Climate change

Appearance before the Standing Committee on Environment and Sustainable Development – May 12, 2021

Adaptation

Issue

• Canadians are seeing the consequences of climate change first-hand through an increase in extreme weather events resulting in flooding and wildfires, as well as slow-onset changes such as permafrost thaw and sea-level rise.

Points to register

• Climate impacts pose major risks to Canadians’ health and well-being, the economy, communities and the natural environment.
• As climate impacts continue to outpace action the government recognizes that a more ambitious, strategic and collaborative approach is required to adapt and build resilience to the changing climate.
• As a result, the federal government has committed to developing Canada’s first-ever National Adaptation Strategy, working with provincial, territorial and municipal governments, Indigenous peoples, and other key partners.
• The federal government is also continuing to take direct action to support climate resilience.
• Federal budgets in 2016 and 2017 invested nearly $700 million in a broad adaptation program suite designed to build resilience in communities across Canada by increasing awareness of climate impacts, strengthening the capacity for action, and supporting on-the-ground projects. Budget 2021 proposes additional funding to strengthen climate resiliency through targeted measures, for example to address wildfires and flooding.
• Environment and Climate Change Canada programs are directly supporting Canadians and their communities in building climate resilience. For example:
  • The Canadian Centre for Climate Services provides Canadians with the information, tools, and support they need to consider climate change in their decisions.
  • The $206-million Climate Action and Awareness Fund is supporting innovative projects that raise awareness, incent behavioural change, and build capacity for climate change action across Canada.
  • The EcoAction Community Funding Program is providing up to $3-million per year to support local, action-based projects that produce positive environmental outcomes including the use of natural infrastructure to improve freshwater management and climate resilience.
• In 2018, the federal government launched the $2-billion Disaster Mitigation and Adaptation Fund to invest in the infrastructure required to build resilience to the effects of a changing climate—the most significant commitment in adaptation made by the federal government to date. Following this initial investment, Budget 2021 proposes to provide $1.4 billion over 12 years to top up the Disaster Mitigation and Adaptation Fund.
• In addition to these targeted programs, the federal government is supporting climate resilience through broader initiatives including $26.9 billion in green infrastructure funding and $3.9 billion in nature-based climate solutions.

Background/current status

• Recognizing the importance of preparing for the impacts of climate change, Climate Change Adaptation and Resilience is one of the four pillars of the Pan-Canadian Framework on Clean Growth and Climate Change (PCF).
• The federal government made significant investments in climate change adaptation and resilience in Budget 2016 and Budget 2017. In 2016, the Government of Canada strengthened its domestic climate change adaptation funding with an investment of $129.5 million to seven federal departments and agencies for a suite of programs related to science, health, northern and Indigenous communities, and key economic sectors; $40 million for Canada’s National Research Council to develop climate-resilient building design guides and codes; and $75 million for the Federation of Canadian Municipalities, part of which will support climate risk assessment and planning in communities.
• In Budget 2017, the federal government committed an additional $441 million for a suite of 12 federal adaptation programs focused on information and capacity building, climate-resilient infrastructure, human health and well-being, vulnerable regions, and climate-related hazards and disaster risks. This included providing funding to support Indigenous peoples in the design, implementation and expansion of long-term community-based climate monitoring projects through the Indigenous Community-Based Climate Monitoring Program.
• Since 2017, there have been several key developments to support the PCF commitment to translate scientific information into action, including the release of Canada’s Changing Climate Report and the launch of a new climate data portal (climatedata.ca) by the Canadian Centre for Climate Services.
• Resilient infrastructure was identified by federal, provincial and territorial officials as a priority area of action under the adaptation pillar of the Pan-Canadian Framework. In response, the federal government launched in 2018 the Disaster Mitigation and Adaptation Fund, a 10-year national program investing $2 billion in public infrastructure to mitigate the potential economic, environmental and social impacts of climate change, and to strengthen our resilience to disasters triggered by natural hazards and extreme weather events.
• The federal government is working with provincial and territorial governments to help Canadians adapt to the impacts of climate change, including through the Federal-Provincial-Territorial Adaptation Policy Committee under the Canadian Council of Ministers of the Environment.
• The federal government has also demonstrated international leadership on adaptation as a convening nation and funding member of the Global Commission on Adaptation (2018-2020), which raised the profile of adaptation and catalyzed concrete solutions.
• Moving forward, under the recently released strengthened climate plan, the Government of Canada has committed to develop a National Adaptation Strategy to build on the successes of the PCF and create a more ambitious, strategic, and collaborative approach to adaptation.
  • The strategy will be developed working with provincial, territorial and municipal governments, Indigenous peoples, and other key partners (e.g. youth and private sector).
  • The strategy will establish a shared vision for climate resilience in Canada; identify key priorities for increased collaboration; and establish a framework for measuring progress at the national level.
  • The next step is to launch engagement on the strategy with key partners via a forum this spring.
• Continuing momentum on the international stage, the federal government will collaborate on adaptation with the U.S. under the U.S.—Canada High-Level Ministerial Dialogue on Climate Ambition.

Arctic Research

Issue

• Environment and Climate Change Canada (ECCC) conducts leading-edge research and monitoring in the North. This knowledge is used to better understand and protect our environment in this region, and is also fundamental to the protection of our Arctic sovereignty in a world that is increasingly interested in Canada’s newly opening Arctic.

Points to register

• The Canadian arctic has fragile ecosystems and, in addition, is disproportionately affected by climate change.
• The Arctic is also affected by the global atmospheric long-range transport of pollutants such as mercury.
• ECCC’s northern science activities are essential to support weather services, climate change adaptation, protection from contaminants, and responsible resource development, among many other priorities.
• ECCC science activities in the North include on-the-ground research to generate new knowledge on the northern environment and monitoring programs through regular collection and dissemination of high quality scientific data.
• ECCC works closely with Inuit and local communities to enhance scientific knowledge and learn from local knowledge keepers supporting Indigenous-led science.
  • For instance, ECCC’s Inuit Field Training Program aims to expose young Inuit to life and work in a northern research camp providing reciprocal engagement and help them consider their employment in environmental fields.
• ECCC has over 100 research sites and over 200 monitoring sites that generate important information to understand the unique and changing nature of ecosystems in the North.

Background/current status

Examples of Arctic research and monitoring

• Biodiversity – ECCC conducts research and monitoring to examine the implications of climate change and other environmental stressors on biodiversity including Species at Risk and Migratory Birds. Examples of activities include: the Peary Caribou Research Program, the Polar Bear Research Program, the Sea Ice Research Program and the Arctic Migratory Birds Research Program. These programs provide insight into the overall health of biodiversity within the Arctic ecosystem.
• Climate Change – ECCC conducts research and monitoring to understand the impacts of climate change on the Arctic and the effect those changes have on global climate including in the areas of: Freshwater Systems Research, Cryosphere Research, Arctic Atmospheric Monitoring, and Climate Modelling and Scenarios.
• Pollutants – ECCC activities on Arctic pollutants fall under the Northern Contaminants Program (NCP), a multidisciplinary initiative funded by the Government of Canada that addresses health, science, and communications issues related to contaminants in Canada's Arctic. A multi-media and food web & food sources approach is used (e.g. fresh and marine waters, fish species, seals, caribou).
• Supporting Emergency Preparedness – ECCC supports environmental emergency preparedness and response. This is important as ship traffic and industrial activities in the Arctic are increasing as a result of the climate change-driven sea ice reduction.
• Atmospheric Science (Observation and Research) – ECCC conducts leading edge environmental research and monitoring in the Arctic, yielding improvements in the following areas:
  • Understanding of the atmosphere, including the state of the ozone layer, the impacts to air quality from northern development, global transport and deposition of pollutants and their interactions with the oceans, ice and biosphere;
  • Weather and environmental forecast systems including hazardous weather warnings that serve Canadians and the Canadian economy (e.g. service and natural resource industries, such as transportation and energy);
    • This includes routine operation and maintenance of atmospheric monitoring stations across the Arctic including upper air stations where staff release radiosondes, which are released twice daily and carried aloft by a weather balloon, automated surface weather stations and the Polar Orbiting Environmental Satellite (POES) receiving station in Resolute Bay, NU;
  • Chemicals management measures including risk assessment and risk management;
  • ECCC is also working closely with the Canadian Space Agency to advance a Canada-led international satellite mission concept that will collect frequent observations of weather variables, greenhouse gases, air quality and space weather over the Arctic. This proposed mission has garnered significant interest from international partners including the U.S. National Oceanographic and Atmospheric Administration (NOAA) and National Aeronautics and Space Administration (NASA) who recognize the value of the mission to fill a critical observation gap over high latitudes.
• ECCC Science Facilities – Foundational weather and atmospheric research and monitoring activities are conducted at numerous sites and research stations including: the Dr. Neil Trivett World Meteorological Organization Global Atmospheric Watch Observatory in Alert (NU); the Eureka (NU) weather station, which serves as the third-northernmost permanent research community in the world supporting scientists from ECCC, OGD’s and academia. In particular, it is a vital site for ECCC's upper air and surface weather programs and also the home of the the Polar Environment Atmosphere Research Laboratory Ridge Laboratory; and sites at Resolute Bay (NU) and Cambridge Bay (NU). Wildlife research stations operate throughout Nunavut, most notably the research station in Pond Inlet that supports multi-disciplinary and community-based programs.
  • On April 5, a fire destroyed the operations building at the Iqaluit Upper Air Weather Station that has reduced the department’s ability to sustain upper air operations, which are necessary for understanding weather patterns in the Arctic Region. However, ECCC uses millions of observations every day from a variety of sources including nearby upper air sites, satellite data, aircraft, and so on. These diverse datasets should limit any impact on forecast quality due to the temporary loss of the Iqaluit station. Efforts are now underway to assess the station and ECCC will take all reasonable steps to establish a temporary Upper Air Monitoring Station in Iqaluit as soon as possible.

