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Business: Industrial

CIPEC Annual Report 2010

Industry Sector Profiles

“Energy impacts the bottom line”

Accurate measurement and meaningful data are fundamental to measuring energy improvements. Data used in this report are collected by Statistics Canada, with funding from Natural Resources Canada (NRCan) and Environment Canada, and supplemented by information received from associations participating in the Canadian Industry Program for Energy Conservation (CIPEC) as well as other private and government organizations.

Statistics Canada manufacturing sector data are collected through the annual Industrial Consumption of Energy (ICE)* survey, which covers approximately 4,300 establishments in the manufacturing sector. The survey gathers information by establishment on energy fuel consumption in natural units for 13 fuel types in 87 manufacturing industries. Survey results are used to track energy efficiency improvements, calculate carbon-dioxide emissions and inform the Canadian public about energy conservation.

Statistics Canada began streamlining the questionnaire and data collection process in data reference year 2004. The changes included standardizing some special industry questionnaires, making provisions for respondents to explain major changes in energy consumption to minimize follow-up inquiries, and converting fuels to a standard unit of measure.

Data analysis and interpretation involves the collective effort of NRCan’s Office of Energy Efficiency (OEE), CIPEC trade associations and the Canadian Industrial Energy End-Use Data and Analysis Centre (CIEEDAC) at Simon Fraser University in Burnaby, British Columbia. CIEEDAC produces energy intensity indicators for each sector based on production and gross domestic product. Primary funding for CIEEDAC comes from the OEE, with additional contributions from industry associations that participate in CIPEC and from the provinces of Quebec and British Columbia.

Much of the ICE data is available online. Statistics Canada data are published in CANSIM table 128-0005 – Energy fuel consumption of manufacturing industries in natural units, by North American Industry Classification System (NAICS); and CANSIM table 128-0006 – Energy fuel consumption of manufacturing industries in gigajoules, by North American Industry Classification System (NAICS).

The link to Statistics Canada is cansim2.statcan.ca

The OEE publishes Energy Efficiency Trends in Canada on an annual basis at www.oee.nrcan.gc.ca/corporate/statistics/neud/dpa/data_e/publications.cfm

Data from CIEEDAC is available at www.cieedac.sfu.ca/CIEEDACweb/mod.php?mod=userpage&menu=16&page_id=9

* The data from the ICE survey (preliminary) relate to the 2008 calendar year.

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Aluminum sector

Aluminum

Profile

Canada’s aluminum sector is a world leader in aluminum production. Outputs of the industry’s plants in the provinces of Quebec and British Columbia significantly contribute to Canada’s national and local economies.

Highlights

  • Energy consumed in the aluminum sector increased by 1.5 percent in 2008 (over 2007).
  • However, both the energy intensity and energy intensity index remained virtually unchanged due to the sector’s increase in production by 1.2 percent.
  • Electricity is the preferred source of energy in the aluminum sector at 91 percent of fuels used, followed by natural gas at 5 percent.

Aluminum Sector – NAICS 331313

Aluminum Energy Intensity Index
Aluminum Total Energy Production
Aluminum Energy Source in Terajoules per Year

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Brewery sector

Brewery

Profile

The Canadian brewing industry prides itself on its world-class beers, leadership in educating consumers to drink responsibly, three-century history in Canada, diversity and, finally, its impressive environmental record.

Highlights

  • Energy usage in the brewery sector increased less than 1 percent in 2008 (over 2007).
  • Concurrently, a corresponding drop in the sector’s output by 1 percent caused energy intensity to edge upwards by close to 2 percent.
  • Natural gas remains the preferred fuel in the brewery sector at 65 percent; electricity comes in second at 24 percent. It is observed that while the sector’s natural gas consumption decreased by 1 percent, its electricity consumption increased by over 6 percent. This change, however, appears consistent with that in most other sectors in Canadian manufacturing.

Brewery Sector – NAICS 31212

Brewery Energy Intensity Index
Brewery Energy and Production Output
Brewery Energy Sources in Terajoules per Year

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Cement sector

Cement

Profile

The cement industry is the cornerstone of Canada’s domestic construction industries and a significant exporter, contributing substantially to the country’s balance of payments. Cement is the active component in the manufacturing of concrete, comprising 10 to 15 percent of finished concrete products. Concrete is the second most consumed product, next to water.

