2023 Progress Report on the 2030 Emissions Reduction Plan: Part I

Chapter 1: Introduction

1.1 Climate accountability legislation and climate plans

Canada was a signatory to the United Nations Framework Convention on Climate Change (UNFCCC) in 1992 and set its first national emissions target in 2000. Despite these and other commitments, emissions in Canada continued to rise. While emissions hit a peak in 2007, in the year before the global economic slowdown, projections in 2015 indicated that that peak would be temporary. Canada’s emissions were projected to exceed the 2007 peak by 2020 and continue to rise. To ensure accountability and transparency, Canada ratified the Paris Agreement in 2016 and adopted the Canadian Net-Zero Emissions Accountability Act (CNZEAA or “the Act”) in 2021, enshrining Canada’s commitments to address climate change in domestic and international law.

Figure 1-1: Timeline of climate commitments in Canada

Figure 1-1 (See long description below)
Long description for Figure 1-1
  • 1992: Canada ratifies the United Nations Framework Convention on Climate Change
  • 1998: Canada signs the Kyoto Protocol
  • 2000: Canada commits to reducing GHG emissions by 65 Mt per year from 2008 to 2012
  • 2002: Canada commits to cutting 240 Mt of GHG emissions from Canada’s projected 2010 levels
  • 2002: Canada formally ratifies the Kyoto Protocol
  • 2005: Kyoto Protocol enters into force, committing Canada to reduce emissions an average of 6% below 1990 levels between 2008 and 2012
  • 2005: Canada commits to reducing emissions by 270 Mt per year from 2008 to 2012
  • 2007: Canada commits to 20% below Canada’s 2006 levels by 2020
  • 2007: Canada commits to reducing emissions by 60–70% by 2050
  • 2009: G8 leaders establish a long-term objective to reduce global emissions by 50% by 2050 (baseline year not specified)
  • 2010: Canada commits to a target of 17% below 2005 levels by 2020 under the Copenhagen Accord
  • 2011: Minister of the Environment announces that Canada will formally withdraw from the Kyoto Protocol
  • 2015: Canada commits to a Nationally Determined Contribution (NDC) of 30% emissions reductions below 2005 levels by 2030
  • 2016: Canada reaffirms its NDC and signs the Paris Agreement
  • 2021: Canada increases its NDC to 40% to 45% below 2005 levels by 2030
  • 2021: The Canadian Net-Zero Emissions Accountability Act enshrines in legislation Canada’s targets of 40–45% below 2005 levels by 2030 and net-zero GHG emissions by 2050
  • 2022: The 2030 Emissions Reduction Plan is released and establishes Canada's 2026 interim GHG emissions reduction objective of 20% below 2005 levels

1.1.1 UNFCCC Paris Agreement

Under the Paris Agreement to the UNFCCC, countries agreed to collectively strengthen the global response to climate change, including by limiting global warming to well below 2°C, while also pursuing efforts to limit warming to 1.5°C. To help reach this goal, the Government of Canada announced in April 2021 that Canada’s initial target for 2030, to reduce greenhouse gas (GHG) emissions by 30% below 2005 levels, would be enhanced to the more ambitious target of 40% to 45% below 2005 levels by 2030, reflecting our ability to surpass the original target, the scale of the climate crisis, and the socio‑economic opportunity that climate action presents.

1.1.2 The Canadian Net-Zero Emissions Accountability Act: The Government of Canada’s climate accountability and transparency legislation

The CNZEAA became law in June 2021. This Act enshrines in legislation the Government of Canada’s commitment to achieve net-zero GHG emissions by 2050, and provides a framework of accountability and transparency to deliver on this commitment. The Act also establishes a legally binding process to set five-year national emissions reduction targets as well as develop credible, science-based emissions reduction plans to achieve each target. Under the Act, Canada’s legislated 2030 GHG emissions target is set as Canada’s Nationally Determined Contribution (NDC) for 2030 under the UNFCCC (40% to 45% below 2005 levels by 2030).

In Summary: The Canadian Net-Zero Emissions Accountability Act
  • Requires national GHG reduction targets for every five years from 2030 to 2050 and an emissions reduction plan, a progress report, and an assessment report for each target to be published and tabled in Parliament.
  • Provides for public participation when setting or amending a target or plan.
  • Formally establishes the Net-Zero Advisory Body as a Governor in Council appointed body to provide independent advice on achieving net-zero emissions by 2050.
  • Requires the Minister of Finance to prepare an annual report on key measures that the Government of Canada has taken to manage its financial risks and opportunities related to climate change.
  • Requires the Commissioner of the Environment and Sustainable Development to, at least once every five years, examine and report on the Government of Canada’s implementation of the measures and strategies in the current plan.
  • Provides for a comprehensive review of the Act, five years after it comes into force.
  • Enshrines the role of Indigenous Knowledge in the climate accountability process

1.1.3 Emissions Reduction Plan

The CNZEAA requires that the Government of Canada prepare a 2030 Emissions Reduction Plan (ERP) to guide actions to meet the 2030 target. In March 2022, the Government of Canada released Canada’s 2030 ERP. Emissions reduction plans are also required for each of the 2035, 2040, 2045, and 2050 targets. The CNZEAA further requires the government to report regularly on the progress being made to meet targets, starting in 2023. As governments, Indigenous Peoples, businesses, civil society organizations and communities across the country work together to reach Canada’s climate targets, the plan will evolve and respond to new opportunities.

1.2 Imperative for climate action

Increasingly, scientists are linking extreme weather events with anthropogenic GHG emissions. An analysis by Carbon Brief found that of 504 extreme weather events reviewed, 71% were the result of or made worse by climate change.1 At current rates, it is expected that global warming of 1.5°C will likely be reached between 2030 and 2052.2 Canada is one of the highest per capita emitters in the world and accounted for approximately 1.5% of global GHG emissions in 2020, making it the world’s tenth largest emitter.3 Canada is the only G7 country that exports more emissions than it imports. While Canada’s emissions related to electricity generation have been cut in half over the past 20 years and Canada’s electricity system is among the cleanest in the world, Canada’s path to additional emissions reductions must contend with a vast geography, cold climate, trade‑exposed economy, and role as a major producer and user of energy and natural resources.

According to the UNFCCC, global emissions need to be nearly halved by 2030 for the world to limit temperature rise to 1.5°C,4 requiring increased ambition, accelerated implementation, and a whole-of-society approach including action by subnational governments, Indigenous Peoples, financial institutions, the private sector, and civil society. The science is clear—accelerated global efforts to reduce emissions are necessary to avoid the most devastating impacts of climate change. The economics are clear too—to build a strong, resilient economy for generations to come, we must harness the power of a cleaner future. Ambitious climate action over the coming years will be critical to making the necessary changes in time to prevent the worst impacts of climate change.

1.2.1 Impacts to communities

The devastating impacts of climate change are clear. In 2023 alone, Canada experienced the hottest summer ever, the largest wildfires in history, drought in the Prairies, and floods in British Columbia and Nova Scotia. Homes were destroyed, lives lost, thousands of people had to evacuate their homes, communities and businesses were impacted, smoke from wildfires blanketed the country, and biodiversity was put at risk. In addition to personal and emotional impacts, these climate impacts have economic consequences that affect families and communities, and send ripples through the Canadian economy.

Cost of climate disasters in Canada

Early estimates from provincial and territorial governments have placed the cost of fighting wildfires in 2023 in British Columbia, Alberta, Northwest Territories and Saskatchewan at $1.4 billion. This does not include firefighting in other impacted provinces, notably Nova Scotia and Québec, and also excludes costs related to evacuations, insured losses, economic interruptions, not to mention health costs. The Canadian Climate Institute reported that the health cost from forest fires alone for one week in June in Ontario amounted to $1.28 billion.

The Insurance Bureau of Canada reported in January 2023 that severe weather in 2022 caused $3.1 billion in insured damage—the third worst year for insured damage in Canadian history. The 2022 season was characterized by a wide variety of events, including storms and flooding. Hurricane Fiona alone was responsible for $800 million in insured damages. The worst year on record was 2016, with $5.96 billion in losses, largely due to the Fort McMurray wildfire. The costs for 2023 are still being tallied. The Tantallon, Nova Scotia wildfire, which lasted from May 28 to June 4, caused over $165 million in insured damage. The atmospheric river event in Nova Scotia on July 23 caused an estimated $170 million in insured damage. An estimated 80% to 90% of structures in the hamlet of Enterprise, Northwest Territories were destroyed by wildfire. The Okanagan and Shuswap area wildfires in British Columbia caused over $720 million in insured damage, with the 2023 British Columbia wildfires ranking as the costliest insured event in provincial history. The financial costs of climate change are staggering, and do not begin to touch the full impact that these events have on people and communities. Moreover, the wildfires had disproportionate impacts on Indigenous, fly-in, and other remote communities that were particularly vulnerable due to lack of services and barriers to response interventions.

Internationally, record-breaking flooding in Bangladesh impacted over 7 million people, leaving thousands homeless. Temperatures nearing 50°C were experienced in most parts of North Africa this past summer, while many parts of Italy, Greece, and Spain had temperatures in the mid- to high-40s. The U.S. National Oceanic and Atmospheric Administration has reported that 2023 is the worst year on record for the number of extreme climate related disasters in the U.S., with more than in any previous year on record.5

1.2.2 Impacts to nature

The wildfire season in Canada in 2023 that took a terrible toll on communities also impacted the landscapes and species found in those areas, including species at risk. As we saw in 2023, extreme weather events such as wildfire contribute to species and habitat loss. In addition, climate change impacts such as increased temperatures and precipitation can alter habitat, affecting ecosystem and species health.

Climate change also undermines nature’s ability to provide a critical contribution to climate change mitigation and adaptation. Canada’s forests, soils, plants, and wetlands contain almost one third of all land-based carbon storage and if these ecosystems are harmed by extreme weather events or ecosystem distributions from the changing climate, the stored carbon can be released into the atmosphere. The 2023 wildfire season in Canada burned over 18.5 million hectares of forest land, resulting in large, unprecedented emissions. The North is warming twice as fast as the global average, melting the permafrost and releasing carbon that has been naturally stored underground.

A synergistic approach to tackling climate change and biodiversity loss is essential to store as much carbon as possible and retain natural features, such as wetlands, that can better absorb climate impacts as we experience greater change. To help meet that goal, in December 2022, Canada co‑hosted and brokered a global biodiversity agreement at COP15 in Montréal. Canada followed up on that historic event by hosting the Global Environment Facility Assembly in August 2023, where governments launched the Global Biodiversity Framework Fund.

1.3 Climate change and affordability

1.3.1 Economy-wide impacts of climate policies

Canada’s economy has recovered strongly following the COVID-19 pandemic, yet many Canadians are now facing new affordability challenges, including higher grocery prices, energy prices and housing costs. The pandemic led to significant supply chain disruptions and changing consumption patterns, which in turn contributed to high inflation. This situation was then worsened by the Russian invasion of Ukraine. These challenges have been significant and highly disruptive for Canadians.

Slowing economic growth has been observed both in Canada and around the world. The Canadian economy grew by 1.6% per year from 2006 through 2021, a period that includes the 2009 global recession and the COVID‑19 pandemic. On an annual basis, Canada’s real GDP growth is projected to slow down from a strong 3.8% in 2022 to 1.1% in 2023 and 0.4% in 2024, before rebounding to 2.2% in 2025.6 While Canada’s economy continues to grow, emissions continue to decrease.

Figure 1-2: Canadian GHG emissions and indexed trend emissions intensity
(excluding Land Use, Land-Use Change and Forestry)

Figure 1-2 (See long description below)
Long description for Figure 1-2

This graphic is a line chart displaying two metrics: Canada's GHG emissions; and, indexed trend emissions intensity (excluding Land Use, Land-Use Change and Forestry). On the horizontal axis, dates are displayed, ranging from 1990 to 2035. On the vertical axis, GHG emissions are displayed.

Long description Figure 1-2: Canadian GHG emissions and indexed trend emissions intensity
(excluding Land Use, Land-Use Change and Forestry)
Year Emissions (Mt CO2 eq) Emissions intensity (kt CO2 eq per million $1997)
1990 588.60 0.77
1991 582.03 0.78
1992 599.24 0.79
1993 601.74 0.78
1994 621.93 0.77
1995 639.07 0.77
1996 660.76 0.78
1997 676.39 0.77
1998 682.43 0.74
1999 694.52 0.72
2000 719.46 0.71
2001 710.17 0.68
2002 715.49 0.67
2003 734.14 0.67
2004 736.73 0.66
2005 732.22 0.63
2006 725.29 0.61
2007 748.07 0.62
2008 730.80 0.60
2009 689.55 0.58
2010 701.87 0.57
2011 711.31 0.57
2012 716.37 0.56
2013 723.10 0.55
2014 720.20 0.53
2015 722.92 0.53
2016 704.93 0.52
2017 712.23 0.51
2018 724.61 0.50
2019 723.68 0.49
2020 658.79 0.47
2021 670.43 0.46
2022 674.52 0.45
2023 663.71 0.44
2024 637.41 0.42
2025 624.24 0.41
2026 600.28 0.39
2027 579.40 0.38
2028 555.56 0.37
2029 535.45 0.35
2030 511.78 0.34
2031 501.01 0.33
2032 493.31 0.32
2033 487.18 0.31
2034 481.18 0.31
2035 468.01 0.30

1.3.2 Revenue neutral carbon price

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 regional 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 GHG 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.

The carbon pricing system has two parts: a regulatory charge on fossil fuels like gasoline and natural gas, known as the fuel charge, and a performance-based system for industries, known as the Output‑Based Pricing System. The fuel charge applies in Ontario, Manitoba, Yukon, Alberta, Saskatchewan, Nunavut, Nova Scotia, New Brunswick, Newfoundland and Labrador, and Prince Edward Island. The Output-Based Pricing System applies in Manitoba, Prince Edward Island, Yukon, and Nunavut. All other provinces and territories are implementing their own pricing systems.

The revenue generated from the federal fuel charge is returned to consumers in the form of Climate Action Incentive payments (CAIP), distributed quarterly. Through these payments, the majority of Canadian families receive more money back than they pay, with low-income Canadians benefitting the most. Households and individuals who take steps to reduce their use of fossil fuels can save even more money by not paying the carbon price.

With this revenue neutral approach, the price signal from the carbon price encourages consumers to reduce the consumption of fossil fuels while ensuring households are not worse off, on average. While this can seem counterintuitive, carbon pricing is proven as one of the lowest cost and effective ways to reduce emissions. For more information, see how carbon pricing works.

1.3.3 Household economic benefits of decarbonization

The International Energy Agency (IEA) has highlighted the important role of electric vehicles and heat pumps in not only achieving net zero but also boosting energy security and affordability.7 Research by Clean Energy Canada found that decarbonization can reduce overall energy costs by up to $800 per month, even when the costs of purchasing the equipment is factored in. Recent analysis by the Canadian Climate Institute found that on average, in the five cities assessed (Vancouver, Edmonton, Toronto, Montréal, and Halifax), the lifetime cost of a standard heat pump with electric backup is 13% lower than a gas furnace and air conditioning, considering both capital and operating costs and including existing household grants that range from $5,000 to $12,000. Heat pumps are two to five times more efficient than gas furnaces, providing substantial savings while helping keep homes warm in winter and cool in summer. Analysis by BC Hydro compares the cost of zero-emission vehicles to gas vehicles, including purchase cost, fuel cost and upkeep cost, and even with a higher upfront purchase cost, zero-emission vehicles are often a more economical option. As an example, the cost to drive 20,000 km per year can average $3,340 in a gas-powered vehicle, based on 2021 gas prices, whereas the equivalent electricity costs for an electric vehicle would be about $478 per year, and not subject to the same degree of price fluctuation as with gas.

However, the upfront costs of a new heating system, new windows, or an electric vehicle are a barrier for many families. This is being addressed in two ways. First, the uptake will happen over time, enabling families to replace their fossil fuel-reliant equipment with electric when needed. No one has to purchase an electric car right now. But in the future when you need a new car, and are going to have that expense regardless, cheaper and more reliable electric cars will likely be available. Second, measures are in place to help families, especially low-income families, purchase equipment sooner so they can begin to realize cost savings sooner while helping reduce emissions. One example is the recently announced Oil to Heat Pump Affordability Program (OHPA) that would make the average heat pump free for low to median income families. A summary of Canada’s 2030 ERP measures is provided in Chapter 2 and a full list of measures is in Chapter 6.

As the Canadian Climate Institute concluded in their report Damage Control: Reducing the Costs of Climate Impacts in Canada (PDF), climate change is itself an affordability risk for households in Canada, and especially for vulnerable populations. Evidence indicates that households will pay the highest price for climate impacts, with low-income households being hardest hit. The impacts are already materializing, with a drop in income per capita of $720 expected by 2025, rising to $1,890 per capita by mid-century in a low-emissions scenario and almost $2,300 per capita in a high-emissions scenario. Low-income households will be most affected, facing income cuts of 23% in a high‑emissions scenario by the end of century. The Institute concluded that a combination of proactive adaptation measures and global emissions reductions will be the most effective in mitigating damages, reducing Canada’s total real GDP losses by 75%.

1.3.4 Avoiding the costs of climate change

Climate change is already increasing the number of acute, high-impact weather- and climate-related events in Canada resulting in costs to individuals, households, communities, business, and governments. As noted in the National Adaptation Strategy released in June 2023:

There are many ways to measure the costs of climate change (Table 1-1). While some costs are covered by insurance, many uninsured costs are borne by homeowners, communities, businesses, and governments. Insurance usually covers direct costs, leaving those unable to get to work or businesses that cannot open without support. Increasingly, there is more attention on the non-market costs of climate change, such as impacts to the health care system from increased physical and mental health costs.

Table 1-1: An overview of the different types of costs incurred due to climate change8
Insured costs Costs covered by insurance companies.
Uninsured costs

Costs not covered by insurance companies, where costs must be covered by homeowners, business, and governments. This often includes situations where insurance coverage is not available.

Direct costs

Costs that arise from the physical impacts of climate hazards, such as damage or disruption to goods and services as well as intangible items.

Indirect costs

Costs that stem from direct climate change impacts in an indirect way, such as when infrastructure is damaged or destroyed, interrupting normal use or service flows, disrupting the delivery of critical services, or otherwise interrupting the operations of businesses.

Market costs

Costs related to goods and services that can be traded in a market and thus have an observed price.

Non-market costs

Costs related to intangible items that are not bought or sold in a traditional market and thus have no readily observable price (e.g., ecosystem services, stress or pain levels, and general quality of life).

There are two ways to avoid the costs of climate change: mitigation of emissions and becoming more resilient to climate impacts through adaptation measures. This report outlines the steps we are taking to mitigate emissions domestically, which, as the eleventh largest emitter in the world, contributes greatly towards achieving the goal of the Paris Agreement to limit global temperature change to 1.5°C. The Government of Canada also released the National Adaptation Strategy in 2023, a whole of society approach to reducing vulnerabilities and increasing adaptive capacity to climate change.

1.4 Climate adaptation: preparing for impacts

The mitigation policies discussed in this report aim to reduce emissions in an effort to reduce climate impacts. Adaptation measures aim to reduce people’s vulnerabilities and increase their resilience to the floods, fires, drought, and other climate impacts we are experiencing today.

In June 2023, the Government of Canada released the National Adaptation Strategy, which sets the direction for whole-of-society efforts to better prepare for the impacts of climate change. The Strategy outlines long-term goals, medium-term objectives and near-term targets for five interconnected systems—disaster resilience, health and well-being, nature and biodiversity, infrastructure, and economy and workers. The Strategy also identifies foundational actions that crosscut these five systems and are necessary to support effective adaptation (e.g., developing evidence-based knowledge on how the climate is changing and the impacts on communities). The Strategy’s implementation will further be underpinned by a set of guiding principles, emphasizing the need for respecting jurisdiction, upholding the rights of Indigenous Peoples, ensuring equity and support for the most vulnerable, taking proactive and integrated risk-based actions, and maximizing benefits across society while reducing maladaptation.

