Wind energy and biofuels – find out more about Suncor’s investments in renewable energy in the 2013 Report on Sustainability

Suncor’s renewable energy investments – 2013 Report on Sustainability

Investing in wind energy and biofuels for a more sustainable energy future – 2013 Report on Sustainability

Renewable energy: find out more about Suncor’s investments in wind energy and biofuels in the 2013 Report on Sustainability

View the latest Report on Sustainability

Renewables

As we work toward a more sustainable energy future, renewable energy is going to be an increasingly important part of the global energy mix. Suncor is a significant player in renewable energy in Canada. Our investments to date are focused on wind power and biofuels, although we continue to monitor other long-term opportunities, including solar.

Many of our stakeholders have asked about the longer-term perspective on renewable energy, with an emphasis on wind power and biofuels in Canada and the U.S. In response to these questions, Suncor commissioned a report from IHS CERA to provide a view to inform the discussion.

Read the IHS CERA report

Wind power

Wind power is one of the fastest growing sources of electricity generation in the world. Suncor was an early entrant into Canadian wind power with our first project startup in 2001. We are currently involved in six operating wind farm projects — five of which are joint ventures. The total installed wind capacity of these operations is 255 megawatts, enough to power about 100,000 Canadian homes per year. Subject to regulatory approvals, we have two additional wind power projects in Ontario expected to commence operations in 2015. This will increase our total installed wind capacity to 395 megawatts.

Despite support for wind power in general, individuals living in close proximity to our proposed projects have raised concerns about the installation of wind turbines near their homes. This is common in any community where a significant development project is planned. Some of the primary concerns expressed relate to the interruption of views and the potential for impacts to regional property values. Concerns around the potential for health risks also remains though studies have found no linkage between wind turbines and health related issues. We continue to support fact based, scientific studies aimed at addressing these concerns.

Suncor endeavors to work in an open, respectful and transparent way, engaging with communities early to alleviate and resolve issues wherever possible. While these conversations can be difficult, our preference is always to reach mutually acceptable solutions. Our wind projects strive to meet or exceed all regulations. For example, our project design philosophy aims to minimize visual impact, reduce turbine density and maximize setbacks wherever practical.

We believe that wind power is a safe and reliable energy source. It is efficient, emissions-free and one of the most economically recognized forms of renewable energy.

Wind energy is, and is expected to be, a key component of Suncor's commitment to advancing different forms of energy.

Installed Wind Capacity

* Production capacity at wind farms in which Suncor is a partner or operator.

Ethanol

We also operate Canada's largest ethanol production plant, near Sarnia, Ont. In 2011, Suncor completed a $120 million expansion of the St. Clair ethanol facility, doubling its capacity to 400 million litres per year. In August 2012, the plant achieved a production milestone of 1.5 billion litres of production.

Virtually all the ethanol produced at the St. Clair plant is blended into Petro-Canada gasoline. "Since it is a requirement for various biofuels mandates across the country, we can either purchase the product or we can produce it," says Jim Provias, VP renewable energy. "By operating the St. Clair plant, we are better able to control cost and quality, further reinforcing the value of Suncor's integrated operating model.

Suncor's commitment to renewable energy

Suncor's combined renewable energy portfolio currently displaces about one million tonnes of carbon dioxide (CO2) per year - the equivalent of the annual tailpipe emissions of about 225,000 cars.

"Developing renewable energy is part of Suncor's long-standing climate change action plan," says Gord Lambert, executive advisor, sustainability and innovation. "It is also another way we strive to create energy for a better world. In other words, we are committed to continuous improvement in environmental performance when it comes to developing the oil sands and other sources of oil and gas, while also investing in new sources of energy for the future."

The company's commitment to advancing different forms of energy also makes good business sense. Wind power and biofuels are some of the energy sources for the future —and Suncor wants to be among the providers of multiple energy solutions through what we believe are strategic, and relatively low-risk, investments.

"Going forward, a much greater diversity of energy sources is going to be the order of the day," observes Lambert. "We're going to need it all: conventional, unconventional and renewable energy sources. You can't really forgo any of it."

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Biofuels: criticism, findings, new technology

Suncor has been blending ethanol in our retail fuels since 1992. Suncor opened the St. Clair ethanol plant in Mooretown, Ont., in 2006 and completed a $120 million expansion of that facility in 2011. The St. Clair plant has the capacity to produce 400 million litres of corn-based ethanol annually — double the facility's original capacity.

