Positioning Teck to Thrive in the Low-Carbon Economy
Energy Use and Reduction
In 2018, we consumed a total of 43,722 TJ of energy (i.e., electricity and fuels), as compared to 43,899 TJ in 2017, as shown in Figure 12. In 2018, five of our operations reduced their absolute energy consumption from 2017.
Collectively, projects implemented in 2018 have reduced annual energy consumption at our operations by 68 TJ — enough to power 631 homes for a year. Since 2011, our efforts have resulted in reduction projects totalling 2,220 TJ of savings.
Figure 12: Energy Consumption by Type
In 2018, approximately 27% of our energy requirements (i.e., electricity and fuels) were supplied by non-carbon-emitting sources, primarily hydroelectricity, compared to 27% in 2017. Of our total electricity consumption in 2018, 81%, or 11,754 TJ, was from renewable energy sources, the majority of which is hydroelectricity.
In Figures 13 to 15, we outline our energy intensity, or the amount of energy used per tonne of product.
Figure 13: Steelmaking Coal Production Intensity
Figure 14: Zinc and Lead Production Intensity
Figure 15: Copper Production Intensity
Energy and carbon intensity for the production of steelmaking coal increased in 2018 (Figure 13). This change is attributed to longer haul distances as well as our Coal Mountain Operations transitioning to approaching closure. According to data from the International Council of Mining and Metals (ICMM), at 67 kilograms of CO2-equivalent per tonne of steelmaking coal produced, the emissions intensity of our steelmaking coal is less than half the industry average of more than 150 kilograms. Similarly, our copper production averages 2.6 tonnes of CO2-equivalent per tonne of copper produced, which is 35% below the industry average of 4 tonnes. Our goal is to continue to improve the carbon intensity of our operations and future projects.
Investing in Alternative Energy
Teck is exploring opportunities for solar, wind and other low-carbon technologies. We are prioritizing these opportunities based on proximity to areas where we operate or have operated, opportunities where we may be able to gain expertise in renewables, opportunities to further explore specific technologies of interest to Teck, and the ability of projects to provide other sustainability benefits, such as for local communities.
Investing in our Energy Business Unit
As the International Energy Agency (IEA) has articulated in looking at all future energy use scenarios, oil and gas will continue to be an important part of the world’s energy mix for the foreseeable future, even in the transition to a low-carbon economy. Our focus is on helping to meet that need and on developing Canada’s oil sands resources in the most sustainable way possible for people, for communities and for the environment.
We have a strong track record of taking steps to improve energy efficiency, reduce GHGs and lower the carbon intensity of our products. Both our steelmaking coal and copper production are among the lowest carbon intensity in the world, and we are building on that track record in how we approach our oil sands development. Bitumen from our Fort Hills oil sands mining and processing operation has a lower carbon intensity than about half of the oil currently refined in the United States, and it has one of the lowest carbon intensities among Canadian oil sands producers.
Reducing Our Carbon Footprint8
Throughout our business units, operations and project planning stages, a full spectrum of environmental risks are assessed, including those associated with energy use and GHG emissions. As shown in Figure 16, Scope 1 (direct) GHG emissions are those that occur from energy sources that are owned or controlled by the company. Scope 2 (indirect) GHG emissions are those that occur from the generation of purchased electricity consumed by the company, and physically occur at the facility where electricity is generated.
Figure 16: Scope 1 and Scope 2 GHG Emissions by Fuel Type(1),(2)
In 2018, our total GHG emissions (Scope 1 and Scope 2), as CO2e, were 2,939 kilotonnes (kt), compared to 3,010 kt in 2017. Of those totals, our direct (Scope 1) GHG emissions were 2,597 kt in 2018, compared to 2,682 kt in 2017. We estimate our indirect (Scope 2) GHG emissions associated with electricity use for 2018 to be 341 kt, or approximately 12% of our total emissions. These emissions are associated primarily with our Cardinal River, Carmen de Andacollo and Quebrada Blanca operations, as their electricity power grids are based heavily on fossil fuels. Elsewhere, our indirect emissions were relatively small, as operations in B.C. and Washington state obtain a significant proportion of their electricity from hydroelectric generation.
Scope 3 emissions are other emissions that arise from sources owned or controlled by other entities within our value chain, such as those arising from business travel by employees, the use of our products, and the transportation of materials that we purchase and sell. Our most material Scope 3 emissions are from the use of our steelmaking coal product by our customers.
Table 14: Total Emissions (kilotonnes CO2e)(1)
|Total Emissions — Direct (Scope 1)
|Total Emissions — Indirect (Scope 2)
|Total Emissions (Scope 1 + Scope 2)
|Total Emissions — Scope 3
(1) Teck’s quantification methodology for our Scope 1 and Scope 2 emissions is aligned with the Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard
Carbon Pricing and Advocating for Climate Action
We believe that broad-based pricing of carbon is one of the most effective ways to incentivize real reductions in GHG emissions by ensuring that all emitters contribute to the solution. In 2018, we continued to advocate for carbon pricing policies that maintain the global competitiveness of trade-exposed industries to prevent carbon leakage, which is when GHG emissions move from one jurisdiction to another as a result of differences in carbon prices. Currently, all of our steelmaking coal operations are covered by carbon pricing, as is half of our copper business, our Fort Hills oil sands mine and all of our metals refining business.
We continue to see a trend among governments to pursue climate change policies. The most significant action has taken place in Canada, where the majority of our operations are located, and Canada has some of the highest carbon prices in the world.9 In 2018, the Province of B.C. increased the carbon tax by $5 per tonne of CO2-equivalent (CO2e) from $30 to $35. This price is expected to increase by $5 per tonne of CO2e per year until reaching $50 per tonne of CO2e. The B.C. Government also made a commitment to address impacts on emissions-intensive, trade-exposed industries to ensure that B.C. operations maintain their competitiveness and to minimize carbon leakage. In 2018, the Province of Alberta transitioned to the Carbon Competitiveness Incentive Regulation, the industry-specific carbon pricing policy set to replace the previous Specified Gas Emitters Regulation, which concluded in 2017. We will continue to assess the potential implications of the updated policies on our operations and projects.
Adapting to Physical Impacts
We are taking steps to guard against the future impacts of climate change, as we recognize that ongoing changes to climate could pose a potential physical risk to our mining operations and to related infrastructure.
In 2018, we hosted a workshop with Acclimatise on physical climate risks and opportunities, and new methods of climate adaptation planning. The workshop gathered people from across Teck to discuss the steps involved in assessing physical climate risks and opportunities for our operations, supporting infrastructure, local communities and environments, and broader stakeholders. Participants also began to identify climate risk management (adaptation) actions, and explored how a changing climate interfaces with existing Teck processes, standards, practices and guidelines.
8 In 2016, we updated the Global Warming Potential values for all of our GHG accounting to align with regulatory requirements; therefore, historical values have been restated. Global Warming Potentials are the factors that convert greenhouse gases — like methane (CH4) — to a carbon dioxide equivalent (CO2e), thereby standardizing the quantification of GHG emissions.