Impacts of climate change in the Arctic

• Annual mean temperature in northern Canada has increased at roughly three times the global average rate. This pattern of amplified northern warming will continue.
• Sea ice has diminished across Canada’s Arctic. Extensive sea ice-free periods are projected by mid-century for the Canadian Arctic and Hudson Bay. Persistent sea ice drifting from the northern Canadian Arctic Archipelago into the Northwest Passage will still present navigation hazards.
• Freshwater ice cover duration has decreased for most Arctic lakes. Many small ice caps and ice shelves are expected to disappear by 2100. Continued warming and thawing of permafrost is projected with implications for infrastructure, streamflow and lake levels.
• Sea level is projected to rise in the Beaufort Sea coastal area. Most regions of Nunavut will experience little change or declining sea level due to land uplift.

Examples of how the impacts of climate change are affecting Northerners

• Changes to Canada’s Arctic climate have resulted in a variety of impacts on northern ecosystems including the wildlife that Inuit rely on for subsistence hunting. For example, it has been shown that there is a strong link between sea ice dynamics (timing of spring break-up and fall freeze-up, ice concentrations, ice extent) and Polar Bear population dynamics.
• Longer ice-free seasons in the summer have also been shown to increase the risk to breeding Eider Ducks (a species hunted by Inuit in the North) of having their nests eaten by Polar Bears. This is an attempt by Polar Bears to supplement their diet with terrestrial food such as eggs when sea ice is not available to use as a platform to hunt seals.
• Severe weather events, including rain-on-snow events and icing events, have increased as a result of climate change and are linked to the decline of Peary Caribou, the most northern species of Caribou in Canada. As rain turns the snow to ice, Caribou cannot access the vegetation under the snow upon which they rely on for food.
• Changes in the timing of the annual sea ice breakup results in a shift in prey seal species for Polar Bears in Hudson Bay. This has contributed to increased concentrations of contaminants found in Polar Bear tissue, including several legacy and emerging Persistent Organic Pollutants. These findings have implications for the health of Polar Bears but also for the communities that hunt them.

Canada’s Nationally Determined Contribution

Issue

• Canada announced an enhanced 2030 greenhouse gas emissions target of 40-45% below 2005 levels.

Points to register

• Canada and other countries around the world need to do more to address climate change, and on a faster timeline. The science is clear that existing efforts put the world on a path to catastrophic climate change.
• Canada has made significant progress to address climate change, and with the release of A Healthy Environment and a Healthy Economy in December 2020 the Government of Canada announced a number of new actions and new investments to further reduce greenhouse gas emissions.
• The measures announced in Canada’s strengthened climate plan will bring Canada’s 2030 emissions to at least 31% below 2005 levels, slightly exceeding Canada’s original 2030 target to reduce emissions by 30% below 2005 levels.
• Like other countries, we need to continue to build a sustainable and resilient economy and reduce emissions year over year. This is why Canada is committing to a new 2030 target of 40-45% below 2005 levels.
• Since the launch of Canada’s strengthened climate plan the Government of Canada has been consulting with provinces, territories, Indigenous organizations, industry and the public on strengthened climate plan measures and new potential climate measures.
• Like many other countries that have set ambitious new emission reductions targets, such as those within the European Union, as well as the United Kingdom and the United States, Canada will work to flesh out a plan to achieve its new target.
• The investments made in Budget 2021, along with other action including strenghtend alignment with the United States to further cut pollution, mean that Canada is now positioned to reduce emissions by about 36% below 2005 levels by 2030.
• The Government of Canada is committed to working with provinces and territories to advance shared priorities that will further lower emissions, including on a regional and bilateral basis. Additional federal, provincial and territorial measures will build on the progress that currently proposed federal measures will achieve leading to further emission reductions.
• Canada and the U.S. have forged a renewed bilateral relationship with cooperation on climate change as a key priority. This includes taking a continental approach to addressing methane emissions reductions in the oil and gas sectors, standards for light-duty and heavy-duty vehicles, and setting a 100% zero-emissions vehicles sales target.
• The Government of Canada will also continue to partner with First Nations, Inuit, and the Métis Nation to advance Indigenous climate leadership and ensure that federal policies and programs are designed to address Indigenous peoples’ climate priorities.
• Canada also remains committed to reaching net-zero emissions by 2050. Bill C-12, the Canadian Net Zero Emissions Accountability Act will set legally binding, five-year emissions reduction milestones as a key component of our plan to achieve a net-zero emissions economy by 2050.
• In summer 2021 Canada will formally submit its new Nationally Determined Contribution to the United Nations Framework Commission on Climate Change through a Nationally Determined Contribution Submission.
• The Government of Canada will continue to assess and report on progress towards Canada’s climate goals.

Background/current status

• As part of the Paris Agreement, all Parties committed to submitting GHG emission reduction targets (referred to as Nationally Determined Contributions or NDCs). An NDC embodies the efforts each country pledged to take as its contribution to the Paris Agreement’s goals – including GHG reduction targets. Canada’s original NDC was to reduce 2030 emissions to 30% below 2050 levels. Canada submitted its original NDC in 2015, and then re-communicated an updated NDC submission in 2017 to highlight the significant new actions under the Pan-Canadian Framework on Clean Growth and Climate Change that would put Canada on a path to meet its target.
• Canada’s original NDC was comparable in stringency to other developed countries’ NDCs when it was published in 2015. In 2018, scientific assessments conducted by the Intergovernmental Panel on Climate change (IPCC) concluded that Parties’ first NDCs to reduce GHGs fell significantly short of achieving the temperature goal of the Paris Agreement with global warming projected to exceed 2°C and projected to reach 3°C by 2100. The IPCC’s Special Report on Global Warming of 1.5°C indicates that, in most scenarios where warming is limited to 1.5°C, global CO₂ emissions in 2030 need to reach 45% below 2010 levels and non-CO₂ emissions need to decrease by about 25% below 2010 levels by 2030, and reach net-zero emissions around 2050.
• The acknowledgement that initial NDCs were incompatible with the temperature goals of the Paris Agreement has led to a global call for all countries to set and work towards more stringent NDCs. As of December 2020, 75 countries (including the 27 EU countries), representing 28.3% of global emissions have submitted a new or enhanced NDC. For example, the European Union and its member states have enhanced their NDC to be a 55% reduction below 1990 levels (equivalent to 51.5% below 2005 levels in 2030) and the United Kingdom has enhanced its NDC to be a 68% reduction below 1990 levels (equivalent to a 63.3% reduction below 2005 levels). A February 2021 Synthesis Report by the United Nations Framework Convention on Climate Change concluded that, even with some countries announcing a more stringent target, the world was still not on track to meet the Paris Agreement goals.
• President Biden urged countries to bring forward enhanced 2030 emissions targets by the April 22-23, 2021, Leaders’ Climate Summit, above 40% below 2005 levels. At the Summit, President Biden announced a 2030 emissions target of 50-52% below 2005 levels and Prime Minister Trudeau announced an enhanced 2030 emissions target of 40-45% below 2005 levels.
• In December 2020 the Government of Canada released A Healthy Environment and A Healthy Economy, Canada’s Strengthened Climate Plan (SCP). The plan included 64 new or strengthened federal measures across all sectors of the economy, with $15 billion in new investments. Full implementation and funding of measures in the SCP, together with existing federal-provincial-territorial actions including those in the Pan-Canadian Framework, would bring Canada’s 2030 emissions to at least 31% below 2005 levels. Through the SCP, Canada now has the second strongest price on carbon in the world, and has indicated its intent to tighten key regulations including those for methane and vehicles, to introduce new regulations for landfill gas, as well as to explore the development of a Clean Electricity Standard.
• Budget 2021 annouced $17.6 billion in investments and new tax changes to create jobs, build a clean economy, and fight and protect against climate change. The new measures annouced in Budget 2021, along with other actions including strengthened alignment with the United States to further cut pollution from transportation and methane emissions, mean that Canada is now positioned to reduce emissions by about 36% below 2005 levels by 2030.
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Canada’s Strengthened Climate Plan – A Healthy Environment and a Healthy Economy

