Tag Archives: energy

False promises and the dirty truth

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Oilsands companies have been taking us for fools, Catherine McKenna writes

This article was written by Catherine McKenna and was published in the Toronto Star on December 7, 2024.

CATHERINE MCKENNA IS A FORMER FEDERAL MINISTER OF ENVIRONMENT AND CLIMATE CHANGE AND INFRASTRUCTURE. SHE IS CEO OF CLIMATE AND NATURE SOLUTIONS AND CHAIR OF THE UNITED NATIONS EXPERT GROUP ON NETZERO.

Catherine McKenna says she worked for years with the oilsands industry — epitomized by facilities such this one seen near Fort McMurray, Alta., in 2014 — on plans that she now says were a mirage.

“ It became increasingly obvious to me that the oilsands sector, along with their cheerleaders in the Alberta government and the federal Conservative party, have no intention of making the fundamental changes required to align with the global shift toward a lowcarbon economy

In May 2016, I was leading intense negotiations between the federal government and the provinces and territories to secure Canada’s first national climate plan. Suddenly, the news was everywhere: wildfires were raging out of control in Alberta, and headed straight for Fort McMurray — the heart of Canada’s oilsands production. The news was devastating: flames jumping rivers, homes and businesses incinerated, and more than 80,000 residents forced to evacuate. Firefighters and other emergency responders did everything they could but were soon outmatched. Fort McMurray would be engulfed — at once causing immense hardship and also showing Canadians the visceral and unpredictable danger of our dependency on fossil fuels.

In that moment, it felt like an unlikely consensus had emerged. The federal government, most provinces and even oilsands companies had seemingly come to understand that Canada had for too long been a laggard on climate and that for both environmental and economic reasons we needed to make meaningful promises on reducing our greenhouse gas emissions and to actually meet them.

In 2015, at COP 21 in Paris, I could already see the world changing as Rachel Notley’s government put forward Alberta’s first credible climate plan. Standing with environmentalists and First Nations leaders, as well as oilsands companies, premier Notley announced a provincial cap on oilsands emissions, a tax on carbon, a phase out of coalfired power and a methanereduction strategy. She was clear that these measures were key to Alberta’s doing its part to tackle climate change while creating the incentive for the oilsands to innovate and be more competitive globally.

Amazingly, the chairman of Canadian Natural Resources Limited, Murray Edwards, spoke enthusiastically on behalf of the oilsands industry at the press conference: “(w)e applaud Premier Notley for giving us … the position of leadership on climate policy.”

Over the next four years, I worked very hard to collaborate with the oilsands sector. I really believed that the environment and the economy could go handinhand and include a vibrant oil and gas sector. I was convinced that we could reduce emissions from the oilsands as part of an ambitious climate plan, finally showing to the world that Canada was committed to meeting our targets and doing our part to tackle the climate crisis.

It turns out the consensus was a mirage. Or, more accurately, a sham. Maybe it shouldn’t have surprised me that our industry partners were working against us from the inside. After all, oil is their business, their bottom line. It was only after I left politics that I came to understand the truth: The oilsands sector and the politicians they sponsor aren’t just greenwashing a product. They are working to brainwash Canadians into buying a version of reality that no longer exists. One where oil will forever be the hero of the Canadian economy rather than an impediment to Canada’s future prosperity in a low carbon, climatesafe world.

Perhaps this sham was never clearer to me than on a Saturday morning in the fall of 2022. I was doing what I always do on weekends, reading the newspaper and enjoying a cup of coffee. But what I saw that morning nearly made me spit out my drink: a fullpage advertisement from the Pathways Alliance, a coalition of the country’s six largest oilsands producers.

The ad boldly claimed that these companies were making “clear strides to netzero” and would “help our country achieve a sustainable future.” Soon, I started seeing a version of this ad everywhere: on my Air Canada flight, on bus shelters, on YouTube, and even during the Super Bowl. Whenever I Googled “net zero,” the Pathways Alliance popped up.

Let’s be clear about the facts. Unlike other sectors in Canada that are reducing their emissions as part of a national effort to decarbonize our economy and become more competitive, emissions from oil and gas are only increasing. This is a massive problem. Oil and gas is by far Canada’s most polluting sector, at 30 per cent of our overall emissions while making up only 1/20th of our GDP. Emissions from the oilsands specifically rose by a whopping 142 per cent since 2005. There is no chance that Canada can live up to our international obligations under the Paris Agreement — the world’s best chance of avoiding catastrophic climate change — without the oilsands finally delivering significant emissions reductions like everyone else.