Highlights

  • Energy intensity in the cement industry has shown a downward turn after highs in the early 2000s.
  • Heat consumption of kilns remains the largest source of energy consumption in this sector.

Cement Sector – NAICS 327310

Cement Energy Intensity Index
Cement Energy Consumption and Production Output
Cement Energy Consumption in Terajoules per Year

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Chemical sector

Chemical

Profile

The chemical sector encompasses a diverse industry producing organic and inorganic chemicals, plastics and synthetic resins. The Chemistry Industry Association of Canada (CIAC) is the trade association that represents manufacturers in this sector. Its member companies produce more than 90 percent of industrial chemicals manufactured in Canada.

Highlights

  • Total CO2 emissions for all members from 1992 to 2008 have decreased by 31 percent.
  • In terms of global warming potential, member companies’ GHG emissions – in millions of tonnes of CO2e emissions – have declined in 2008 by 62 percent compared to 1992 amounts.

Chemical Sector – NAICS 331313

Global Warming Potential vs. Production
Carbon Dioxide Emissions vs. Production

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Construction sector

Construction

Profile

Construction is Canada’s largest industry, composed of a diverse array of companies whose work touches every economic sector and region of the country.

Highlights

  • Energy intensity in the construction sector remained unchanged in 2008 (over 2007).Decline in both energy consumption and GDP by an almost identical percentage (3 percent) caused the intensity to remain unchanged.
  • Middle distillates remain the preferred fuel at 64 percent, followed by natural gas at 30 percent.
  • Propane showed the highest percentage decline at 28 percent even though propane’s share as a fuel source is a mere 5 percent.

Construction Sector – NAICS 23

Construction Energy Energy Intensity Index
Construction Total Energy and Economic Output
Energy Sources in Terajoules per Year

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Dairy sector

Dairy

Profile

Canada’s dairy product processing sector operates facilities and employs people across the country.

Highlights

  • An increase of 4 percent in energy consumption in 2008 (over 2007) caused the energy intensity to edge upwards by the same percentage, given the virtually unchanged production level.
  • Most of the energy consumption increase is due to an increase in electricity consumption.**
  • Natural gas remains the preferred fuel at 62 percent, followed by electricity at 34 percent.

** The electricity consumption figure for 2008 is in contrast to production, and is being reviewed.

Dairy Sector – NAICS 3115

Dairy Energy Intensity Index
Dairy Total Energy and Production Output
Dairy Energy Sources in Terajoules per Year

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Electronics sector

Electrical & Electronics

Profile

The electrical and electronics sector includes companies that produce electrical appliances, lighting, consumer electronics, communications and electronic equipment, cabling, office equipment, industrial equipment and other electrical products. The industry is a major exporter and a growing contributor to the national economy.

Highlights

  • Energy intensity in the electrical and electronics sector improved by 8 percent in 2008 (over 2007), primarily due to a drop in energy consumption by 6 percent and a concurrent increase in the sector’s GDP by 3 percent.
  • Most of the energy improvements resulted from a significant reduction in natural gas consumption as a fuel source in 2008 – the drop in natural gas consumption being 12 percent.
  • Electricity share, as a fuel source, increased from 58 percent in 2007 to 62 percent in 2008.

Electrical and Electronics Sector – NAICS 334, 335

Electrical Energy Intensity Index
Electrical Energy and Economic Output
Energy Sources in Terajoules per Year

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Electricity generation sector

Electricity Generation – Utility Generation only***

Profile

Electricity is a major driver of the Canadian economy. Approximately one-quarter of the energy used by Canadians is electricity, and there is no substitute in most applications. Canadians use electricity generated in residential, commercial, industrial and utility sectors.

*** This sector excludes industrial electricity generation.

Highlights

  • Energy intensity in utility electricity generation improved by 3 percent in 2008 compared to 2007.
  • The improvement in energy intensity in 2008 is attributable to an increasing use of hydroelectric power as a fuel source, relative to fossil fuels.
  • GHG emissions decreased by 2.6 percent in 2008 compared to 2007. The decrease is largely attributable to the decline in generation from fossil fuels.