All of us across the country—governments, Indigenous Peoples, the private sector, civil society, communities, and individuals—need to take action to create a more climate-resilient Canada. The implementation of the National Adaptation Strategy will be supported by a number of action plans, including the Government of Canada Adaptation Action Plan, which outlines the federal contributions to the Strategy’s goals, objectives and targets. Provincial, territorial, municipal, and sectoral strategies and action plans will also advance the implementation of the Strategy. In addition, Indigenous Peoples are on the front lines of the response to climate change, as First Nations, Inuit, and Métis are experiencing disproportionate impacts of climate change while leading climate action both within Canada and globally. This includes advancing responses to climate change that draw on Indigenous Science and Knowledge systems and are based on Indigenous stewardship of lands and waters. The Indigenous Climate Leadership Agenda will be a key mechanism for advancing Indigenous-led and self-determined climate change adaptation and mitigation action.

Implementation of Canada’s first National Adaptation Strategy presents an opportunity to coordinate efforts to reduce vulnerability and increase resilience across the country, with an emphasis on the most vulnerable. As implementation of the Strategy proceeds, regular reporting will outline progress on the state of climate resiliency in Canada.

1.5 The role of science in combatting climate change

Scientific research is fundamental to understanding climate change and its impacts on Canadians and their health, environment, and communities. Science informs climate mitigation and adaptation measures, and assesses the effectiveness of actions that have been taken. Each year, Canada prepares a National Inventory Report (NIR) to report Canada’s GHG emissions estimates and tracks emissions from individual facilities through its Greenhouse Gas Reporting Program (GHGRP). The NIR serves as the fundamental basis for informing policy decisions and developing Canada’s regulatory regime. Atmospheric measurements from the ground, aircraft, and satellites are increasingly being explored to improve the validity and robustness of emissions estimates. This information upholds the credibility of Canada’s emissions estimates and improves capacity to track Canada’s emissions reductions over time.

Climate emergency and air quality warnings to protect Canadians and their communities—like the air quality alerts issued because of the devastating 2023 wildfire season—depend on federal government science, monitoring, and air quality forecasting. In 2023, there were three to five times more air quality alerts than any other year between 2017 and 2022. Without this information, the lives and the health of Canadians may be put at risk, from immediate asthma attacks to chronic health problems related to long-term exposure to air pollution. Canada’s Changing Climate Report (2019) assessed the state of knowledge on how and why Canada’s climate has changed and what changes are projected for the future.9 It found that both past and future warming in Canada is, on average, about double the magnitude of warming globally. In the Arctic, the rate of warming is now three to four times the global average. Climate science allows us to monitor and report on current conditions and project future climate conditions to better predict and respond to these changes and understand their underlying causes and potential impacts.

Biologically diverse ecosystems are more resilient to the adverse effects of climate change. Scientific research on nature-based solutions and the natural carbon cycle can play a vital role in Canada’s future ability to mitigate GHG emissions and adapt to climate-change impacts. Climate change also impacts the quality and quantity of freshwater. Scientific monitoring, modelling, and analysis inform hydrological predictions and preparation for extreme events like flooding. They also inform water management decisions related to water supply and demand, contaminant levels, and recreational use. Ongoing advancement and mobilization of knowledge, data, and tools are essential to make informed decisions with respect to identifying the climate actions necessary to respond to the risks and impacts we are experiencing now and will experience in the future.

Science and knowledge, inclusive of the full range of Western natural, social, and health science and Indigenous science and knowledge systems, is crucial to guiding and informing the most effective climate actions to reduce GHG emissions, minimize risks for health and our natural environment, and increase resilience across the country. Efforts need to continue to build relationships that bridge, braid, and weave Indigenous and Western science and knowledge systems to inform and enhance decision‑making. As scientific understanding continues to advance and evolve, it will help identify, inform, and assist with the implementation of new approaches to meeting Canada’s climate targets, protect Canadians and their communities, and evaluate the progress to date.

A National Priorities for Climate Change Science and Knowledge report is planned for publication in early 2024, which will summarize the most important scientific research and data needs that Canada’s science community should undertake to help us better evaluate climate change and plan for its impacts.

1.6 How Canada assesses progress

Canada’s established methodology for reporting on progress toward emissions reduction targets considers (1) historical greenhouse gas emissions and (2) greenhouse gas emissions projections, which are both indicators within the Canadian Environmental Sustainability Indicators (CESI) program, indicators under the Federal Sustainable Development Strategy (FSDS), and consistent with UNFCCC reporting guidelines. This approach for assessing progress is confirmed within the CNZEAA, further specifying that the most recently published data must be used.

Canada reports on progress domestically under the CNZEAA and the Federal Sustainable Development Strategy and internationally through the UNFCCC biennial reports, UNFCCC biennial transparency reports, and United Nations Sustainable Development Goals (UN SDGs). This ERP Progress Report fulfills requirements laid out in the CNZEAA. For more on Canada’s emissions reporting, see Chapter 5.

1.6.1 Indicators of progress

The primary means through which Canada will assess achievement of its target is through emissions in the target year. This 2023 Progress Report includes several measures to assess progress toward Canada's GHG emissions reduction target, including:

1.6.2 Historical emissions

Historical GHG emissions are presented in Canada’s NIR, which is submitted to the UNFCCC in April each year. Canada’s most recent submission in April 2023 included emissions data covering the period 1990 to 2021. Canada’s emissions inventory is prepared according to UNFCCC reporting guidelines for national GHG inventories. The reporting guidelines require Annex I Parties, which includes Canada, to develop their national inventories using the 2006 Intergovernmental Panel on Climate Change (IPCC) Guidelines for National Greenhouse Gas Inventories. The reporting guidelines also require inventory reports to provide detailed and complete information on estimates development, including the formal arrangements supporting their preparation and any significant changes to inventory preparation and submission procedures. The reporting guidelines also commit Parties to improve the quality of emissions and removal estimates on an ongoing basis.

Emissions reductions often do not follow a linear path, as there is usually a ramping up period between when an initiative is first implemented and when emissions reductions are fully realized, limiting how much can be determined from the historical emissions trajectory. For example, the GHG reductions from regulations and programs designed to incent the uptake of electric vehicles are not realized the year they are put in place. It can take several years for regulations to come into force and programs to be fully implemented. To consider what could happen, future emissions trajectories are projected.

1.6.3 Emissions projections

Emissions projections are a valued tool to estimate future GHG emissions. They are used to establish a baseline scenario and inform the development of emissions targets, assess progress toward the target, and estimate the impact of measures on future GHG emissions. Projections are an estimate based on best available information at the time that they are developed. Projections are expected to change over time in response to new climate actions, revisions to historical emissions estimates, improvements in estimation methodology, and in response to new information in the changing domestic and global context such as economic conditions and energy demand.

Emissions projections are prepared annually and submitted to the UNFCCC every two years as part of Canada’s biennial report to the UNFCCC. Canada last submitted emissions projections to the UNFCCC in December 2022, with Canada’s Eighth National Communication and Fifth Biennial Report, which included emissions projections to 2035. In non-UNFCCC reporting years, projections are published as a standalone report by ECCC as Canada’s Greenhouse Gas and Air Pollutant Emissions Projections Report. Canada’s most recent emissions projections report was published in December 2023. Canada’s emissions projections are developed in line with recognized best practices and incorporate IPCC standards for estimating GHG emissions across different fuels and processes. These standards are continually being improved upon. In addition, Canada relies on outside expert views and the most up‑to-date data available for key drivers such as economic growth, energy prices, and energy demand and supply. Finally, Canada applies an internationally recognized energy and macroeconomic modelling framework in the estimation of emissions and economic interactions.

When developing emissions projections, Canada includes both a “reference” scenario (referred to in UNFCCC submissions as the “with measures” or WM scenario) and an “Additional Measures” scenario (referred to in UNFCCC submissions as “with additional measures” or WAM scenario). According to international guidelines, the reference scenario includes all policies and measures funded, legislated, and implemented by federal, provincial, and territorial governments up to the designated cut-off date. The Additional Measures scenario accounts for those additional policies and measures that are under development and for which there is enough information for the policies and measures to be modelled. It is the Additional Measures scenario that is referenced throughout this report, as it best represents progress to Canada’s 2030 target and captures the impact of Canada’s climate policies.

Even though every effort is made to be as complete as possible in what is included in the model, the Additional Measures scenario does not include all announced measures. Measures that have not been sufficiently developed to support their inclusion in the model, as of the cut-off date for completion of the annual modelling cycle, are not reflected in the Additional Measures scenario. The cut-off time for preparation of the projections scenarios is typically two to three months in advance of publication of the projections. Measures are not included when there are important decisions yet to be confirmed that would impact the emissions reductions associated with the measure. For the 2023 projections cycle, the cut-off date for new measures was August 2023. Measures not included in the model update for 2023 include elements of the Canada Green Buildings Strategy. Measures that are being considered or are under development by the provinces and territories are only included if these measures have been identified by the jurisdiction for inclusion in the model by the cut-off point, with sufficient detail to be included. Conversely, measures that had previously been included based on announced timelines and approach may require adjustment if measures do not advance as originally expected.

1.6.4 Accounting for uncertainty

Canada’s GHG emissions projections are based on the current economic structure and policy context subject to future changes that will occur in government policy, energy supply, demand and technology, or domestic and international economic and political events. A series of plausible assumptions are made regarding, among others, population and economic growth, prices, demand and supply of energy, and the evolution of technologies. Given the uncertainty inherent in projecting into the future, emissions projections should be seen as one estimate within a set of possible emissions outcomes over the projection period. Scenarios and sensitivity analyses are used to explore the potential impacts of these assumptions. An overview of the assumptions used in the 2023 projections can be found in Chapter 5. The detailed description of assumptions and the results of the sensitivity analysis is available in Canada’s Greenhouse Gas and Air Pollutant Emissions Projections 2023.

The Energy, Emissions and Economy Model for Canada (E3MC) is used to generate Canada’s economy-wide emissions projections and is also often used for the analysis of various policies and regulations, depending on whether it has sufficient level of granularity and model features required to analyse a policy or regulation in question. Nevertheless, throughout policy development, ECCC does not rely solely on the E3MC, because different modelling tools could be used to provide the best analytical insight about the different features or parameters of the proposed measure. Different modelling approaches could produce different modelling results, that are still informative and could be used in specific circumstances. For more information, see Canada’s approach to prepare emissions projections.

For those wanting to learn more about projections and international best practices, the UNFCCC is an important source of information. One example of the materials available to learn more is an introductory guide for practitioners (PDF) on emissions projections developed by Germany to support UNFCCC efforts related to new reporting requirements under the Paris Agreement’s Enhanced Transparency Framework. For Canada, an Energy Modelling Hub was established in 2022 to foster ongoing dialogue among Canadian energy system modellers, policy makers, and stakeholders. In 2023, the Government of Canada announced funding support for three energy modelling projects with leading organizations across Canada to expand the evidence base for net-zero pathways in Canada.

ECCC convened an expert-led process to provide independent advice on ensuring a robust and reliable modelling regime that maximizes transparency and addresses the inherent uncertainties in all modelling processes. A summary of the modelling review outcomes is provided in Section 5.5. See the Emissions Projections Report for more on the independent modelling review action plan.

The pace of technology development and adoption

The development and adoption of clean technologies across all economic sectors will be necessary to meet Canada’s climate commitments, shifting from carbon-intensive technologies, processes, and practices to those that can significantly reduce or eliminate GHG emissions. Clean technology solutions are needed across all of Canada’s economic sectors. The International Energy Agency’s Net-Zero Emissions Scenario forecasts that reaching net zero by 2050 requires further rapid deployment of available technologies as well as widespread use of technologies that are not yet on the market. It estimates that about 35% of emissions reductions needed to reach net zero by 2050 will come from technologies that are currently at the demonstration or prototype phase. The Canadian Climate Institute similarly estimates that, for Canada, clean technologies that are currently commercially available can be expected to play a significant role in reaching the 2030 target, but that substantial innovation efforts will be needed to ready solutions in key areas for net zero by 2050. The pace and scale of change will vary by sector according to context-specific factors, such as the relative cost of clean technologies, supply-chain development, and presence of enabling infrastructure.

For the development of emissions projections, assumptions are made based on current technologies and expected pace of technology development and adoption. Greater emissions reductions are possible—from more rapid development of innovative technologies as well as greater uptake of existing technologies. A range of factors influence technology development and uptake, including government and private sector investment and innovation. Decisions rest in large part with industry stakeholders—influenced by the financial sector, as well as the extent to which the federal, provincial and territorial governments create enabling policy, regulatory, and market environments to drive the clean technology transition.

For more on Canada’s emissions reporting and the Government of Canada’s commitment to continuous improvement of Canada’s inventory estimates and emissions projections, see Chapter 5 in Part II of this report.

Chapter 2: Progress update

This chapter provides an update on progress toward the 2026 interim objective and 2030 target with reference to Canada’s most recent NIR and most recently published emissions projections (see Part II of this report for more information on Canada’s emissions reporting).

To provide insight on the actions that are contributing to Canada’s trajectory of declining emissions, this chapter also provides an overview of the implementation status of measures to date and some of the work that is forthcoming. Section 2.2 provides a summary of the status of the 149 ERP measures and an overview of some of the key measures that are well under way or implemented. Section 2.3 looks ahead to the measures that the Government of Canada has committed to exploring. Section 2.4 highlights examples where provinces, territories, Indigenous Peoples, and the private sector are demonstrating best practices and what can be done to help move Canada toward our target. Finally, Section 2.5 outlines the enabling measures that do not necessarily reduce emissions directly but that help society make the transition to a cleaner, more affordable, net-zero lifestyle.

2.1 Meeting Canada’s emissions target

Canada’s emissions target is 40% to 45% below 2005 levels by 2030, with an interim objective of 20% below 2005 levels by 2026. Based on the most recently published projections:

Figure 2-1: Progression of Canada’s projected emissions in 2030 (Mt CO2 eq)

Figure 2-1 (See long description below)

Note: Percentage reductions are calculated here against the 2005 emissions as reported in the same year as the emissions projections were generated. Canada’s 2005 emissions level can change with each edition of the annual NIR, due to methodological improvements and revisions to source data. Percentage reductions can also be calculated based on the 2005 level from the current year NIR, yielding different values.

Long description for Figure 2-1

This graphic is a bar chart displaying the progression of Canada's projected emissions in 2030 in (Mt), between successive plans and reports. The 6 items outlined, in chronological order, are: Before Canada's Climate Plans (Second Biennial Report) (2015), with a projected 9% increase in emissions; the Pan-Canadian Framework (2016), with a 19% decrease; the Strengthened Climate Plan (2020), with a 31% decrease; the 2030 ERP (2022), with a 36% decrease; the Fifth Biennial Report (2022), with a 34% decrease; and the 2023 Progress Report (2023), with a 36% decrease.

Long description Figure 2-1: Progression of Canada’s projected emissions in 2030 (Mt CO2 eq)
Report (year) 2005 Emissions
(Mt CO2 eq)
2030 Emissions
(Mt CO2 eq)
Before Canada's Climate Plans: Second Biennial Report (2015) 749 815 +9%
Pan-Canadian Framework (2016) 730 588 -19%
Strengthened Climate Plan (2020) 730 503 -31%
2030 ERP (2022) 739 470 -36%
Fifth Biennial Report (2022) 741 491 -34%
2023 Progress Report (2023) 732 467 -36%

Canada has made substantial and enduring progress toward emissions reductions since the establishment of the Pan-Canadian Framework on Clean Growth and Climate Change with provinces and territories in 2016. Emissions projections are updated each year to account for new measures, to address changing conditions in the domestic and global economy, and to incorporate the historical emissions from the most recent NIR. The underlying data and methodology for estimating emissions are also revised over time in line with the principle of continuous improvement. For more on Canada’s emissions reporting, including recent changes to emissions projections modelling and the continuous improvement approach, see Chapter 5.

Based on data from Canada’s most recent NIR and Emissions Projections Report (EPR), Canada’s GHG emissions peaked in 2007. This represents a significant accomplishment, given that in 2015, as reported in Canada’s Second Biennial Report to the UNFCCC, Canada’s emissions were projected to be 2.2% above 2005 levels in 2020, and to continue to grow, reaching 9% above 2005 levels by 2030.1 In contrast, the most recent NIR indicated that Canada’s 2020 emissions were 10% below 2005 levels, which does not include the accounting contribution from the LULUCF sector or credits purchased by Québec from California under the Western Climate Initiative (WCI). If the LULUCF and WCI contributions were included, Canada’s emissions are estimated to have fallen by about 16% below 2005 levels by 2020, very near to Canada’s 2020 target of 17%.

The most recent projections indicate that the modelled measures will result in emissions reductions of 21.7% below 2005 levels by 2026 and 36.2% below 2005 levels by 2030. Emissions continue to fall post 2030, on the road to net zero by 2050, falling by 42.2% below 2005 levels by 2035. According to these results, with the current measures announced, Canada is on track to significantly surpass the original 2030 target of 30% below 2005 levels, exceed the 2026 interim objective, but has more work to do to achieve the enhanced target of 40% to 45% below 2005 levels by 2030.

Figure 2-2: Canada’s projected emissions trajectory

Figure 2-2 (See long description below)
Long description for Figure 2-2

This graphic is a line graph, displaying Canada’s historical emissions  and projected emissions trajectory, beginning in 2005 and ending in 2035. The three data lines are: 2015 projections from the Second Biennial Report, 2023 projections, and 2023 projections with nature-based climate solutions (NBCS) and agriculture measures. Additionally, the graph indicates Canada’s 2026 interim objective (20% below 2005 levels), as well as the former (30% below 2005 levels) and current (40–45% below 2005 levels) 2030 emissions targets.

Long description Figure 2-2: Canada’s projected emissions trajectory
Year 2015 Projections (Second Biennial Report) (Mt CO2 eq) 2023 Projections
(Mt CO2 eq)
2023 Projections with NBCS and Ag measures (Mt CO2 eq)
2005 749 732 -
2006 740 722 -
2007 761 751 -
2008 741 733 -
2009 699 675 -
2010 707 712 -
2011 709 727 -
2012 715 719 -
2013 726 718 -
2014 727 692 -
2015 736 725 -
2016 748 695 -
2017 755 693 -
2018 761 707 -
2019 764 697 -
2020 768 629 -
2021 770 637 -
2022 774 679 -
2023 783 626 -
2024 789 610 -
2025 793 597 -
2026 798 573 -
2027 801 551 -
2028 807 526 -
2029 812 505 -
2030 815 480 467
2031 - 470 457
2032 - 461 448
2033 - 455 442
2034 - 448 435
2035 - 436 423

The Government of Canada uses a combination of models and modelling approaches. The “bottom-up” approach uses a detailed simulation model that provides an estimate of emissions reductions from existing climate measures (additional measures scenario). Bottom-up projections are what is typically referred to when emissions projections are referenced. Under the “backcasting” approach, the model is used to identify potential reductions by sector in an economically efficient manner. Backcasting produces an illustrative scenario that is based on all policies and measures included in the bottom‑up approach and is calibrated to achieve the 2030 target of 40% below 2005 levels. Backcasting is not used to assess progress. It is, however, an important tool to support the consideration of where additional emissions reductions could be found. It can also be used to help account for policies and measures that are announced but that are not sufficiently developed to support their inclusion in the bottom-up modelling. The results from the backcasting scenario should not be interpreted as signaling policy intentions, but rather as an illustration of what the modelling framework suggests are economically efficient opportunities to reach pre‑determined emissions reductions.

The 2030 ERP used the combined bottom-up and backcasting approaches to provide one potential pathway across economic sectors to meet Canada’s 2030 target. Along with the updated bottom-up projections published in December 2023, the backcasting was also updated, identifying a path to meeting the 2030 target that takes into account recent developments. The revised path identifies the same sectors with the greatest potential as the 2030 ERP:

The path identified requires additional efforts between now and 2030, including full implementation of the measures already announced under the 2030 ERP and the development of new opportunities for further emissions reductions, particularly those that will help Canada’s low-carbon economy grow and support Canadians to prosper in a low-carbon future. The path to the target also requires that other orders of government and the private sector take action.

Figure 2-3: Pathway to 2030 (40% backcasting scenario)

Figure 2-3 (See long description below)

*NBCS/Agr. Measures refers to nature-based climate solutions and agriculture measures.