The irony of this ad campaign was not lost on me. After leaving politics, I was asked by the United Nations secretarygeneral to chair an international expert group to combat greenwashing — companies promoting false solutions to the climate crisis that distract from and delay action. As the secretarygeneral stated, “We cannot afford slow movers, fake movers or any form of greenwashing.” Our report, Integrity Matters, presented at COP 27 in Egypt, established clear global standards for netzero pledges and drew a red line around greenwashing.

And yet, here I was, staring at the Pathways Alliance’s blatant greenwashing campaign.

You would have thought that when the oilsands industry made historic profits over the past few years they would have reinvested that windfall in clean energy solutions. After all, their product is not only carbonintensive, but also expensive to produce. You’d think they’d have seen the need to clean up their act to compete in a lowcarbon future. But you would be wrong. Sure, oilsands companies invested a small fraction of their money in clean technology — enough to say they had — but mostly they chose business as usual, returning the vast majority of their historic profits to shareholders largely outside of Canada, rewarding their CEOs with bonuses of $10 million or more, and ramping up production while increasing their emissions.

Worse still, they continue to demand that governments cough up even more taxpayerfunded subsidies to “clean up” their pollution.

Oilsands companies are taking us for fools.

Only now, and much too late, are they starting to be held to account for their greenwashing. Greenpeace and other environmental groups have called out the Pathways Alliance to the Competition Bureau, which is investigating their misleading claims.

This June, the federal government passed new antigreenwashing rules, which resulted in the Pathways Alliance and oilsands companies preemptively removing their climate claims from their websites and social media. It seems they couldn’t handle the new truth in advertising rules.

I understand how persuasive these companies can be. As environment minister, I bought into the idea that tighter regulations and technological advances like carbon capture and storage (CCS) would allow us to continue developing the oilsands while being serious about climate action. I also believed that working with Alberta to help diversify their economy would require compromise.

Yes, I found the government’s decision to buy the Trans Mountain pipeline a bitter pill to swallow. But I rationalized it by telling myself that it was in the national interest and was the price of bringing Albertans onside with Canada’s climate plan.

Over time I started to have serious doubts, about both the pipeline and our conciliatory approach to the oilsands sector more broadly. They started when I learned that Conser

vative politicians and oilsands companies were spreading rumours that we bought the pipeline in order to kill it. Give me a break. (Today I wish we hadn’t bought it at all. As I watched the $4.5billion purchase price balloon to the $34 billion spent to date, as I came to realize that not only will taxpayer dollars probably never be recouped, but also that Canadians will likely be left with a very expensive stranded asset, I came to regret not pushing back harder.)

It’s also come to light recently that the epic fight led by the Conservatives to kill carbon pricing that I found myself embroiled in, especially online, was supported and significantly underwritten by oil and gas companies. The campaign to discredit carbon pricing by falsely claiming it raised the cost of living — when, in fact, it benefits most Canadians — was amplified by ragefarming outlets, bots and social media algorithms.

It became increasingly obvious to me that the oilsands sector, along with their cheerleaders in the Alberta government and the federal Conservative party, have no intention of making the fundamental changes required to align with the global shift toward a lowcarbon economy.

Unlike Progressive Conservatives like Brian Mulroney, and even recent Conservative leader Erin O’Toole, who understood the need for an economically sound strategy to protect the environment for future generations, today’s Conservative politicians are at war with the very idea of meaningful climate action. Their opposition isn’t scientific or even economic: it is pure ideology.

It was only after I finished my time in government and was able to step back that I could see the balance we were trying to strike couldn’t hold. As painful — and criticized — as the compromises we struck were, I was convinced that in a diverse federation such as ours it was crucial to keep everyone in the tent. But compromise has to go both ways. And you can’t find productive compromise with ideologues hellbent on trying to preserve the status quo while the world moves on.

The sham of cooperation has delivered great fortune to the oilsands and come at a great cost to the rest of us.

The urgency of the climate crisis has never been clearer and at the same time the world is undergoing a rapid transition to clean energy.