Issue

• On December 11, 2020, the Government announced A Healthy Environment and a Healthy Economy – Canada’s strengthened climate plan of federal policies, programs; and $15 billion in investments to accelerate the fight against climate change, create good new jobs, make life more affordable for households, and build a better future. The plan includes steps to:
  • Make the places Canadians live and gather more affordable by cutting energy waste;
  • Make clean, affordable transportation and power available in every Canadian community;
  • Continue to ensure that pollution isn’t free and that households get more money back;
  • Build Canada’s clean industrial advantage; and,
  • Embrace the power of nature to support healthier families and more resilient communities.

Points to register

• A Healthy Environment and a Healthy Economy builds on the important achievements and work underway to implement the 2016 Pan-Canadian Framework on Clean Growth and Climate Change, in collaboration with provinces, territories, and Indigenous peoples.
• Taken together with the Pan Canadian Framework, A Heathy Environment and a Healthy Economy will allow Canada to reduce greenhouse gas emissions by at least 31% below 2005 level by 2030.
• The investments made in Budget 2021, along with other action including strengthened alignment with the United States to further cut pollution from transportation and methane emissions, mean that Canada is now positioned to reduce emissions by about 36% below 2005 levels by 2030.
• With less than a decade left to 2030, and with countries around the world quickly moving to a cleaner economy, Canada’s new target of reducing emissions by 40-45%, below 2005 levels is ambitious, required and achievable – reflecting both the scale of the climate crisis and economic opportunity that climate action presents.
• The Government of Canada continues to engage with provinces, territories, First Nations, Inuit and Métis people, stakeholders, civil society on enabling a healthier economy and environment. We are working together to implement the Pan-Canadian Framework to ensure A Healthy Economy and a Healthy Environment is a strong workable plan that can be delivered together, and on collectively increasing climate ambition.
• Since the Strengthened Climate Plan was released the Government of Canada has:
  • Proposed in Budget 2021, $17.6 billion in additional investments towards a green recovery to create well-paying middle class jobs, build a clean economy and fight to protect against climate change.
  • Announced the Growing Canada’s Forest Commitment as the next step of the Government’s commitment to plant two billion trees.
  • Launched the first phase of new Agricultural Climate Solutions Program with $185 million over the next 10 years to support the development of proposals focused on regional collaboration hubs.
  • Announced $14.9 billion for public transit projects over the next eight years, which includes permanent funding of $3 billion per year for Canadian communities beginning in 2026-27.
  • Launched the updated Greening Government Strategy to transition to net-zero carbon and climate-resilient operations, while also reducing environmental impacts beyond carbon including on waste, water and biodiversity.
  • Released the Hydrogen Strategy for Canada that outlines a framework for Hydrogen to become a key tool in enabling Canada to achieve a prosperous net-zero emissions future.
  • Launched Canada’s Small Modular Reactor Action Plan containing over 50 recommendations to advance this technology.

Background/current status

Examples of new and strengthened measures

Buildings

• $2.6 billion over seven years to help homeowners make their homes more energy efficient. This funding will provide grants of up to $5,000, up to one million free EnerGuide assessments, and support to recruit and train EnerGuide auditors.
• $1.5 billion over three years for green and inclusive community buildings, and requiring that at least 10 per cent of this funding be allocated to projects serving First Nations, Inuit and Métis communities.
• Accelerating work with provincial and territorial governments to develop and adopt increasingly stringent model codes with the ultimate goal of a net-zero energy ready model building code by 2030.
• Budget 2021 proposes $4.4 billion to help homeowners complete deep home retrofits through interest-free loans worth up to $40,000.

Transportation

• Additional $287 million over two years to continue the Incentives for Zero-Emission Vehicles (iZEV) program until March 2022.
• Additional $150 million over three years for charging and refueling stations across Canada.
• Working with partners in the year ahead on supply-side policy options to achieve additional reductions from Canada’s light-duty vehicle fleet, including regulations and investments to accelerate and expand the consumer availability of ZEVs in Canada as demand grows.
• Launched a national active transportation strategy, including $400 million for Canada’s first active transporation fund, to deliver more active transportation options such as walking trails, cycling paths and other forms of active mobility.

Electricity

• Additional $964 million over four years to advance smart renewable energy and grid modernization projects.
• Additional $300 million over five years to advance the government’s commitment to ensure rural, remote, and Indigenous communities that currently rely on diesel, have the opportunity to be powered by clean, reliable energy by 2030.
• Working with provinces and territories to help build key intertie projects with support from the Canada Infrastructure Bank.
• Working with provinces, territories, utilities, industry and interested Canadians to ensure that Canada’s electricity generation achieves net-zero emissions before 2050. The Government of Canada will explore the role of a clean electricity performance standard in the context of the full set of measures in place and proposed by this plan.

Carbon Pricing

• Federal proposal to increase the carbon price through to 2030, increasing $15/t each year starting in 2023 to $170 in 2030.
• Provinces and territories will continue to have flexibility to implement their own systems, aligned with minimum national stringency standards (federal benchmark).
• To ensure carbon pricing systems are fair and effective, also propose to strengthen the minimum national criteria each system has to meet (federal benchmark). This will help ensure consistent coverage of GHG emissions, provide more stability over time (e.g. through multi-year assessments), and ensure all systems provide a strong incentive to reduce emissions and spur innovation.
• The federal pollution pricing system will remain revenue neutral – all direct proceeds will be returned to the jurisdiction of origin. The federal government is committed to ensuring that the price on pollution remains affordable, and helping households and businesses to increase energy efficiency and reduce emissions.
• In the provinces where the federal price on carbon pollution is in effect, the Government of Canada returns most of the fuel charge proceeds directly to families through Climate Action Incentive Payments, currently delivered through annual tax returns. In order to maintain the incentive to reduce emissions, the amount returned to households is not related to the costs they incur due to the federal carbon pricing system.

Clean Industry

• Launching a Net-Zero Challenge for large emitters to support Canadian industries in developing and implementing plans to transition their facilities to net-zero emissions by 2050.
• $3 billion over five years for the Strategic Innovation Fund’s Net-Zero Accelerator Fund to support decarbonization and create jobs, in complement to the Challenge. Budget 2021 proposes to provide an additional $5 billion over seven years to the Net-Zero Accelerator, totalling $8 billion of support to projects that will help reduce domestic greenhouse gas emissions across the economy.
• $165.7 million over seven years to support the agriculture industry in developing transformative clean technologies and help farmers adopt commercially available clean technology.
• Setting a national emission reduction target of 30% below 2020 levels from fertilizers and work with fertilizer manufacturers, farmers, provinces and territories, to develop an approach to meet it.
• Developing new federal regulations to increase the number of landfills that collect and treat their methane, and ensure that landfills already operating these systems make improvements to collect all they can.
• Additional $750 million over 5 years to recapitalize Sustainable Development Technology Canada.
• Budget 2021 recognizes the importance carbon capture, utilization and storage (CCUS) for reducing emissions in high emitting sectors by: proposing to introduce an investment tax credit for capital invested in CCUS projects with the goal of reducing emissions by at least 15 megatonnes of CO2 annually; and, by proposing to invest $319 million over seven years to support research, development, and demonstrations that would improve the commercial viability of CCUS technologies.

Nature

• Up to $3.16 billion over 10 years to partner with provinces, territories, non-government organizations, Indigenous communities, municipalities, private landowners, and others to plant two billion trees.
• Up to $631 million over 10 years to work with provinces, territories, conservation organizations, Indigenous communities, private landowners, and others to restore and enhance wetlands, peatlands, grasslands and agricultural lands to boost carbon sequestration.
• $98.4 million over 10 years to establish a new Natural Climate Solutions for Agriculture Fund.