Electricity Generation – NAICS 22111

Utility Production and Energy Intensity
Utility GHG Emissions vs Utility Production
Utility Generation Sources

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Fertilizer sector

Fertilizer

Profile

Canada’s fertilizer industry is one of the world’s major producers and exporters of nitrogen, potash and sulphur fertilizers.

Highlights

  • The sizeable reductions in energy consumption in both the nitrogenous fertilizer and potash sectors, by 7 percent and 6 percent respectively, were accompanied by a 5-percent drop in output of nitrogenous fertilizer and a 3-percent drop in output of potash.
  • Energy intensities in both sectors improved by 2 and 3 percent respectively. The declines in production precluded further improvements in energy efficiency.

Fertilizer Sector (Nitrogenous) – NAICS 325313

Total Energy and Physical Output
Energy Sources Terajoules per Year

Fertilizer Sector (Potash Mines) – NAICS 212396

Total Energy and Physical Output
Energy Sources Terajoules per Year

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Food and Beverage sector

Food & Beverage

Profile

Canada’s food and beverage sector includes manufacturers that produce meat, poultry, fish, fruit and vegetables, flour and bakery products, oils and sugars, coffee, snack foods, soft drinks and confectionery.

Highlights

  • The 1 TJ (1.1 percent) of reduction in energy consumption in the food and beverage sector was more than offset by the almost $600-million decline in the sector’s GDP.
  • As a result, the food and beverage sector energy intensity index showed a marginal 1.3-percent increase, given the sector’s 2.4-percent drop in GDP.
  • In the food and beverage sector, where energy consumption declined, the share of natural gas consumed by the sector showed a decrease from 62 percent in 2007 to 60 percent in 2008.
  • Electricity consumption in the sector, however, displaced natural gas by almost the same amount. The share of electricity consumed in the food and beverage sector increased in 2008 to 32 percent, from 29 percent in 2007. In an energy-reducing world, the displacement of natural gas by electricity consumption is an important signal and represents a major “switch.” The current level of natural gas consumption in 2008 is comparable to levels in the 1990s.

Food & Beverage Sector – NAICS 311, 3121

Food and Beverage Energy Intensity Index
Food and Beverage Total Energy and Economic Output
Food and Beverage Energy Sources in Terajoules per Year

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Foundry sector

Foundry

Profile

Metal castings are the first step in the value-added manufacturing chain and are utilized in the manufacturing of most durable goods. Markets and industries served by foundries include the automotive sector, construction, agriculture, forestry, mining, pulp and paper, heavy industrial machinery and equipment, aircraft and aerospace, plumbing, soil pipe, municipal road castings, defence, railway, petroleum and petrochemical, electricity distribution and a myriad of specialty markets.

Highlights

  • Energy intensity in the foundry sector improved significantly: by 12 percent in 2008 (over 2007).
  • The improvement is primarily due to the reduced energy consumption in the sector: energy consumption in the sector decreased by 14 percent. However, the associated decrease in the sector’s 2008 GDP by 2 percent slightly mitigated the energy intensity improvements.
  • The foundry sector adjusted its energy usage downward in anticipation of the impending reduction in aggregate demand in the economy. The sector thus achieved significant industrial efficiency through gains in energy intensity improvements.
  • Natural gas remains the preferred fuel in the foundry sector at 58 percent, followed by electricity at 38 percent.

Foundry Sector – NAICS 3315

Foundry Energy Intensity Index
Foundry Total Energy and Economic Output
Foundry Energy Sources in Terajoules per Year

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General manufacturing sector

General Manufacturing

Profile

The general manufacturing sector consists of a variety of industries, including leather, clothing, furniture, printing activities, construction materials, floor coverings, insulation, glass and glass products, adhesives, and pharmaceuticals. The sector includes approximately 2,000 small, medium-sized and large companies.

Highlights

  • Energy consumption in the general manufacturing sector increased by 12 percent in 2008 (over 2007).
  • Increased energy consumption and a deteriorating economic environment that preempted Canada’s export markets and caused declines in GDP in virtually all sub-sectors of Canadian manufacturing, contributed to a deterioration in energy intensity by as much as 22 percent in 2008.