Global CO2 emissions are set to hit a record high this year, with the bulk of the emissions from the burning of fossil fuels. The UN’s Emissions Gap Report shows that if we continue on our current path, global temperatures will rise by more than 3 C or more by the end of the century, leading to catastrophic consequences.

This is a particular disaster for Canada, which is warming at nearly twice the global average. We are on track for temperature increases of 5 to 6 C — an unthinkable outcome. Imagine endless summers of boreal fires threatening communities and filling our air with smoke, torrential rainfalls that wash away buildings and cars, punishing heatwaves that kill our most vulnerable, huge chunks of our coastline falling into the sea, an icefree Arctic.

We’ve already seen the devastating impacts of climate change: extreme drought in Alberta, catastrophic wildfires in British Columbia, historic flooding in Eastern Canada and deadly heat waves. In 2023 alone, Canada experienced more than $3 billion in insured losses due to extreme weather events. These are not anomalies — they are the new normal. And they are happening because of our continued reliance on fossil fuels.

The good news is that the world is undergoing a massive trilliondollar clean energy revolution that is quickly reducing our reliance on fossil fuels. The International Energy Agency projects that global oil demand will peak by 2030 largely due to the exponential growth in electric vehicles, as well as the growth in renewable energy and government policies.

China, the world’s largest emitter, has likely already peaked its emissions and is leading the world in renewable energy investment. In fact, China is building the equivalent of a large solar farm every day, and half of all electric vehicles sold globally are now produced there. Meanwhile, the United States, through the Inflation Reduction Act, is investing billions into clean energy solutions, leaving Canada lagging far behind.

The shift to a global “age of electricity,” as the executive director of the International Energy Agency, Fatih Birol, calls it, is a huge opportunity for Canada with our vast natural resources in hydro, solar and wind. Canada also has an opportunity to leverage our manufacturing and technological expertise to meet the demand for clean, efficient technologies. Our vast reserves of critical minerals are essential to new electric vehicles, batteries and renewable energy infrastructure. And then there are the jobs: Clean Energy Canada estimates that by 2030, the clean energy transition could create up to 400,000 new jobs, far surpassing existing positions in the oil and gas sector.

But the energy transition also presents a huge risk to Canada’s economy if we don’t change. With an oversupply of oil driving prices down, the first barrels to go will be those that are the most costly to produce and the most polluting — the oilsands fall into that category. Oilsands defenders tell us that the proposed federal cap on oil and gas will bring nothing but economic ruin. But the opposite is true. Without taking serious action now to decarbonize and invest in the clean transition, it is likely that Canadians will be saddled with billions in stranded oilsands assets, a hugely expensive cleanup operation, lost jobs and devastated communities.

Of course, the Alberta government, federal Conservative politicians and big business lobbyists are already taking the second Trump presidency as proof that, yet again, this isn’t the right time to reduce emissions in the oil and gas sector. That is the exact wrong lesson to take. The fact that Trump is committed to doubling down on fossil fuels in the face of an accelerating climate crisis is all the more reason for Canada to work urgently with likeminded countries committed to climate action. Plus, the world has changed since the first Trump presidency: the global economic landscape has shifted drastically. It’s worth remembering that when Trump was elected the first time, he promised to revive coal in the U.S. But he couldn’t fight the economics of clean energy and his plan went nowhere. Canada’s longterm prosperity hinges on moving away from fossil fuels and shifting to clean energy, regardless of who occupies the White House.

There’s no getting around it: Canada is going to have to change. The market will insist on it. The question is whether we get dragged into the future saddled with stranded assets and unfunded liabilities or whether we lead, working together to make the transition as painless — and lucrative — as possible.

The oilsands sector has been lying to us for years. They are not getting cleaner. They are not part of the solution. As I tell my kids all the time, life is about choices. Canada can choose to be on the right side of history. We can act with the urgency the climate crisis requires and the economic case makes clear. Or, we can double down on the oilsands, abandon the Paris Agreement, ignore the economic opportunities of clean energy and leave our children a deadly and unsustainable future.

Without taking serious action now to decarbonize and invest in the clean transition, it is likely that Canadians will be saddled with billions in stranded oilsands assets, a hugely expensive cleanup operation, lost jobs and devastated communities

Global oil demand to peak before 2030 amid shift to electrification, IEA says

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This article was written by Jeffrey Jones and was published in the Globe & Mail on October 17, 2024.