Adaptation

• Developing Canada’s first-ever national adaptation strategy, working with provincial, territorial and municipal governments, Indigenous peoples, and other key partners.

Indigenous Partnership

• Co-developing, on a distinction basis, an Indigenous Climate Leadership Agenda which builds regional and national capacity and progressively vests authorities and resources for climate action in the National Indigenous Organizations and Representatives (NIORs).
• Working with First Nations, Inuit and Métis peoples to co-develop decision-making guidance that will ensure all of Canada’s future climate actions help advance Indigenous climate self-determination.
• Starting in 2020-21, triple the net fuel charge proceeds available to Indigenous governments in federal backstop jurisdictions. These proceeds will be returned through co-developed solutions.

Greening Government

• Updated the Greening Government Strategy to align with the new federal target to be net-zero emissions by 2050, and accelerating the interim target for federal facilities and conventional fleet to achieve a 40% reduction by 2025 (instead of 2030).
• Developing a climate lens to integrate climate considerations throughout government decision-making and explore options for its implementation. These considerations include both short and long-term climate mitigation, Indigenous climate leadership, as well as climate resilience and adaptation.
• Updating the Government of Canada’s social cost of carbon estimates to ensure Canada’s methodology aligns with the best international climate science and economic modelling.

Net-Zero 2050 Commitments

Canadian Net-Zero Emissions Accountability Act

• The proposed Canadian Net-Zero Emissions Accountability Act (Bill C-12) will require the Government of Canada to set national emissions reduction targets based on best available science at five-year intervals for 2030, 2035, 2040, and 2045, and require the government to develop emission reduction plans for each target as well as explain how each plan will contribute to reaching net-zero in 2050.
• Bill C-12 will also require that the Government of Canada table the first emissions reduction plan within 6 months of the coming into force of the Act, which will be well before 2030. It will also ensure that the government provides an update on progress toward achieving the 2030 target at least two years prior to 2030.
• As part of its suite of accountability and transparency mechanisms, the Act will also require Canada’s Commissioner of the Environment and Sustainable Development to examine and report on implementation of the measures intended to achieve the target at least once every five years.
• The reporting under Bill C-12 will complement Canada’s reporting obligations to the United Nations Framework Convention on Climate Change (UNFCCC). These include the annual submission of a National Inventory Report detailing Canada’s greenhouse gas emissions for every year dating back to 1990. Under the United Nations Framework Convention on Climate Change, Canada also submits a Biennial Report every two years and a National Communication Report every four years. These reports provide extensive information on Canada’s actions to address climate change and projections of Canada’s future emissions.

Net-Zero Advisory Body

• The Act also establishes an advisory body to provide independent advice to the government and conduct engagement on optimal pathways to achieve net-zero emissions by 2050.
• The Net-Zero Advisory Body (NZAB), launched on February 25, 2021, will follow a transparent and inclusive process to engage with government and hear from provinces, territories, Indigenous peoples, youth, businesses, environmental groups, and interested Canadians.
• Some of the Advisory Body’s work will include:
  • advice on the most likely pathways for Canada to achieve net-zero emissions, including advice on emissions reductions milestones leading up to 2050;
  • identification of next steps in the years ahead to fight climate change and reach net-zero emissions that will grow the economy, while also making life more affordable; and,
  • helping to mobilize stakeholders and other Canadians to take action towards the government’s goal of Canada reaching net-zero emissions by 2050.
• Seeking expert advice on charting Canada’s path to net-zero emissions by 2050 remains critical to the government’s work. The Advisory Body will provide ongoing advice to the Minister as Canada develops and implements its emission reduction plans. This is an important requirement of the Canadian Net-Zero Emissions Accountability Act.
• The NZAB is inspired by international best practices but designed specifically for Canada’s unique considerations and needs including the importance of traditional resource economy and shared jurisdiction on environment.

Carbon Pollution Pricing – Supreme Court of Canada Decision

Issue

• On March 25, 2021, the Supreme Court of Canada ruled that the Greenhouse Gas Pollution Pricing Act (GGPPA) is constitutional. A strong majority (6-3) upheld the Act as constitutional under Parliament’s power to legislate for peace, order, and good government (POGG).

Points to register

• The majority of the SCC opined that the entire Act is constitutional as a valid exercise of Parliament’s POGG power to legislate minimum national standards of GHG price stringency to reduce GHG emissions.
• The majority further opined that the fuel charge and the excess emissions charge imposed under the GGPPA are valid regulatory charges, not taxes.
• This outcome allows the Government of Canada to proceed with its climate plan, including strengthening the Benchmark criteria to ensure continuing increasing stringency of carbon pricing throughout Canada.
• In a partial dissent, Justice Côté agreed with the majority that Parliament has the authority under POGG to legislate minimum national standards of GHG price stringency. However, she found that the GGPPA, as drafted, was unconstitutional because it vested too much discretion in the government.
• Justices Brown and Rowe each provided their own dissenting reasons, although each agreed substantially that the GGPPA is unconstitutional, as it falls squarely within provincial jurisdiction.

Background/current status

• Carbon pricing is a central component of the Pan-Canadian Framework (PCF) and Canada’s strengthened climate plan, A Healthy Environment and A Healthy Economy.
• The GGPPA became law in June 2018. It ensures that sufficiently stringent carbon pricing systems apply throughout Canada.
• The GGPPA implements a federal carbon pricing system that applies fully or partially as a backstop in provinces and territories that request it, have no carbon pricing system of their own, or that have a system that does not meet the federal Benchmark stringency criteria.
• Since 2019 every jurisdiction in Canada has had a price on carbon pollution. Canada’s approach is flexible: any province or territory can design its own pricing system tailored to local needs, or can choose the federal pricing system.
• The federal government sets minimum national stringency standards (the Benchmark) that all systems must meet to ensure they are comparable and contribute their fair share to reducing greenhouse gas emissions. If a province decides not to price carbon, or proposes a system that does not meet these standards, the federal pricing system is put in place.
• The GGPPA has two parts:
  • Part 1: a regulatory charge on fossil fuels (applies in ON, MB, YK, AB, SK and NU)
  • Part 2: a regulatory trading system for industry known as the Output-Based Pricing System (OBPS) (in ON*, NB*, MB, PEI, YK, NU and partially in SK)
    • *ON & NB to transition to provincial pricing systems for industry in the coming months (timing TBD)
• Summary of GGPPA court challenges
  • Three provincial references:
    • GGPPA was upheld by SK and ON Courts of Appeal but not by AB’s,
    • Three appeals to the Supreme Court of Canada were heard jointly in September 2020;
  • A judicial review application:
    • MB challenged both the constitutionality of the GGPPA and the Governor-in Council’s decision to apply the fuel charge in MB,
    • The application was heard by the Federal Court in December 2020 and the decision is expected within a few months.

Clean Fuel Standard

Issue

• ECCC is developing a CFS to reduce the lifecycle carbon intensity of liquid fossil fuels.

Points to register

• The CFS will:
  • reduce the emissions associated with the production, delivery and use of fuels.
  • help cut more than 20 MT of emissions in 2030.
  • create incentives to use less-intensive fuels, drive innovation in the oil and gas sector, and encourage increased production of clean fuels in Canada.
• The CFS will target liquid fossil fuels like gasoline and diesel that are used mostly in transportation, and to a lesser extent in buildings and industry.
• Why does the CFS no longer include a gaseous or solids stream?
  • re-scoped to only liquid fuels because SCP proposes to increase the price on carbon.
• Who has been consulted on the proposed CFS?
  • extensive consultations.
  • also learning from California and B.C. that have already implemented similar measures.
• Implications of the CFS on households that rely largely on home heating oil? What is being done to offset these impacts?
  • working with other departments and provinces while we consider how this may be addressed.
• How will the $1.5B for a Low-carbon and Zero-emissions Fuels Fund impact the CFS?
  • will support the production and use of low-carbon fuels (e.g., hydrogen, renewable natural gas and diesel) in Canada, while the CFS will incentivize the industry to invest in these fuels as a means of complying with the regulation.
  • together these measures will work together to grow the clean fuels market in Canada.