*** NAICS Category Name
Leather & Allied Product 316
Clothing & Manufacturing 315
Furniture & Related Product 337
Printed and Related Support Activities 323
Fabricated Metal Product 332
Machinery 333
Non-metallic Mineral Product not Elsewhere Classified 3271, 3272, 32732, 32733, 32739, 32742, 3279
Miscellaneous Manufacturing 339
Chemical Manufacturing not Elsewhere Classified 32522, 325314, 32532, 3254, 3255, 3256, 3259
Tobacco Product Manufacturing 3122
Converted Paper Product Manufacturing 3222

General Manufacturing Sector – NAICS ***

General Manufacturing Energy Intensity Index
General Manufacturing Energy and Economic Output
General Manufacturing Energy Sources in Terajoules per Year

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Lime sector

Lime

Profile

Canada’s merchant lime sector supplies essential raw materials for the steel and mining industry, the pulp and paper industry, water treatment, environmental management and other basic industries.

Highlights

  • In 2008, energy consumption in the lime sector decreased over the 2007 levels by a considerable 6 percent.
  • However the decline in production – due to competitive pressures and shrinking markets – by as much as 4 percent almost offset the efficiency gains achieved due to reduction in energy savings.
  • Despite the adversity in markets, the energy intensity index improved in 2008 by almost 3 percent indicating major efficiency gains in the lime sector.

Lime Sector – NAICS 327410

Lime Energy Intensity Index
Lime Total Energy and Physical Output
Lime Energy Sources in Terajoules per Year

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Mining sector

Mining

Profile

Canada’s metal mining industry produces minerals and metals for domestic and export markets.

Highlights

  • Energy consumption in the mining sector increased by 8 percent in 2008. Increase in production was however much less: 5 percent.
  • Energy intensity, as a result, increased by 3 percent in 2008 (over 2007).
  • Electricity consumption in the sector, at almost 40 percent of all fuels, increased in 2008 by 3 percent.
  • Most other fuels also showed increases in 2008 over 2007. However, the largest percentage increases occurred in middle distillates and heavy fuel oil, at 12 percent and 16 percent respectively.

Metal Mining Sector – NAICS 2122

Mining Energy Intensity Index
Mining Energy and Production Output
Mining Energy Sources in Terajoules per Year

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Oil sands sector

Oil Sands

Profile

Canada’s oil sands sector includes plants in northern Alberta and one heavy oil upgrader in Saskatchewan. The sector is a major employer and a significant contributor to Canada’s exports and GDP.

Highlights

  • Energy intensity in the oil sands sector improved in 2008, from the 2007 levels.
  • The significant drop in total energy use by 10 percent was mitigated by an associated 7-percent decline in net bitumen production, limiting energy intensity improvements to only 3 percent.
  • Natural gas remains the prime source for energy at 51 percent of total energy sources (from 44 percent in 2007), followed by process gas at 25 percent. These two fuels combined make up over three quarters of all energy sources in the oil sands sector.
  • The largest improvements in energy reduction occurred in electricity, process gas and coke at 53 percent, 23 percent and 12 percent respectively.

Oil Sands Sector – NAICS 211114

Oil Sands Energy Intensity Index
Oil Sands Total Energy and Production
Oil Sands Energy Sources in Terajoules per Year

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Petroleum products sector

Petroleum Products

Profile

Canada’s petroleum products sector markets gasoline, diesel, heating oil, jet fuels, lubricating oil and other related products through a network of approximately 15,000 wholesale and retail outlets.

Highlights

  • The 2008 energy intensity index in the petroleum products sector moved upwards over 2007.
  • Despite a 3-percent decline in energy consumption in 2008, the precipitous decline in the GDP of the petroleum products sector by 8 percent resulted in a shift in the energy intensity index.
  • Refinery fuel gas remained the main source of energy in the sector in 2008.

