Canada's Low-Carbon LNG Tax Incentives Spark Subsidy Debate

Canada has introduced an accelerated capital cost allowance for LNG facilities that meet specific emissions intensity thresholds. While the government views this as a way to diversify exports and replace coal globally, environmental advocates argue it is a fossil fuel subsidy that ignores upstream methane leaks and shipping emissions. The policy targets facilities with emissions intensity of 0.20 tonnes of CO2e per tonne of LNG. Critics claim this narrow definition creates a credibility gap by excluding the full lifecycle of natural gas production and transport.