Long description for Figure 2-3

This graphic is a stacked area graph displaying a pathway to a 40% emissions reduction by 2030. In 2030, the backcasting model totals 438 megatonnes (Mt). The seven sectors contributing to the emissions totals are: transportation, heavy industry, electricity and steam, agriculture + land use, land-use change and forestry (LULUCF) and nature-based climate solutions (NBCS)/agriculture measures, oil and gas, waste and others, and buildings.

Canada’s greenhouse gas emissions pathway to 2030, by sector (Mt CO2 eq)
Year Agriculture + LULUCF and NBCS/Agr. Measures (emissions) Agriculture + LULUCF and NBCS/Agr. Measures (removal) Buildings Electricity and Steam Heavy Industry Oil and Gas Transportation Waste & Others
2005 63.6 0.0 84.8 117.6 89.0 168.3 156.8 52.1
2006 62.3 -2.9 79.7 111.6 88.7 174.6 157.7 50.7
2007 62.4 3.3 85.5 119.7 87.4 179.8 162.7 50.6
2008 61.9 2.5 85.4 108.9 85.9 176.5 163.2 48.9
2009 59.2 -14.2 83.9 93.8 72.5 173.8 162.0 44.4
2010 59.4 9.7 81.5 94.6 75.7 179.3 165.5 45.9
2011 60.2 15.4 86.0 86.9 81.8 184.8 164.4 47.2
2012 62.5 2.2 84.5 83.3 81.8 192.1 164.6 47.5
2013 64.4 -4.6 85.7 79.7 80.5 196.8 167.1 48.9
2014 63.4 -28.3 86.2 76.3 80.9 202.4 164.7 46.3
2015 65.0 2.0 85.3 78.9 80.6 203.1 162.6 47.5
2016 66.0 -10.3 84.9 74.3 78.0 191.5 162.4 48.0
2017 66.5 -18.9 87.7 72.6 77.3 194.0 165.4 48.7
2018 68.5 -17.5 92.4 62.7 79.6 202.5 169.3 49.6
2019 69.0 -26.6 93.3 61.6 78.8 201.3 170.2 49.6
2020 69.8 -29.9 89.1 53.7 73.6 183.4 143.2 46.1
2021 68.5 -32.9 87.2 51.7 76.8 189.2 150.1 47.0
2022 68.0 4.9 86.6 51.8 76.6 190.3 163.0 46.5
2023 67.2 -38.2 84.3 50.2 75.8 185.1 156.6 44.4
2024 66.5 -27.6 79.4 39.6 75.7 177.2 153.3 41.6
2025 66.2 -27.3 75.5 38.6 73.6 170.3 150.1 39.1
2026 65.8 -27.4 71.7 39.7 70.5 156.6 145.2 36.9
2027 64.9 -28.6 68.8 38.4 66.4 148.7 140.0 34.7
2028 64.1 -29.6 66.9 34.2 64.7 137.3 135.3 33.2
2029 63.4 -30.7 65.5 29.3 60.3 122.6 130.9 31.8
2030 62.6 -44.6 63.6 22.0 57.5 119.1 127.9 30.4

An overview of the bottom-up and backcasting results by sector is provided below. For more detailed information about Canada’s GHG emissions projections, including results from the backcasting scenario, please see the full version of Canada’s emissions projections report.

Table 2-1: GHG emissions by sector from historical estimates (2005), and bottom-up and backcasting scenario (2030)
Sector 2005 Emissions (Mt) 2030 Emissions (Mt)
2030 Emissions (Mt)
LULUCF + NBCS/Agr. measures 0 -45 -45
Agriculture* 64 63 63
Buildings 85 69 64
Electricity 118 20 22
Heavy Industry 89 63 57
Oil and Gas 168 128 119
Transportation 157 137 128
Waste and Others 52 32 30
Total 732 467 438

* Agriculture emissions are not expected to show significant reductions in the backcasting scenario as process emissions from crop and animal production, which represent approximately 80% of the sector’s emissions, are exogenous to the modelling. Reductions associated with agriculture measures are included in the “LULUCF + NBCS/Agr. Measures” row.

Emissions projections are updated each year to account for new measures, to address changing conditions in the domestic and global economy, and to incorporate the updated historical emissions from the most recent NIR, including changes that result from methodological improvements to the NIR.

In the projections that were updated and submitted to the UNFCCC in December 2022, the main drivers of change leading to emissions increases were higher population growth expectations, higher forecasts for natural gas and liquefied natural gas production, changes in assumptions related to carbon capture and storage and solvents in the oil and gas sector, and revisions in the NIR that led to increases in the oil and gas sector methane emissions. Changes that led to lower emissions included changes to building sector methodology, lower expected GDP growth estimates, and agricultural sector revisions in the NIR. The net impact was an increase in projected 2030 emissions compared to the previous projections that were published as part of the 2030 ERP in March 2022.

For the 2023 projections, NIR revisions, LULUCF accounting changes, a lower natural gas production forecast, and methodological revisions to the model resulted in lower projected emissions. Higher industrial emissions intensities and revised policy assumptions related to the hydrogen strategy and the adoption of net-zero building codes by provinces and territories led to higher emissions. The net impact was a drop in projected 2030 emissions compared to the December 2022 projections.

For more on Canada’s emissions reporting, including an overview of the drivers for change, see Section 5.4 in Chapter 5. Detailed information can be found in Canada’s National Inventory Report and in Canada’s Emissions Projections Report.

Figure 2-4: Overview of main drivers for change in updated projections between the projections included in the 2030 ERP, the December 2022 projections, and the 2023 projections

Figure 2-4 (See long description below)
Long description for Figure 2-4

This graphic provides a visual representation of the main drivers for change in updated projections between the 2021 projections included in the 2030 Emissions Reduction Plan (2030 ERP), the 2022 projections included in the Eighth National Communication and Fifth Biennial Report (NC8/BR5) to the United Nations Framework Convention on Climate Change, and the 2023 projections included in the 2023 Progress Report on the 2030 ERP.

The 2021 projections estimated that emissions in 2030 would be 470 megatonnes (Mt), or 36% below 2005 levels.

The 2022 projections estimated that emissions in 2030 would be 491 Mt, or 34% below 2005 levels. There are blue arrows pointing downwards that indicate buildings sector methodology; gross domestic product (GDP); and, agriculture revisions in the National Inventory Report (NIR) all had a downward (reducing) impact on the emissions projections. There are also red arrows pointing upwards that indicate that population; natural gas and liquified natural gas production; carbon capture and storage/solvents assumptions; and, oil and gas methane revisions in the NIR all had upwards (increasing) impact on the emissions projections.

The 2023 projections estimated that emissions in 2030 would be 467 Mt, or 36% below 2005 levels. There are blue arrows pointing downwards that indicate NIR revisions; land use, land-use change, and forestry accounting; Canada Energy Regulator natural gas production forecast; and, methodological revisions all had a downward (reducing) impact on the emissions projections. There are also red arrows pointing upwards that indicate that industrial emissions intensities and revised policy assumptions both had upwards (increasing) impact on the emissions projections.

2.2 Implementing the 2030 ERP: Highlighting recent climate action

Canada’s approach to climate action is organized on a sector-by-sector basis, while recognizing the interconnectedness among sectors. The entire Canadian economy has a role to play in reducing emissions. The sectors identified include economic sectors (buildings, electricity, heavy industry, oil and gas, transportation, agriculture, and waste), economy-wide measures that cut across sectors, and nature-based solutions, which look for opportunities to reduce emissions through nature, such as planting trees and conserving and enhancing other GHG sinks such as wetlands. An overview of how sectors are defined is included in the annex.

The Government of Canada has taken extensive action to reduce emissions, using the range of mechanisms available, including through regulations, funding support, procurement, research, and communications to inform actions being taken by others. There are 149 ERP measures which are categorized as: under exploration (1); under development (13); initiated (12); ongoing (108); adopted (9); and, concluded (6). Highlights are provided below, with a comprehensive implementation update on all of the 2030 ERP measures and strategies provided in Chapter 6, as well as information on how measures are categorized into the different implementation status types.

Figure 2-5: Implementation status of ERP measures

Figure 2-5 (See long description below)
Long description for Figure 2-5

This graphic is a pie chart displaying the breakdown of the implementation status of Canada's 2030 ERP measures. The five categories of the pie chart are: under exploration or development (9%), initiated (9%), ongoing (72%), adopted (6%), and concluded (4%).

Long description Figure 2-5: Implementation status of ERP measures
Implementation status Percentage
Under exploration or development 9%
Initiated 9%
Ongoing 72%
Adopted 6%
Concluded 4%

2.2.1 Economy-wide

Putting a price on carbon pollution continues to be a fundamental measure in Canada’s approach to climate action, with the minimum price set at $65 per tonne of COeq in 2023 and rising by $15 per year to $170 in 2030. The carbon price is estimated to be responsible for about a third of projected emissions reductions in 2030. Climate Action Incentive payments to households have increased since their introduction, reflecting the higher price on carbon pollution. Individuals and families in the provinces where the federal fuel charge applies are receiving these payments on a quarterly basis. The majority of households get more money back in Climate Action Incentive payments than the costs incurred from the federal carbon pricing system, and still have an incentive to reduce emissions.

The Government of Canada has established the Canada Growth Fund, a $15 billion arm’s length public investment vehicle that will help attract private capital to build Canada’s clean economy by using investment instruments that absorb certain risks to encourage private investment in low carbon projects, technologies, businesses, and supply chains. The first investment by the Canada Growth Fund was announced in October 2023. One of the investment tools the Canada Growth Fund will provide to support clean growth projects is contracts for difference.

Carbon contracts for difference will backstop the future price of carbon and provide predictability to businesses to de-risk important emissions reducing projects. The 2023 Fall Economic Statement announced that the Canada Growth Fund will be the principal federal entity issuing carbon contracts for difference. The Canada Growth Fund will allocate, on a priority basis, up to $7 billion of its current $15 billion in capital to issue all forms of contracts for difference and offtake agreements. The Canada Growth Fund is already in the process of negotiating carbon contracts for difference with a number of project proponents across a range of sectors. The Canada Growth Fund’s carbon contracts for difference will also support the establishment of robust carbon credit markets.

Canada’s GHG Offset Credit System enables industries with hard-to-abate emissions to purchase emissions reductions from other sources. This extends the carbon price signal and creates opportunities for foresters, farmers, Indigenous communities, and other project developers to earn revenue by selling GHG offsets. At the same time, the availability of offset credits is expected to help stimulate innovation and private sector investment. The Canadian Greenhouse Gas Offset Credit System Regulations were published in June 2022 and the Government of Canada is continuing to develop offset protocols, which set out the requirements for particular offset project types.

In the spotlight: Greenhouse Gas (GHG) Offsets

Canada’s GHG Offset Credit System encourages municipalities, Indigenous communities, foresters, farmers and other project developers to undertake innovative projects that reduce GHGs compared to business-as-usual practices. There are currently two active federal offset protocols:

The federal offset protocol for Reducing Greenhouse Gas Emissions from Refrigeration Systems encourages industrial and commercial entities to transition away from refrigerants with high global warming potential (GWP) values in their refrigeration or air conditioning systems. To be eligible under the protocol, entities must either a) retrofit a pre-existing refrigeration or air conditioning system to use an eligible refrigerant, or b) install a new refrigeration or air conditioning system containing an eligible refrigerant.

The Low Carbon Economy Fund (LCEF) leverages further climate actions from provinces and territories, municipalities, universities, colleges, schools, hospitals, businesses, not-for-profit organizations, and Indigenous governments, communities, and representative organizations by providing funding for decarbonization initiatives and programs. There are four streams in the LCEF: Leadership Fund for provinces and territories; Challenge Fund for business and not for profit organizations; Indigenous Leadership Fund; and, Implementation Readiness Fund.

In the spotlight: Low Carbon Economy Fund (LCEF)

The LCEF supports climate actions by provinces, territories, municipalities, universities, colleges, schools, hospitals, businesses, not-for-profit organizations, and Indigenous communities and organizations. Since March 2022, LCEF has been investing in a number of projects, including:

  • Up to $60.5 million to Nova Scotians and up to $17.3 million to Newfoundlanders and Labradorians for provincial Heating Oil Transition programming to support lower-income homeowners’ move from home heating oil to more affordable low-emitting technologies, like electric heat pumps and electric furnaces.
  • Up to $2.9 million to support Brock University’s District Energy System Electrification Project, which aims to reduce emissions through retrofits.
  • Up to $1.4 million to Redcliff Cypress Regional Waste Management Authority, in Redcliff (Alberta), and up to $10 million to PurEnergy Inc., in Havelock Township (Ontario), to reduce emissions from food waste.
  • Up to $910,000 from the Government of Canada and British Columbia to the District of Kitimat to help develop a new compost facility to process food, yard, and wood waste.
  • Up to $600,000 for the Kwadacha and Heiltsuk Nations to help create and expand their organic processing capacity.

The Clean Fuel Regulations set increasingly stringent requirements on producers and importers of fossil fuels to reduce the carbon intensity of gasoline and diesel used in Canada. This reduces emissions while also creating economic opportunities in the development and use of clean fuel alternatives. The Clean Fuel Regulations were published in Canada Gazette, Part II, in July 2022, and the reduction requirements came into force in July 2023.

Measured over a 20-year period, methane is 80 times more potent than carbon dioxide (CO2). As such, reducing methane from the oil and gas sector and landfills continues to be a prerequisite for Canada to meet its climate targets. To this end, the Government of Canada released Canada’s Methane Strategy in September 2022 with the objective of reducing domestic methane emissions by more than 35% by 2030, compared to 2020 levels, consolidating Canada’s leading role in this area. As part of the Strategy, Canada recently released draft methane regulations for consultation that aim to reduce methane emissions from the oil and gas sector by at least 75% below 2012 levels by 2030.

The Government of Canada is implementing the Carbon Management Strategy, released in September 2023. Carbon management—a range of approaches to capture CO2 to be durably stored or reused. This includes technologies removing carbon from point sources, such as power generation or industrial plants, or direct air capture, bioenergy with carbon capture and storage (BECCS) or other carbon dioxide removal technologies that remove CO2. According to the IPCC and the International Energy Agency, there is no credible path to net-zero emissions without carbon management technologies. Their deployment must be rapid and immense, scaling up by nearly 200 times by 2050.2 Other benefits include innovation and employment opportunities. These innovative technologies are being developed and implemented around the world, including in Canada. The Government is implementing supports to build on Canada’s early leadership in this area, including through the Carbon Capture, Utilization, and Storage (CCUS) Investment Tax Credit, Canada’s GHG Offset Credit System, and direct support for technology RD&D.

In the spotlight: Regional Energy and Resource Tables

The Regional Energy and Resource Tables (Regional Tables) are a key initiative to drive efforts to support workers and communities as Canada shifts to a low-carbon economy, ensuring equitable, inclusive, and sustainable economic growth across the country. The Regional Tables are helping to accelerate Canada’s economic growth opportunities by taking into account each region’s unique advantages and ability to meet the demands of new and emerging markets. These regional processes are being undertaken in partnership with individual provincial and territorial governments, and through engagement with Indigenous partners, as well as experts, labour organizations, industry, and other stakeholders. The Regional Tables will form the basis for implementing joint strategies to leverage energy and resource opportunities to realize each region of Canada’s comparative advantages in a net-zero emissions economy.

2.2.2 Buildings

The Canada Green Buildings Strategy is an overarching vision for decarbonizing existing and new buildings in Canada, seeking to mobilize national action to create a net-zero emissions buildings sector by 2050, while increasing resiliency. The Strategy will focus on increasing the rate of building retrofits, ensuring buildings are resilient and net-zero-ready from the start, and on transforming space and water heating. Two key initiatives supporting the Canada Green Buildings Strategy—the Codes Acceleration Fund and the Deep Retrofit Accelerator Initiative—were launched in early 2023. The Oil to Heat Pump Affordability (OHPA) Grant also launched in 2023. A Discussion Paper on the Canada Green Buildings Strategy was shared for public consultations in 2022 and a What We Heard Report and Summary of Engagement with Indigenous partners were released in July 2023.

2.2.3 Electricity

Regulations are in place to phase out unabated coal-fired electricity generation by 2030. Complementary regulations are also in place to ensure only well-performing natural gas generation is built. Additional funding programs and incentives are de-risking and supporting capital projects such as smart electrification, renewable energy development and deployment, as well as energy transitions in rural, remote, and Indigenous communities. The Government of Canada has committed to achieving a net-zero electricity grid by 2035 and has provided a suite of measures, including billions in funding, to support the achievement of this objective. In light of similar commitments made by the United States and other G7 countries, to remain competitive internationally and to support the growing demand for the electrification of the Canadian economy, the Clean Electricity Regulations (CER) were proposed to provide an early signal to ensure that this transition is clean. The draft CER were published in August 2023 for a 75-day comment period. The CER provide considerable flexibility to electricity generators to determine the best way to transition to a clean grid while continuing to provide reliable and affordable energy to Canadians and their businesses. Powering Canada Forward, a vision for achieving an affordable and reliable net-zero electricity grid by 2035, was released in August 2023. It underscores the critical importance of decarbonizing Canada’s electricity systems as a step toward achieving net-zero emissions across the economy by 2050 and ensuring a prosperous future for Canadians. The paper is a call to action and invites Canadians to join a national dialogue on electricity that will inform the development of Canada’s first Clean Electricity Strategy to be released in 2024.

A Canada Electricity Advisory Council was established as an independent, electricity-sector focused, expert advisory body to provide advice to the Minister of Energy and Natural Resources to accelerate investment, and promote sustainable, affordable, and reliable electricity systems. The Council commenced its work in May 2023 and aims to submit a final report with their advice in spring 2024.

2.2.4 Heavy industry

The Strategic Innovation Fund – Net Zero Accelerator (SIF-NZA) is investing in projects to support Canada’s largest industrial GHG emitting sectors reduce emissions, help position them to be successful in the net-zero global economy of 2050, and assist in establishing Canada as a clean technology leader capitalizing on new growth opportunities, including a domestic battery ecosystem. Since its launch in 2021, the initiative has executed a number of contribution agreements in a wide array of sectors including fuel cell technologies, battery development, nuclear, steel, and electric vehicles. The Government of Canada worked with the Cement Association of Canada to develop the Standard on Embodied Carbon in Construction and the development of the data required to disclose and reduce the embodied carbon of ready-mixed concrete supplied to major federal government construction projects. The standard took effect on December 31, 2022, with all Government of Canada procurements that take affect after that date required to apply to the standard. Canada’s Critical Minerals Strategy was launched in December 2022 and a Critical Minerals Centre of Excellence has been established.

Jurisdictions across North America are competing for zero-emission vehicle (ZEV) and automotive supply chain investments. The Inflation Reduction Act (IRA) in the U.S., as well as its Advanced Manufacturing Tax Credit, are attractive incentives for firms to choose to anchor production in the U.S., and thereby pose a challenge to Canada’s ability to compete for North American battery investments. As a response, Canada has committed to provide production-based support via Special Contribution Agreements with select battery manufacturers (e.g., PowerCo, NextStar, and Northvolt). These investments stand to secure battery and EV manufacturing in Canada for decades to come.

2.2.5 Oil and gas

The Government of Canada is publishing a regulatory framework for a cap on emissions from the production of oil and gas in fall 2023. The cap will complement other measures such as the methane regulations, clean fuel standards, carbon pricing, and tax incentives (e.g., the Carbon Capture, Utilization, and Storage Investment Tax Credit), the SIF-NZA, and the Canada Growth Fund.

2.2.6 Transportation

The Government’s Regulations Amending the Passenger Automobile and Light Truck Greenhouse Gas Emission Regulations requiring that all sales of new passenger cars and light trucks be ZEVs by 2035, with interim targets of at least 20% by 2026, and at least 60% by 2030.The Government is also developing similar requirements for on-road heavy-duty vehicles. Several initiatives complement these regulatory measures by helping to address barriers. For example, the Incentives for Zero-Emission Vehicles (iZEV) Program has contributed to the purchase of over 300,000 ZEVs since its launch in May 2019, and the Incentives for Medium- and Heavy-duty Zero-Emission Vehicles (iMHZEV) Program, launched in 2022, has processed over 1,000 incentive requests. The Zero-Emission Trucking Program (ZETP) is funding projects to capture data and firsthand experience on zero-emission truck performance in Canadian conditions and is helping accelerate the safe deployment of MHZEVs, including funding for testbeds and to support provinces and territories in the development, modernization, and alignment of codes, standards, and regulations for zero-emission trucking. 