The International Energy Agency says demand for crude oil will hit a tipping point before 2030, leading to stiffer competition among producing countries and falling prices, while cleaner energy sources will keep expanding their reach.

Global oil demand is projected to peak by the end of the decade, as climate and energy-security risks push countries to accelerate electrifying their economies to meet surging demand, the International Energy Agency said on Wednesday.

Demand for crude oil will hit a tipping point before 2030, leading to stiffer competition among producing countries and falling prices, the Paris-based agency said in its annual World Energy Outlook, while cleaner energy sources keep expanding their reach in transport and power generation.

After the peak, the IEA said, the reduction in oil demand will be gradual through the subsequent decade, based on countries’ current stated policies.

That makes achieving the goal of netzero carbon emissions all the more difficult. But it should provide a “buffer” against risks of energy-market disruption, as technology such as electric vehicles, computer-chip manufacturing, data centres and artificial intelligence soak up increasing amounts of power, it said.

The energy-security watchdog’s report, which examined a range of potential future scenarios, highlights the difficulties in balancing the need to slash emissions and provide affordable and reliable energy, all against the backdrop of global conflict and climate-driven disasters.

“After the Age of Coal & Age of Oil, the world is moving rapidly into the Age of Electricity,” IEA executive director Fatih Birol wrote in a social-media post.

Electricity supplies grew at double the rate of total energy demand from 2010 to 2023, and that is projected to increase to six times as fast between now and 2035, he said.

Much of the expected increase will be fed by renewables, with solar energy supplying the most by 2035, followed by wind, the agency predicted. Coal-fired generation is projected to peak in 2026, then fall by 36 per cent by 2035.

Despite this, based on current policies, the world will miss the target of limiting the rise in temperatures to 1.5 C above preindustrial levels by 2100, the amount by which scientists say will prevent the worst effects of climate change, the IEA said. Current policies suggest global warming of 2.4 C.

Military conflict in Ukraine and in the Middle East have not inflamed oil prices as would have been expected historically, when threats of supply disruptions loomed.

U.S. benchmark West Texas Intermediate crude sold for about US$70.50 a barrel on Wednesday, well off this year’s highs.

Still, the IEA said it rates the potential for disruption as high, pointing to the fact that a fifth of the world’s oil and supplies of liquefied natural gas flows through the Strait of Hormuz, where maritime security is a major concern.

The hostilities underscore the need to diversify energy sources that emphasize clean alternatives. Yet even that comes with its own risks, including the concentration of market power within clean-energy supply chains, the agency said.

Rory Johnston, founder of Toronto-based market research firm Commodity Context, said the oil-demand peak forecast is not as remarkable as the near plateau that follows it. The forecast shows that, absent of some dramatic change in policies aimed at slashing emissions, oil consumption will linger, especially in emerging markets and for petrochemical manufacturing.

“There will be further growth in biofuels et cetera, so you see some substitution and pressure on petroleum products specifically,” Mr. Johnston said. Under a net-zero scenario, the reduction would be far steeper, but the stated policy projection suggests “a small-c conservative view” of energy transition.

With the stated policies, output peaks at about 102 million barrels a day in 2029, and remains above 98 million beyond at least 2035. Like oil, demand for coal and natural gas will also peak before 2030, but the IEA stressed that trends vary across countries that are at different stages of energy and economic development.

Mr. Johnston said Alberta’s oil sands could survive such a future, given the long-term investment horizon and variety of nonfuel products derived from the supplies.

“In that scenario, crude prices are kind of level around the mid US$70s a barrel in real terms to 2050. That’s a scenario where the oil sands kind of thrive in, particularly if it is relative to slower growth from the U.S.”

Under a more stringent set of net-zero policies, he said, that would not be the case.

The economics that power renewables

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This editorial was written and published by the Globe & Mail on October 17, 2024.

The potential of solar and wind to become a pillar of power systems around the world was, for many years, technically feasible but seemed to be economically unlikely. Evidence has mounted over the past several years that strongly suggests the dominance of renewable power is now inevitable, based on market economics. After years of needing lots of money from taxpayers, to establish a foothold, the technology – especially solar paired with battery storage – is morphing into an economic force to compete and win against rival sources of electricity.

