Climate Change Action Plan

Suncor recognized early that climate change would be an important issue for our company. That's why we introduced a seven-point action plan in 1997. That plan has helped drive improvements in overall greenhouse gas (GHG) emission intensity and put us on a more sustainable footing for future growth.

Here's a summary of our 2008 performance, measured against our action plan:

1. Manage our own emissions

Between 2007 and 2008, Suncor's overall GHG emission intensity decreased from 0.44 tonnes CO2e/m3OE to 0.42 tonnes CO2e/m3OE. During the same period, absolute emissions dropped from 11.8 million tonnes CO2e to 11.1 million tonnes CO2e. Those decreases, however, did not represent improved performance. They were the result of extended outages of one of our oil sands hydrotreating units, which resulted in a larger amount of sour crude product being produced and sold.

2. Develop renewable sources of energy

Suncor continued to pursue a “parallel path” for energy development—building today's oil sands industry while also bringing along new sources of energy for tomorrow. In 2008, we operated four Canadian wind farms with a combined generating capacity of 147 megawatts that is estimated to offset approximately 284,000 tonnes of CO2 annually. We also owned and operated one of Canada's largest ethanol production facilities, which delivers about 200 million litres of ethanol annually. An independent Life Cycle Value Assessment of our Ontario-based plant has estimated that overall CO2 emissions could be reduced by up to 300,000 tonnes annually by blending 10 percent ethanol from this facility into gasoline.

3. Invest in environmental and economic research

Through our participation in the Integrated CO2 Network (ICO2N), Suncor continued to advance awareness and support for carbon capture and storage (CSS) technology. We also continued to serve as a partner in the Carbon Capture Project, which sees some of the world's leading energy companies and various governments pursue research to help make CSS a reality. As well, Suncor invested in research into other technologies aimed at conserving energy and reducing GHG emissions. These include proposals to use gasification technology to turn petroleum coke into synthetic gas as well as proposals to explore the potential for harnessing deep geothermal energy.

4. Use domestic and international offsets

Our operating wind farms continued to generate GHG offset credits. In Alberta, the credits accrue to Suncor. In other jurisdictions, the credits accrue to the regulating body. The credits generated at both of our Alberta wind farms were used to comply with the Alberta Specified Gas Emitter regulations to ensure Suncor's oil sands facilities were in compliance. As well, Suncor received its final payment from the Canadian government for GHG offset credits from our Chin Chute Wind Power Project (to May 2008) under the Pilot Emission Removals, Reductions and Learnings Initiative. In 2008, Suncor also purchased third party Alberta-based offsets to diversify its portfolio of offset credits and to further meet 2008 compliance pursuant to the Specified Gas Emitter Regulation.

Suncor continues to be involved in a number of initiatives on emissions trading. Suncor has invested in the Greenhouse Gas Credits Aggregation Pool (GG-CAP) created by NatSource to provide buyers with high-quality GHG emission reductions that can be applied against their GHG emissions liabilities. Similar to a mutual fund, the pool aggregates individual buyers' demand and mitigates risk by acquiring a portfolio of instruments. Suncor also made a 10-year commitment to the Rio Bravo Carbon Sequestration Project in Belize, a rainforest conservation project which is expected to lead to more than one million tonnes of GHG reductions.

5. Collaborate on policy development

Suncor continued to consult with provincial, state and federal governments on energy and climate change policy. When it comes to climate change regulations, we want to see clarity and certainty (i.e. our investors want to know what the rules are up front), fairness and competitiveness (i.e. no one industry should be unfairly targeted or punished and Canadian industry must be on equal footing with international players/peers), and harmonization across jurisdictions to avoid overlap and inefficiencies. Suncor is an active participant in the National Roundtable on the Environment and the Economy (NRTEE) and in 2008 we submitted a position paper to the NRTEE calling for a National Sustainable Energy Strategy that would include firm targets and goals for reducing GHG emissions. Suncor also closely monitored proposals by California and other jurisdictions to introduce low carbon fuel standards and we continue to participate in lifecyle assessment studies of transportation fuels from our products. We continue to question policies that could unfairly target Canadian oil sands products based on incomplete or partial use of lifecycle assessments that potentially result in displacing additional GHG emissions to other oil-producing jurisdictions.

6. Educate employees and the public

Our employees continued to take individual accountability for reducing waste and improving energy efficiency as part of our Environmental Excellence Strategy. That strategy includes funding initiatives that reduce environmental impacts and help improve environmental performance. Employees were also recognized at Suncor's President's Operational Excellence Awards for energy efficiency and GHG reduction projects.

7. Measure and report our progress

For the fifth consecutive year, Suncor was recognized by the Carbon Disclosure Project's “Carbon Disclosure Leadership Index,” which ranked Suncor best among oil and gas companies globally. The index highlights companies with the most comprehensive practices relating to climate change governance and disclosure. The Carbon Disclosure Project represents 385 global institutional investors with more than $57 trillion in assets. Stratos Inc., one of Canada's leading sustainability consultancies, ranked Suncor first among seven companies in their Best Practices in Canadian Corporate Sustainability Reporting. Ceres, a coalition of investors, environmental organizations and public interest groups, awarded a special commendation for Suncor's 2007 Progress Report on Climate Change. In March 2009, we filed our second annual GHG compliance report for our oil sands operations with the Alberta government for compliance with the Specific Gas Emitters Regulations (SGER) and we continue to annually report to Statistics Canada for all our facilities in Canada that are over 100,000 tonnes.

Additionally Suncor is participating in the protocol development of The Climate Registry and is a member of the Western Regional Air Partnership.

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