2.2.7 Agriculture

The Government of Canada continues to implement ambitious action to support farmers and producers, to build resilience and reduce emissions through investments in climate-smart farming practices. In July 2022, the federal, provincial, and territorial Ministers of Agriculture reached an agreement in principle for the Sustainable Canadian Agricultural Partnership. As of August 2023, Agricultural Climate Solutions: On-Farm Climate Action Fund has distributed over $124.8 million through 13 projects, supporting farmers to adopt and implement immediate on-farm beneficial management practices that store carbon and reduce GHG emissions. The Agricultural Clean Technology Program provides funding for research, innovation and adoption of clean technology that will support a low carbon economy and drive sustainable growth in the agriculture sector. The Government of Canada has committed $470.7 million to this program over seven years, with over $79.2 million distributed as of October 2023.

2.2.8 Waste

The Government of Canada is implementing a comprehensive plan to reduce plastic pollution and move towards a circular plastics economy, including by working with provinces and territories to implement the Canada-wide Strategy and Action Plan on Zero Plastic Waste. A proposed regulatory framework for reducing methane emissions from landfills was released in April 2023, with draft regulations under development and planned for publication by winter 2024. Canada published an offset protocol for “Landfill Methane Recovery and Destruction” under Canada’s GHG offset system. Offset protocols are also available for use in BC (“Methane from Organic Waste Offset Protocol”), Alberta (“Landfill Gas Capture and Combustion” and “Aerobic Landfill Bioreactor”), and Québec (“Landfill Methane Reclamation and Destruction”).

2.2.9 Nature-based solutions

The Government of Canada continues to make progress toward conserving 25% of Canada’s lands and waters by 2025 and 30% by 2030, working closely with provinces and territories, Indigenous Peoples, municipalities and local governments, environmental non-governmental organizations (ENGOs), private land trusts and other partners.

Additional funding of $780 million in the Nature Smart Climate Solutions Fund, for a total of $1.4 billion, has been invested to deliver emissions reductions from nature-based climate solutions. Furthermore, the 2 Billion Trees program will invest up to $3.2 billion in tree planting efforts to support provinces, territories, third-party organizations (for-profit and not-for profit) and Indigenous organizations to support the Government of Canada’s commitment to plant two billion trees across the country. In 2022, the Canadian Council of Forest Ministers endorsed the Renewed Forest Bioeconomy Framework to accelerate development of the bioeconomy and maximize the forest sector’s contribution to net zero. The Framework builds on the recognition that emissions reductions can be achieved by increasing the use of wood in construction and by using waste and forest residuals to generate bioenergy and produce bioproducts that substitute for more emissions-intensive materials.

2.2.10 Greening government

The Government of Canada has committed to transition its operations to net-zero emissions and increase climate-resilience, while also reducing environmental impacts beyond carbon, including on waste, water and biodiversity. Led by the Centre for Greening Government of the Treasury Board of Canada Secretariat, the Government of Canada will ensure that Canada is a leader in government operations that are net‑zero, resilient and green. The Centre for Greening Government works closely with technical departments, such as NRCan, ECCC, NRC and PSPC, to provide expert advice and guidance to support departments in implementing the Greening Government Strategy.

Consistent with the Greening Government Strategy, all departments must develop a Carbon Neutral Portfolio Strategy to create a pathway to the complete decarbonization of departmental real property holdings. This includes assessing real property to ensure future needs are met and divest surplus assets, optimize the management and energy efficiency of buildings retained, and fuel switch to low carbon sources of energy.

In the spotlight: The 25 St. Clair Avenue East Rehabilitation Project

The 25 St. Clair Avenue East Rehabilitation Project is a flagship model of the Government’s commitment to reducing its real property carbon footprint. It will be one of Canada’s first federal net-zero carbon ready buildings in downtown Toronto. The building features geothermal systems to provide sustainable heating and cooling, roof-top photovoltaic panels to provide over 10% of the buildings electricity demand, water reduction infrastructure, a (Smart) Building Automation System, and Electrical Vehicle Charging Stations in parking garages, reducing the building’s GHG emissions by over 80%. The building will meet the Zero Carbon Building Standard (CaGBC) and achieve LEED-GOLD and WELL-SILVER certifications.

In 2023, the Government of Canada released the Standard on Embodied Carbon in Construction which sets minimum requirements for the procurement of design and construction services. Companies bidding on federal government projects must meet the requirements of the standards to be considered. Embodied carbon forms a significant proportion of the whole life carbon emissions from construction projects. Major construction projects typically include the renovation or new construction of buildings or engineering assets.

The Standard on the Disclosure of Greenhouse Gas Emissions and the Setting of Reduction Targets requires companies bidding on federal projects over $25 million to disclose their GHG emissions and set reduction targets. Companies that join the Net-Zero Challenge or other recognized programs automatically meet the standard. This ensures the process for procurements over $25 million encourages suppliers to set a path to net zero.

2.3 Implementing the 2030 ERP: Opportunities for additional action

There are a number of measures that the Government of Canada has committed to that are still in the early stages of exploration, development, and implementation. These measures hold the potential to have significant impacts. This includes taking a collaborative approach so that both public dollars and private capital can be strategically directed with maximum effect to support economic growth, reconciliation, climate outcomes, diversity and equity, and the creation of sustainable jobs. For many of these initiatives, the Government of Canada has committed to consult widely—with provinces and territories, Indigenous Peoples, industry, and the Canadian public. How these initiatives will develop will depend in large part on what the Government hears from Canadians.

2.3.1 Economy-wide

Collaborate with provinces and territories—along with Indigenous partners and key stakeholders—to identify and accelerate the most promising clean-growth opportunities in each region; build clean energy projects; and, support workers in the global net-zero future.

Continue to explore additional ways to provide businesses certainty regarding the carbon pollution pricing trajectory, including potential legislative approaches and other new measures, in conjunction with provinces and territories.

Continue to explore how border carbon adjustments may fit into Canada’s broader climate strategy.

Guided by Canada’s Carbon Management Strategy, identify policies and programs to support accelerated innovation and scale-up of negative emissions technologies to offset hard-to-abate emissions sources.

As announced in the 2023 Fall Economic Statement, the Canada Growth Fund will be the principal federal entity issuing carbon contracts for difference—the Canada Growth Fund will allocate, on a priority basis, up to $7 billion of its current $15 billion in capital to issue all forms of contracts for difference and offtake agreements.

Complete the implementation of the new clean economy investment tax credits.

2.3.2 Buildings

Continue to develop the Canada Green Buildings Strategy to support a net-zero emissions and climate‑resilient buildings sector.

Work with the provinces and territories and other stakeholders to develop new code requirements to limit GHG emissions in new construction and for energy-efficient alterations to existing buildings.

Explore the potential to update energy and GHG performance standards in federally funded homes and buildings programs.

Explore further opportunities to minimize embodied emissions from the built environment.

2.3.3 Electricity

Engage with provinces, territories, and others to develop the design and implementation details of the Clean Electricity Investment Tax Credit.

Building on the release of Powering Canada Forward: Building a Clean, Affordable and Reliable Electricity System for Every Region of Canada, Canada remains committed to releasing its first Clean Electricity Strategy in 2024.

2.3.4 Heavy Industry

Given the multiple linkages between this sector and others, measures in other sectors will also be important for how emissions can be reduced in the heavy industry sector:

Explore opportunities to advance industrial decarbonization, including the potential to articulate a coordinated approach to accelerating industry’s adoption of clean technologies and fuels.

Continue to support industry on the road to net zero and promote clean economic growth through the Strategic Innovation Fund and the Canada Growth Fund, providing significant funding and other forms of financial support to develop and adopt new low‑carbon technologies and processes.

2.3.5 Oil and Gas

Continue to implement regulations that are addressing emissions in the sector, including carbon pricing, methane regulations, and the Clean Fuel Regulations.

Develop and implement a national cap on emissions from the production of oil and gas.

Provide financial supports for decarbonization activities in the oil and gas sector, including through the CCUS Investment Tax Credit.

2.3.6 Transportation

Deliver on the commitment to permanently fund public transit.

Consider opportunities stemming from engagement with biofuels’ stakeholders.

Continue to develop and implement climate plans for marine, rail, and aviation sectors.

Explore opportunities to accelerate the turnover of older, higher-emitting on-road vehicles.

Explore opportunities to deploy charging and hydrogen stations for medium- and heavy-duty ZEVs.

Explore opportunities to accelerate development of an off-road decarbonization strategy to transition to zero-emission equipment, machines, and zero-emission and/or low carbon fuels.

Advance the development of a Sustainable Aviation Fuels (SAF) Blueprint.

Examine options for the development of a new blueprint for a sustainable, net-zero transportation system by 2050 that takes an integrated transportation sector approach, ensures coordination across governments and stakeholders, and supports low-emitting modes where appropriate.

Explore the potential to expand the Incentives for Zero Emission Vehicles (iZEV) program to include used vehicles, building off the recent expansion of the program to enhance access to more incentives for car‑sharing fleets.

Explore the potential to expand incentives for medium- and heavy-duty ZEVs to other specialty vehicles/off-road equipment used at transportation hubs (such as airports, ports).

2.3.7 Agriculture

Develop the Sustainable Agriculture Strategy, which will help set a shared direction for collective action to reduce emissions and improve environmental performance in the sector over the long-term.

Explore various approaches to help promote the sustainability of the agriculture sector, increase clean technology use in Canada, and address barriers of adoption/extension and knowledge transfer of emissions-reducing technologies on farms.

2.3.8 Greening government

Building on recent achievements to strengthen the Policy on Green Procurement with the completion of two new standards, the Standard on Embodied Carbon in Construction and the Standard on the Disclosure of Greenhouse Gas Emissions and the Setting of Reduction Targets, attention will focus on the effective implementation of these standards, working with companies bidding on federal contracts.

Continue the implementation of the Government of Canada’s Greening Government Strategy to demonstrate leadership while exploring the potential for new measures that could contribute towards the Government of Canada’s targets related to net-zero emissions and climate-resilient operations. Short-term opportunities include procurement of clean electricity, low-carbon fuels, and zero-emission vehicles, as well as climate risk assessment of operations.

2.4 Actions being taken across Canada

The Government of Canada recognizes that achieving Canada’s emissions target requires efforts across society and the economy. Many are already stepping up to do their part, but more is needed. In addition to those actions that the Government of Canada is pursuing, provinces and territories, municipalities, Indigenous Peoples and the private sector have important roles and responsibilities. This section provides highlights of what is being done by others and uses examples of successful projects to illustrate how other governments and sectors can increase their ambition. The whole of society approach is explored further in Chapter 3, and overviews of each province and territory are provided in Chapter 7.

Figure 2-6: Achieving Canada’s 2030 emissions reductions

Figure 2-6 (See long description below)
Long description for Figure 2-6

This graphic is a stacked bar chart displaying what it would take to achieve Canada’s 2030 emissions reduction target. The categories listed are the Pan-Canadian Framework on Clean Growth and Climate Change (PCF), the 2030 Emissions Reduction Plan Bottom-up Projections, and additional action. The additional action category is broken down into: Government of Canada actions, provincial/territorial actions, municipal actions, and private sector actions.

Long description Figure 2-6: Achieving Canada’s 2030 emissions reductions
Categories Percentage of emission reductions
PCF (2016) 21%
2030 ERP Bottom-up Projections 15%
Additional action 4% to 9%
Cumulative total 40% to 45%

2.4.1 Economy-wide

The private sector makes investment decisions and provinces and territories help establish a business environment that incentivizes investments towards decarbonization. A number of provinces and territories have developed their own carbon pricing systems and are considering how they can support emissions reductions opportunities that best suit their jurisdiction. The private sector is making investments to reduce emissions and pursue low-carbon opportunities, including in hydrogen production.

In the spotlight: Low-Carbon hydrogen production

Over 70 new low-carbon hydrogen production projects have been announced and are at various stages of development. These projects set the foundation for this new clean energy industry to help decarbonize hard-to-abate sectors such as heavy-duty vehicle transportation and heavy industry, while also creating export opportunities.

2.4.2 Buildings

Provinces and territories are responsible for the adoption of building codes and have authority over municipal government affairs. Municipalities have responsibilities related to zoning and building, and have considerable scope to support homeowners to pursue deep retrofits. The private sector and individuals make purchasing decisions that have enduring impacts given the long-term nature of building stock.

In the spotlight: Net-zero buildings in Canada

Following in the footsteps of both the Mosaic Centre for Conscious Community and Commerce (Alberta’s first net-zero commercial office building) and the Mohawk College’s Joyce Centre for Partnership & Innovation (Canada’s first institutional building to receive a Zero Carbon Building Design certification by the Canada Green Building Council (CAGBC)), several buildings have distinguished themselves in achieving net-zero emissions:

  • The Stack in Vancouver is the first new commercial high-rise tower in Canada to be recognized officially as a net-zero building.
  • The Co-operators headquarters in Guelph is designed to be all-electric and eliminate direct carbon emissions from any onsite source, earning CAGBC Zero Carbon Building – Design Standard certification.
  • The Phenix in Montréal achieved CAGBC Zero Carbon Building – Performance certification for transforming an abandoned warehouse into a low-carbon, net-zero energy workspace.
Going further: Building codes

In December 2016, Canada’s First Ministers adopted the Pan-Canadian Framework on Clean Growth and Climate Change (PCF).Footnote 1  In the PCF, governments committed to work to develop and adopt increasingly stringent model building codes, starting in 2020, with the goal that provinces and territories adopt a “net-zero energy ready” model building code by 2030. Building codes are recognized as important to spur innovation and support Canadian businesses in developing more efficient building techniques and technologies.

British Columbia has committed to take important steps to increase energy-efficiency requirements in the BC Building Code and to make buildings net-zero energy ready by 2032. The BC Energy Step Code is a part of the BC Building Code. A voluntary provincial standard that provides an incremental and consistent approach to achieving more energy-efficient buildings that go beyond the requirements of the base BC Building Code, it establishes a series of measurable, performance-based energy-efficiency requirements for construction that builders can choose to follow while communities may voluntarily adopt bylaws and policies highlighted in the BC Energy Step Code. This Code came into force in April 2017, giving builders the option to build to the requirements in the Energy Step Code at any time. Currently, local governments have the authority to require or incentivise builders to meet one or more steps. In future, new homes will need to be built better than the current BC Building Code, reaching 40% more energy efficient by 2027 and 80% more energy efficient by 2032, which is the net-zero energy ready standard.

Further to this example from British Columbia, there are other jurisdictions, including municipalities, that are also looking to develop and accelerate adoption of codes and standards with a focus on net-zero energy readiness.

Going further: Heat pumps

Space and water heating accounts for 98% of direct operational emissions in the buildings sector. These emissions can be reduced by switching from fossil fuels to heat pumps, powered by non-emitting electricity. Not only does the use of heat pumps contribute to lower emissions, but they have also proven to be highly energy efficient and, consequently, can reduce energy costs for homeowners and renters. Technology development in recent years has led to new high-performance cold-climate models suited to the Canadian climate that have been shown to out-perform fossil fuel options.3 Heat pumps also offer both cooling and heating, eliminating the need for a separate air conditioning unit—a feature that has grown in importance given the more frequent heat waves during Canada’s summers. These considerations, combined with incentives from federal, provincial and territorial governments and utilities, have led to a considerable increase in the number of residential heat pumps installed in Canada, more than doubling since 2000 to around 850,000 households using heat pumps as their primary source of heating in 2020.4 This estimate does not include heat pump uptake since 2020, and does not include households who use a heat pump for partial heating. In the three Maritime provinces, the proportion of households with heat pumps was more than 20% as of 2021.5

Research from the Canadian Climate Institute, published in September 2023, shows that heat pumps, when combined with currently available grant incentives, are less costly over their lifetime than gas heating and air conditioning, including capital and operating expenses, in most cases in Canada. They are particularly cost effective for single family homes and townhouses. The all-electric scenario—a standard heat pump with electric backup—tends to be the lowest-cost option available.

As of 2021, home heating in Canada accounted for 33 Mt of emissions, or approximately 6% of Canada’s emissions. By 2030, home space heating is projected to account for about 23 Mt of emissions, with just over 10% of total home heating supplied by heat pumps. Accelerated adoption of heat pumps holds enormous potential to further reduce emissions, help maintain comfortable and safe indoor temperatures during extreme heat events, and lower costs for Canadians.

2.4.3 Electricity

While the federal government has the authority to regulate GHG emissions, provinces and territories have a key role in electricity planning and operation. Furthermore, several utilities are provincially owned Crown corporations. In other jurisdictions, utilities are privately owned, but are regulated by provincial utility regimes. Municipal governments also have an important role, with ownership of utilities in some jurisdictions (i.e., Ontario), and decision-making related to zoning. As well, Indigenous communities continue to implement innovative solutions to support a robust transition to clean electricity.

In the spotlight: Tarquti Energy

Tarquti is a Nunavik-owned company that carries out clean energy projects tailored to the needs and interests of the region’s Inuit communities. They are leading Nunavik’s clean energy transition in partnership with community stakeholders, promoting local job creation and building a better future for the region that respects the environment and Inuit values. In 2022, Tarquti signed a historic partnership with Hydro-Québec, the provincial utility organization, to advance community-led and community-owned clean energy projects across Nunavik, while creating numerous local and regional jobs. The Government of Canada also established a partnership with Tarquti to help build capacity for renewable energy in the region.

In the spotlight: Accelerated coal phase-out in Alberta

In 2012, the Government of Canada introduced Canada’s first coal phase-out regulation, that would have seen Alberta close its last coal plant in 2061. In 2015, the Government of Alberta introduced its Climate Leadership Plan, which included the objective of phasing out coal-fired electricity by 2030. At that time, coal provided over half of Alberta’s electricity.6  In 2016, the Government of Canada announced federal legislation to achieve the phase-out of all unabated coal-fired electricity generation in Canada by 2030. In 2023, the coal phase-out is about to be achieved in Alberta, seven years ahead of schedule, as the last remaining coal-fired generating station completes the switch to natural gas. The phase-out ahead of schedule has been possible due to several factors, including clear policy leadership from both provincial and federal governments through measures such as carbon pricing, regulation, and financial supports to impacted utilities, workers, and communities, as well as the availability of cost-competitive technologies.

Going further: Renewable energy

Renewable energy holds significant potential to increase the availability of electricity to support wide scale electrification, reduce emissions from electricity generation and, given their emergence as some of the lowest cost options for new electricity production, reduce costs for Canadians. The cost of renewables such as solar and wind power has declined dramatically between 2010 and 2022. The weighted average cost of electricity from solar photovoltaics and onshore wind fell by 89% and 69%, respectively.7 These technologies have become competitive with fossil fuels in certain regions, for example in Alberta and Ontario where wind can produce electricity at a lower cost than natural-gas-fired power.8  In 2022, Canada’s solar electricity generation capacity grew by 41% and wind by 7%. Canada now has an installed capacity of more than 19 GW of utility-scale wind and solar energy, having added more than 1.8 GW of new generation capacity in 2022 (CANREA).9 Alberta has been a leader in renewable energy development in Canada, accounting for 75% of the country’s increase in solar and wind generation in 2022, with 17% of the province’s electricity from wind and solar in 2022. Nova Scotia, already a pioneer in Canada in the adoption of wind energy and exploration of renewable energy alternatives, is committing to large-scale wind and solar development, citing low costs and proven technologies. The province released its clean power plan in October 2023, calling for 30% more wind power and 5% more solar energy in its power grid. The clean power plan calls for an additional 1,000 megawatts of onshore wind by 2030 which would then generate 50% of the province’s electricity.

