Changing course

At present Canada is not on track to reach net-zero GHG emissions by mid-century.

Despite the climate policies introduced by the federal government since 2015, and optimistic assessments of Canada’s 2022 Emissions Reduction Plan, a recent report from Environment and Climate Change Canada (ECCC) recognized a substantial gap remains between reductions anticipated from existing climate policies and the official 2030 and 2035 interim targets. This is consistent with the earlier assessment in the Institut de l’énergie Trottier’s Canadian Energy Outlook. ECCC now forecasts an 18% GHG reduction rather than 40% for 2030, and 20% rather than the intended 50% for 2035, a projection that does not include the impact of the repeal of the consumer-facing carbon levy. According to ECCC, the adoption and full implementation of all other measures being considered by government (so called "advanced measures") could partially close this gap by achieving a 30% GHG reduction by 2030 and 35% by 2035.

Without further significant action the country would therefore achieve less than half the targeted reductions. Considering the difficult political conjuncture, with turmoil over tariffs, the hostility of the current US administration to the energy transition and international climate regime (as well as the Canadian government’s poor record of accurately anticipating future emissions trajectories), even these results are far from certain. In the meantime, many of Canada’s OECD counterparts have managed to make greater progress. In contrast to Canada, European countries have decreased their emissions significantly since 1990. So, while every country faces its own unique challenges and conditions, a large number of states have succeeded in deploying strategies that allow sizeable reductions in emissions, compatible with the Paris Agreement objectives. This failure is not only environmental: we are not moving rapidly enough to build the new economy that will be required for Canadian prosperity in the second half of the century.

In this report we reexamine the challenge of decarbonizing Canada’s economy by mid-century, consider the progress that has been made to date, and outline measures that can reorient efforts to make progress in key economic sectors.