The Canadian government is at a crossroads: it could either continue with the slow implementation of an inadequate climate plan, or adopt a recovery package that accelerates the transition to a zero emissions future. During the last election (October 2019), the government made a number of promises to scale up climate action, including exceeding the country’s 2030 NDC target and achieving net zero emissions by 2050, but has done little to deliver on this in the intervening months. The CAT rates Canada as ‘Insufficient’.

We expect GHG emissions to be 11 to 13% lower in 2020 compared to 2019, due to the economic slowdown of the pandemic. Oil and gas supply could drop by 8% this year, but is expected to rebound in 2021. Road transport dropped from March to June around the height of lockdowns across the country. Domestic aviation was down 72% in April compared to the same time last year and has been slow to recover.

Prior to the pandemic, Canada was far from meeting its ‘Insufficient’ NDC under its current or planned policies. While 2030 projections are uncertain and are likely to be lower due to slower economic growth, the country still may not meet its NDC with the combined effect of current or planned policies and the pandemic. Much greater action is needed to ‘exceed’ its NDC as promised.

Whether and how any behavioural changes from the pandemic affects GHG emissions in the long-term is unclear; however, previous CAT analysis has shown that the extent to which recovery measures support green climate action has a much greater impact on lowering emissions in 2030 than the temporary drop in emissions due to the lockdown and associated economic impact.

There has been little support for a green recovery in the measures implemented to date. Much of Canada’s CAD 200+ billion COVID-19 Economic Recovery Plan is focused on helping affected individuals and businesses address the immediate health and economic impacts of the pandemic. The package has provided CAD 2.5 billion in support to the oil and gas sector to clean up orphan and inactive wells and to reduce fugitive methane emissions. Depending on how this support is structured, it could undermine the polluter pays principle. CAD 330 million has also been provided to the country’s airports. On the positive side, large employers who wish to access support will need to publish annual climate-related financial disclosure reports and outline how they are contributing to achieving Canada’s NDC and other Paris commitments. The government has also provided some resources to help redistribute food and avoid food waste.

The true test to determine whether the recovery will be green comes on September 23, 2020 when the government will outline its legislative agenda for the next Parliamentary session. As a minority government, it will need the support of other parties to implement this agenda or Canadians could face a snap election.

Implementation of the Pan-Canadian Framework on Clean Growth and Climate Change, the government’s climate strategy, continues; however, the pandemic has caused some delays in advancing or implementing regulations. Advancing action on transport regulations has also been marred by uncertainty due to the recent rollbacks in the USA on fuel economy standards for cars and light-duty trucks, to which Canadian standards are aligned.

As a founding member of the Powering Past Coal Alliance, Canada came under fire recently for its hypocritical stance on coal mining. The Minister of Environment and Climate Change declined to subject a coal mine expansion to a federal environmental impact assessment last year, though he reversed his decision in July. The Alliance is committed to phasing out coal-fired electricity in the OECD by 2030 and globally by 2050 (though our research shows that it is a decade too late). The coal from this mining project would be exported to Asia to power its electricity consumption.

The exodus of companies and investors from the oil sands projects continue. French energy giant, Total, wrote down two of its assets as ‘stranded’, withdrew from a leading industry advocacy group over divergent public positions, and halted any further increase in capacity of its existing assets, while Deutsche Bank announced it would no longer provide financing for oil sands projects.

Canada continues to expand its LNG production and anticipates exporting large quantities of LNG beginning in 2024 through to 2040. In early 2020, renewed protests by Indigenous groups over the construction of a natural gas pipeline on their territory led to solidarity protests and blockages across the country and were linked to Berkshire Hathaway’s decision to pull out of investing in an LNG facility in another part of the country.

In 2019, Canada adopted a 2050 target of net zero emissions; however, it has yet to enshrine that target into law or release a plan to achieve it.