This does not mean power grids will transform overnight. It does not mean there are not many challenges. And it doesn’t mean there isn’t a big role for governments to speed change. Climate action is more urgent than ever.

In early October, the International Energy Agency – the long-standing advisory group to wealthy countries – reported that renewables are “on course to meet almost half of global electricity demand” within six years. By 2030, the IEA projects that of all the world’s electricity, solar and wind will double to 30 per cent from today’s level.

It is a big declaration. The key factor is cost. Most people have little interest in why and how a light turns on when they flip a switch. What we care about most is price and reliability. The local power grid is not going to be, tomorrow, 100 per cent renewable energy. But change is moving fast and, according to IEA executive director Fatih Birol, solar and wind “offer the cheapest option to add new power plants in almost all countries around the world.”

By contrast, the IEA sees the beginning of the end of fossil fuels’ dominance. The urgency to cut back on the bonfire of fossil fuels is high.

On Wednesday, in the IEA’s annual World Energy Outlook, it forecasts global demand for fossil fuels peaking by 2030, in part because issues of energy security and climate risks will propel greater use of electricity. That makes for a double challenge: renewables need to replace fossil fuels and help meet surging demand.

Human ingenuity and resolve got us to this moment. Lots more will be needed. New transmission lines, in Canada and everywhere, are essential, as well as speeding up approvals to build them. The IEA estimates countries need to soon build and modernize 25-million kilometres of power lines.

And, breaking news, it is true the sun does not shine at night. But demand for electricity is low overnight and gridscale battery storage could carry a big load in the evening hours. The IEA argues that upward of 1,500 gigawatts of storage is needed by 2030 (about 10 times Canada’s entire grid).

This all does sound – perhaps like the goal of people walking on the Moon did in 1962 – a little fantastical. Consider, however, that turning sand into glass to harness sunlight to produce electricity is in the same remarkable scientific-engineering arena as refining crude oil into rocket fuel to fly into space. Humans have a history of marshalling elements and overcoming adversity.

But, yes, politics.

If Donald Trump lives in the White House come late January, his presidency would attempt to slow the advance of clean power in the United States. But the power of the market won’t disappear in the U.S. or anywhere else.

Opposition is less extreme in Canada, yet Conservative Leader Pierre Poilievre does not often speak about, and certainly doesn’t extol, solar. He should celebrate the market’s embrace of renewables. In Alberta, Premier Danielle Smith has worked to promote fossil fuels and slow solar and wind – in part squandering Alberta’s national leadership, powered by a free market, in renewables.

In the end, the power of prices will win. Look at the free market of Texas. The state where the oil gusher at Spindletop in 1901 launched the 20th century is the No. 1 state for wind and utility-scale solar.

Clean technology keeps getting better and cheaper. The price of solar fell 90 per cent in the past decade. The price of batteries fell by more than that. One can guess the technology of today will be outclassed by the technology of 2030 and beyond.

Climate action is essential. But the real payoff for everyone – beyond a viable climate for human life – is affordable energy in abundance that could accelerate economic growth for decades to come.

UPFRONT PRICES CAN BE A BARRIER TO ENTRY TO ELECTRIFYING A HOME

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This opinion was written by Rachel Doran and Jana Elbrecht, and was published in the Toronto Star on October 16, 2024.

RACHEL DORAN IS THE VICE PRESIDENT OF POLICY AT STRATEGY AT CLEAN ENERGY CANADA. JANA ELBRECHT IS A POLICY ADVISER AT CLEAN ENERGY CANADA.

Over the last two years, Canadian households have been getting on board with the energy transition. The Greener Homes Grant helped Canadians from coast to coast to coast install heat pumps and retrofit their homes, while EV sales have risen rapidly thanks to growing model availability and purchase incentives.

Accordingly, thousands of Canadians have made a shift away from fossil fuels, reaping the affordability benefits. In fact, our latest analysis finds that a household in Toronto that switched out its gas cars for electric versions, ditched its natural gas appliances, installed a heat pump and made some modest energy efficiency upgrades would cut $550 off its monthly bill, even taking into account upfront costs.

And no wonder, Canadians’ continued reliance on fossil fuels is costing them. In fact, a recent study found that energy prices are the most volatile component of inflation in the country.

