CIPMA Connection - June 2018

June | 2018

MESSAGE FROM THE PRESIDENT JENNIFER STEWART

A SMARTER APPROACH TO CLIMATE CHANGE POLICY BY: DENNIS DESROSIERS

UPCOMING EVENTS 2018 EVENTS

NEWS UPDATES 2018 NEWS

MEMBER UPDATES NEW MEMBERS

OTHER UPDATES

FULL MEMBERS

ASSOCIATE MEMBERS

CONNECTION CONTENTS 1

| MESSAGE FROM THE PRESIDENT | Jennifer Stewart

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| A SMARTER APPROACH TO CLIMATE CHANGE POLICY | By: Dennis Desrosiers

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| UPCOMING EVENTS | 2018 Events

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| ADVOCACY UPDATES

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| NEWS UPDATES | 2018 News

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MEMBER UPDATES | 2018 Members

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OTHER UPDATES

MISSION CIPMA’s mission is to ensure the sustainability and growth of a healthy and viable independent fuel marketing and distribution sector at both the wholesale and retail levels in Canada. Our specific goals include: Ensuring that independent fuel marketers thrive and have the opportunity to earn a fair and reasonable return that is proportionate to their business risk and capital investment, and ensuring that Canadian consumers and independent fuel marketers have access to a competitively priced and readily available supply of fuel products in all regions of the country.

MESSAGE FROM THE PRESIDENT JENNIFER STEWART | PRESIDENT & CEO

Dear CIPMA Members and Associate Members With summer underway, CIPMA has a lot of engagement on the go. We have been busy reaching out to members of Parliament on carbon pricing and are in the midst of preparing an advocacy campaign on credit card fees.

On behalf of the CIPMA team, have a safe and healthy summer. And of course, please do not hesitate to reach out.

Until next time,

The 2018 Membership Survey has also been issued and we are looking for your input. This survey is important in helping us build a comprehensive picture of CIPMA’s membership and shaping our advocacy efforts. Your participation is very much valued and appreciated.

In this edition of Connection, you will find the latest in industry-related news headlines, and insights on Canada’s climate change policy and what needs to be done to make real progress, in a submitted article by Dennis DesRosiers.

We also have our annual Golf Challenge coming up in September I am looking forward to seeing you all on the links!

Jennifer Stewart President and CEO Canadian Independent Petroleum Marketers Association

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We want to share the successes of our members.

If you want to feature your company’s recent achievements, updates, or simply want to be featured, please reach out to Jennifer Stewart at jstewart@cipma.org

Canadian Independent Petroleum Marketers Association | Connection 2018 |

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A SMARTER APPROACH TO CLIMATE CHANGE POLICY DENNIS DESROSIERS

P R E S I D E N T, D E S R O S I E R S A U T O M O T I V E C O N S U LTA N T S I N C .

Around the world, and certainly in Canada, our regulators seem to have a one-track mind when it comes to climate change policy and the automotive sector … Simply put … promote electric vehicles of all types. Battery electric, plug-in hybrids and hybrids. Trouble is that with a few exceptions (Norway is usually singled out as the best example) consumers are not buying electric vehicles in any meaningful numbers. In Canada, hybrids have been available for 16 years and BEV’s for 6 years and a grand total of 240,562 have been purchased. Over the same time frame Canadians bought 30 million conventionally fuelled vehicles. Policies to promote electrification obviously are not working (at least not in Canada) and therefore very little headway is being made to reduce greenhouse gases related to light vehicles in use in Canada.

Promoting electric vehicles is an important element in our climate change policy but there are seven more important areas that should be addressed if we are to make real progress.

1 Limit or reverse ownership growth. Ownership of vehicles in the year 2000 was two thirds of the driving age population. Last year it was 87 percent which means there are about 10 million more light vehicles on the road today. As long as ownership continues to grow, no amount of electrification will move the needle on GHG’s. I don’t know which policies to suggest in order to limit or reverse ownership growth, but that would be my number one target.

2 Promote less driving per vehicle. Changing the fuel pricing equation would do the trick, but consumers love their vehicles and they drive them a lot which is not good for GHG emissions.

3 Make driving the existing 27 million light vehicles on the road a lot more efficient. I find it interesting in Toronto, where HOV lanes are popular, there are very few vehicles using them and most have only one person in the vehicle, meanwhile the remaining lanes are jam packed and moving at a snail’s pace. Get rid of HOV lanes. Fewer stop signs/lights and more traffic circles which are very efficient – that’s the way to go.