Background/current status

• On December 18, 2020, ECCC published proposed regulations initiating a 75-day comment period that ended on March 4, 2021.
  • final regulations expected fall 2021.
  • reduction requirements to come into force in December 2022.
• Will reduce GHGs, mostly from transportation, which accounts for 25% of total emissions.
• The CFS will promote investments in low carbon fuels and low carbon technologies. This will:
  • drive innovation and create conditions for jobs across multiple sectors including clean tech and low carbon energy sectors such as biofuels and hydrogen;
  • grow Canada’s clean fuels industry at a time when the global market is expanding; and
  • create opportunities for industries that are producing renewable fuels, and promote faster growth of zero-emission vehicles.
• ECCC made a number of changes in the design of the CFS to better support oil & gas sector.
  • narrowed the coverage of the CFS to liquid fuels only. This means natural gas will not face a regulatory obligation and there will be no natural gas price increases due to the CFS.
  • less stringent in the years immediately following its implementation and provided more time between the final regulations and the coming-into-force of the regulatory requirement. This means more lead-time for investments.
  • introduced a generic quantification method for oil and gas GHG reduction projects with a streamlined assessment process.
  • extended the initial crediting period for projects from 5 to 10 years (from 10 to 20 for CCS). This will increase certainty for investors.

Climate change programs

Carbon Pollution Pricing

Issue

• Since 2019 every jurisdiction in Canada has had a price on carbon pollution and all proceeds from the federal system are returned to the jurisdiction of origin.

Points to register

• Carbon pricing is an effective and essential part of any serious response to the global challenge of climate change.
• Since 2019 every jurisdiction in Canada has had a price on carbon pollution.
• Canada’s approach is flexible: any province or territory can design its own pricing system tailored to local needs, or can choose the federal pricing system.
• The federal government sets minimum national stringency standards that all systems must meet to ensure they are comparable and contribute their fair share to reducing greenhouse gas emissions.
• If a province decides not to price pollution, or proposes a system that does not meet these standards, the federal system is put in place as a backstop.
• All proceeds from the federal system are returned to the jurisdiction of origin, this includes those collected in 2019-20 and the same will continue to be true for carbon pollution proceeds from subsequent fiscal years.

Background/current status

• Carbon pricing is a central component of the Pan-Canadian Framework (PCF) and Canada’s strengthened climate plan, A Healthy Environment and A Healthy Economy.
• When the Government of Canada introduced a price on carbon pollution across Canada in 2019, Quebec, British Columbia and Alberta already had carbon pricing systems. Since then many of the other provinces and territories have introduced their own carbon pollution pricing systems. They use the proceeds from their systems as they see fit.
• The federal carbon pollution pricing system applies in provinces and territories that requested it or did not have a pricing system that met the minimum federal stringency requirements.
• The federal system has two parts: a regulatory charge on fossil fuels and a regulatory trading system for industry, the Output-Based Pricing System (OBPS).
• Those governments that opted for the federal pricing system receive all the proceeds back directly and decide how to reinvest them.

Return of proceeds from the fuel charge

• In the remaining provinces in 2019-20, where the federal carbon pollution pricing system is in effect, the vast majority of proceeds from the fuel charge flowed directly back to individuals in Ontario, Manitoba, New Brunswick and Saskatchewan through Climate Action Incentive Payments. The Government of Canada applied an additional top-up to Climate Action Incentive Payments for Canadians who live in rural and smaller centres.
• The remainder of fuel charge proceeds in 2019-20 were to be returned via programming to support small and medium-sized businesses (SMEs), Indigenous peoples, and other recipients reduce energy use, costs, and greenhouse gas emissions.
• Environment and Climate Change Canada (ECCC) is returning a portion of carbon pollution proceeds from 2019-20 to SMEs and to support projects in schools under the Climate Action Incentive Fund (CAIF). These projects reduce energy use and greenhouse gas emissions, and save money.
  • Under the SME Project stream of the Climate Action Incentive Fund, over 700 project proposals were approved-in-principle ranging from solar energy generation, building retrofits, industrial equipment upgrades, and lighting upgrades that include:
    • Installing a solar power system at a grain farm in Saskatchewan;
    • Installing new windows, doors, insulation, and heat pumps at a commercial building in New Brunswick;
    • Replacing an old, inefficient grain dryer at a family operated farm in Ontario; and,
    • Installing building retrofits including LED lighting fixtures at a storage facility in Manitoba.
  • Also with funding from the CAIF, school boards in the provinces have been able to upgrade and improve aging infrastructure in schools. Through investments in better-insulated windows, newer heating and cooling systems and other energy efficiency projects, these projects can contribute to improved indoor air quality in classrooms, for students and teachers alike, as well as making them more comfortable while lowering energy costs.
• Some of the 2019-20 fuel charge proceeds is being returned to jurisdictions of origin through other federal programming:
  • Crown-Indigenous Relations and Northern Affairs Canada’s Indigenous Community-Based Climate Monitoring Program;
  • Indigenous Services Canada’s Capital Facilities and Maintenance Program /First Nations Infrastructure Fund; and,
  • Natural Resources Canada’s Clean Energy for Rural and Remote Communities Program, and Energy Manager Program.
• The Government of Canada will return all direct fuel charge proceeds from 2019-20 to the jurisdiction of origin and the same will continue to be true for carbon pollution proceeds from subsequent fiscal years.
• There are efforts being made across the Government of Canada related to the next phase of climate actions, including those associated with the strengthened climate plan -- A Healthy Environment and a Healthy Economy. This will require engagement, including with provinces and territories, as it relates to the return of carbon pollution proceeds.

Return of proceeds from the Output-Based Pricing System

• In the provinces where the federal Output-Based Pricing System (OBPS) is in effect, proceeds collected from the OBPS will be used for industry to further support industrial projects to cut emissions and use new cleaner technologies and processes as part of the plan to decarbonize industrial sectors. These proceeds will start to be collected in the spring of 2021, after which the Government of Canada plans to launch a call for proposals to find the most promising projects across industries that will contribute greenhouse gas emissions reductions.

Reporting

• The first annual Greenhouse Gas Pollution Pricing Act Report to Parliament covered the general administration of the Act, including the implementation of the federal fuel charge and the Output-Based Pricing System from the coming into force of the Act in 2018 up to the end of 2019. A second annual report is under development and will be published later this year.

Climate Action Incentive Fund

Issue

• The Climate Action Incentive Fund (CAIF) is contributing to a decrease in planned spending for the 2021-22 Main Estimates.

Points to register

• CAIF sunsets in 2020-21. Program recipients had until March 31, 2021, to incur eligible expenses. For this reason there is a decrease of $109.1 million under CAIF for the 2021-22 Main Estimates.
• CAIF was allocated up to $218 million of 2019-20 carbon pollution proceeds funding to be spent over two fiscal years (2019-20 and 2020-21), and estimated spending for the funding per year was split across these two fiscal years.
• Environment and Climate Change Canada (ECCC) received $9.5 million for CAIF operating funding in 2019-20 and $9.2 million in 2020-21.
• Not all of the funding allocated to CAIF will be spent. All carbon pollution proceeds will be returned to jurisdictions of origin and reporting to the House of Commons will be done annually, as is required under the Greenhouse Gas Pollution Pricing Act.