But despite the savings benefits of clean technologies, upfront price can be a barrier to entry for many middle-income Canadians. And in many cases, these costs have been moving in the wrong direction — particularly for Ontarians who receive comparatively little provincial support.

Over the past year, the federal government’s Greener Homes Grant (that offered up to $5,000 off the price of a heat pump and other energy-saving measures) was discontinued in favour of a program for lower income households.

Also, many of the most affordable and bestselling EVs in Canada have either increased in price or disappeared. Production of both the sub-$45,000 Chevrolet Bolt and the Kia Soul EV has been paused or discontinued, leaving gaps in the more affordable end of the market. And now the cheapest Tesla will no longer be available in Canada following new tariffs imposed on Chinese-made EVs.

Our evidence is clear: switching your fossil fuel-powered car for an EV saves money in every scenario, in every region of the country — even when upfront costs are included and even in Ontario. A driver opting for an electric Volkswagen ID.4 instead of a gas-powered Honda CR-V would save over $2,400 a year over the lifetime of the car. The problem is that not everyone can finance a pricier car that will start saving them money in the future.

Indeed, despite clear upsides, upfront cost remains the No. 1 concern for prospective EV buyers, despite EV sticker prices dropping in recent years. It needn’t be the case.

Europeans can choose from at least 12 different fully electric options with a purchase price of less than $45,000, compared to just three in Canada. And the playing field isn’t level across the country, either. Most provinces and territories offer some kind of rebate for buying a new or used EV. But Ontario isn’t one of them.

The implications are written in the sales numbers: Ontario continues to trail the national average and has now even fallen behind the Yukon on electric market share. In fact, EVs now make up 32 per cent of new vehicle sales in Montreal and 25 per cent in Vancouver, compared to just nine per cent in Toronto. Ontarians are missing out on EV options. The new Ontario-made electric Dodge Charger, for instance, will initially only be available in B.C. and Quebec.

This points to the critical importance of government policy, to both help cut the upfront cost via purchase incentives and encourage automakers to make more affordable models. But rebates are not universal and some key policies are at risk.

In fact, another recent report found that the federal Electric Vehicle Availability Standard (which requires automakers to make an increasing portion of EVs available for sale) will be key to incenting automakers to bring more affordable EVs to market. And yet, the future of the policy remains uncertain with the official opposition publicly stating they would repeal it if elected.

When it comes to home upgrades, many provinces stepped up after the federal government dropped its program earlier this year, retaining or expanding support for heat pumps and energy retrofits. But the result is a geographically unequal transition.

A median-income family in B.C. can receive up to $12,000 in government subsidies to switch from natural gas to a heat pump, while that same family in Ontario would receive no government support (and only up to $2,000 from the utility).

We are at a critical time in the energy transition. We have the solutions to lower energy bills and fight climate change, but it is vital that every Canadian can benefit. To that end, all levels of government must take action, offering rebates to cut upfront costs, improving charging access, simplifying financing and improving electricity rates to further incentivize cleaner options.

Anyone considering a clean energy shift can visit Clean Energy Canada’s new online calculator, mycleanbill.ca, to get a better sense of potential savings based on your location, vehicle type and home.

After all, the door to cleaner homes and lower bills must be open to all Canadians.

Opinion | Canadians are saving money with EVs and heat pumps. But only if they can afford the upfront cost

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Ford and Trudeau
Premier Doug Ford and Prime Minister Justin Trudeau look over a vehicle along an assembly line at an event announcing plans for a Honda electric vehicle battery plant in Alliston in April 2024.  Nathan Denette/The Canadian Press

This opinion was written by Rachel Doran and Jana Elbrecht, and was published in the Toronto Star on October 16, 2024. Rachel Doran is the vice president of policy at strategy at Clean Energy Canada. Jana Elbecht is a policy advisor at Clean Energy Canada.

Over the last two years, Canadian households have been getting on board with the energy transition. The Greener Homes Grant helped Canadians from coast to coast to coast install heat pumps and retrofit their homes, while EV sales have risen rapidly thanks to growing model availability and purchase incentives.

Accordingly, thousands of Canadians have made a shift away from fossil fuels, reaping the affordability benefits. In fact, our latest analysis finds that a household in Toronto that switched out its gas cars for electric versions, ditched its natural gas appliances, installed a heat pump and made some modest energy efficiency upgrades would cut $550 off its monthly bill, even taking into account upfront costs.