Canadian Independent Petroleum Marketers Association | Connection 2018 |

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4 Increase the fuel efficiency of the existing light vehicles on the road.

Most vehicles become less fuel efficient over time (the average is about 15 percent less than their original Transport Canada rating). Simple mandatory maintenance inspections could seriously improve the fuel efficiency of these vehicles and have a huge impact on GHG emissions.

5 Promote increasing the fuel efficiency of new conventionally fuelled vehicles. They are the one’s consumers want to buy, so why fight it? This could be done by funding the science behind fuel efficiency. All the low hanging fruit hasn’t been picked on internal combustion vehicles (ICE) even though the average ICE vehicle is between 25 and 35 percent more fuel efficient than its equivalent ten-yearold vehicle. This leads me to my next suggestion.

6 Buy a new vehicle. Since every category of new vehicle has improved its fuel efficiency by more than 25 percent over the last decade, why not just get consumers to buy a new vehicle … any new vehicle. If they are intent on driving a gas guzzler, just get them to drive a new one. It will be significantly more fuel efficient than their old one and will do more for reducing GHG emissions than NOT buying an electric vehicle.

Limit or reverse ownership growth

Promote less driving per vehicle

Promote increasing the fuel efficiency of new conventionally fuelled vehicles

7 Get older vehicles off the road. If getting consumers to buy more new vehicles will work, we also have to find a way to get older vehicles off the road. There are now about 12 million vehicles on the road over 10 years old and these are growing every year. And most importantly almost all of these have little of the advanced fuel technology available today and, as mentioned, operate well below their original fuel ratings. Carrot-based scrappage programs do little to remove these, so a better policy would be a ‘stick’-based approach. A simple one would be an inspection program forcing vehicles to meet current emission standards as opposed to the standard when they were originally purchased. This has been very effective in countries where it is used and would reduce the number of older vehicles on the road by a significant margin.

So, there you have it. Seven policy areas that would be much more effective, and if developed, would have a much bigger impact, than simply promoting electrification of our new vehicles sales.

Make driving the existing light vehicles on the road more efficient

Buy new vehicles

Increase the fuel efficiency of the existing light vehicles on the road

Get older vehicles off the road

Canadian Independent Petroleum Marketers Association | Connection 2018 |

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UPCOMING EVENTS CIPMA CONNECTION | 2018 EVENTS

CIPMA GOLF CHALLENGE

Thursday, September 13, 2018 | Glen Abbey Golf Club, Oakville, ON Early Bird Registration is now open. Sponsorship opportunities are available.

Click for more details

EASTERN MEMBERS MEETING

Tuesday, October 23, 2018 | Halifax More details coming soon.

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ADVOCACY UPDATES Government advocacy is the main priority for the CIPMA team, and having a voice on important issues at the municipal, provincial and federal levels of government is one of the key reasons why members join our organization. CIPMA members receive quarterly updates on the association’s advocacy efforts, which are also posted on the Members Only section of cipma.org.

Canadian Independent Petroleum Marketers Association | Connection 2018 |

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NEWS UPDATES CIPMA CONNECTION | 2018 NEWS

This section presents a series of media articles of interest to the sector. The headlines included below are taken directly from media sources and are not written by CIPMA or CIPMA team members.

GLOBAL COSTA RICA TO BAN FOSSIL FUELS AND BECOME WORLD’S FIRST DECARBONISED SOCIETY Costa Rica’s new president has announced a plan to ban fossil fuels and become the first fully decarbonised country in the world.

NEW DECOMMISSIONING TECHNOLOGY COULD SAVE UK OIL AND GAS INDUSTRY £100 MILLION ANNUALLY A new decommissioning technology which could cut hundreds of millions from the decommissioning bill for both the U.K. taxpayer and the oil and gas industry has been successfully tested by Spirit Energy.

GLOBAL ENERGY POLITICS ARE FRONT AND CENTER AT THE WORLD CUP IN RUSSIA Opinion piece contributed to The Hill publication by Charles Hernick, director of Policy and Advocacy at Citizens for Responsible Energy Solutions (CRES) Forum.

