This editorial was written and published by the Globe & Mail on June 23, 2023.

The National Energy Board was established in 1959 and headquartered in Calgary. It oversaw the export of oil and natural gas. Eight years later, on Canada’s centenary, it published its first long-term energy outlook, focused on fossil fuels. Each forecast that followed maintained that focus.

A different view of the future arrived this week. The Canada Energy Regulator – rebranded in 2019 – published its first map of what the country’s road to net zero greenhouse gas emissions could look like. It’s not a prediction of what will happen but serves as a sketch of what shape success might take.

The conclusion is net zero 2050 is doable but there’s a lot of work to do. The array of current and pending climate policies, including the rising carbon tax to 2030 and cutting fossil fuels out of the electrical grid by 2035, won’t be enough. Political debate is stuck on whether Canada’s doing too much. The fact is it’s not doing enough.

The CER is late to the game. Two years ago, the Paris-based International Energy Agency published a landmark report: Net Zero by 2050. IEA forecasts, like those of the CER, had long been about fossil fuels. The 2021 report instead detailed a lot more renewable power and a lot less oil and natural gas. In late 2021, however, the CER’s annual outlook remained rooted in the past. This space was critical of the behind-the times approach, because the CER’s work serves as a widely used reference document. The Liberal government soon after asked for a reboot.

The result landed on Monday. It is an essential report but its main findings contain no surprises. The outlines of what’s necessary, in Canada and around the world, are already well known: lots more electrical power, to replace fossil fuels in everything from transportation to heating homes; and generating that new power from clean sources. The total supply of electrical power needs to more than double by 2050, the CER calculated, a similar conclusion as others have found. Wind power is predicted to be at the fore of change, with the CER citing “low capital and operating costs.”

The CER modelled two main scenarios, one in which Canada and the world make it to net zero by 2050 and a second in which Canada succeeds but the world doesn’t hit the deadline. The difference between these two outlooks is best seen in what happens to oil – and there are two key lessons.

Oil output is at a record level, close to 5-million barrels a day. In a net zero world in 2050, demand for oil collapses, by about 75 per cent, around the same as what the IEA foresees in such a scenario. (Demand for natural gas also plummets.) But in the CER forecast where the world doesn’t reach net zero by 2050, Canadian oil production could still be 4.1-million b/d – driven by continued global demand.

The lessons are clear. First, the future of Canada’s No. 1 export is one of long-term decline. It is a major challenge for the country’s economy. But, second, it doesn’t make sense to force lower oil production just to claim lower emissions. The CER charts a way for domestic net zero in 2050, as oil and gas output is largely decarbonized, while still selling a sizable volume of fossil fuels abroad, if there is demand.

Of the CER’s main conclusion – that net zero 2050 in Canada is doable but there’s a lot of work to do – the main question is what more is to be done.

The primary policy tool should be the carbon tax, an ever higher rate to increase the squeeze across the economy away from fossil fuels.

Ottawa made a big bet on the carbon tax in late 2020 but more recently shifted to increasingly complicated regulatory measures. Some of that can be valuable – planned federal subsidies for clean power make sense – but the carbon tax should be Canada’s main lever. And as revenue from carbon pricing rises, Ottawa has to make sure it is fully revenue neutral, rather than just another source of general revenue.

The CER’s work also details of what’s possible on the road to net zero.

Clean power, a hot debate this spring, is an example. Alberta and Saskatchewan say they believe in net zero 2050 but don’t think it’s possible in power generation by 2035. The CER indicates clean power on the Prairies by the mid-2030s can happen, led by investments in wind power.

It took too long for the CER to produce a map to net zero. Now that it’s here, it becomes a guiding document as Canada builds its clean energy future.