to a well for further extraction after primary and secondary production. CCS and CCUS are also critical enabling technologies for carbon dioxide removal solutions such as direct air capture.

Carbon dioxide equivalent (CO2e) is a measure used to compare the emissions from various greenhouse gases on the basis of their global-warming potential, by converting amounts of other gases to the equivalent amount of carbon dioxide with the same global warming potential.

Carbon leakage can occur when carbon costs cause companies or investors to move production to jurisdictions with lower or no carbon costs. The result is that emissions are not reduced; they are just emitted in a different location.

Direct emissions, referred to as “Scope 1” emissions, originate directly from sources that are owned or controlled by an organization.

Downstream emissions are the greenhouse gases emitted during the use, end-of-life treatment, and disposal phases of a product or service. In essence, these emissions occur after the product has been sold to the consumer.  The Greenhouse Gas Protocol breaks down downstream emissions into seven distinct categories:

• Downstream transportation and distribution – This includes emissions linked to the delivery and distribution of company products. 

• Processing of sold products – Emissions related to the processing of products sold by third parties. 

• Use of sold products – Emissions stemming from the final use of the goods and services. 

• End-of-life disposal and treatment – Any emissions related to waste disposal or treatment of the company’s products. 

• Downstream leased assets – Emissions stemming from a company’s leased assets to organizations or individuals. 

• Franchises – Any emissions created by the operation of franchises that do not fall under scope 1 or 2 emissions. 

• Investments – Emissions linked to the operation of investments, including the financing of projects. 

Emissions intensity is a measure of the greenhouse gas emissions released per unit, for example per GPD, per barrel of oil, or per capita. Emissions intensities are used to compare the environmental impact of different fuels or activities.

Flaring emissions are controlled emissions of gases from industrial activities as a result of the combustion of a gas or liquid stream produced at a facility, the purpose of which is not to produce useful heat.

Fossil fuels are materials such as coal, oil, and natural gas that contain hydrocarbon from the remains of dead plants and animals. These materials are extracted and burned as a fuel

Fugitive emissions are unintentional releases of GHGs from the production, processing, transmission, storage and delivery of fossil fuels. Released hydrocarbon gases that are disposed of by combustion (e.g., flaring of natural gases at oil and gas production and processing facilities) and post-production emissions, including those from abandoned coalmines and abandoned oil and gas wells, are also considered fugitive emissions.

Greenhouse gasses (GHGs) are a group of gases contributing to global warming and climate change. The 1997 Kyoto Protocol covers seven greenhouse gases:

• non-fluorinated gases:

◦ carbon dioxide (CO2)

◦ methane (CH4)

◦ nitrous oxide (N2O)

• fluorinated gases:

◦ hydrofluorocarbons (HFCs)

◦ perfluorocarbons (PFCs)

◦ sulphur hexafluoride (SF6)

◦ nitrogen trifluoride (NF3)

Indirect emissions, are emissions generated indirectly from the consumption of purchased energy such as natural gas, diesel, or coal-fired electricity generation (referred to as Scope 2 emissions), or other indirect emissions (referred to as Scope 3 emissions) associated with an organization’s operations (i.e. emissions from supply chains) or products. Scope 3 emissions can occur in other sectors or other jurisdictions (e.g., the use of exported crude oil or of gasoline in internal combustion engine vehicles).

Offset credits or ‘offsets’ are GHG emission reductions or removal enhancements generated from project-based activities that compensate for emissions made elsewhere. Offset credits can be generated in both regulatory and voluntary programs. In regulatory programs, offsets allow regulated emitters to use emission reductions from projects undertaken by project developers on a voluntary basis to fulfil their emissions reduction obligations.

Paris Agreement is a legally binding international treaty on climate change that came into force in 2016. Its overarching goal is to hold “the increase in the global average temperature to well below 2°C above pre-industrial levels” and pursue efforts “to limit the temperature increase to 1.5°C above pre-industrial levels.”

Upstream emissions are the greenhouse gasses that stem from the production of goods or services that a company purchases or uses.  The Greenhouse Gas Protocol outlines eight upstream emissions categories. These are: 

• Purchased goods and services – This includes emissions arising from the extraction, manufacturing, and transportation of any items or services purchased by the company. 

• Capital good – This is emissions arising from the extraction, manufacturing, and transportation of a company’s purchased or acquired assets. 

• Fuel and energy use – Emissions arising from the extraction, manufacturing, and transportation of fuels and energy that are not already included under scope 2 or 3 emissions.

• Upstream transport and distribution – This covers emissions linked to the transportation and distribution of the company’s purchased products. This category also includes logistics and transportation such as supply chain services, outbound logistics, and transportation between company facilities. 

• Operational waste – Emissions produced as a result of the disposal or treatment of operational waste. This excludes emissions linked to in-house waste management facilities. 

• Business travel – Emissions resulting from employee transportation for business-related activities in vehicles not belonging to the company. 

• Employee commuting – This covers emissions resulting from an employee’s commute between their home and office where the vehicles used don’t belong to the company. 

• Upstream leased assets – This includes any assets leased by the company that fall out with scope 1 and 2 emissions. 

Venting emissions are controlled emissions that occur due to the design of a facility, to procedures used in the manufacture or processing of a substance or product or to pressure exceeding the capacity of the equipment at the facility.