RUSSIA-SAUDI PLANS FOR SUPER-OPEC COULD RESHAPE GLOBAL OIL ORDER It would mark a seismic shift in oil’s world order and while it probably won’t supplant OPEC in the short term it would create a rival for the organization.

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UNITED STATES

POWER LEDGER AND SILICON VALLEY POWER TO TRACK EV LOW-CARBON CREDITS VIA BLOCKCHAIN Blockchain’s use in the energy space gets a new proof-of-concept deployment in Silicon Valley.

US JUDGE THROWS OUT CLIMATE CHANGE LAWSUITS AGAINST BIG OIL A U.S. judge who held a hearing about climate change that received widespread attention ruled that Congress and the president were best suited to address the contribution of fossil fuels to global warming, throwing out lawsuits that sought to hold big oil companies liable for the Earth’s changing environment.

GOP WILL BACK CARBON TAX IF TIED TO INNOVATION, TECH GROUP PREDICTS The Republican climate policy of choice may be a revenue-neutral carbon tax, says a new study by a prominent technology think tank.

ALBERTA CRUDE LEAKS INTO FLOODWATERS AFTER TRAIN DERAILS IN IOWA An estimated 230,000 gallons (870,619 litres) of crude oil spilled into floodwaters in the northwestern corner of Iowa following a train derailment, according to railroad official.

NATIONAL

CANADIAN RETAIL GASOLINE PRICES AVERAGE 135.2 CENTS PER LITRE IN JUNE As of June 26, the Canadian average retail regular gasoline price was 135.2 cents per litre, up from 106.4 cents per litre in June 2017, while the average retail diesel price hit 131.7 cents per litre, versus 103.0 for the same time last year, according to Kent Group Ltd. For more information and analytics, click here.

CANADIAN OIL AND GAS M&A JUMPS TO HIGHEST IN A YEAR Royal Dutch Shell’s decision to divest its stake in Canadian Natural Resources Limited for US$3.3 billion (~C$4.2 billion) meant that upstream sector divestments in Canada reached C$4.5 billion in May 2018. The latest CanOils M&A report illustrates that this is the largest monthly total seen over the past 12 months in Canada.

WE’RE FINALLY TOLD WHAT TRUDEAU’S CARBON TAX WILL COST US. ARE YOU SITTING DOWN? Households in Alberta, Saskatchewan and Nova Scotia will be hit with more than $1,000 of carbon tax per year, while those in British Columbia, Quebec and Manitoba will pay around $650.

IS A CARBON TAX CANADA’S BEST OPTION TO HELP THE ENVIRONMENT? If Canada is serious about cutting carbon dioxide emissions, most economists agree a carbon tax is the cheapest and least heavy-handed way for the government to do it. Yet that fact has been swallowed up by a divisive debate over how much the federal government’s proposed tax would impact Canadian families. The tax will see Canadians pay at least $20 per tonne of carbon dioxide emitted starting in January and rising to $50 per tonne by 2022.

TALKS UNDERWAY FOR ‘AMBITIOUS’ CLEAN FUEL STANDARD NOT BROAD ENOUGH, SAYS TORY CRITIC Conservative environment critic Ed Fast says the Liberals won’t meet their commitments to the Paris climate accord, despite costing consumers more money at the gas pump.

GREENING THE CANADIAN TRANSPORTATION SECTOR CEO of IGPC Ethanol Inc. and Chair of Renewable Industries Canada Jim Grey talks about how Canada is a good example of how biofuels can lead the way for greenhouse gas reductions.

ENVIRONMENT CANADA URGED TO RELEASE ITS PROBE OF FOSSIL FUEL SUBSIDIES The federal government should publish its full review of fossil fuel subsidies as it works toward phasing them out, says an Ottawa-based corporate watchdog.

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THE POLITICS OF PIPELINES ARE THE POLITICS OF CANADIAN SOVEREIGNTY Op-ed contributed to the Globe and Mail publication

by Toronto-based writer, Tom C.H. Fraser.

WESTERN REGION DOUG FORD SUPPORTS PREMIER MOE IN FIGHT AGAINST CARBON TAX Ontario’s premier-designate Doug Ford ran on a platform which fought against the cap-and-trade system in that province, before ultimately winning the leadership race earlier this month. Looking on from Saskatchewan, Premier Scott Moe said Ford’s win proves many Canadians don’t want the carbon tax.