Petroleum Products – NAICS 324110

Petroleum Products Energy Intensity Index
Petroleum Products Total Energy and GDP
Petroleum Products Energy Sources in Terajoules per Year

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Plastics sector

Plastics

Profile

The Canadian plastics processing sector is characterized by many processes and applications that use an ever-increasing variety of raw materials. The major markets served by the plastics industry are packaging, construction and automotive. This sector includes more than 113,000 people employed by approximately 3,400 companies.

Highlights

  • In 2008, a marginal increase in energy consumption in the plastics sector was accentuated by the precipitous decline in the sectors’s GDP – to the tune of 14 percent – partly due to imports.
  • As a result of the significant decline in GDP, the energy intensity index increased in 2008.The sector’s GDP declined three years in a row (2006, 2007 and 2008), from a high of 8.1 billion in 2005 to 6.4 billion in 2008.
  • Electricity remained as the major preferred fuel in 2008, while natural gas consumption declined.

Plastics Sector – NAICS 3261

Plastics Energy Intensity Index
Plastics Total Energy and Economic Output
Plastics Energy Sources in Terajoules per Year

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Pulp and paper sector

Pulp & Paper

Profile

Pulp and paper, a key component of the forest products industry, is a major contributor to Canada’s economy. In addition to market pulp, the sector produces newsprint, specialty papers, paperboard, building board and other paper products. It is the largest industrial energy consumer, representing 25 percent of industrial energy consumption in Canada.

Highlights

  • Although additional rationalization occurred in the sector during 2008, the overall energy intensity improved, regaining lost ground from the previous year.

Pulp and Paper Sector – NAICS 3221

Pulp and Paper Energy Intensity Index
Pulp and Paper Total Energy and Physical Output
Pulp and Paper Energy Sources in Terajoules per Year

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Rubber

Rubber

Profile

The rubber products industry is a major contributor to the Canadian economy. It represents approximately $6 billion in shipments and employs approximately 25,700 people. The industry is also very active in international trade, with imports of $4.2 billion and exports of $3.4 billion.

Highlights

  • Reduction in energy consumption in the rubber sector by 4 percent in 2008 (over 2007) was overshadowed by a larger 10-percent decline in GDP, resulting in a 7-percent increase in energy intensity in the rubber sector.
  • Electricity consumption – the largest fuel source in the sector at 45 percent – declined in 2008 by over 3 percent. However, natural gas consumption increased.
  • Consumption of fuels other than electricity and natural gas have declined in 2008 relative to 2000 levels.

Rubber Sector – NAICS 3262

Rubber Energy Intensity Index
Rubber Total Energy and Economic Output
Rubber Energy Sources in Terajoules per Year

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Steel sector

Steel

Profile

Canada’s steel sector is one of the country’s major industries. The industry employs more than 30,000 Canadians. The sector produces more than 15 million tonnes of steel annually, supplying flat-rolled (sheet and plate), long (re-bar and structural steel), and specialty and alloy (stainless and tool steels) products for major markets in the automotive, appliance, oil and gas, machinery, construction, and packaging industries.

Highlights

  • Steel industry output went up over 17 percent between 1990 and 2008. Following a strong first half of 2008, the industry entered the global downturn, with substantial reductions in output and associated energy consumption.
  • Energy intensity in the sector declined from 20.93 to 15.52 (26 percent) during the same period.
  • Energy intensity improved from 2007 to 2008, by approximately 1.6 percent. Both increases in output and reductions in energy consumed contributed to this improvement.

Steel Sector – NAICS 331100

Steel Energy Intensity Index
Steel Total Energy and Physical Output
Steel Energy Intensity and Physical Output
Steel Energy Sources in Terajoules per Year

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Textiles sector

Textiles

Profile

Canada’s textile industry produces fibres, yarns, fabrics and textile articles purchased by users and customers as diverse as the automotive manufacturing, clothing, construction, environmental protection, road-building and retail sectors.

Highlights

  • Textiles sector’s energy intensity improved by 6 percent in 2008 (over 2007).
  • Improvement in energy intensity in the sector was primarily due to reduction in total energy consumption by 17 percent. Both natural gas consumption and electricity consumption were reduced by 19 percent and 13 percent respectively.
  • The corresponding decline in the sector’s GDP by 11 percent precluded further gains in energy intensity improvements.
  • Natural gas remained as the preferred fuel in the textiles sector with a 54 percent share. Electricity was second at 43 percent of all fuel consumed.

