Active Business Services and Canada’s
Natural Gas
Natural gas is a key component of Canada’s energy system, supplying about one-third of the country’s energy needs. Natural gas is affordable, abundant, versatile, and is the cleanest-burning hydrocarbon.
As part of a fully integrated and continental natural gas market, Canada moves its natural gas resources across provincial and national borders, from supply basins to demand centres.
Natural gas development is an important part of the Canadian economy. In addition to providing thousands of jobs across Canada, the natural gas industry contributes significant revenue to provincial and federal governments through royalties and taxes, helping to pay for social programs across the country.
Active Business Services’ Managed Natural Gas program offers tools to help businesses manage risk, along with diversified portfolio procurement strategies. Our energy management professionals assist businesses by working to determine the optimal hedging strategy given market conditions, reducing exposure to high prices while at the same time maximizing low-price potential.
Natural gas has been — and continues to be — a crucial part of Canada’s energy sector. It’s used by millions of people for heating, electricity, fuel, fertilizer and as a feedstock for petrochemicals. The wealth of Canada natural gas makes it important to the country’s exports, as well as domestic use.
According to Canada’s Oil & Natural Gas Producers, at least 6 million Canadian residents use natural gas for lighting, heating, and cooling their businesses and homes, as well as for cooking and for heating water.
According to Canada Energy Regulator, Canada natural gas “plays a significant role in our daily lives and contributes greatly to the high quality of life enjoyed by all Canadians. It feeds us and moves us. It keeps us warm in the winter, cool in the summer, and brightens our homes and workplaces.”
This energy source remains a significant driver of the Canadian economy, contributing about 11 per cent of gross domestic product and employing more than 276,000 Canadians, Canada Energy Regulator wrote.
According to the government website, about one-third of all Canada’s energy needs are met by Canada natural gas. Canada natural gas is used in energy-efficient appliances and furnaces, like water heaters. It’s also a common source of fuel for barbecues and natural gas fireplaces, which have been growing in popularity, the site said.
In general, Canada has a wealth of energy, including natural gas. With its abundant natural resources, Canada ranks as the fourth-largest natural gas producer. Among other energy sources, Canada is the fourth-largest crude oil producer, third largest hydro producer and tenth largest renewable electricity generator.
Natural gas is the primary energy source for households in Alberta, at 77 per cent, according to Statistics Canada.
In other parts of the country, Canada natural gas comprises 70 per cent of household energy use in Saskatchewan, 58 per cent in Ontario, 49 per cent in Manitoba, and 52 per cent in British Columbia, per Statistics Canada.
Canada has many remote communities, especially in its far-flung northern reaches. There, many residents lack access to the infrastructure that allows them to use natural gas for heating, according to the website for Canada’s Oil & Natural Gas Producers. That means petroleum-based fuels like diesel, propane and heating oil are critical for their lifestyle.
Additionally, Canada natural gas contributes to the heating of many greenhouses, aiding Canadians growing many of the fruits and vegetables for themselves, their families and their communities.
Natural gas is also often used to generate electricity. It’s very necessary in regions that lack access to hydro or other forms of electricity generation.
That makes Canada natural gas a reliable substitute for renewable — but intermittent — energy sources, like wind and solar. Roughly 80 per cent of Alberta’s electricity, for example, comes from burning coal, yet the province’s electricity grid plans to become coal-free by the end of this year, according to the provincial website.
Vehicles that use natural gas (whether liquefied or compressed) produce less emissions than cars using either gasoline or diesel. At least 20,000 natural gas-powered vehicles are currently in use in Canada, according to a government report.
According to a 2022 report from the Canadian Natural Gas Vehicle Alliance, there are other benefits from natural gas for transportation as well. Using the gas reduces greenhouse gas emissions by 10-25 per cent. It’s usually about 10-20 per cent less expensive than diesel and gasoline. And natural gas-powered vehicles typically make less noise, improving quality of life, especially in urban areas.
Some additional facts about natural gas, gathered by Canada Energy Regulator.
- In 2020, Canada was the world’s sixth-largest producer of natural gas. Production averaged about 15.5 billion cubic feet per day.
- Just two provinces, British Columbia and Alberta, accounted for about 98 per cent of all production in Canada in 2020. However, provinces producing smaller amounts of natural gas include Ontario, Saskatchewan, New Brunswick, and the Northwest Territories.
- Canada’s production of natural gas liquids, known as NGLs, was about 812 million barrels per day. Half of all that NGL production comes from Alberta.
Active Business Services also offers Flexible Pricing Options, allowing customers to hedge a portion or all of their natural gas consumption requirements. This option provides businesses with a customized solution that aligns with budgeting strategies.