PREPAYING FOR GAS NOW MANDATORY IN ALBERTA Drivers in Alberta are now required by law to pay before filling up their gas tanks. The legislation is designed to protect workers at gas stations and convenience stores by preventing gas-and-dash thefts. British Columbia has had similar legislation for more than a decade.

ANYTHING IS A POTENTIAL TARGET’: COULD TRUMP FOCUS ON ALBERTA OIL NEXT? Canadian Chamber of Commerce president weighs in on US-Canada trade concerns.

DOUG FORD SAYS OIL COMPANIES ARE ON NOTICE AS HE MOVES FORWARD TO CUT GAS PRICES BY 10 CENTS A LITRE On June 15, Ontario premier designate Doug Ford said he’s putting the oil companies on notice.

Despite the potential impact in other areas, Ford is sticking to his campaign promise to drive down gas prices within days after he takes office.

ATLANTIC REGION

EMERA HOPES TO GET MORE NOVA SCOTIANS DRIVING ELECTRIC CARS Emera has created a network of “fast-charging” stations to address the province’s “primary inhibitor” to Nova Scotia adopting electric vehicles.

N.S. HOPES TO BOOST OFFSHORE OIL EXPLORATION WITH $12 MILLION FOR RESEARCH Nova Scotia has committed millions of dollars to encourage offshore exploration, hoping to bring billions more in oil riches -- even as ecologists say the cash would be better used to counter carbon emissions.

ONTARIO / QUÉBEC REGION GOLDSTEIN: WYNNE’S CARBON SCHEME DESERVES TO DIE Ontario premier-designate Doug Ford is being warned by the usual suspects that it would be insane for him to kill outgoing premier Kathleen Wynne’s cap-and-trade scheme. In fact, the deal is so bad for Ontarians, it would be insane not to kill it.

GREENHOUSE OWNER HOPEFUL PREMIERDESIGNATE DOUG FORD WILL SAVE INDUSTRY Gerry Mastronardi, owner of T G & G Mastronardi greenhouses, says he was on “pins and needles” over the past few years trying to keep up financially with the carbon tax, soaring hydro rates and a higher minimum wage. But today, he’s hoping a Ford government will offer some relief.

SCIENTISTS USING MICROSCOPIC HELPERS IN OFFSHORE OIL AND GAS SEARCH Scientists have turned to tiny creatures that live kilometres under the ocean in the search for oil and gas reserves off Nova Scotia.

PROVINCE EXTENDS FRACKING BAN ‘INDEFINITELY’ AFTER FAILING TO MEET ITS OWN CONDITIONS Three and a half years into what was supposed to be a “temporary” moratorium on natural gas fracking in New Brunswick, the Gallant government has failed to execute key tasks it gave itself before the ban can be lifted and is citing that inaction as a reason to extend the moratorium further.

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MEMBER UPDATES CIPMA is pleased to welcome new Associate Member, Shell Canada Products.

ASSOCIATE MEMBERS

SHELL CANADA PRODUCTS Shell is an integrated energy company that aims to meet the world’s growing demand for energy in ways that are economically, environmentally and socially responsible.

OTHER UPDATES 2018 CIPMA MEMBERSHIP SURVEY If you haven’t already done so, please take some time to complete the member survey.

The survey is CONFIDENTIAL, and questions cover a number of areas that help us to build a comprehensive picture of CIPMA’s membership.

You can access the survey and download it by clicking here.

Please return the survey by Thursday, July 19, 2018.

NATIONAL RETAIL PETROLEUM SITE CENSUS One of the benefits of your CIPMA membership is the availability of the National Retail Petroleum Site Census published by Kent Group Ltd. The 2017 National Retail Petroleum Site Census and the data file can be found on www.cipma.org as follows: Use your Full Member login (your email address and password) to access the Members’ Area page. · Click on the bottom tab “Helpful Resources” where you will find the two National Retail Petroleum Site Census files available to download. · If you don’t remember your password, the website will allow you to reset it.

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Jennifer Stewart, President and CEO jstewart@cipma.org | Cell: 613.915.5699

Rita Molinari, CMP, Operations Manager rmolinari@cipma.org | Cell: 416.358.5207

MAILING ADDRESS | 3-1750 The Queensway, Suite 115 - Toronto, ON., M9C 5H5

Canadian Independent Petroleum Marketers Association | Connection 2018 |