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The Conference Board also assessed how Canada could increase its renewable energy capacity, and the investments required to electrify its grid. It followed up on previous research by the Canadian Academy of Engineering that assessed the possibilities of shifting toward a greener grid from a technical standpoint.

In order to meet its climate targets and successfully shift toward a lower-carbon economy, anywhere between $1.5 trillion and $3.5 trillion will need to be invested between 2017 and 205o, according to the report.

The shift would require heavy investment into increasing the adoption of electric vehicles and expanding current infrastructure. Meanwhile, power suppliers will need to double or even triple their current capacity while replacing coal and natural gas with cleaner supplies.

“It is a very massive transformation of the economy,” Coad said.

The report did not assess the impact on Canadian oil and gas companies specifically, but Coad said costs will rise for those companies as well. Some producers have begun electrifying their upstream processes as a way to reduce emissions, but many are still dependent on burning natural gas to power their operations.

He said oilsands and other Canadian unconventional basins “are both expensive resources to develop, so adding additional cost from carbon pricing does put additional pressure on them and their competitiveness.”

Another challenge for Canadian companies and consumers are lingering questions over whether the U.S. and other jurisdictions will implement similar carbon policies.

Rigid carbon restrictions on Canadian companies could put them at a disadvantage to competitors with different tax rates.

“Even after passing on the higher costs to their workers, exporters will still be at a competitive disadvantage, as they will not be able to pass on any of those higher costs to foreign buyers,” the report said.

jsnyder@postmedia.com