Going Further: Provinces investing in nuclear energy

Nuclear energy is an existing source of emissions-free energy in Canada with new opportunities being explored. Ontario’s Independent Electricity System Operator’s Pathways to Decarbonization Report forecasts that in less than 30 years, Ontario could need to more than double its electricity generation capacity from 42,000 MW today to 88,000 MW in 2050. The report forecasts an additional 17,800 MW of nuclear power could be required to meet that increased demand. In response Ontario has announced the potential construction of up to 4,800 MW new nuclear capacity being added to the grid at the Bruce Power site. This would be the first new, large-scale nuclear plant built in Canada in over 30 years. Ontario has also announced that it will work with Ontario Power Generation to commence planning and licensing for three additional small modular reactors (SMR), for a total of four reactors at the Darlington New Nuclear Site. Pending regulatory approvals to build the additional three reactors, the total output would be 1,200 MW with the first grid-scale SMR in Canada to be completed by 2029.

New Brunswick is home to the only Canadian nuclear plant outside of Ontario and is considering opportunities associated with small modular reactor technology.

Saskatchewan has identified nuclear power as a possible energy generation option in the province and in March 2022 launched a strategic plan to support SMR development.

The Government of Alberta has expressed interest in SMRs as an option to help decarbonize the oil and gas industry and provide clean electricity to their grid, highlighting SMRs as a potential decarbonization pathway in the Emissions Reduction and Energy Development Plan 2023. The province has committed $7 million to further assess the feasibility of SMR applications in the oil sands, following up a study by Hatch which concluded that SMRs are a feasible option for the provision of electricity and steam in the oil sands to support net-zero energy production at in-site facilities.

2.4.4 Heavy Industry

Heavy industry operates in a global marketplace and is facing increasing market pressure to account for and reduce their Scope 1, 2 and 3 emissions.

In the spotlight: Canada’s Steel Industry

Canada’s major integrated steel operations are transitioning to lower-emitting steel. Algoma Steel is transitioning its operations to electric arc furnaces in Sault Ste. Marie. This process is expected to reduce Algoma’s GHG emissions by more than 70%. ArcelorMittal Dofasco is transitioning to direct-reduced iron steelmaking, set to reduce carbon emissions by 60% and lay the groundwork for net zero, and announced an annual biocarbon purchase agreement with CHAR Technologies to purchase biocarbon at their Thorold facility made of woody biomass, as a partial replacement for fossil coal in its steelmaking process.

In the spotlight: Cement Association of Canada

The Cement Association of Canada (CAC) is the voice of Canada’s cement industry. CAC has been active over the past years in accelerating the decarbonization of the sector by beginning a transition to lower-carbon fuel sources, carbon-reduced cements, and clean technologies. Its mission is to create the conditions necessary for the industry to lead and thrive in a clean economy. In 2021, CAC and the Government of Canada announced a partnership to position Canada as a global leader in low-carbon cement and concrete production and related clean technologies. The partnership established an Industry-Government Working Group, which spearheaded the Roadmap to Net-Zero Carbon Concrete by 2050, released in 2022. The Roadmap committed the industry to reducing GHG emissions from the cement and concrete sector by 15 Mt by 2030 and achieving net-zero concrete by 2050. In 2023, CAC published an action plan (PDF) to get to net zero, where collaboration between the public and private sector plays a central role. CAC has also been among the first organizations to join the Net-Zero Challenge, a federal initiative that encourages businesses to develop and implement credible and effective plans to transition their facilities and operations to net-zero emissions by 2050.

In the spotlight: Decarbonizing the Chemicals Industry

On November 28, 2023, Dow announced its final investment decision for the construction of the world’s first net-zero ethylene and derivatives facility at its Fort Saskatchewan site in Alberta. This investment will represent the world’s first net-zero Scope 1 and Scope 2 ethylene and derivatives complex. This investment will triple Dow’s capacity while eliminating carbon emissions by converting hydrogen from cracker off-gas as a clean fuel as well as CO2 capture and storage. It will leverage an additional $2 billion of investment from third parties for circular hydrogen, CO2 capture, and other infrastructure assets. At the height of construction, this facility is estimated to create 7,000 to 8,000 construction jobs. Alberta is the home to this “first of its kind” investment because of the availability of Carbon Capture, Utilization and Storage (CCUS) and associated infrastructure, and its feedstock advantage. When the project was announced in 2021, Dow stated that a key element of the investment decision was Canada’s strong, stable, and rising carbon price.

2.4.5 Oil and Gas

Provinces and territories and industry all have pivotal roles to play in ensuring emissions reductions from oil and gas production. Indigenous Peoples are also important partners, recognizing the impacts of oil and gas development and given the role of Indigenous Peoples through ownership and benefit sharing agreements.

In the spotlight: British Columbia’s oil and gas sector methane emissions

British Columbia has committed to reduce methane emissions from oil and gas by 75% from 2014 levels by 2030 and to nearly eliminate methane emissions in oil and gas, mining, industrial wood waste and other sectors by 2035.

In the spotlight: The Clean Resource Innovation Network

The CRIN is a pan-Canadian network focused on ensuring Canada’s oil and gas resources can be sustainably developed and integrated into the global energy supply. By identifying industry challenges, they create a market pull to accelerate commercialization and widespread adoption of clean technologies by bringing together industries, entrepreneurs, investors, academia, governments, and other economic actors. As part of the Government of Canada’s Strategic Innovation Fund (SIF), $100 million has been allocated for CRIN to help accelerate the development and adoption of innovative technologies and processes aiming to lower the oil and gas industry’s environmental impacts. Furthermore, three technology competition challenges for high-impact projects with clear paths to commercialization have been launched. Some of these projects include: up to $10 million funded in 2022 to Cvictus that will enable an expansion of its commercial operations to demonstrate technology that will supply low carbon intensity hydrogen from stranded hydrocarbons in Alberta; up to $8 million to Ekona Power Inc. to demonstrate pilot-scale methane solutions that will deliver decarbonized hydrogen at costs on par with conventional systems, while reducing emissions by up to 90%; up to $1 million towards VL Energy’s Field Demonstration A.I. Powered Predictive Emissions Monitoring Systems, designed to optimize processes while reducing emissions from venting, flaring and fugitives.

2.4.6 Transportation

Consumers can replace their gas and diesel-fueled cars and trucks with zero-emission vehicles (ZEVs). Freight companies, municipalities, transit agencies, and school districts can modernize their fleets with zero-emission trucks and buses. And municipalities and provinces can design efficient public transit infrastructure and take an approach to planning that supports low-emissions transportation solutions, such as locating high-density housing near transit hubs. Addressing ZEV affordability and the availability of charging stations, transitioning to clean fuels, and promoting the uptake of zero-emissions technologies for off-road vehicles and equipment, are some examples of how emissions reductions can be achieved in this sector.

In the spotlight: Canadian Urban Transit Research & Innovation Consortium (CUTRIC)

CUTRIC is an innovative non-profit organization that designs, launches, and spearheads the development of technology and commercialization projects that advance next-generation mobility and transportation solutions across Canada. In addition, the CUTRIC develops low-cost simulation tools that help transit agencies transitioning to zero-emission fleets to predict how vehicles will operate in real time on roads and in service. The advancements coming out of their initiatives and partnerships help to grow the low-carbon and smart technology ecosystem across Canada and North America, while nurturing job growth and economic development over the long term. Some notable projects by CUTRIC include: the National Smart Vehicle Joint Procurement Initiative, which is deploying half a dozen electric autonomous shuttles in Markham; and, the Pan-Canadian Hydrogen Fuel Cell Electric Bus Demonstration and Integration Trial, deploying 10 fuel cell electric buses (FCEB) with Mississauga Transit. This program is Canada’s first FCEB trial to deploy Canadian-developed hydrogen technology across the hydrogen-based transit value chain, with phase 2 launched in 2022 and inaugural sessions for phase 3 taking place in 2023.

Going further: Zero-emission vehicles

Accelerating the transition to zero-emission vehicles (ZEV) is essential to achieving net-zero emissions by 2050. More and more Canadians are choosing ZEVs each year. Canadians that are making the switch are realizing the benefit of reducing their environmental footprint and vehicle operating costs, while still meeting their transportation needs.

In 2022, demand for ZEVs outstripped supply, in part due to supply chain constraints, but also reflecting increased interest from consumers.10 According to S&P Global Mobility, almost 11% of new light-duty vehicles registered in the first three quarters of 2023 were ZEVs, compared with 8.9% in 2022, 5.6% in 2021, 3.8% in 2020, and 3.1% in 2019.11 By 2035, all new light-duty vehicles sold in Canada will be ZEVs. Canadians are choosing ZEVs faster than expected, realizing the benefit of reducing their environmental footprint and vehicle operating costs, while still meeting their transportation needs, and supported by an expanding network of chargers and government incentives (e.g., federal, British Columbia, Québec, Prince Edward Island, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, and Yukon).

Figure 2-7: Light-Duty ZEV New Market Share

Figure 2-7 (See long description below)
Long description for Figure 2-7

A Map of Canada including internal borders between the provinces and territories. Beside each province and territory there is a percentage indicating the percentage of new vehicles registered that are zero-emission vehicles. The higher the percentage, the darker the shade of the province. These percentages from darkest to lightest are:

  • greater than or equal to 15.0%
  • 10.0% - 14.9%
  • 5.0% - 9.9%
  • 1.0% - 4.9%
  • less than 1%

The average percentage of new light-duty vehicles registered in the first three quarters of 2023 that are electric vehicles for each province and territory are:

  • British Columbia: 22.3%
  • Alberta: 4.1%
  • Saskatchewan: 2.7%
  • Manitoba: 3.7%
  • Ontario: 7.4%
  • Quebec: 18.9%
  • New Brunswick: 4.8%
  • Nova Scotia: 4.1%
  • Prince Edward Island: 7.0%
  • Newfoundland and Labrador: 2.7%
  • Nunavut: 0.7%
  • Northwest Territories: 1.4%
  • Yukon: 7.6%

2.4.7 Agriculture

Federal, provincial, and territorial governments work closely to promote emissions reductions in the sector, while also supporting the competitiveness of Canadian farms and their contribution to domestic and global food security. A recent study by RBC, the BCG Centre for Canada’s Future, and Arrell Food Institute, reported that annual research and development budgets from Canadian agriculture businesses have at least doubled since 2015, but more investment is required to achieve the sector’s emissions reduction potential, which by their estimate could be as high as 40% by 2050.12 According to this report, a key challenge for the sector will be the development and widespread adoption of transformative technologies, including precision fertilization, anaerobic digesters, and biotechnology that supports agricultural resilience against disease and extreme weather events. When considering emissions from agriculture and opportunities for emissions reductions, it is important to include not only those emissions related to production of crops and livestock, but also emissions from on-farm fuel use and emissions and removals from agricultural soils (for more on considerations for how emissions related to the agriculture sector are reported on, see Annex 1).

In the spotlight: Dairy Farmers of Canada

Dairy Famers of Canada (DFC) is a farmer-funded and farmer-run organization that represents the interests of almost 10,000 Canadian dairy farms. In 2022, DFC indicated their dedication to fighting climate change by committing the dairy farm sector to reaching net-zero greenhouse gas emissions by the year 2050. To do so, DFC is working with GHG reduction specialists, federal and provincial governments, dairy stakeholders, and farmers, on strategies that can be applied at the farm level to reduce and sequester emissions as they strive for continuous improvement. To help farmers along the path to net zero, DFC released its Best Management Practices Guide to Mitigate Emissions on Dairy Farms (PDF) in March 2023. The guide is designed to help farmers identify and implement beneficial management practices (BMPs) on their farm, including an overview of 30 BMP opportunities for reducing emissions, increasing carbon sequestration, and improving overall environmental sustainability. Furthermore, DFC has also developed a Net-Zero strategy, (PDF) which lays out current sector emissions while indicating what the industry should work on to reduce emissions. This includes focusing on more reliable measurement tools as well as research into maximizing carbon sequestration, and better use of water on dairy farms.

2.4.8 Waste

Waste management falls under the jurisdiction of provinces and territories, while the collection, diversion, and disposal of waste are typically managed by municipal authorities or private firms. A number of provinces, territories and municipalities are active in the waste sector, particularly to manage related issues such as landfill capacity.

In the spotlight: The National Zero Waste Council (NZWC)

The NZWC, an initiative of Metro Vancouver, is leading Canada’s transition to a circular economy by bringing together governments, businesses, and NGOs to advance a waste prevention agenda that maximizes economic opportunities for the benefit of all Canadians. The NZWC have set out on a mission to act collaboratively with business, government, and the community, at the national and international level, as an agent of change for waste prevention and reduction in the design, production, and use of goods. In June 2022, the NZWC published their forward-looking National Zero Waste Council 2022–2025 Strategic Plan (PDF).Their 2022 priority areas of work included cities, food loss and waste, plastics, construction and demolition, and cross-sector. Their 2023–2025 priorities consist of two priority sectors and areas of work: reuse, and built environment, in addition to the five 2022 priorities. Between 2023–2025, the NZWC has indicated that they will form a new Working Group/Task Force that will lead work in the reuse sector, including advocating for consumer protections such as the right-to-repair.

2.4.9 Nature-based solutions

Indigenous Peoples play a leading role. Indigenous Science, knowledge, experiences, perspectives, and rights are essential components to building effective climate change strategies. Municipalities have the ability to preserve local carbon sinks through effective land-use planning. Provinces and territories have jurisdiction over the vast majority of the country’s forests and management decisions related to forested lands. Private landowners also have an important role in making decisions on how their land is managed.

In the spotlight: Tree Canada

Tree Canada is Canada’s only national non-profit organization dedicated to planting and nurturing trees in rural and urban environments in every province across the country. Through their programs, research, and educational efforts, Tree Canada has helped restore tree cover in areas hit by natural disasters, guided communities in managing their urban forests, helped green over 600 schoolyards, and organized annual urban forest conferences. To date, Tree Canada has planted more than 82 million trees. Their Community Tree Grants initiative supports community greening, innovation, and stewardship initiatives. Some recent projects include the restoration of New Brunswick’s Belleisle Watershed Community; the planting of edible berry shrubs on Siksika Nation in Alberta; and, providing an opportunity for patients from the Centre intégré de santé et de services sociaux de la Montérégie-Centre to plant trees to nurture a healing environment with nature.

Going further: Municipal governments and nature-based solutions

A recent study published in the scientific journal, Nature Climate Change, identified nature-based solutions as a key tool for cities to lower carbon emissions, showing how 54 European cities could reduce carbon emissions by an average of 17.4% using nature-based solutions like urban parks, streetscaping and rooftop gardens. Municipalities in Canada are actively pursuing measures to lower GHG emissions while making communities more livable, including through nature-based solutions. Nature-based solutions use nature to reduce emissions through activities such as planting trees, restoring grasslands and wetlands, and improving agricultural land management. Examples of nature‑based solutions at work include exploring the creation of a national urban park in Saskatoon, the city of Toronto (PDF) committing to a canopy cover of 40% by 2050, and the Capital Region of Victoria creating a land acquisition fund in 2000 which has helped grow the regional parks system from 8,400 hectares to over 13,000 hectares.

As urban areas account for around 40% of GHG emissions in Canada, there are considerable opportunities for emissions reductions at the local level.

2.5 Enabling measures

In addition to measures that directly address emissions, enabling measures support Canada’s efforts to reduce GHG emissions through technology development and deployment, innovative financing, and by building the skills required for a low-carbon economy and to support workers. Enabling measures are not expected to generate emissions reductions directly but will support emissions reductions in indirect ways and are recognized as important to achieving Canada’s climate mitigation objectives; or are expected to generate emissions reductions, but those reductions are accounted for in one or more economic sectors (e.g., clean technologies that support emissions reductions in agriculture, heavy industry, electricity, etc.). While there may not be GHG emissions reductions directly associated with enabling measures in all cases, the Canadian climate change mitigation story would be incomplete without them.

To enable the transition to net-zero emissions, it is important that decision makers consider climate impacts in a rigorous, consistent, and measurable manner. These considerations should include both short and long-term climate mitigation, as well as climate resilience and adaptation. This is why the Government of Canada is developing a “climate lens” that will take into account climate and economic considerations to inform policy development and government decision-making across federal departments. The Integrated Climate Lens was launched in the fall of 2021 and has been piloted in key departments to ensure that climate-related and economic considerations have informed major policy, program and funding decisions. Building on the lessons from the pilot, work is ongoing to ensure that climate, biodiversity and other key environmental considerations are further included in a consistent manner in decision documents from federal departments and agencies.

2.5.1 Clean technology and climate innovation

Accelerated development and adoption of clean technologies across all economic sectors will be necessary to meet Canada’s climate commitments, shifting from carbon-intensive technologies to those that can significantly reduce or eliminate GHG emissions from processes and practices.

In the spotlight: Canada’s clean technology industry

Canada’s clean technology industry continues to be a driver for economic activity, contributing $34 billion to its GDP and more than 188,000 jobs to the economy in 2021.13 This opportunity for clean growth extends across every part of the country and all sectors of the economy, from emerging high-tech industries to longstanding sectors like energy and renewables, resource development and manufacturing. Over 2,400 identified clean technology companies are actively innovating across Canada, with concentrations in Ontario, British Columbia, Québec, and Alberta. Canada continues to rank high for providing clean technology solutions to the world, with 12 Canadian companies named to this year’s Global Cleantech 100 list, more than any other country after the United States.14

There are numerous challenges that impact the pace and scale of clean technology adoption and innovation. Clean technologies can be more expensive, incurring higher capital costs than their equivalent emissions-intensive options, which means a mix of incentives, carbon pricing, and/or regulations are needed to encourage sufficient private sector investment and public uptake. Given the relatively early stage of the transition in most sectors, clean technologies are also confronted by uneven supply chains and enabling infrastructure; these require time to build out before widespread adoption and cost reductions can take hold. Moreover, there tends to be a general lack of awareness among stakeholders about clean technology solutions or the necessity of shifting towards them.

The Government of Canada has made significant investments since 2016 to overcome these challenges and accelerate clean technology deployment and development, with investments of over $120 billion in clean growth and other emissions reduction measures. Prominent federal measures, such as the Canada Growth Fund, the Strategic Innovation Fund – Net Zero Accelerator, the Energy Innovation Program and the Low Carbon Economy Fund, are propelling clean technology research, development and demonstration (RD&D) in emerging innovations and de-risking investment in clean technology deployment to guide decarbonization across industries. Underlying regulations and investment tax credits are also providing clear signals across the innovation continuum. Beyond this, the Government continues to undertake numerous enabling actions to encourage clean technology development and adoption, including the activities of the Clean Growth Hub, Clean Technology Data Strategy, and Clean Technology and Climate Innovation Strategy.

The support to date from the Government of Canada, provinces and the private sector is supporting the development of critical technologies, but not to the point of market saturation where supports are no longer needed. The Government of Canada estimates that between $125 to $140 billion in annual private and public investment across all levels of government is needed to reach net zero by 2050, but currently, only $15 to $25 billion is being invested each year. Given the fiscal support already provided by the Government of Canada, it is increasingly important for business, investment, and financial sector leaders to respond to the strong market signals that have been put in place.

Figure 2-8 Accelerating clean technology development and adoption in Canada

Figure 2-8 (See long description below)
Long description for Figure 2-8

GHG emissions reductions deepen with deployment. Cost and efficiency of clean technology improve with time.

  • Emergence: strong support
  • Deployment: moderate/strong support
  • Market saturation: no support

Readying innovations for 2050:

  • Negative emissions technologies
  • Clean hydrogen
  • Carbon capture

Advancing deployment for 2030:

  • Heat pumps
  • Zero emission vehicles
  • Renewables
  • Efficient building materials
  • Methane reduction solutions

The position and selection of clean technologies is for illustrative purposes.

Priority actions:

  • Clear regulatory signals
  • Innovation support
  • Deployment investment
  • Tax incentives
  • Green procurement
In the spotlight: Canada Cleantech Alliance

Canada Cleantech Alliance is a Canadian coalition of 22 cleantech industry associations and accelerators representing over 2,000 cleantech manufacturers, innovators, investors, industry adopters and researchers across the country. They work towards making Canada the best place on earth to invest in clean technology, while opening up new opportunities for Canada’s cleantech innovators. They are doing this by, among other things, sharing knowledge, making policy recommendations, trying to reduce barriers to innovation and cleantech adoption, and connecting cleantech ventures with buyers and investors. In 2022, they launched the Accelerating Cleantech Innovation in Oil & Gas program, in collaboration with the Clean Resource Innovation Network, to de-risk investments in clean technology for oil and gas companies, and ultimately help reduce the oil and gas sector’s emissions and footprint from source to end use.