Background/current status

• In October 2016 the Government of Canada announced the Pan-Canadian Approach to Pricing Carbon Pollution, which gave provinces and territories the flexibility to implement their own carbon pollution pricing systems, as long as they met minimum federal criteria. The federal government also committed to implementing a federal carbon pollution pricing system in provinces and territories that request it or do not have a carbon pollution pricing system that meets those criteria (backstop jurisdictions).
  • CAIF returned a portion of the proceeds collected from the federal carbon pollution pricing system to backstop jurisdictions (i.e. Saskatchewan, Manitoba, Ontario and New Brunswick).
  • The federal fuel charge came into effect on April 1, 2019, in Saskatchewan, Manitoba, Ontario and New Brunswick, and on January 1, 2020, in Alberta.
  • New Brunswick later adopted its own carbon pollution pricing system that meets the federal fuel charge benchmark, and the federal fuel charge no longer applied in that province as of April 1, 2020.
• The Government of Canada committed to return the majority of the direct proceeds collected from the federal fuel charge directly to individuals and families in those provinces through Climate Action Incentive Payments. The remainder of the proceeds were allocated to be distributed through federal programming such as CAIF.
• Carbon pollution proceeds for a portion of the fuel charge from 2019-20 are being returned to small and medium-sized enterprises (SMEs) and schools through CAIF. The objective of CAIF is to support eligible recipients by encouraging them to adopt clean technologies that will help reduce carbon pollution, energy usage and achieve cost savings.
  • ECCC has agreements in place with more than 400 SMEs to provide approximately $35 million, and with four provincial partners to provide over $60 million towards projects in schools.
• The SME Project stream of CAIF has supported energy efficiency projects in sectors such as buildings, transportation, industry, waste and agriculture, with projects such as energy efficient lighting improvements, upgraded heating and cooling systems, better-insulated windows, and renewable energy systems.
  • CAIF has helped SMEs be more productive and competitive as they reduce energy use, energy-related costs, and greenhouse gas (GHG) emissions directly benefitting their own competitiveness and indirectly all Canadians.
• Under the Municipalities, Universities, Schools and Hospitals (MUSH) Retrofit stream of CAIF, the Government of Canada identified schools as a priority recipient for 2019-20 carbon pollution fuel charge proceeds.
• Another stream of CAIF, the Rebate stream, was announced, but plans for implementation of this stream were not finalized since a third party to deliver the program was not secured. The stream was placed under reassessment and subsequently cancelled since it could not be delivered in the manner that had been envisioned.
• The process of returning 2019-20 proceeds was slowed by a number of factors including the Federal Election in fall 2019 and the associated implementation of the Caretaker Convention across the federal public service. Additional delays continue as a result of the COVID-19 pandemic. As is common with new programs, time was needed to establish elements such as IT infrastructure and key materials to support application, approval, agreement, and reimbursement processes.
  • CAIF recipients themselves have, in many cases, faced project implementation delays due to limited access to goods and services during the pandemic. Some projects supported by the CAIF have been cancelled by applicants.
• Efforts continue to be made to return carbon pollution proceeds from 2019-20 to SMEs and to support projects in schools under CAIF as the program wraps up over the coming months. Additional details on funding allocated and spending will be available in the next Greenhouse Gas Pollution Pricing Act annual report. There will be unspent programming dollars through CAIF. Unspent fuel charge proceeds from 2019-20 will be considered as part of future Minister of Finance specifications.
• As part of Canada’s strengthened climate plan, A Healthy Environment and a Healthy Economy, there are efforts being made across the Government of Canada related to the next phase of climate actions. This will require engagement, including with provinces and territories, as it relates to returns of carbon pollution proceeds.

Low Carbon Economy Fund

Issue

• The Low Carbon Economy Fund (LCEF) is contributing to a number of changes in spending for the 2021-22 Main Estimates, in addition to changes in planned spending for future fiscal years and the number of FTE going forward until 2023-2024, when the program is scheduled to sunset.

Points to register

• LCEF is scheduled to sunset in 2023-24 and will fund eligible projects until March 31, 2024.
  • LCEF was initially given authorities for five years, ending in 2021-22, so its original operating budget is ending at that time. *Redacted*
• LCEF is split into two parts: up to $1.4 billion for the Low Carbon Economy Leadership Fund and approximately $500 million for the Low Carbon Economy Challenge. The funding profile and associated planned spending for the Low Carbon Economy Leadership Fund is expected to decrease in 2022-23 and 2023-24 as approved projects are implemented, though reprofile requests are expected to be submitted as implementation evolves.
  • Provinces and territories were notionally allocated funding under the Low Carbon Economy Leadership Fund. As of April 2021 nine jurisdictions (BC, AB, QC, NB, NS, NL, YT, NWT, and NU) have approval to access their full notional funding allocation. MB and PEI are working to identify additional projects to access the approximately $21M of their combined remaining allocations.
  • Provinces and territories are responsible for submitting claims for eligible expenses as per the schedule outlined in their funding agreements for the Low Carbon Economy Leadership Fund. ECCC and the provinces and territories are in regular contact. Federal transfer payments to provinces and territories, as part of the funding agreements under the Low Carbon Economy Leadership Fund, are initiated when claims received are deemed eligible. ECCC continues to work with provinces and territories to finalize claims submitted for expenditures incurred in previous years as well as the current fiscal.
• Main Estimates show an expected decrease of $185.8 million under LCEF in 2021-22 because – based on LCEF’s current funding profile – projects were not expected to have the same level of expenditures as in fiscal year 2020-21.
  • As projects are implemented the reallocation of funds between fiscal years is expected to be requested to ensure that the program can be implemented in a way that maximizes support for greenhouse gas (GHG) emissions reduction projects.
  • As is common for larger grants and contributions programs, reallocation requests should be expected for 2021-22 and future fiscal years because funding profiles can evolve as funding agreements for large and complex projects are signed and projects are implemented.
  • Implementation delays including due to evolving economic circumstances, capital budget cycles, and COVID effects on the availability of good and services, continue to impact projects’ abilities to incur expenditures.
• The possibility exists for future intakes under the Low Carbon Economy Challenge in 2021-22 to invest unallocated funding.

Background/current status

• There are two parts to LCEF:
  • The Low Carbon Economy Leadership Fund provides up to $1.4 billion to provinces and territories to deliver on their commitments to reduce carbon pollution and contribute to meeting Canada’s 2030 climate target.
  • An additional approximately $500 million is available through the Low Carbon Economy Challenge, which was open to all provinces and territories, municipalities, Indigenous communities and organizations, businesses and not-for-profit organizations. Low Carbon Economy Challenge projects leverage Canadian innovation across the country to reduce carbon pollution, save money, reduce emissions, create jobs, and drive economic growth.
• Projects funded through LCEF will benefit Canadians in multiple ways. For example, LCEF is supporting GHG emissions reduction projects in provinces and territories across Canada. Projects supported by LCEF will help Canadians and businesses save money by lowering energy bills. Additionally, LCEF is supporting communities, companies, colleges and other organizations as they adopt clean technologies that will help them be more efficient and innovative, creating jobs and energy and cost savings across Canada.
• Following the launch of LCEF in June 2017 provinces and territories proposed project ideas under the Low Carbon Economy Leadership Fund. The federal government worked with each province and territory to develop these ideas and agree on the best ones to fund.
  • Projects had to meet four minimum requirements:
    • Emissions reductions must be material (measurable and verifiable);
    • Emissions reductions must be in addition to existing or planned actions;
    • Emissions reductions must contribute towards Canada’s 2030 climate target;
    • Projects must be as cost-effective as possible
• With approximately $450 million available, the Champions stream of the Low Carbon Economy Challenge provides funding to eligible applicants including provinces and territories, municipalities, Indigenous communities and organizations, businesses and not-for-profit organizations. The deadline for submitting proposals was September 28, 2018.
• With up to $50 million available the Partnerships stream of the Low Carbon Economy Challenge provides funding through two separate opportunities:
  • First intake: Approximately $40 million for projects led by Indigenous communities and organizations, small and medium-sized businesses, not-for-profit organizations, and small municipalities. The deadline for submitting proposals was March 8, 2019.
  • Second intake: Approximately $10 million for small and medium-sized enterprises (SMEs) in Canada with up to 499 employees. The deadline for submitting proposals was November 15, 2019.
• As a part of Canada’s strengthened climate plan, A Healthy Environment and a Healthy Economy, the Government of Canada is investing in further climate action. Consideration is being given on how to invest unallocated Low Carbon Economy Challenge funding, including the potential for new intakes under the Challenge portion of the Fund.
  • Any future intakes under LCEF would support Canada’s strengthened climate plan by delivering emission reductions to help meet and exceed Canada’s Paris Agreement target in 2030. With new federal climate programming coming online, LCEF would focus on supporting projects that deploy existing technologies, and would consider the feedback gathered through stakeholder engagement to deliver an efficient and effective program.

Indigenous Relations on Climate Change

Issue

• The government is committed to collaborating with Indigenous organizations and representatives on the implementation of proposed measures in A Healthy Environment and a Healthy Economy, and is in the process of co-developing an agenda for joint climate action and a framework for collaboration with Indigenous partners.

Points to register

• The Government of Canada acknowledges the disproportionate burden of climate change on Indigenous peoples that exacerbates existing inequality with other Canadians across human health indicators and the determinants of health.
• Canada’s strengthened climate plan, released in December 2020, commits to supporting Indigenous Climate Leadership to ensure that Canada’s future climate actions help advance Indigenous self-determination and address Indigenous priorities, and that all federal climate policies and programs are inclusive-by-design (i.e. include Indigenous perspectives from the outset and are accessible).
• Three senior-level, distinctions-based bilateral tables with the Assembly of First Nations, Inuit Tapiriit Kanatami and Métis National Council will continue to inform the federal government’s climate actions such that they respond to the unique needs and circumstances of Indigenous peoples. These tables were instrumental in ensuring that the plan responds to Indigenous climate priorities.
• The Government is committed to continuing to work in partnership with Indigenous peoples to address their unique circumstances and empower them with the tools they need to respond to the changing climate.
• To seek input and to co-develop programming, officials from across the federal government are beginning to engage on specific proposed measures in the plan, including on Canada’s Nationally Determined Contribution submission. The Government of Canada will be engaging with Indigneous peoples throughout spring 2021 to co-develop language for inclusion in Canada’s submission, leading up to the 26^th United Nations Climate Change Conference of Parties.

