Research
Highlights
- Since 2010, refinery margins in British Columbia have risen well above the Canadian average and are well above margins in other global markets.
- Higher than average refining margins have cost BC consumers roughly $2.7 billion since 2010. In contrast, the cost impact of the RLCFRR is likely 30 times smaller.
- Furthermore, the RLCFRR increased the supply of transportation energy during a period when pipeline capacity and refinery outages were pushing fuel prices higher.
This report is Navius Research’s second installment in a series of analyses exploring British Columbia’s (BC) Renewable and Low Carbon Fuel Regulation Requirement (RLCFRR). In our first report, we provided an overview of how the regulation works, its impact on greenhouse gas emissions, as well as its acceptance by the citizens of BC. In this document, we explain how analysing the net-revenue for petroleum refining (i.e. the refinery margin) in BC provides insights into the economic impact of the RLCFRR. Specifically, we discuss:
- The relative impact of the RLCFRR on the financial viability of petroleum refining for the BC market.
- The cost impact of the RLCFRR on refiners relative to the cost impact of refinery margins on consumers.
- The potential for the RLCFRR to improve the competition in the market for transportation energy, resulting in lower energy costs for consumers.
This figure shows that between 2010 and 2014 annual average refinery margins for gasoline rose faster in Vancouver relative to the rest of Canada.
To learn more about this research, please contact Michael Wolinetz.
Other Research
2023
2022
Damage Control: Reducing the costs of climate impacts in Canada
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Potential of small modular reactors in hard-to-decarbonize industries
Hitting Canada’s climate targets with biogas & RNG
Under Water: The costs of climate change for Canada’s infrastructure
2021
Informing a strategy for reducing agricultural greenhouse gas emissions in British Columbia
The role of carbon capture and storage in Canada’s net zero future
Canada’s clean energy economy to 2030
Canada’s Clean Fuel Regulations explanation and insights
Towards Canada’s fair share: New modeling and analysis on achieving a stronger climate target
Assessing the impacts of the Conservative Plan to Combat Climate Change
2020
2019
Meeting Canada’s climate mitigation commitments under the Paris Agreement
Quantifying Canada’s clean energy economy
California and Québec’s ZEV mandates description
Reversing carbon leakage in the Canadian aluminum sector
Supporting the development of CleanBC
Saskatchewan’s carbon tax numbers are in and the answer is … reporting errors
Older
Review of British Columbia’s RLCFRR energy effectiveness ratios
Refining margins and fuel policy in British Columbia
Analysis of the proposed Canadian Clean Fuel Standard
Electrification best practices in Canada
A review of ECCC’s method for estimating upstream GHGs
Refining margins in British Columbia
Greenhouse gas emissions resulting from the Energy East pipeline project
The Renewable and Low Carbon Fuel Requirement Regulation
How do industrial GHG reduction efforts affect demand for skilled labour?
Is British Columbia’s carbon tax good for household income?
How resilient are the Canadian oil sands to carbon constraints?