Credit Check: Should Canada get climate credit for its liquefied natural gas exports?

The document argues that claiming climate credits for LNG exports is likely impossible and environmentally unsound. It highlights the difficulty of proving 'additionality'—that exports actually cause a switch from coal to gas—and warns that such a mechanism could lead to overstated emissions reductions. The author concludes that any feasible route to these credits would require costly subsidies that would violate Canada's own policies and lock in fossil fuel infrastructure.

• The proposal to use Article 6.2 for internationally transferred mitigation outcomes (ITMOs) is problematic because it is difficult to prove 'additionality'—the requirement to demonstrate that the emissions reductions would not have occurred without the specific Canadian LNG exports.
• The actual climate benefit of LNG is contested due to higher-than-reported upstream methane emissions and the high energy intensity required for liquefaction, transport, and reconstitution.
• Claiming credit for how other countries use Canadian exports would challenge existing UNFCCC accounting rules, which generally hold countries responsible for emissions occurring on their own soil.
• The 'sell gas, bank credits' model is unlikely to work because the transferring country would have to give up credits that have monetary value and make it harder to meet their own national climate targets, without receiving a corresponding benefit from Canada.
• A more typical Article 6.2 approach involving technology transfer or finance to help buyers switch from coal to gas would be prohibitively expensive and would violate Canada's policy to end subsidies for the international unabated fossil fuel energy sector.
• Incentivizing a switch to gas would lock in fossil fuel infrastructure for 30 to 40 years, contradicting net-zero scenarios that call for decreasing gas consumption.

APA

Cosbey, A. (2024). Credit Check: Should Canada get climate credit for its liquefied natural gas exports? International Institute for Sustainable Development. https://www.iisd.org/system/files/2024-10/credit-check-lng-exports-canada.pdf

Chicago

Cosbey, Aaron. Credit Check: Should Canada get climate credit for its liquefied natural gas exports? International Institute for Sustainable Development, 2024. https://www.iisd.org/system/files/2024-10/credit-check-lng-exports-canada.pdf.

Wikipedia

{{cite report |last1=Cosbey |first1=Aaron |title=Credit Check: Should Canada get climate credit for its liquefied natural gas exports? |publisher=International Institute for Sustainable Development |date=October 2024 |url=https://www.iisd.org/system/files/2024-10/credit-check-lng-exports-canada.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{cosbey2024credit, author = {Cosbey, Aaron}, title = {{Credit Check: Should Canada get climate credit for its liquefied natural gas exports?}}, institution = {International Institute for Sustainable Development}, year = {2024}, month = oct, url = {https://www.iisd.org/system/files/2024-10/credit-check-lng-exports-canada.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }