* New emissions standards to be unveiled early next year
* Measures to cut GHG emissions by 15 megatonnes
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By Scott Haggett
CALGARY, Alberta, June 23 Canada will phase out
older coal-fired power plants to cut the country's greenhouse
gas emissions, Environment Minister Jim Prentice said on
Wednesday, as it moves to make natural-gas fired plants the new
The new standards, expected to be firmed up by early 2011,
will force electricity producers to phase out older,
high-emitting coal-fired plants and require newer facilities to
match the lower greenhouse-gas emissions of more efficient
natural-gas fired plants.
Canada has 51 coal-fired units producing 19 percent of the
country's electricity and 13 percent of its greenhouse gas
emissions. However, 33 of those plants will reach the end of
their economic lives by 2025. Unless the operators make
substantial investments to cut emissions from the aging
facilities, they'll be required to shut down.
"Our regulation will be very clear," Prentice said at a
press conference. "When each coal-burning unit reaches the end
of its economic life, it will have to meet the new standards or
close down. No trading, no offsets, no credits."
Canada is frequently criticized by green groups for not
doing enough to protect the environment and for allowing
emissions of greenhouse gases to rise steadily over the last
As well, the Conservative government's record is expected
to be under scrutiny as green groups and international media
descend on Toronto for the G8 and G20 summits this week.
Still the measures, expected to reduce emissions by 15
megatonnes -- the equivalent of taking 3.2 million vehicles off
the road -- received some support from the green sector.
"We're looking at this positively," said Marlo Raynolds,
executive director of the Pembina Institute, an environmental
think tank. "For once the minister is heading in the right
direction but the details of the regulations must actually
result in a true and timely phase out (of coal power) in
The move is a departure from the Canadian government's
usual practice of coordinating its emission-reduction targets
with U.S. moves. The planned regulations are much stricter than
current proposals for coal-fired power in the United States.
The only regulation of carbon dioxide from coal plants in
the United States is within the 10-state Regional Greenhouse
Gas Initiative in the Northeast, which aims to cut emissions
from power plants by 10 percent by 2018.
The U.S. climate bill sponsored by Senators John Kerry and
Joe Lieberman would put emissions caps on power plants,
including ones fired by coal. It would also launch a cap and
trade market in emissions credits, but the future of the
legislation is uncertain as it faces stiff opposition from
lawmakers from coal and oil states.
TransAlta Corp (TA.TO), the country's largest operator of
coal-fired plants, said on Wednesday it supports the new
standard as long as the regulations don't threaten the
reliability of the country's power system.
"We're supportive of the approach," Steve Snyder,
TransAlta's chief executive, said in an interview. "We think it
raises some issues that have to be resolved, but we think they
Capital Power Corp (CPX.TO), which has three coal-fired
units in Alberta with a combined capacity of 1,315 megawatts,
also welcomed Ottawa's push to phase out inefficient plants but
Brian Vaasjo, the company's chief executive, said the
government must come up with appropriate standards.
"There needs to be some certainty on what the natural-gas
regime would look like so that developers can go forward and
build gas plants," he said. "Some of that detail needs to be
Along with the proposed regulations, Prentice also
announced the government would contribute C$400 million ($384
million) for its share of a fund set up under the Copenhagen
accord to help impoverished countries cope with climate
Shares in companies that own Canadian coal-fired plants were
mixed on the Toronto Stock Exchange after the announcement.
TransAlta fell 37 Canadian cents to C$20.73 midafternoon on
Wednesday while Atco Ltd's (ACOx.TO) Class 1 shares dropped 39
Canadian cents to C$47.61 and Capital Power rose 14 Canadian
cents to C$22.95.
(Additional reporting by Rod Nickel, Timothy Gardner and
David Ljunggren; Editing by Mario Di Simine)