Background/current status

A Healthy Environment and a Healthy Economy and Budget 2021 Investments

• In December 2020 the Government of Canada released A Healthy Environment and a Healthy Economy, a strengthened climate plan to meet and exceed Canada’s 2030 GHG-reduction target. The plan contains measures that align with, and help advance, priorities raised at the senior bilateral tables on clean growth and climate change that the government holds with First Nations, Inuit and the Métis Nation.
• The plan commits to supporting Indigenous-led climate strategies and exploring means of strengthening targeted adaptation programming. Together with the additional investments made in Budget 2021, Canada’s climate plan for Indigenous peoples includes measures that will:
  • Support First Nations and Inuit as they manage the health impacts of climate change such as the impacts of extreme weather events, and mental health impacts of climate change on youth ($22.7 million over five years);
  • Improve food security in the north, including in Inuit Nunangat ($163,4M over 3 years);
  • Help transition rural, remote and Indigneous communities to clean energy ($376.4M over 5 years to help transition diesel-dependent communities to clean energy;
  • Support greener and more resilient infrastructure, including for large-scale adaptation or mitigation projects ($290M over 12 years); and,
  • The protection of biodiversity through the creation of Indigenous Protected and Conserved Areas and partnerships to restore and enhance wetlands, peatlands, grasslands and agricultural lands to boost carbon sequestration (subset of $2.3B over 5 years for conservation, subset of $3.16B over 10 years for Nature-based solutions, subset of $163.4M over 10 years for nature-based carbon sequestration).
• The plan also proposes that the government work with First Nations, Inuit and Métis peoples to co-develop an Indigenous Climate Leadership agenda. This agenda would be used across government to guide decision-making, and ensure all of Canada’s future climate actions help advance Indigenous climate self-determination. For example, this could impact federal climate actions by:
  • Ensuring that policy and program decisions support the devolution of federal resources to Indigenous peoples to address climate change; and,
  • Leading Ministers across government to include Indigenous peoples in the design and implementation of any climate programming, even for measures that are not targeted to Indigenous peoples (e.g. with carve-outs for Indigenous applicants).

Engaging Indigneous Peoples on Canada’s Nationally Determined Contribution

• During the April 22, 2021, Leaders Summit on Climate, the Prime Minister announced that Canada’s new Nationally Determined Contribution under the Paris Agreement will be to reduce emissions by 40-45% below 2005 levels by 2030.
• The target is only one part of the Nationally Determined Contribution, and Canada is committed to engaging with Indigenous peoples on Canada’s new 2030 target and how to collectively achieve that target.
• Furthermore, the Government of Canada will engage with Indigenous peoples throughout spring 2021 to co-develop language for inclusion in Canada’s NDC submission leading up to the 26th United Nations Climate Change Conference of Parties.

Senior Bilateral Tables on Clean Growth and Climate Change and the Pan-Canadian Framework on Clean Growth and Climate Change

• On December 9, 2016, in parallel with the release of the Pan-Canadian Framework on Clean Growth and Climate Change (PCF), the Prime Minister and the national leaders of the AFN, ITK, and MNC respectively made joint commitments to establish distinctions-based senior bilateral tables focused on climate change and based on the recognition of rights, co-operation, and partnership. These structured, collaborative forums seek to promote First Nations, Inuit and Métis peoples’ full and effective participation in federal climate actions while addressing joint climate change priorities.
• Budget 2017 provided $26.4 million over 5 years to implement the new Engaging Indigenous Peoples in Climate Policy Program. Beginning in 2017-2018, Crown-Indigenous Relations and Northern Affairs Canada (CIRNAC) has been providing $2.2M to the Assembly of First Nations, $1.3M to Inuit Tapiriit Kanatami and $1M to the Métis National Council and Métis Nation Governing Members for their clean growth and climate change activities. ECCC provides an additional $100K to the Assembly of First Nations, $160K to Inuit Tapiriit Kanatami and $60K to the Métis National Council for international engagement capacity on climate change.
• In addition, Budgets 2016 and 2017 provided $26.2 million over six years to implement the Climate Change and Health Adaption Program. This program supports Indigenous peoples to identify, assess and respond to the health impacts of climate change through community based projects.

Canada’s Strengthened Climate Plan and the United Nations Declaration on the Rights of Indigenous Peoples

• The Government of Canada supports without qualification the United Nations Declaration on the Rights of Indigenous Peoples, including free, prior and informed consent. To formalize this commitment the government has recently tabled legislation in support of the Declaration (Bill C-15 - United Nations Declaration on the Rights of Indigenous Peoples Act).
• The government is already building the principles of the UN Declaration into new legislation. For example, the proposed Canadian Net-Zero Emissions Accountability Act (Bill C-12) stipulates that the Minister of Environment and Climate Change must provide Indigenous peoples of Canada with the opportunity to make submissions when setting or amending a national greenhouse gas emissions target or an emissions reduction plan under this legislation.
• Under the Strengthened Climate Plan, the Government proposes to further the principles of the UN Declaration, working with First Nations, Inuit and Métis peoples to co-develop decision-making guidance that will ensure all of Canada’s future climate actions help advance Indigenous climate self-determination.
• In all aspects of the climate agenda, the government looks forward to advancing solutions in partnership with First Nations, Inuit and Métis and exploring new opportunities for joint decision-making.

National Inventory Report – 2021 Edition

Issue

• The National Inventory Report (NIR) is Canada’s authoritative source for greenhouse gas (GHG) sources and sinks in Canada and is published annually in April. The NIR forms part of Canada’s submission to the United Nations Framework Convention on Climate Change (UNFCCC) and presents the official estimates used to measure progress Canada is making to reduce its GHG emissions.

Points to register

• The most recent National Inventory Report was published in April 2021 and summarizes Canada’s GHG emissions from 1990 until the end of 2019, prior to the start of the COVID-19 pandemic. In 2019 GHG emissons were 730 megatonnes of carbon dioxide equivalent (Mt CO₂ eq), about a 1 Mt or 0.2% increase from 2018 emissions and a net decrease of 9 Mt or 1.1% from 2005 emissions (Figure 1).
• During this time Canada experienced years of economic growth and low unemployment, while in recent years annual GHG emissions in Canada remained flat hovering between 700 and 730 Mt CO₂ eq.
• Canada’s GHG emission trends from 2005 - 2019 have remained consistent as emission increases in the oil and gas sector and the transportation sector have been offset by decreases in the electricity and heavy industry sectors.
• Canada’s National Inventory Report, along with other reports such as Canada’s National Communications and Biennial Reports, the greenhouse gas and air pollutant emissions projections, annual synthesis reports on the status of implementation of the Pan-Canadian Framework (PCF) on Clean Growth and Climate Change, and future legislated reports, all support Canada’s assessment of its progress in reducing emissions and combatting climate change.
• The government’s strengthened climate plan, A Healthy Environment and a Healthy Economy, builds on the Pan-Canadian Framework on Clean Growth and Climate Change, which has resulted in emissions in 2030 being projected to be 227 million tonnes lower than before it was adopted. Before the Pan-Canadian Framework absolute emissions in 2019 were forecasted to be 764 Mt (Second Biennial Report, 2015), which is 34 Mt higher than this year’s 2019 data.

Background/current status

• As a signatory to the United Nations Framework Convention on Climate Change (UNFCCC), Canada is obligated to prepare an annual national GHG inventory of anthropogenic emissions by sources and removals by sinks, including annual estimates since 1990. Each year the standardized and detailed NIR and common reporting format tables must be submitted electronically to the UNFCCC no later than April 15.
• The UNFCCC is an international treaty established in 1992 to cooperatively address climate change issues. The ultimate objective of the UNFCCC is to stabilize atmospheric GHG concentrations at a level that would prevent dangerous interference with the climate system. Canada ratified the UNFCCC in December 1992, and the Convention came into force in March 1994.