2.5.2 Sustainable finance

Promoting low-carbon investments from the private sector to accelerate the transition to a green economy remains a priority in Canada. To this end, the federal government, in collaboration with federal and provincial financial regulators and financial experts, has been supporting the development of the market infrastructure needed to mobilize low-carbon investments in Canada. This includes climate-related financial disclosure to ensure risk is transparent to investors, taxonomy and net-zero capital allocation strategies to guide green and transition investments, and Federal Green Bonds to help finance the transition to net zero.

Climate-related financial disclosure is a critical element of sustainable finance that has seen progress since the release of the 2030 ERP. In March 2023, the Office of the Superintendent of Financial Institutions (OSFI) published their Guideline on Climate Risk Management, which establishes OSFI’s expectations related to the federally regulated financial institutions’ management of climate-related risks, including on governance and financial disclosures. This guideline is expected to be effective starting in 2024, with a gradually phased-in approach.

The Sustainable Finance Action Council (SFAC), which includes a broad representation of Canadian banks, insurance companies and pension funds, provided recommendations to the federal government on advancing climate-related disclosures in Canada. To expand the coverage of mandatory climate disclosures, the 2023 Fall Economic Statement announced that the Department of Finance; Innovation, Science and Economic Development Canada; and Environment and Climate Change Canada will develop options for making climate disclosures mandatory for private companies.

The SFAC also provided recommendations to the federal government on a Canadian green and transition taxonomy via its Taxonomy Roadmap Report submitted in November 2022. Building on this Report, the 2023 Fall Economic Statement announced that the Department of Finance will work with Environment and Climate Change Canada and Natural Resource Canada to undertake next steps, in consultation with regulators, the financial sector, industry and independent experts, to develop a taxonomy that is aligned with reaching net zero by 2050. In the coming months, the SFAC will provide additional advice to the federal government on strategies for aligning private sector capital with net zero, as well as on climate data and analytics.

Federal Green Bonds continue to be a key initiative that aims to mobilize capital in support of Canada’s climate and environmental objectives. Released in March 2022, Canada’s Green Bond Framework identifies expenditures that are eligible for allocation to a green bond, including in: clean transportation; living natural resources and land use; energy efficiency; terrestrial and aquatic biodiversity; renewable energy; climate change adaptation; sustainable water and wastewater management; circular economy-adapted products, production, technologies, and processes; and, pollution prevention and control. The Government of Canada successfully issued its inaugural 7.5-year, $5 billion green bond in March 2022 with the intent to issue additional green bonds in the near future.

2.5.3 Sustainable jobs, skills, and communities

The Government of Canada is committed to delivering a net-zero future that is equitable, fair, and inclusive. A net-zero emissions economy represents significant opportunities for Canadians—to secure and create jobs, to grow industries, and to lead the world with the resources and technologies it will need for generations to come. With highly skilled and dedicated workers, abundant access to the natural resources and energy sources critical for a net-zero future, and a thriving clean technology industry, Canada is uniquely positioned to seize the moment.

On June 15, 2023, the Government of Canada introduced Bill C-50, the Canadian Sustainable Jobs Act, which aims to facilitate and promote economic growth, the creation of sustainable jobs in Canada as the world advances toward a net-zero future. The bill puts workers and communities at the centre of federal policy and decision-making by establishing a framework for accountability, a governance structure and engagement mechanisms to guide effective federal action.

Subject to Parliamentary consideration, this bill would:

This legislation and interim Plan are the product of a comprehensive consultation process that took place over 2021–22, engaging provinces and territories, Indigenous groups, workers, key labour and industry partners, stakeholders and the Canadian public. It also took into consideration the recommendations of the Task Force on Just Transition for Canadian Coal Power Workers and Communities, as well as a report by the Commissioner of Environment and Sustainable Development.

The Government also offers a broad suite of programming to support jobseekers and workers of all ages and from a variety of socio-economic backgrounds, as well as employers, unions and training providers. Many of these programs, created in consultation with stakeholders, are already helping to advance sustainable jobs. They include:

The 2022 Fall Economic Statement announced funding for the creation of a Sustainable Jobs Training Fund, also an action area under the interim Sustainable Jobs Plan. This initiative will help workers develop skills for jobs in areas that are critical for a net-zero future. It will seek to help 15,000 workers across the country upgrade or gain new skills for jobs in the low-carbon economy.

In addition, the 2022 Fall Economic Statement announced funding for a new Sustainable Jobs stream in the Union Training and Innovation Program under the Canadian Apprenticeship Strategy. This stream will aim to support unions in leading the development of green skills training for workers in the trades. It is expected that an additional 20,000 apprentices and journeypersons could benefit from this investment.

In the spotlight: Indigenous Clean Energy

Indigenous Clean Energy (ICE) is a pan-Canadian not-for-profit platform that promotes Indigenous inclusion in Canada’s energy future. ICE aims to promote Indigenous leadership and accelerate First Nations, Inuit, and Métis participation in clean energy projects. They achieve this by nurturing skill development, promoting Indigenous youth leadership, building connections with governments and energy stakeholders, and sharing knowledge. Over the years, they have implemented several notable programs, such as: the 20/20 Catalyst Program, that provides participants with tools and resources to become clean energy leaders; Generation Power and ImaGENation, designed to equip youth to pursue clean energy careers and to advance their own energy projects; Charge Up, an initiative to accelerate the implementation of electric vehicle (EV) charging stations in Indigenous communities across Canada; and, Bringing it Home, supporting Indigenous, community-scale energy efficiency projects. ICE also plays a pivotal role in the Indigenous Off-Diesel Initiative, a Government of Canada initiative that supports remote Indigenous communities in reducing diesel use for heat and power, by providing training and resources to Energy Champions and the participating communities. By leveraging its expertise and connections to help communities developing clean energy projects, ICE contributes to increasing the equity and self-determination of Indigenous Peoples.

In the spotlight: The Environmental Careers Organization of Canada (ECO Canada)

ECO Canada acts as the steward for the Canadian environmental workforce spanning all industries. Working in partnership with industry, academia and practitioners, their mission is to position Canada as a global leader in innovative workforce solutions and job creation. Through job creation, wage funding, training, and labour market research, they contribute to boost future career aspirations of youth and careers of environmental professionals. They also serve as a matchmaker between environmental employers and skilled junior talent and professionals. This expertise has been acknowledged by the Government of Canada, who has chosen ECO Canada as one of the organizations in charge of placing post-secondary graduates in internship positions in environmental science, technology, engineering, and mathematics (STEM) across Canada for 2023 to 2025, as part of the Science Horizons Youth Internship Program.

Chapter 3: Working together to achieve our climate objectives

Effective action to combat climate change requires concerted effort across society, by all orders of government, and working closely with civil society and the private sector. It is imperative that we work together if we are to make the changes needed to halt and reverse the worst effects of climate change and achieve lasting emissions reductions.

This chapter addresses the whole-of-society nature of the climate crisis, considering how action can take different forms, depending on varying roles, responsibilities and capacity. The importance of individual and collective action cannot be overstated; action is needed across all of society and by all orders of government. An overview of what others are doing to advance climate action in Canada is provided, including the actions being taken by each province and territory, continued collaboration with Indigenous partners, the advice being provided by the Net-Zero Advisory Body, and efforts underway with the international community.

3.1 Whole-of-society approach

Climate change is impacting every person in Canada, whether it is through storm activity, evacuations, smoke from wildfires, drought or the increased costs associated with a changing climate. Every government, every economic sector, every business, and indeed every individual has a role to play in taking action on climate change. What that action looks like can vary widely—for many, taking action on climate change must be aligned with the other competing priorities facing Canadians, such as affordability and the rising cost of living.

3.1.1 Federal government

The Government of Canada has a key role to play in driving climate action at home and abroad. For example, the federal government has direct responsibilities for interprovincial and international trade, conducts environmental assessments of major projects, and has authority over aspects of the nuclear generation sector, electricity exports, and designated international and interprovincial transmission lines. The federal government also enacts regulations to drive innovation, create job opportunities in the low-carbon economy, and help ensure a healthy environment. In addition to direct management and regulatory roles, the Government of Canada provides extensive funding support to provinces and territories, Indigenous partners, municipalities, the private sector and individual Canadians. A detailed overview of the actions being taken by the federal government are provided in Chapter 6.

3.1.2 Provincial and territorial governments

Provincial and territorial governments have an important role in climate action given the shared responsibilities between federal and provincial and territorial governments in areas of the economy and jobs, energy, and the environment. Provinces and territories hold responsibilities over many important sources of emissions. Provincial and territorial governments manage resource ownership, royalties, land-use planning, and allocations as well as exploration, development, conservation, and use of natural resources within their boundaries. Each province and territory is responsible for electricity generation, intra-provincial transmission, and distribution within their boundaries. Provinces and territories are also responsible for the adoption of building codes and have authority over municipal government affairs. An overview of the actions being taken by each province and territory on climate change is provided in Chapter 7.

GHG targets across Canada

British Columbia: Legislated targets under Climate Change Accountability Act (2018): 40% below 2007 levels by 2030; 60% below 2007 levels by 2040; 80% below 2007 levels by 2050; commitment to reach net zero by 2050 will be backed by legislation (forthcoming)

Alberta: Goal of net zero by 2050 under Emissions Reduction and Energy Development Plan (2023)

Saskatchewan: No overall GHG reduction target

Manitoba: Goal of cumulative reduction of 5.6 Mt CO2 eq from 2023 to 2027 under Carbon Savings Account; commitment to develop a roadmap to net zero by 2050

Ontario: Committed to 30% below 2005 levels by 2030 in Made-in-Ontario Environment Plan (2018)

Québec: Legislated target of 37.5% below 1990 levels by 2030 as per amendments in 2020 to Environment Quality Act; commitment to net zero by 2050, reiterated in 2030 Plan for a Green Economy (2020)

New Brunswick: Legislated targets under Climate Change Act (2018) of less than 10.7 Mt COeq by 2030 and 5 Mt COeq by 2050; net zero by 2050 in 2022 Climate Change Action Plan

Nova Scotia: Legislated targets under Environmental Goals and Climate Change Reduction Act (2021): 53% below 2005 levels by 2030; net-zero emissions by 2050

Prince Edward Island: Legislated targets under Net-zero Carbon Act (2020): less than 1.2 Mt COeq by 2030; net zero by 2040

Newfoundland and Labrador: Committed to 30% below 2005 levels by 2030 in 2019 Climate Change Action Plan; net zero by 2050

Yukon: Legislated targets under Clean Energy Act (2022): 45% below 2010 levels by 2030; net zero by 2050

Northwest Territories: Committed to 30% below 2005 levels by 2030 in 2018 Climate Change Strategic Framework

Nunavut: No overall GHG reduction target

3.1.3 Indigenous Peoples

Indigenous Peoples have noted that lived realities are inseparable from the effects of climate change and stress the urgency of protecting their territories, homelands, resources, languages, traditions and food systems for future generations. Canada has committed to advancing an Indigenous Climate Leadership (ICL) Agenda together with First Nations, Inuit, and Métis partners in recognition that Indigenous Peoples have long called for a renewed nation-to-nation, Inuit–Crown and Government-to-Government relationship, based on the recognition of rights, respect, cooperation, and partnership. An overview of the ICL initiative is provided later in Section 3.2.

3.1.4 Municipal governments

Municipal governments are essential partners in the fight against climate change. Municipalities have influence and control over roughly 50% of GHG emissions in Canada through their management of buildings, transportation, water, waste and land-use.1 They have the ability to implement local measures that reduce GHG emissions, including public transportation projects and zero-emission buses, energy retrofits, net-zero energy buildings, active transportation, and investing in natural infrastructure. Many municipalities have their own climate targets and sector-specific commitments to reduce energy use, decarbonize transportation, reduce waste, and change land-use practices.

In the spotlight: Retrofit loan programs

In addition to direct federal supports for residential energy efficiency upgrades (e.g., Canada Greener Homes Initiative), municipalities and financial institutions are actively supporting homeowners to improve the energy efficiency of their homes through retrofit loan programs. In 2021, the City of Ottawa launched a three-year pilot for a loan program for home energy efficiency retrofits, to support local residents to reduce energy consumption and greenhouse gas emissions. The program offers low-interest, 20-year loans of up to $125,000 to cover the cost of home energy improvements and climate adaptation. Eligible measures include thermal envelope upgrades, mechanical systems, renewable energy, EV chargers (Level 2), and the addition of rental suites. With low-interest, 20-year loans that are tied to the property, not the individual, the program makes it easier and more affordable for homeowners to pay for these home improvements over time. First launched in November 2021 with a total of $8 million in zero-interest loans and $4 million in low-interest loans, the City of Ottawa recapitalized the program in June 2022 by securing a $15 million loan agreement with VanCity Community Investment Bank.

In the spotlight: Municipal leadership

The Federation of Canadian Municipalities (FCM), the national voice of local governments in Canada, is taking transformative action, such as the Climate Action Accelerator to Net-Zero (CAANZero), funded by the Government of Canada and led by MaRS Discovery District, which will aid cohorts of municipalities to accelerate climate action through retrofit projects.

Municipalities across the country are taking action, including:

  • The City of Medicine Hat, AB: with Project Clear Horizon is developing a CCUS hub aimed at reducing their own corporate emissions while being open to industry partners. Upon completion, the hub could permanently sequester up to 3 Mt CO2 eq per year.
  • The City of Laval, QC: in partnership with the Government of Québec, is investing $64.8 million to replace fossil fuels with renewables for 40 municipal buildings, increase the stock of car-sharing vehicles, build 140 public EV chargers, and plant 15,000 trees.
  • The City of Fredericton, NB: publishes an Environmental Dashboard showcasing its accomplishments. In 2022, solar panels on city-owned buildings generated enough energy to offset 33.4 t CO2 eq and the city has reduced emissions from municipal buildings by 500 tonnes since 2004.
  • The City of Yellowknife, NT: has a Corporate and Community Energy Action Plan designed to target heating, energy, cost-effectiveness, and adaptability, and has committed to increase the share of renewable energy to 30% and to reduce community emissions by 30% below 2009 levels by 2025.
  • The FCM Community Efficiency Financing initiative, delivered through the Green Municipal Fund, is a $300 million program that seeks to help municipalities deliver energy financing programs for low-rise residential properties to make homes more energy efficient and generate more renewable energy.

3.1.5 Private sector

The private sector includes businesses that directly produce emissions through industrial activity. The private sector also encompasses the investment decisions that are being made that directly impact the structure of the economy and will have an enormous impact on efforts to reduce emissions. Individual businesses, banks, institutional investors, venture capital firms and others make decisions on what to fund that directly influences the pace and scale of clean technology uptake by the private sector. A growing number of Canadian companies, including industrial sectors, are producing or adopting clean technologies to reduce emissions, drive growth, and remain competitive. These efforts often align with economic benefits, including ongoing cost savings, jobs, innovation, and improved competitiveness. Canadian businesses are also reducing emissions by using sustainable suppliers, switching company fleets to electric vehicles, and offering carbon credits to customers. Several Canadian businesses have already made net-zero pledges, including Maple Leaf Foods, Lululemon, Teck Resources, and more.

In their Canada’s Road to Net-Zero report, RBC estimates that Canada will need to invest two trillion dollars over the next thirty years (approximately $60 billion per year, up from $15 billion per year currently) to achieve net-zero emissions. The private sector will be key to reaching the investment levels required to create low-carbon and climate-resilient communities.

In the spotlight: Canadian Alliance for Net-Zero Agri-food (CANZA)

CANZA was co-founded in 2023 by a diverse group of organizations who are committed to taking action and leveraging their extensive networks and value-chain partners to achieve a shared vision: a net-zero agri-food system for Canada. Founding partners include Nutrien, BCG, McCain, RBC, Loblaw and Maple Leaf. CANZA provides a platform for action-oriented research, thought leadership and collaboration, helping to harness the ingenuity, entrepreneurship, and resources of this complex but critical ecosystem. CANZA will coordinate and catalyze opportunities through a flexible and evolving platform of pilots, regional projects and scalable innovations. This ground-up innovation approach starts in partnership with farmers, by collaborating on solutions that meet their needs and making sure they have the support (financial or otherwise) they need to implement these solutions successfully. CANZA operates as an initiative of The Natural Step Canada, an independently incorporated charity since 1996.

In the spotlight: The Net-Zero Challenge

In August 2022, the Government of Canada launched the Net-Zero Challenge (NZC) to encourage businesses operating in Canada to develop and implement credible and effective plans to transition their facilities and operations to net-zero emissions by 2050. The NZC is open to all businesses operating in Canada. To date, over 130 companies have joined, spanning many sectors of the economy. Recent additions to the program include, for example, Pomerleau Inc., Aéroports de Montréal, Colliers Projects Leaders, Deloitte, WSP in Canada, and Canada Lands Company Limited. Participating companies are supported in their net-zero planning process through a variety of means, including technical guidance that draws on international and national guidance, protocols, and best practices. In joining, participating companies build public and investor confidence in their net-zero plans, have access to a community of practice of their peers, receive public recognition of their commitments, and benefit from simple reporting requirements. Net-Zero Challenge participants are spearheading Canada’s clean industrial advantage and the path toward a sustainable future.

3.1.6 Civil society

Civil society organizations are instrumental in pushing for more ambitious climate action and holding governments and businesses accountable for their commitments. They serve as an important link between citizens, policymakers, and the private sector, helping to ensure governments take meaningful measures to combat climate change. Civil society organizations play a number of key roles including: raising awareness of climate issues; advocating for stronger climate laws, programs and policies; holding governments to account on their commitments; facilitating community-led events and initiatives; providing research, analysis, and recommendations on climate-related topics; and, participating in national and international climate forums, including climate negotiations.

In the spotlight: Canadian Climate Institute

The Canadian Climate Institute (CCI) is an independent climate change policy research organization producing analysis and evidence-based recommendations to help drive climate resilience and chart net-zero pathways towards the goal of long-term prosperity. The CCI produces policy and program scoping papers, reports on climate adaptation, clean economic growth, and climate mitigation, and case studies that highlight innovative solutions and Indigenous perspectives. Their 440 Megatonnes project tracks emissions reductions from policy measures.

3.2 Indigenous climate leadership

The Government of Canada recognizes that Indigenous Peoples’ leadership is key to Canada achieving its climate objectives and is committed to working collaboratively with First Nations, Inuit, and Métis partners to advance distinctions-based, self-determined climate action. While GHG emissions originating from Indigenous communities—estimated at less than one megatonne per year—are modest, Indigenous Peoples’ contributions to climate efforts far exceed the emissions directly attributed to their communities. The territorial stewardship of First Nations, Inuit, and Métis communities and lands, the exercise of constitutionally protected Aboriginal and Treaty Rights, and the participation in co-management regimes for natural resources and major infrastructure projects all position Indigenous Peoples as indispensable and influential contributors to climate policy and action. Further, Indigenous Knowledge Systems encompass many perspectives for understanding environmental complexity, and provide strategies to reduce, manage and adapt to environmental change in a place-based and holistic manner. In a changing climate, it is critical to prioritize Indigenous Knowledge and Science and to support self-determined climate action and initiatives.

During the development of the 2030 ERP, Indigenous Peoples, governments, and representative organizations were invited to provide submissions detailing their priorities and recommendations for Canada’s climate ambition. In their submissions, Indigenous Peoples noted that the time to engage on the 2030 ERP was inadequate and highlighted the need for their early, meaningful and consistent involvement in federal climate policy and programming. They also noted the urgency of protecting their territories, homelands, resources, languages, traditions, worldviews, and food systems for future generations and that lived realities are inseparable from the effects of climate change. They emphasized that First Nations, Inuit, and Métis experience disproportionate effects of climate change, including intensified effects of wildfires and flooding, food insecurity, and health impacts. The legacies of colonization (including displacement from traditional territories) and a unique relationship with the land, waters, and ice are factors that compound the effects of climate change, leading to intensified negative cultural, social, and economic impacts for Indigenous Peoples that directly compromise their health and wellbeing. In recognition that Indigenous partners are essential contributors to climate policy and action, and that the lived realities of First Nations, Inuit and Métis must be reflected in Canada’s climate plans, submissions from the Assembly of First Nations, Inuit Tapiriit Kanatami and the Métis National Council were included as an annex to the 2030 ERP.