And no wonder, Canadians’ continued reliance on fossil fuels is costing them. In fact, a recent study found that energy prices are the most volatile component of inflation in the country.

But despite the savings benefits of clean technologies, upfront price can be a barrier to entry for many middle-income Canadians. And in many cases, these costs have been moving in the wrong direction — particularly for Ontarians who receive comparatively little provincial support.

Over the past year, the federal government’s Greener Homes Grant (that offered up to $5,000 off the price of a heat pump and other energy-saving measures) was discontinued in favour of a program for lower income households.

Also, many of the most affordable and bestselling EVs in Canada have either increased in price or disappeared. Production of both the sub-$45,000 Chevrolet Bolt and the Kia Soul EV has been paused or discontinued, leaving gaps in the more affordable end of the market. And now the cheapest Tesla will no longer be available in Canada following new tariffs imposed on Chinese-made EVs.

Our evidence is clear: switching your fossil fuel-powered car for an EV saves money in every scenario, in every region of the country — even when upfront costs are included and even in Ontario. A driver opting for an electric Volkswagen ID.4 instead of a gas-powered Honda CR-V would save over $2,400 a year over the lifetime of the car. The problem is that not everyone can finance a pricier car that will start saving them money in the future.

Indeed, despite clear upsides, upfront cost remains the No. 1 concern for prospective EV buyers, despite EV sticker prices dropping in recent years. It needn’t be the case.

ARTICLE CONTINUES BELOW

Europeans can choose from at least 12 different fully electric options with a purchase price of less than $45,000, compared to just three in Canada. And the playing field isn’t level across the country, either. Most provinces and territories offer some kind of rebate for buying a new or used EV. But Ontario isn’t one of them.

The implications are written in the sales numbers: Ontario continues to trail the national average and has now even fallen behind the Yukon on electric market share. In fact, EVs now make up 32 per cent of new vehicle sales in Montreal and 25 per cent in Vancouver, compared to just 9 per cent in Toronto. Ontarians are missing out on EV options. The new Ontario-made electric Dodge Charger, for instance, will initially only be available in B.C. and Quebec.

This points to the critical importance of government policy, to both help cut the upfront cost via purchase incentives and encourage automakers to make more affordable models. But rebates are not universal and some key policies are at risk.

In fact, another recent report found that the federal Electric Vehicle Availability Standard (which requires automakers to make an increasing portion of EVs available for sale) will be key to incenting automakers to bring more affordable EVs to market. And yet, the future of the policy remains uncertain with the official opposition publicly stating they would repeal it if elected.

When it comes to home upgrades, many provinces stepped up after the federal government dropped its program earlier this year, retaining or expanding support for heat pumps and energy retrofits. But the result is a geographically unequal transition.

A median-income family in B.C. can receive up to $12,000 in government subsidies to switch from natural gas to a heat pump, while that same family in Ontario would receive no government support (and only up to $2,000 from the utility).

We are at a critical time in the energy transition. We have the solutions to lower energy bills and fight climate change, but it is vital that every Canadian can benefit. To that end, all levels of government must take action, offering rebates to cut upfront costs, improving charging access, simplifying financing and improving electricity rates to further incentivize cleaner options.

Anyone considering a clean energy shift can visit Clean Energy Canada’s new online calculator, mycleanbill.ca, to get a better sense of potential savings based on your location, vehicle type, and home.

After all, the door to cleaner homes and lower bills must be open to all Canadians.

Here is Clean Energy Canada’s Opening the Door, October, 2024 report.

Federal panel wants Canada’s emissions cut in half by 2035

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This article was written by Adam Radwanski and was published in the Globe & Mail on September 26, 2024.

A federal panel is calling for Ottawa to commit to cutting Canada’s greenhouse-gas emissions between 50 and 55 per cent from 2005 levels by 2035, as the government prepares to announce new national climate targets for that time frame by the end of this year.

The recommendation, made by the government-appointed Net Zero Advisory Body in a report being released Thursday morning, is accompanied by a proposal that the country begin adopting carbon budgets. That approach would set limits for cumulative emissions, rather than focusing only on benchmark years, and could steer decisions around purchases of carbon credits or other ways of offsetting excess emissions.