The ethanol produced at the St. Clair plant is blended into Suncor's Petro-Canada branded gasoline, providing a lower environmental impact than regular, non-ethanolized gasoline and ensuring Suncor meets government-mandated blending standards.

In Canada, the Federal Renewable Fuel Regulations requires an average of 5% renewable ethanol content in gasoline across Canada. In addition, as of December 2012, there is a requirement for an average of 2% renewable fuel content in diesel fuel and heating distillate oil.

Some of the provinces have their own mandates for biofuel blending requirements, which means Suncor purchases product from third parties to complement our supply from our St. Clair ethanol plant in Ontario. In 2012, Suncor blended approximately one billion litres of ethanol into our gasoline across Canada.

Ethanol criticisms

In recent years, some observers have raised concerns about the production and use of ethanol. Among them:

  • creating ethanol-blended gasoline using corn feedstock could actually be more carbon and energy intensive than sticking with conventional petroleum
  • corn production consumes unsustainable amounts of water and, by using corn for fuel, poor countries lose out on food as world prices are driven higher
  • ethanol-blended gasoline has drivers re-fuelling more often because of reduced mileage per gallon

Ethanol benefits

However, there is growing evidence that biofuels such as ethanol are proven energy sources with demonstrable benefits.

The Conference Board of Canada concluded in a report titled Ethanol's Potential Contribution to Canada's Transportation Sector that:

  • ethanol reduces greenhouse gas (GHG) emissions relative to gasoline by between 40 and 62% depending on agricultural and production practices
  • improved farming techniques have significantly increased the average bushels of corn produced per acre, positively impacting water and fertilizer efficiency
  • today's corn production is also more energy efficient and most of the corn produced is not suited for human consumption

Although 10% ethanol-blended gasoline contains about 3% less energy than pure gasoline, it is an oxygenated fuel that has the ability to improve combustion efficiency in many vehicles. For most vehicles, this increased efficiency helps to offset the slightly lower energy content in the ethanol-blended gasoline. As well, using a 10% ethanol blend (E-10) does not significantly affect a vehicle's overall fuel economy.

Life cycle assessments

Suncor believes it is appropriate to look at the full life cycle of ethanol production when discussing environmental benefits. In the case of Suncor's ethanol plant, we asked the Alberta-based Pembina Institute to conduct two Life Cycle Assessments (LCA) in 2002, which looked at all of the energy inputs from the corn field to the gas pump. This was an early study focused specifically on the St. Clair ethanol plant before building it. Once the first phase of our facility was operational, Suncor requested that Pembina revisit the study again in 2007 to ensure both the latest scientific methodology, along with actual operating data, were used.

Visit the Pembina Institute website to learn more.

From its assessment, which was independently verified by the U.S. government's Argonne National Laboratory, Pembina estimated that overall C02 emissions could be reduced by up to 300,000 tonnes per year by blending all of the ethanol from the original St. Clair plant into gasoline. With the completed expansion of the plant, that environmental benefit has doubled to 600,000 tonnes per year. St. Clair’s ethanol provides about a 60% reduction in greenhouse gas emissions compared to gasoline. These estimates were more recently reconfirmed by internal calculations.

The type of corn used as feedstock at the St. Clair plant has traditionally been used to feed livestock. Once the sugars and starches are extracted from the corn to make ethanol, the remaining elements are used to make premium cattle feed.

Suncor believes the St. Clair plant's ethanol production is best-in-class. This is based on the feedstock, technology and energy used to manufacture ethanol, and the fact that we create shared value by producing an environmentally friendly byproduct (i.e., material left over in the production process is used as animal feedstock).

Visit the Argonne National Laboratory website to learn more.

New ethanol technologies

That said, as technical advances allow us to make ethanol from plants we don't typically eat, biofuels are destined to get even better. The goal is to make bio ethanol from non-food crops or, better still, from marginal or non-edible plants such as grasses. Using so-called cellulosic ethanol, it's been estimated E85 fuel would emit 63% less greenhouse gas emissions than conventional gasoline.

Suncor remains committed to our renewable energy business and believes the biofuels industry is here to stay.

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