Figure 1: Canadian greenhouse gas emissions and indexed trend emission intensity (excluding Land Use, Land-Use Change and Forestry)

• During the period covered in this report, Canada’s economy grew more rapidly than its GHG emissions. As a result, the emissions intensity for the entire economy (GHG per Gross Domestic Product [GDP]) has declined by 37% since 1990 and by 23% since 2005. (Figure 1)
• The GHG inventory includes emissions of carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), perfluorocarbons (PFCs), hydrofluorocarbons (HFCs), sulphur hexafluoride (SF6) and nitrogen trifluoride (NF3) in the following five sectors: Energy; Industrial Processes and Product Use (IPPU); Agriculture; Waste; and Land Use, Land-Use Change and Forestry (LULUCF).
  • In 2019, the Energy sector (consisting of Stationary Combustion, Transport and Fugitive Sources) emitted 589 Mt, or 81% of Canada’s total GHG emissions (Figure 2). The remaining emissions were largely generated by the Agriculture and IPPU sectors (8% and 7% respectively), with contributions from the Waste sector (4%). In 2019 the LULUCF sector emitted 9.9 Mt to the atmosphere.

Figure 2: Breakdown of Canada’s emissions by Intergovernmental Panel on Climate Change sector (2019)

• The GHG emission and removal estimates contained in Canada’s GHG inventory are developed using methodologies consistent with the Intergovernmental Panel on Climate Change’s (IPCC) 2006 Guidelines for National Greenhouse Gas Inventories.
• The Government of Canada is committed to incorporating the best available scientific evidence and working closely with scientists and industry experts to refine and improve our understanding and measuring of emissions.
• In line with the principle of continuous improvement, the underlying data and methodology for estimating emissions are revised over time; hence, total emissions in all years are subject to change as both data and methods are improved.
• The NIR also includes provincial/territorial emissions estimates. Emissions vary significantly by province and territory as a result of factors such as population, energy sources and economic structure. (Figure 3)

Figure 3: Greenhouse gas emissions by province and territory in 2005, 2010 and 2019

Net-Zero Legislation, Bill C-12

Issue

• On November 19, 2020, the Government of Canada introduced net-zero legislation (Canadian Net-Zero Emissions Accountability Act) as part of its commitment to develop a plan to achieve net-zero emissions by 2050.

Points to register

• Bill C-12, the Canadian Net-Zero Emissions Accountability Act, will legally bind the Government to a process to achieve net-zero emissions by 2050.
• By establishing rolling five-year emissions targets and requiring plans for meeting each target, the Government is delivering on its commitment to enshrine accountability and transparency into law.
• Canada is well-positioned to provide the world with clean technology and non-emitting energy and products, while creating good jobs for Canadians, not just now but for decades to come. Net-zero emissions is not just a plan for the environment; it’s a plan to build a cleaner, more competitive economy.
• The Act will require Canada to set emissions reduction targets for milestones at five-year intervals for the years 2030, 2035, 2040 and 2045.
• It will require the government to report to Parliament with plans to reach these targets, interim progress reports on implementation and effectiveness, as well as final assessment reports on each target.
• It requires that provinces and territories, Indigenous peoples, stakeholders, and experts be given the opportunity to provide input into this process.
• Reaching net-zero emissions will require the support from all parts of society. The Act establishes an independent expert Advisory Body to advise the government on the best pathways to growing the economy while reducing emissions. The Advisory Body will also engage with Canadians across the country.

Background/current status

• Bill C-12 started Second Reading on November 25. It may be referred to Committee this spring.
• The Government has received numerous proposed amendments; some of which may be made during the parliamentary process.
• The Government will be required to submit its first target and associated emissions reductions plan within 6–9 months of Royal Assent.
• Canada has joined over 120 countries that have responded to the UNFCCC’s call to commit to net-zero emissions. This Act mirrors the efforts of several other G7 nations (UK, Germany, Italy, Japan, NZ, France).
• Hundreds of cities around the world have also made net-zero commitments including Vancouver, Hamilton, Toronto, and Halifax.

Net-Zero Advisory Body

Issue

• The Canadian Net-Zero Emissions Accountability Act establishes an advisory body to provide independent advice to the government and conduct engagement on optimal pathways to achieve net-zero emissions by 2050.

Points to register

• The Net-Zero Advisory Body (NZAB), launched on February 25, 2021, will follow a transparent and inclusive process to engage with government and hear from provinces, territories, Indigenous peoples, youth, businesses, environmental groups, and interested Canadians. The Terms of Reference for the NZAB were made public at launch.
• Some of the Advisory Body’s work will include:
  • advice on the most likely pathways for Canada to achieve net-zero emissions, including advice on emissions reductions milestones leading up to 2050;
  • identification of next steps in the years ahead to fight climate change and reach net-zero emissions that will grow the economy, while also making life more affordable; and,
  • helping to mobilize stakeholders and other Canadians to take action towards the Government’s goal of Canada reaching net-zero emissions by 2050.
• The role and design of the NZAB is informed by international best practices, but designed specifically for Canada’s unique considerations and needs including the importance of a traditional resource economy and shared jurisdiction on environment.
• Seeking expert advice on charting Canada’s path to net-zero emissions by 2050 remains critical to the Government’s work.

Background/current status

• The Advisory Body was announced while the Canadian Net-Zero Emissions Accountability Act is under consideration by Parliament in order to enable the advisory body’s important work to begin as soon as possible.
• The Advisory Body is intended to be a permanent resource that provides ongoing expert advice to the Minister of Environment for the duration of the 30 year timeline Canada has set to achieve net-zero emissions by 2050.
• The Advisory Body’s terms of reference allow for adjustments by the Minister of Environment and Climate Change. Should any changes to the mandate and operations of the NZAB be required as a result of Parliament’s consideration of the proposed legislation, corresponding adjustments will be to the Terms of Reference of the advisory body.

Membership

• The 14 members initially appointed by the Minister of Environment and Climate Change are volunteering their time.
• Consistent with the proposed Canadian Net-Zero Emissions Accountability Act, members of the Net-Zero Advisory Body may be appointed by the Governor-in-Council in the future.
• The Minister of Environment and Climate Change selected members based on expertise and credibility in at least one of the following areas:
  • climate change/environmental policy
  • energy, industrial and finance sectors
  • scientific background
  • innovation and entrepreneurship
  • economics, jobs, or labour policy
• The Advisory Body is also gender-balanced and includes representation from British Columbia, the Prairies, Ontario, Quebec, Atlantic Canada, and the North, as well as Canada’s Indigenous peoples.
• On February 25, 2021, the Advisory Body was launched with the following 14 members:
  • Marie-Pierre Ippersiel, co-chair (QC)
  • Dan Wicklum, co-chair (AB)
  • Catherine Abreu (NS)
  • Kluane Adamek (YK)
  • Theresa Baikie (NL)
  • Lindy Coady (BC)
  • Simon Donner (BC)
  • Sarah Houde (QC)
  • Peter Tertzakian (AB)
  • Gaetan Thomas (NB)
  • Kim Thomassin (QC)
  • John T. Wright (SK)
  • Yung Wu (ON)
  • Hassan Yussuff (ON)

Sustainable Finance Action Council

Issue

• The Sustainable Finance Action Council (Action Council) will be established this spring for a period of three years to provide financial sector input on implementing sustainable finance capital market infrastructure in Canada.

Points to register

• Mobilizing private sector capital is critical to financing the transition to a low-carbon economy. Developing sustainable finance in Canada will promote the longterm growth and stability of our financial system in the face of climate change. Sustainable finance will also create new opportunities for Canadian businesses and investors.
• In the November 2020 Fall Economic Statement, the Government committed $7.3 million over three years for the Department of Finance Canada and Environment and Climate Change Canada to create a public-private Sustainable Finance Action Council (Action Council) aimed at developing a well-functioning sustainable finance market in Canada.
• The Action Council will make recommendations on critical market infrastructure needed to attract and scale sustainable finance in Canada including enhancing climate disclosures, ensuring access to useful data on sustainability and climate risks, and developing standards for investments to be identified as sustainable.
• The Department is working closely with Finance Canada to set up the Action Council.

Background/current status

• In June 2019 the Expert Panel on Sustainable Finance released their final report, Mobilizing Finance For Sustainable Growth, which provided 15 recommendations to bring sustainable finance into the mainstream.
• In line with Recommendation 3 of the Expert Panel on Sustainable Finance, in November 2020 the Fall Economic Statement announced the creation of a private-public Sustainable Finance Action Council (SFAC). The SFAC will make recommendations on critical market infrastructure needed to attract and scale sustainable finance in Canada including enhancing climate disclosures, ensuring access to useful data on sustainability and climate risks, and developing standards for investments to be identified as sustainable.