And the NZAB is also suggesting ways that Canada can get on track to meet its existing target of a 40-per-cent emissions reduction by 2030, in a separate report also being released Thursday – such as strengthening the country’s industrial carbon-pricing system and methane regulations.

But it’s the 2035 guidance that particularly adds to the pressure on Prime Minister Justin Trudeau’s government.

The 2035 guidance attempts to balance the government’s ambitions to meet international climate responsibilities with domestic realities – including economic and affordability concerns, skepticism about the ability to achieve current emissions targets let alone loftier ones, and polls showing a big lead for an opposition Conservative Party promising to scrap climate measures currently in place.

The government is required under the Canadian Net-Zero Emissions Accountability Act to set emissions-reduction commitments for five-year intervals, on the path to net-zero emissions by 2050; the next of those, for 2035, is due by the end of 2024. A similar demand is set by the international Paris Agreement, under which Canada needs to announce a strengthened target by 2025.

Ottawa is not required to follow the recommendations of the NZAB, which was established in 2021 through the same accountability legislation, and which has since struggled to build a profile amid heavy turnover of its members.

However, the government officially sought the body’s input on a 2035 target, through a request submitted by Environment Minister Steven Guilbeault last year.

In a statement, Mr. Guilbeault thanked the NZAB for its work, but was non-committal about its recommendations, saying he wants to ensure the 2035 goal is achievable.

Speaking to reporters in advance of the recommendations’ release, NZAB co-chair Simon Donner – a prominent climate scientist at the University of British Columbia – said the advisory group tried to balance “being ambitious and being technically feasible” in proposing the target. He pointed out that it would still be more modest, on a percentage basis, than emissions-reduction commitments already made by the European Union, Britain and the United States.

Prof. Donner said the NZAB opted against going higher than 50 to 55 per cent, which some members wanted, because it would place too much strain on some regions of the country.

A similar calculus was provided by the Canadian Climate Institute, a government-funded think tank with greater independent research capacity, which provided the NZAB with analysis to inform its recommendations.

Anna Kanduth, who heads the Climate Institute’s emissionstracking process, said in an interview that her organization’s modelling showed that emissions reductions beyond 52 per cent, by 2035, would be too difficult in terms of both policy implementation and costs. However, she said that if Canada is able to reach its 40-per-cent target for 2030, at least 49 per cent by 2035 should be doable.

As of 2023, according to the Climate Institute’s most recent estimates, the country had achieved an 8-per-cent reduction from 2005 levels, largely through decarbonization measures for electricity generation, and to a lesser extent, heavy industry and waste management. Meanwhile, emissions from the oil-and-gas and agricultural sectors have significantly risen.

Ms. Kanduth nevertheless expressed optimism about a 40per-cent reduction by decade’s end still being in reach, noting that drops have accelerated in recent years and that policies – which at the federal level range from carbon pricing to new environmental regulations to tax credits and subsidies – take a while to bite.

To get the rest of the way there, both the NZAB (in the second report released Thursday) and the Climate Institute are calling for Ottawa to finalize promised policies such as an oiland-gas emissions cap, clean electricity regulations and regulations for commercial vehicles; to strengthen existing measures such as industrial carbon pricing and methane caps; and to explore a small number of new measures such as heating and cooling regulations for commercial buildings.

Prof. Donner noted that even if Canada sets and achieves the NZAB’s 2035 recommendation – which, he stressed, would require greater ambition from the provinces and the private sector in addition to Ottawa – the country would still be responsible for more than its fair share of global emissions if planetary warming is to be contained to 1.5 or 2 degrees Celsius, which are international targets to minimize climate-related disaster.

That’s part of the rationale for the NZAB’s additional recommendation of adopting carbon budgets, to account for cumulative emissions. In addition to other benefits such as avoiding over-focusing on milestone years in which there could be statistical noise, the panel contends that the approach could help determine the extent to which Canada is exceeding the emissions needed to achieve global goals, and inform compensatory measures such as investments in carbon removal and internationally traded carbon credits.

At the same time, the NZAB acknowledges that those sorts of offsets might also be needed just to achieve the 2035 target it is suggesting – which, Prof. Donner allowed, is something of a stretch goal based on the trajectory to date.