In order to strengthen Canada’s partnership with Indigenous Peoples on climate, and in response to longstanding recommendations received from Indigenous partners, Canada committed to advancing work with First Nations, Inuit and Métis rightsholders, governments, and representative organizations to develop and implement a model of partnership that empowers self-determined climate action, implements the United Nations Declaration on the Rights of Indigenous Peoples, and enables Indigenous Knowledge and ways of knowing to be fully integrated in national climate policy.

To support this work, the 2030 ERP announced an investment of $29.6 million over three years, starting in 2022-23, to advance an ICL Agenda. In addition, the plan announced $180 million over seven years, starting in 2022-23, for a new Indigenous Leadership Fund under the Low Carbon Economy Fund, which supports clean energy and energy efficiency projects led by First Nations, Inuit and Métis communities and organizations. Progress on the Indigenous Leadership Fund can be found in the implementation update chapter of this report. Progress to date on the ICL initiative is detailed below.

3.2.1 The Indigenous Climate Leadership Agenda

Since time immemorial, the ability of Indigenous Peoples to adapt to and care for the land has been crucial in ensuring a flourishing way of life and rich, strong cultures. Faced with the current challenges of anthropogenic climate change, Indigenous Peoples in Canada and around the world are leaders and key drivers of climate action, at local, regional, national, and international levels. Indigenous Peoples in Canada are advancing responses to climate change in ways that reflect their Knowledge systems, legal systems, governance, values, worldviews, and nationhoods. Many Indigenous organizations, regions, and communities have developed climate change strategies and action plans to articulate their self-determined priorities. Indigenous Peoples have also called for Canada to respond meaningfully to their priorities in the climate space and to address challenges in current federal climate programming in order to make funding more accessible and equitable for First Nations, Inuit and Métis. Further, Indigenous Peoples have been calling for Canada to implement climate action that is consistent with the Paris Agreement, including urgent and transformative measures to slow climate change and address the impacts of a rapidly changing climate.

To support Indigenous Peoples’ actions in response to their climate priorities and adaptation plans, the Government of Canada is committed to renewed nation-to-nation, Inuit–Crown and government-to-government relationships with First Nations, Inuit, and Métis, based on the recognition of rights, respect, cooperation, and partnership. Recognizing that Indigenous Knowledge systems and ways of doing must be a cornerstone of Canadian climate policy, Canada has committed to advance an ICL Agenda jointly with First Nations, Inuit, and Métis partners. The goal of the ICL Agenda is to implement a model of partnership for climate action between the federal government and Indigenous Peoples that empowers self-determined climate action; leverages the transition to a net-zero economy to support overarching efforts towards self-determination, the alleviation of socio-economic inequities, and the implementation of the United Nations Declaration on the Rights of Indigenous Peoples; and, supports the inclusion of Indigenous Knowledge in national climate policy through appropriate governance arrangements, the promotion of Indigenous perspectives on climate change, and the ethical and equitable consideration of both Indigenous and non-Indigenous knowledge systems and science.

Together, the federal government and Indigenous partners have made significant progress to develop a path forward for strengthening Canada’s approach to investing in Indigenous climate action and engaging with Indigenous partners on climate. Prior to and following the release of the 2030 ERP, Canada has maintained strong partnerships with First Nations, Inuit, and Métis through three distinctions-based, Senior Bilateral Tables on Clean Growth and Climate Change. These tables, established to address challenges with the lack of meaningful engagement with Indigenous Peoples during the development of the Pan-Canadian Framework on Clean Growth and Climate Change, were announced by the Prime Minister and the national leaders of the Assembly of First Nations, Inuit Tapiriit Kanatami and the Métis National Council in 2016. More than six years later, the tables continue to be instrumental in fostering relationships between the federal government and Indigenous partners, sharing climate action that Indigenous Peoples are leading, and providing opportunities for cultural teachings and land-based learning. They are important spaces for identifying barriers, finding mutually beneficial solutions, and advancing joint climate priorities. Priorities established at these tables, as well as through First Nations, Inuit, and Métis national and regional climate change strategies, will continue to inform the ICL Agenda.

Following the release of the 2030 ERP, and building on longstanding joint priorities, Environment and Climate Change Canada and Crown–Indigenous Relations and Northern Affairs Canada launched national, regional, and community-level discussions with First Nations, Inuit, and Métis partners, with a shared objective of advancing the ICL Agenda as announced in the 2030 ERP. Recognizing that the federal government must hear directly from Indigenous partners on their vision for climate leadership, federal officials reached out to Indigenous partners in late 2022 to initiate early dialogue, which focused on laying the groundwork for a jointly developed process and setting the stage for Indigenous-led community-level engagement through to Fall 2024.

Since then, through this initiative, the Government of Canada has established partnerships with over 30 Indigenous governments and regional organizations across the country to support an inclusive process that recognizes the right to self-determination and reflects the diversity of First Nations, Inuit, and Métis realities and priorities. Canada is providing funding to many of these partners to advance unique engagement plans, each with different methods of collecting input from their citizens and communities, including targeted working groups, in-person and virtual meetings, public consultations in communities, and larger regional conferences. To date, over $20 million in contribution funding has been committed to support the efforts of these partners.

In parallel to these efforts, Environment and Climate Change Canada and Crown–Indigenous Relations and Northern Affairs Canada are working with all federal departments with responsibilities related to climate change in order to ensure programs are taking immediate action to implement best practices for meaningful engagement with Indigenous partners, and to increase Indigenous Peoples’ access to federal programming through flexible and equitable program design and implementation. Further, federal efforts to advance the ICL Agenda include sharing the early results of engagement and discussing ways that the federal government can meaningfully respond to recommendations received from Indigenous partners. Three interdepartmental committees have been established to support this work, including an Assistant Deputy Minister committee to provide strategic advice to federal departments on how to implement the ICL Agenda.

As the ICL Agenda progresses, the Government of Canada will continue to work with First Nations, Inuit, and Métis rightsholders, governments, and representative organizations to advance commitments in the 2030 ERP, including creating distinctions-based agendas for climate action that establish next steps on issues such as:

Ultimately, Canada’s approach to implementing the ICL Agenda must recognize and uphold Indigenous rights and the right to self-determination. In July 2023, Canada reconfirmed this commitment in the United Nations Declaration on the Rights of Indigenous Peoples Act Action Plan (PDF), which includes the ICL Agenda as a key action. Measure 46 states that “Canada will partner with First Nations, Inuit, and Métis to advance an ICL Agenda, including distinctions-based strategies, that vests the resources and authorities necessary for Indigenous Peoples to fully exercise their right to self-determination on climate. This includes ensuring that First Nations, Inuit, and Métis peoples have stable, long-term financing to implement their climate actions, make climate-related decisions with the Government of Canada, and that systemic barriers to Indigenous climate leadership are addressed.”

The First Nations – Canada Joint Committee on Climate Action (JCCA)

In June 2023, the Assembly of First Nations and the Government of Canada released the fifth Annual Report of the Joint Committee on Climate Action, which highlights the priorities of the committee for 2023, including a commitment to ensuring Canada’s climate solutions build on First Nations Climate Leadership and promote its full inclusion in emerging climate actions. In July 2023, the Assembly of First Nations ratified their National Climate Strategy, which sets direction for First Nations‑led climate priorities and will inform both work at the JCCA and the development of the First Nations stream of the ICL Agenda.

The Inuit – Canada Table on Clean Growth and Climate Change

In January 2023, the Inuit–Canada Table met in Ottawa and reaffirmed its focus on implementation of the Inuit Nunangat Policy, the National Inuit Climate Change Strategy, and regional strategies as they are launched, such as the Inuvialuit Settlement Region Climate Change Strategy. Inuit and federal representatives also committed to continued work to improve federal programming to foster holistic approaches to climate action in Inuit Nunangat and support Inuit Climate Leadership to advance the Inuit stream of the ICL Agenda.

Métis Nation – Canada Goose Moon Table on Clean Growth and Climate Change

In March 2023, the Goose Moon Table met in Métis Crossing, Alberta with a focus on finding new ways to meaningfully build relationships, highlight critical climate actions being taken, and integrate Métis Climate Leadership into climate policy and programming, particularly in sectors such as climate adaptation and emergency management, where they continue to be ineligible to access Indigenous-targeted federal programs. The Métis National Council, Les Femmes Michif Otipemisiwak, and Métis Nation’s Governing Members are working on the first Métis Nation’s National Climate Change Strategy, which, when it is launched in 2024, will inform priority work for the Goose Moon Table, as well as highlight top climate priorities and recommendations to further support the Métis stream of the ICL Agenda.

3.2.2 Next steps

Environment and Climate Change Canada and Crown–Indigenous Relations and Northern Affairs Canada will continue to work with First Nations, Inuit, and Métis rightsholders, governments, and representative organizations, as well as senior leaders across the federal government, to develop a roadmap for strengthening Canada’s partnership with Indigenous Peoples on climate. Increasing collaboration with Indigenous partners through a distinctions-based approach will ensure that the unique priorities and knowledge of First Nations, Inuit, and Métis underpin national climate efforts, provide a foundation for regional and community-led climate action, and are meaningfully reflected in Canada’s climate plans.

3.3 Net-Zero Advisory Body

The Net-Zero Advisory Body (NZAB) was launched in February 2021 and formally established as a Governor in Council-appointed body through the CNZEAA in June 2021. Comprised of up to 15 experts from across Canada, the NZAB’s role is to provide independent advice on how Canada can achieve net-zero emissions by 2050.

Since its launch in 2021, the NZAB has provided their advice through several publications including Net-Zero Pathways: Initial Observations, its submission to the Government of Canada’s 2030 ERP, and annual report, as well as other engagements.

3.3.1 Advice for Canada’s 2030 Emissions Reduction Plan

The NZAB’s official submission to Canada’s 2030 ERP built on their five foundational values and five design principles and marked the first year of NZAB’s work. The submission provided advice on four lines of inquiry: buildings, transportation, oil and gas, and governance. The three lines of inquiry that align with specific economic sectors were chosen as they are the highest-emitting sectors in Canada. Governance was chosen as a fourth line of inquiry based on the importance of institutional capacity and internal and external relationships for delivering emissions reductions.

3.3.2 Recent activities

Since the publication of the 2030 ERP, the NZAB has continued to advance their important work through a number of activities. This has included hosting and participating in domestic and international engagement opportunities such as stakeholder roundtables to inform its 2022 annual report, discussions on implementing the NZAB’s values and principles to achieve net zero by 2050, and a panel on the role of independent climate councils for climate governance and accountability, at an event organized by the International Climate Councils Network at COP27.

The NZAB also worked in partnership with the Canadian Climate Institute to organize several public conferences. In October 2022, they co-hosted 2030 in Focus: Getting the Next Decade Right on Net-Zero and in November 2023, they co‑hosted Building Momentum Towards Net Zero. Discussions focused on the progress toward net zero, from a national and an international perspective. The conferences featured keynote speakers, moderated panels, and fireside conversations with national and international climate change policy experts, as well as political, business, and Indigenous leaders.

The NZAB also completed its first annual report, Compete and Succeed in a Net-Zero Future. The report was submitted to the Minister of Environment and Climate Change in December 2022. As per the requirements of the CNZEAA, intended to ensure transparency and accountability, the NZAB report was published on January 27, 2023, and the Minister of Environment and Climate Change publicly responded on April 19, 2023.

In the report, the NZAB provided 25 pieces of advice across three lines of inquiry: Net-Zero Governance, Net-Zero Industrial Policy, and Net-Zero Energy systems. The selection of these lines of inquiry was guided by extensive engagement activities, review of literature, discussions with lay and expert Canadians, and early discussions with Indigenous experts and organizations.

Net-zero governance

The NZAB highlighted the need for the federal government to work with partners to implement strong governance structures and taking on a leadership role. It also highlighted the importance of, and recommendations for, best practices in monitoring progress. The advice also provided a number of recommendations for supporting effective net-zero modeling. The Minister’s response to these recommendations noted a commitment to playing a leadership role in the transition to net-zero emissions; working to continuously improve its monitoring and reporting on GHG emissions; and to improving its GHG modelling.

Net-zero industrial policy

The NZAB provided guidance on setting priorities for net-zero industrial policy, and ensuring Canada draws upon its unique advantages to remain competitive in a low-carbon economy. Its report also provided advice on implementing industrial policy to help Canada secure a foothold in emerging clean technology supply and value chains. The report highlighted the importance of creating an enabling environment for net-zero industry. The NZAB also noted that a net-zero industrial policy will complement the ERP. The Minister agreed with the importance of net-zero industrial policy in securing Canada’s transition to a net-zero future. He noted continued engagement with the NZAB on how to improve net-zero industrial policy engagement and committed to exploring mechanisms to improve the efficiency of the impact assessment and permitting process.

Net-zero energy systems

The NZAB highlighted the importance of net-zero energy systems in continuing to provide reliable and affordable energy to Canadians, while transitioning to a net-zero economy. It also provided advice on how to support grid decarbonization and electricity interties, through for example the Pan-Canadian Grid Council (launched as the Canada Electricity Advisory Council in May 2023). Finally, this line of inquiry provided guidance on how to create a more streamlined regulatory environment in order to facilitate timely deployment of non-emitting electricity. The Minister acknowledged the importance of a net-zero energy vision that reflects the principles outlined by the NZAB, as well as recognized ongoing efforts to work with partners to improve regulatory processes and achieve a net-zero grid.

3.3.3 Looking ahead

At the request of the Minister of Environment and Climate Change, the NZAB is developing advice on achieving Canada’s 2030 emission reduction goal. This advice will encourage action that can yield additional incremental emissions reductions while considering environmental, economic, social, and technological factors and the best available scientific information and knowledge, including Indigenous knowledge, respecting climate change. Grounded in Canada’s unique realities, this 2030 advice will consider the implementation risk facing many existing climate policies and if existing policies need to be strengthened or approaches altered to realize intended 2030 emissions reductions. This advice will be shared directly with the Minister of Environment and Climate Change and will be publicly available in the NZAB’s 2023 Annual Report.

The NZAB’s 2030 advice will be informed by insights gained from its ongoing engagement with Canadians, expert stakeholders, and Indigenous organizations, as well as NZAB’s foundational values and design principles to ensure alignment with the most likely pathways for Canada to achieve net zero by 2050.

Beyond providing its 2030 advice, the NZAB is developing advice emerging from its three lines of inquiry: net-zero energy systems, net-zero governance, and net-zero industrial policy, as well as developing recommendations to inform a 2035 emission reduction target. The NZAB will continue knowledge-building and learning about Indigenous climate priorities across all lines of inquiry.

3.4 International leadership

Building on Canada’s long history of stepping up to tackle global challenges, Canada has been active through the G7, G20, United Nations, and other international fora and bilateral relationships to push for increased global ambition and concrete actions to address climate change. To ensure implementation of the Paris Agreement, Canada is taking action at home and working with partners around the world to promote and facilitate global climate action everywhere. Canada is committed to supporting mitigation and climate action by developing countries.

3.4.1 International commitments and collaboration

Under the UNFCCC, Canada is committed to working with the international community to meet the objectives of the Paris Agreement and to scale up climate finance to support developing countries in their climate mitigation efforts, as well as to foster resilience among those most at-risk from the effects of climate change.

The 2015 Paris Agreement is a legally binding international treaty adopted by Parties to the UNFCCC. The Agreement aims to keep the global average temperature to well below 2.0°C above pre-industrial levels and make efforts to limit temperature increase to 1.5°C. The Agreement also seeks to enhance the ability to adapt to climate change, and make global finance flows consistent with low greenhouse gas emissions and climate-resilient development.

International climate finance

In 2021, Canada doubled its international climate finance commitment to $5.3 billion over five years. This commitment helps developing countries address the interconnected crises of climate change and biodiversity loss and supports their transitions to sustainable, low-carbon, climate-resilient development.

Canada is actively working to meet its targets of allocating at least 20% of funding from its $5.3 billion commitment to projects that leverage nature-based climate solutions with biodiversity co-benefits, 80% of funding to projects that incorporate gender equality considerations, and 40% of funding for climate adaptation projects to help developing countries build resilience to climate change impacts.

In addition, Canada is working to mobilize private sector capital to address climate change and support climate-resilient development. As part of its $5.3 billion climate finance commitment, Canada is aiming to increase its cumulative provision of private finance mobilized each year, reaching an overall target of $0.75 of private sector capital for every $1.00 of public funds invested.

Canada continues to work with Germany, since 2021, to demonstrate collective progress on the goal to mobilize US$100 billion per year in climate finance for developing countries, publishing the Climate Finance Delivery Plan in 2021 and its Progress Report in 2022. Ahead of COP28, Canada and Germany released an open letter (PDF) referencing recently published figures from the Organisation for Economic Co-operation and Development (OECD) regarding the delivery of the US$100 billion goal. The OECD has stated that it is likely the goal has already met as of 2022.

3.4.2 Update on actions in international forums

Canada’s work to support ambitious mitigation globally includes leadership of complementary initiatives and efforts, such as the Powering Past Coal Alliance, the Prime Minister’s Global Carbon Pricing Challenge, the Global Methane Pledge, and through the delivery of climate finance via the Climate Investment Funds and in the replenishment of the Green Climate Fund. Canada’s active participation in such initiatives and multilateral efforts and partnerships contributes to building consensus and finding solutions with other countries and partners on a range of issues.

United Nations Framework Convention on Climate Change Conference of the Parties

The United Nations Conference of the Parties (COP) takes place annually. It functions as both the UNFCCC’s supreme decision-making body as well as a broader UN climate change conference bringing together more than 50,000 participants to advance global discussions and solutions for climate change.

At the 27th United Nations Climate Change Conference (COP27) in November 2022, Canada and other countries agreed to accelerate efforts toward phasing out inefficient fossil fuel subsidies and the phase‑down of unabated coal power which are the single largest sources of CO2 emissions. Canada also continued to advocate for clean energy and called for more widespread adoption of carbon pricing globally. Following Prime Minister Justin Trudeau’s challenge to triple the global coverage of carbon pricing to 60% by 2030 at COP26, Canada and Chile officially launched the Global Carbon Pricing Challenge at COP27. Since then, the Republic of Korea, New Zealand, the United Kingdom, Norway, Denmark, and Germany have joined the Challenge as partners, and Côte d’Ivoire has joined as a Friend of the Challenge. Canada also worked with other Parties to examine solutions, including the creation of new financial instruments, to help vulnerable developing countries respond to loss and damage. Canada is actively involved in developing these solutions.

Canada is participating in COP28, held from November 30 to December 12, 2023, under the United Arab Emirates’ (UAE) Presidency. The UAE’s vision for COP28 focused on four paradigm shifts seeking to: (i) fast-track the energy transition and slashing emissions before 2030; (ii) transform climate finance; (iii) put nature, people, lives and livelihoods at the heart of climate action; and, (iv) mobilize the most inclusive COP. Of particular importance, Parties are reviewing the findings of the first Global Stocktake (GST) of the Paris Agreement, which aims to assess global progress in achieving the Paris Agreement’s objectives. The outcome of the GST, negotiated at COP28, will set the direction for future climate actions needed by all countries to limit temperature increases and respond to the impacts of a warming planet.

North American Leaders Summit

In January 2023, Canada, the United States and Mexico held the North American Leaders Summit, where all three parties agreed on some commitments and approaches to increase climate ambition in the region. The most notable clean growth pledges include: reducing methane emissions by 15% below 2020 levels in the solid waste and wastewater sectors by 2030; committing to develop a North American clean hydrogen market to support the transition from fossil fuels; and, agreeing to ensure that regional supply chains are promised for semiconductors and electric vehicle batteries, to be achieved through public-private dialogues. Other commitments include advancing cooperation and alignment on SC-GHG approaches and continuing cooperation on nature-based solutions and conservation.