Textiles Sector – NAICS 313, 314

Textiles Energy Intensity Index
Textiles Energy and Economic Output
Textiles Energy Sources in Terajoules per Year

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Transportation equipment manufacturing sector

Transportation Equipment Manufacturing

Profile

The Canadian transportation equipment manufacturing sector includes companies that manufacture aircraft, aircraft parts, automobiles, motor vehicle parts, trucks, buses, trailers, ships, and railroad rolling stock.

Highlights

  • Despite an energy reduction in the transportation equipment manufacturing sector by 5 percent in 2008, energy intensity in the sector increased by about 13 percent over 2007.
  • Increase in energy intensity was primarily due to the unprecedented decline in the fortunes of the automobile manufacturing sector. Overall, the sector’s GDP declined by as much as 16 percent, resulting in the reduction in consumption of natural gas and electricity, at 7 percent and 4 percent respectively.
  • Natural gas represents over 51 percent of all fuel consumed; electricity accounts for 42 percent.

Transportation Equipment Manufacturing Sector – NAICS 336

Transportation equipment manufacturing Energy Intensity Index
Transportation equipment manufacturing Total Energy and Economic Output
Transportation equipment manufacturing Energy Sources in Terajoules per Year

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Upstream Oil and Gas sector

Upstream Oil & Gas ****

Profile

The upstream oil and gas sector includes the companies that find and develop Canada’s vast oil and gas resources. The sector is broadly divided into conventional oil and gas production, and oil sands production and upgrading. This section discusses the conventional oil and gas sector. The oil sands sector is covered separately elsewhere in this report. Products and services derived by downstream sectors from the output of this industry include heating and transportation fuels, building supplies and materials, clothing, and vital medicines. The exploration and production industry is represented by the Canadian Association of Petroleum Producers (CAPP) and the Small Explorers and Producers Association of Canada (SEPAC).

CAPP represents companies, large and small, that explore for, develop and produce natural gas and crude oil throughout Canada. CAPP’s member companies produce about 90 percent of Canada’s natural gas and crude oil. CAPP’s associate members provide a wide range of services that support the upstream crude oil and natural gas industry. Together CAPP’s members and associate members are an important part of a $110-billion-a-year national industry that provides essential energy products. CAPP’s mission is to enhance the economic sustainability of the Canadian upstream petroleum industry in a safe and environmentally and socially responsible manner, through constructive engagement and communication with governments, the public and stakeholders in the communities in which CAPP operates.

Highlights

  • Analyses of trends from the CAPP Stewardship data on greenhouse gas (GHG) emissions intensity cannot be performed due to shifting mixes of production, variations in CAPP’s coverage of total conventional oil and gas production, and an incomplete dataset on GHG emissions for 1999–2006. However, as of the 2007 reporting year, all CAPP members are required to report direct GHG emissions through the Stewardship program.

**** This section deals with the conventional oil and gas sector. The oil sands sector is covered separately elsewhere in this report.

Upstream Oil & Gas Sector – NAICS 211113

Upstream oil and gas GHG Emission Intensity Conventional Oil and Gas

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Wood products sector

Wood Products

Profile

The wood products sector has as many as 7,000 facilities in primary and secondary manufacturing. The primary grouping includes commodity-based production facilities such as lumber and structural panels, and more specialized production facilities such as engineered wood products and assemblies. The secondary grouping encompasses a diverse range of facilities that make prefabricated buildings, windows and doors, flooring, mouldings, containers and pallets, other millwork, and numerous other products. The energy data presented here focuses on the primary manufacturing grouping.

Highlights

  • Further deterioration in the U.S. housing market had a cascading negative effect on the Canadian wood products sector. More rationalization occurred through 2008, further eroding earlier improvements in the energy intensity of the sector. However, the sector continued its adoption of renewable biomass for energy needs. This can be seen in the sizable declines in fossil fuel use while wood waste use was stable.

Wood Products Sector – NAICS 321

Wood Energy Intensity Index
Wood Total Energy and Economic Output
Wood Energy Sources in Terajoules per Year

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