Toughest Part Still Ahead for Canada Climate Plan
Anne McLellan and Lisa Raitt
Last week, COP28 ended in Dubai. It included a historic agreement to gradually move away from fossil fuels. This moment offers us an opportunity to take a look at an important pillar of our Scorecard – the Canadian economy’s ability to grow in a sustainable fashion, both from an environmental and economic resiliency perspective.
On climate, the data shows there’s been progress.
Things won’t get any easier from here. Progress will depend on massive investments in green technology that remain a big question mark, along with governments fully implementing emission reductions plans at a time when economic outlooks and public support are uncertain.
Canada generated 670 megatonnes of carbon dioxide emissions in 2021, according to the latest available inventory data from the government. That represents a slight tick up from the 2020 pandemic year, but that’s still down from 738 megatonnes in 2019. (The Canadian Climate Institute also projects a slight increase in 2022.)
On a per-dollar-of-economic-output basis, emissions were down five per cent in 2021, which keeps us on track to hit the Coalition’s ‘intensity’ target for a 25 per cent decline by 2030.
All this is consistent with the federal government’s own assessments of progress, released earlier this month, which shows the nation is making progress - but still well short of - its target for a 40 per cent reduction in absolute emissions by 2030.
Things won’t get any easier from here. Progress will depend on massive investments in green technology that remain a big question mark, along with governments fully implementing emission reductions plans at a time when economic outlooks and public support are uncertain.
The Coalition recognizes there are different opinions about the pace of climate action that is needed, and that there are questions over which jurisdictions – federal government or provinces - should be leading the effort. We’re also cognizant there are big differences in policy approaches between the major parties, with the Conservatives promising to drop the consumer-facing carbon pricing framework.
The ensuing uncertainty is a big challenge for business, as well as the risk that Canada could end up with a costly piecemeal approach, should consensus not be found.
There are areas of common ground, too, and that’s worth emphasizing.
This includes a broad consensus around net zero longer-term targets, while the idea of using pricing for industrial emitters continues to remain intact.
It’s also important to note, as we’ve written before, that we can’t be too cavalier about how we tackle emissions in the resource sector. There’s no credible climate change plan for Canada that doesn’t include a major commitment to reduce emissions from the oil and gas sector.
But we need to be careful about economic costs. Losing support from the public would be a sure-fire way of losing momentum.
Without energy exports, which have been worth more than $300 billion over the past two years, our dollar would be weaker and inflation and interest rates would be higher.
We’d all be poorer, which would undermine the second part of our sustainability test – economic resiliency.
Our members are committed to net zero 2050. Each of our members will mark this goal in ways that make environmental and economic sense, either on an industry-wide basis or as individual organizations or companies. COP28 further underscores the need for all of us to take action now.