G7 Ministers’ Meeting on Climate, Energy, and Environment

The Group of Seven (G7) is made of the world’s leading economies, specifically: Canada, the United States, the United Kingdom, France, Italy, Germany, Japan, and the European Union. The G7 has indicated its collective commitment to mitigating climate change. Canada will be the G7 President in 2025.

In 2022, G7 leaders jointly endorsed the goals of an international Climate Club to accelerate the implementation of the Paris Agreement and committed to achieving a highly decarbonised road sector by 2030, and a fully or predominantly decarbonised power sector by 2035.

In 2023, Canada and other G7 countries called for increased climate ambition through the implementation of high integrity carbon markets and initiatives like the Global Carbon Pricing Challenge, accelerating the phase-out of unabated coal power, reducing methane emissions, and using nature-based solutions. The 2023 G7 Ministers’ Meeting on Climate, Energy, and Environment took place in Sapporo, Japan from April 15 to 16. The Ministers worked to support increased ambition on climate action, nature conservation, clean and efficient energy, and pollution reduction, while also advancing global energy security and seizing economic opportunities for Canadian businesses, workers, communities, and Indigenous Peoples. This was followed by the G7 Leaders’ Summit in Hiroshima on May 19 to 21, where G7 Leaders also agreed to a number of outcomes on climate change and environment issues. Key Ministerial and Leader-level outcomes included:

G7 Ministers of agriculture

Recognizing that agriculture can make a vital contribution to mitigating the impacts of climate change, G7 ministers of agriculture met in 2022. They committed to greater use of policies to promote sustainable production, including enhanced mitigation efforts and steps to adapt agricultural production to climate change. Ministers further committed to scaling up efforts to achieve net-zero GHG emissions as soon as possible, and by 2050 at the latest. A related priority was the responsible use of fertilizers while also reducing nutrient losses and halting and reversing biodiversity loss.

G7 ministers of agriculture also recognized that activities for enhanced carbon sequestration support transformation to sustainable food systems and improve climate stewardship and food security.

Ministerial meeting on climate action

Ministerial meetings on climate action are co-hosted annually by Canada, China, and the European Union. They bring together key partners to advance the goals of the Paris Agreement. These meetings also provide a forum to discuss economic opportunities with global business leaders. In July 2023, participating ministers shared expectations for COP28, including the need to keep global warming to 1.5°C within reach and to work together to support people and communities experiencing severe impacts of the climate crisis. Ahead of this meeting, Canada announced its contribution to the second replenishment of the Green Climate Fund, a 50% increase when compared to its previous contribution. Canada called for new and enhanced actions to reduce emissions, its commitment to an inclusive approach to addressing climate change, the importance of responding to loss and damage experienced by developing countries at COP28, as well as its commitment to make climate and biodiversity action mutually reinforcing following the historic adoption of the Kunming-Montréal Global Biodiversity Framework during the Convention on Biological Diversity (COP15) in December 2022.

Meeting of the G20

The Group of Twenty (G20) is the primary forum for international economic cooperation among the world’s leading developed and emerging economies. During the 2023 G20 meetings in India, Canada worked with its partners to push for G20 commitments that would accelerate ambitions to keep a 1.5°C temperature rise within reach, halt and reverse biodiversity loss by 2030, and end plastic pollution. At their meeting in New Delhi on September 9 and 10, G20 Leaders agreed to outcomes that: noted the requirement to peak global emissions by 2025 in order to limit global warming to 1.5°C; encouraged all countries to develop emissions reduction plans that include economy-wide targets covering all greenhouse gas emissions; and reiterated previous G20 commitments to phase-out and rationalise inefficient fossil fuel subsidies and accelerate efforts towards the phasedown of unabated coal power. G20 Leaders also committed to the swift, full and effective implementation of the KMGBF, encouraging actions to halt and reverse biodiversity loss by 2030, and calling for enhanced financial resources from all sources to support this effort; and stated their determination to end plastic pollution, welcoming the negotiations towards a new, legally-binding global instrument on plastic pollution.

Major Economies Forum on Energy and Climate

The Major Economies Forum on Energy and Climate (MEF) seeks to accelerate collective efforts to keep a 1.5°C limit on warming within reach. On April 20, 2023, U.S. President Biden convened the latest leaders-level MEF, involving Prime Minister Trudeau and the leaders of 19 other major economies. Leaders expressed support for initiatives in five priority areas: (1) decarbonizing energy; (2) ending deforestation; (3) reducing non-CO2 emissions; (4) advancing carbon management technologies; and, (5) scaling up climate finance from multilateral development banks (MDB).

Canada supported the collective goal of over 50% of light duty vehicles (LDV) and at least 30% of medium- and heavy-duty vehicles (MHDVs) sold by 2030 to be ZEVs. Canada endorsed the decarbonizing international shipping initiative to support the adoption of 1.5°C-aligned goals for the shipping sector in the International Maritime Organization (IMO), including a goal of zero emissions from international shipping no later than 2050. Canada joined partners in launching the Methane Finance Sprint, which aimed to raise by COP28, at least $200 million in new public and philanthropic support for methane abatement activities, with a view to developing a pipeline of projects. Canada also endorsed an initiative to encourage major economies to ratify the Kigali Agreement and support a strong replenishment of the Montreal Protocol Multilateral Fund to incentivize early action on HFCs. Canada expressed full support and in July 2023 became a co-sponsor of the Carbon Management Challenge, with the aim for countries to come forward by COP28 with concrete announcements and goals that will accelerate carbon capture, removal, use, and storage technologies.

Organization for Economic Co-operation and Development

On November 3 and 4, 2022, Ministers of agriculture from around the world and representatives from international organizations met in Paris for the OECD Meeting of Agriculture Ministers. The Meeting was co-chaired by Canada and New Zealand. As an outcome of this Meeting, all parties agreed on commitments and approaches to increase climate change mitigation efforts by reducing emissions from agriculture and food systems and effectively increasing carbon sequestration. This would contribute to the goal of achieving economy-wide net-zero GHG emission by 2050, actions and innovative policies building on existing Nationally Determined Contributions of the Paris Agreement.

These commitments include the development and implementation of policies to facilitate adaptation to climate change; investments in research, innovation and extension services that can facilitate sustainable productivity growth and offer climate change mitigation and adaptation solutions; as well as various commitments related to other, related agri-environmental priorities and benefits.

Other international-level priorities

In addition to the priorities outlined above, Canada continues to support a wide-range of international-level effortsFootnote 2  to reduce GHG emissions and protect ecosystems and the environment, including the:

3.4.3 Pursuing progress

Canada will continue to advocate for increasing global ambition and climate action from all countries to keep 1.5˚C of warming by the end of the century within reach. Canada will deliver on its international climate finance commitments, work to continuously increase the effectiveness of investments and to mobilize private resources to meet the global financing goals. At the same time, the Government of Canada is committed to supporting and enabling Indigenous climate leadership, promoting gender equality and mainstreaming gender-based analysis, and supporting developing countries with a focus on the most vulnerable and marginalized. The 2030 ERP committed to exploring additional opportunities to work with international partners and advance leadership. Efforts have been made since the release of the 2030 ERP to advance each of these opportunities.

Encouraging the use of carbon pollution pricing around the world

Canada has continued to champion the Global Carbon Pricing Challenge (GCPC) in major international forums, including at COP27, the G7 Summit, and the UN General Assembly Climate Ambition Summit. At COP27 in November 2022, Canada hosted a high-level discussion to advance carbon pricing with representatives from Chile, New Zealand, Sweden, and the UK. In September 2023, Canada’s Prime Minister and Minister of the Environment and Climate Change hosted the GCPC event “Driving Global Climate Ambition”, featuring political representatives and high-level officials from Côte d’Ivoire, Denmark, the European Union, the Republic of Korea, New Zealand, Norway, the United Kingdom, and Vietnam, as well as the Managing Director of the International Monetary Fund, the Special Adviser on Climate to the United Nations Secretary General, and the Executive Director of the International Energy Agency. As of September 2023, the GCPC network includes Canada, Chile, Côte d’Ivoire, Denmark, Germany, the Republic of Korea, New Zealand, Norway, and the UK. The EU has signaled its intention to join. Through the GCPC Advisory Committee and Technical Working Group, work is under way to facilitate country-to-country partnerships to support and expand carbon pricing coverage.

Global phase-out of unabated coal-power electricity and thermal coal mining

In November 2022, at COP27, Minister Guilbeault announced the release of “Powering Past Coal,” the first global review of the state of coal phase-out. The report’s release marked five years of progress by the Powering Past Coal Alliance (PPCA), a global alliance of governments, businesses and industry organizations co-led by Canada and the United Kingdom. The report shows that the PPCA membership has grown to more than 165 members, including national governments, sub-national governments, businesses, and finance institutions. The report shows that the end of unabated coal power is underway and is making progress. Furthermore, the report shows that the PPCA has helped ensure that over 75% of coal power in Organisation for Economic Co-operation and Development member countries has retired or is scheduled to close by 2030.

Addressing plastic pollution

In June 2023, Canada announced that it is planning to welcome the world to Ottawa in April 2024 for the fourth session of the Intergovernmental Negotiating Committee (INC‑4) on a global treaty to end plastic pollution. Canada will continue to work with other leading countries to establish a new international legally binding agreement on plastic pollution that addresses the full lifecycle of plastics, to respond to the need for a coordinated approach with targeted, ambitious, and sustained action to address plastic pollution globally.

International carbon offsets

Following Canada’s strong advocacy at COP26 for robust international rules for internationally transferred mitigation outcomes (ITMOs) to ensure environmental integrity, transparency and the avoidance of double-counting offset credits, efforts are ongoing to explore the development of federal policy on ITMOs. Negotiations of rules for the implementation of ITMOs took place at COP27 and continued to progress at COP28 in November and December 2023.

Chapter 4: Next steps

4.1 Upcoming milestones on the road to 2030 and 2050

This report, as the first progress report under the CNZEAA, represents an important milestone for the Government of Canada’s commitment to ensure accountability and transparency in planning for and taking action against climate change. The report follows the first climate plan established under the Act, the 2030 ERP, that was released in March 2022. The Government of Canada is required to set progressively more ambitious GHG emissions targets for 2035, 2040, and 2045. These targets must be set by the Government no later than ten years in advance of the target date, and the 2035 target will be set no later than December 1, 2024. These future targets will take into account the best scientific information available, Canada’s international commitments with respect to climate change, Indigenous Knowledge, advice from the Net-Zero Advisory Body, and input from key partners and Canadians. Emissions reduction plans must also be established for each target year at least five years in advance of the target date.

The next progress report on the implementation of the 2030 Emission Reduction Plan must be finalized by no later than the end of 2025. In accordance with the Act, the 2025 Progress Report must contain an assessment of the 2030 GHG emissions target, based on the most recent developments in science, technology and GHG emissions management, and must consider whether the target should be changed, based on those developments.

The Commissioner of the Environment and Sustainable Development (CESD) provides parliamentarians and Canadians with analysis and recommendations on the Government of Canada’s efforts to protect the environment, mitigate the effects of climate change, and nurture sustainable development. The CESD is appointed by the Auditor General of Canada for a seven-year term. Under the Act, the CESD must, at least once every five years, examine and report on the Government of Canada’s implementation of the measures aimed at mitigating climate change, while prescribing recommendations related to improving the effectiveness of measure implementation. The CESD released their first report under the Act on the 2030 ERP in November 2023.

Annual Financial Risk Report under the Canadian Net-Zero Emissions Accountability Act

On March 30, 2023, the Treasury Board approved the Order in Council that brings Section 23 of the Act into force. This section of the Act requires that the Minister of Finance, in cooperation with the Minister of Environment and Climate Change, prepare an annual report respecting key measures that the federal public administration has taken to manage its financial risks and opportunities related to climate change. The first annual report is planned to be released in 2024, to cover the 2023-24 fiscal year.

Figure 4-1: CNZEAA transparency and accountability cycle 

Figure 4-1 (See long description below)
Long description for Figure 4-1
Canadian Net-Zero Emissions Accountability Act transparency and accountability cycle

Emissions Reduction Targets (olive green) – enhanced Nationally Determined Contribution for milestone year 2030; Subsequent targets must be set at least ten years in advance of milestone years. (i.e., 2035 Target due by December 1, 2024; 2040 Target due by December 1, 2029; 2045 Target due by December 1, 2034)

High Level Description (white) (HLD) – must be published within 1 year after a target is set. The content is similar to Canada’s nationally determined contribution submitted to UNFCCC. (2035 HLD due within 1 year of setting 2035 target e.g., Fall 2025; 2040 HLD due within 1 year of setting 2040 target e.g., Fall 2030; 2045 HLD due within 1 year of setting 2045 target e.g. Fall 2035)

Emission Reduction Plans (blue) (ERP) – ERP 2030 must be established by March 29, 2022. Future ERPs must be established at least five years before beginning of year to which it relates (2035 ERP due by December 31, 2029; 2040 ERP due by December 31, 2034; 2045 ERP due by December 31, 2039; 2050 ERP due by December 31, 2044)

Progress Reports (grey) (PR) – for milestone years after 2030 must be prepared no later than two years before the beginning of the relevant year. (2030 PR-1 due by Dec 31, 2023; 2030 PR-2 due by Dec 31, 2025; 2030 PR-3 due by Dec 31, 2027; 2035 PR due by Dec 31, 2032; 2040 PR due by Dec 31, 2037; 2045 PR due by Dec 31 2042; 2050 PR due by Dec 31, 2047)

Assessment Reports (yellow) (AR) – must be prepared no later than 30 days after the day on which Canada submits its official GHG emissions inventory report, currently submitted annually on or before April 15. (meaning that the 2030 AR would be due by May 15, 2032; 2035 AR by May 15, 2037; 2040 AR by May 15, 2042; 2045 AR by May 15, 2047; 2050 AR by May 15, 2052)

Financial Risk Reports (red) – The Minister of Finance must, in cooperation with the Minister of Environment and Climate Change, prepare an annual report on key measures that the Government of Canada's public administration has taken to manage its financial risks and opportunities related to climate change. The first report is expected in 2024.

The Commissioner of the Environment and Sustainable Development (black) (CESD) – must, at least once every five years, examine and report on the implementation of the measures aimed at mitigating climate change (first report no later than Dec 31, 2024; assuming this schedule is maintained, additional reports are expected in 2029, 2034, 2039, 2044, 2049)

There are many other upcoming reports that will provide additional information on climate change in Canada and the efforts being made to mitigate its impacts:

4.2 Conclusion

The Government of Canada remains steadfastly committed to meeting the 2030 emissions target, transitioning to a net-zero economy, and strengthening the fabric of Canadian society. This requires a wide range of regulations, programs, and initiatives which have been described in this report. Getting to this point has required the commitment of Indigenous Peoples, communities, provincial, territorial, and municipal governments, businesses, and individuals. At seven years away from 2030, Canada’s projected 2030 emissions are at 36% below 2005 levels. To meet Canada’s target of 40% to 45% below 2005 levels, additional emissions reductions are needed. There is more work to do.

This report outlines the more than 140 measures currently in place or in development that reduce emissions as well as the enabling measures that help support the shift to a net-zero future.

The Government of Canada recognizes the importance of finalizing policies under development and fully implementing announced policies. The Government will continue to implement measures under the 2030 ERP, including releasing the Canada Green Buildings Strategy, and implementing the Carbon Management Strategy. The government will also continue to seek new opportunities and consider a number of potential options as identified throughout this report, including exploring the potential for energy and GHG performance standards in federally funded homes and buildings programs, opportunities related to charging and hydrogen refuelling stations, the development of a Sustainable Aviation Fuels Blueprint, and approaches in the agriculture sector to help promote the adoption of beneficial management practices and increase clean technology use.

Given the central role of provinces and territories, municipalities, Indigenous Peoples and the private sector in climate action, the Government of Canada will continue to work closely with partners. Governments in Canada are being called upon by Canadians to demonstrate leadership in the fight against climate change. It is imperative that we work together to ensure that Canada does its part to reduce global emissions and protect Canadians from catastrophic climate impacts.

The Government of Canada will continue to provide updates on progress to implement the 2030 ERP and fulfill its international reporting obligations to the UNFCCC, including through the first Biennial Transparency Report to the UNFCCC that is due by the end of December 2024. The CNZEAA will ensure that Canada’s climate planning and reporting remains transparent and accountable. The Government of Canada will also continue to work closely with Indigenous Peoples, provinces and territories, municipalities, industry, and civil society. Recognizing the critical role that provinces and territories and the private sector have in achieving Canada’s climate objectives and ensuring Canada is well positioned to prosper through the net-zero transition, the Government of Canada will continue to seek opportunities with partners.


Chapter 1

1 Carbon Brief. 2022. (webpage). Attributing extreme weather to climate change. Released August 4, 2022.

2 Environment and Climate Change Canada. 2022. 2030 Emissions Reduction Plan: Canada’s Next Steps for Clean Air and a Strong Economy (PDF). Ottawa. Released March 29, 2022.

3 Climate Watch. 2023. (webpage). Historical GHG Emissions – Emissions for 2020.

4 United Nations Framework Convention on Climate Change. (webpage). Why the Global Stocktake is a Critical Moment for Climate Action.

5 National Oceanic and Atmospheric Administration National Centers for Environmental Information. 2023. (webpage). Billion-Dollar Weather and Climate Disasters. Updated November 8, 2023.

6 Finance Canada. 2023. 2023 Fall Economic Statement. Ottawa. Released November 21, 2023.

7 International Energy Agency. 2023. World Energy Outlook 2023. Paris. Released October 24, 2023.

8 Boyd, Richard and Anil Markandya. 2021. Costs and Benefits of Climate Change Impacts and Adaptation. Chapter 6 in Canada in a Changing Climate: National Issues Report. Fiona J. Warren and Nicole Lulham, editors. Natural Resources Canada, Ottawa.; Insurance Bureau of Canada. 2023. (webpage). Insured Damages from Hurricane Fiona Now Over $800 Million. Released January 5, 2023.

9 Bush, Elizabeth and Donald S. Lemmen, editors. 2019. Canada’s Changing Climate Report. Environment and Climate Change Canada, Ottawa.

Chapter 2

1 Environment and Climate Change Canada. 2016. Canada’s Second Biennial Report on Climate Change. Ottawa. Released February 10, 2016.

2 Intergovernmental Panel on Climate Change. 2019. Special Report on Climate Change and Land.; International Energy Agency. 2021. Net Zero by 2050: A Roadmap for the Global Energy Sector.

3 Gibb, Duncan, Jan Rosenow, Richard Lowes, and Neil J. Hewitt. 2023. Coming in from the cold: Heat pump efficiency at low temperatures. Joule 7 (9): 1939-1942.

4 Natural Resources Canada. (webpage). National Energy Use Database – Residential Sector – Canada – Table 27: Heating System Stock by Building Type and Heating System Type.

5 Government of Nova Scotia. 2022. (webpage). Residential Heating Fuel and Equipment, 2021. Released December 12, 2022.

6 Natural Resources Canada. 2016. (pdf). Energy Fact Book 2016-2017. Ottawa.

7 International Renewable Energy Agency. 2023. Renewable Power Generation Costs in 2022. Abu Dhabi.

8 Clean Energy Canada. 2023. A Renewables Powerhouse. Vancouver. Released February 2, 2023.

9 Canadian Renewable Energy Association. 2023. News Release: Canada added 1.8 GW of wind and solar in 2022. Ottawa. Released January 31, 2023.

10 Dunsky Energy + Climate Advisors. 2023. (webpage). Zero Emission Vehicle Availability: Estimating Inventories in Canada: 2022 Update. Montréal. Released January 31, 2023.

11 S&P Global Mobility. 2023. (pdf). Canadian Automotive Insights – Q3 2023.

12 RBC Economics and Thought Leadership, BCG Centre for Canada’s Future, and Arrell Food Institute. 2022. The Transformative Seven: Technologies that can drive Canada’s next green revolution. Released on November 30, 2022.

13 Statistics Canada. 2022. (webpage). Environmental and Clean Technology Products Economic Account, 2021. Released December 19, 2022.

14 Cleantech Group. 2023. (webpage). 2023 Global Cleantech 100.

Chapter 3

1 Federation of Canadian Municipalities. (webpage). Climate and sustainability.

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