Canada’s 2030 Emissions Reduction Plan: More questions than answers says Canadian Chamber of Commerce

(OTTAWA) – March 30, 2022 – The Canadian Chamber of Commerce’s Senior Director of Natural Resources, Environment & Sustainability, David Billedeau, issued the following statement today on the release of the government’s new emission reduction plan.

“The Canadian Chamber of Commerce welcomes the Government of Canada’s 2030 Emissions Reduction Plan (ERP), which seeks to couple Canada’s sustainable economic development and commitment to reaching net zero by 2050.

The 2030 targets are ambitious and aggressive, which reflect the urgency of the climate crisis and the need for government, business, and individual Canadians to work together to reach net zero by 2050. While the 2030 targets inform Canada’s path to our 2050 goal, we need an equally ambitious, detailed plan in which every business and Canadian understands their role, the cost of net zero, and options available to help them succeed.

Since 2005, Canada has only managed to reduce its overall greenhouse gas emissions from 739 to 730 megatonnes of carbon dioxide equivalent. Yet, between 2023 – 2030 the Government of Canada is aiming to reduce emissions by 287 megatonnes of carbon dioxide equivalent. Such ambition needs to be matched by strong funding, program, and policy supports.

Make no mistake, Environment and Climate Change Canada’s leadership on setting the course for the transition to net zero is commendable. We support new commitments intended to increase renewable energy, modernize distribution grids, and deploy carbon capture, utilization, and storage (CCUS) technologies.

However, the 2030 ERP leaves us with more questions than answers. The Chamber has concerns with the feasibility and limited supporting detail of several components of the ERP. Above all, we are concerned that the Government of Canada’s approach, if not followed up quickly with detailed plans and a federal budget that reflects the level of investment required, will hinder progress on meeting emissions targets.

If Canada is to meet its emissions reductions targets and achieve an orderly transition to net zero by 2050, the business community needs clarity on several subjects – such as emissions caps, offset markets, skills development, support for breakthrough technology, energy supply, electrification, CCUS input tax credits, and carbon border adjustment mechanisms.

To improve the ERP, we encourage the Government of Canada to consider the following questions:

When will Canada develop a plan to sustainably develop its critical minerals?
According to the International Energy Agency, the average electric vehicle can require six times the amount of minerals as a conventional car – as well as materials like nickel, cobalt, and lithium that a conventional vehicle typically does not require. As another example, wind plants need up to nine times more mineral resources than a gas-fired plant. In sum, the transition to a net zero future hinges on the availability of critical minerals. While provinces continue to develop strategies to develop their natural resources, including critical minerals, leadership from Ottawa is still absent. 

When will Canada get serious about the infrastructure deficits at odds with the proposed Zero Emission Vehicle (ZEV) mandates?
Canada lags behind jurisdictions around the world on ZEV charging infrastructure. Based on international guidelines and industry research, Canada will need nearly four million electric vehicle (EV) chargers by 2050 to support consumer adoption. For context, Canada currently has about 15,000 public or semi-private chargers available while the ERP commits funding for 50,000 new EV charging stations. Canada’s plan to deploy hydrogen fueling stations is similarly limited. The current misalignment of ZEV mandates (which require 100 percent of auto sales to be ZEV by 2035) and supporting infrastructure will ultimately hinder consumer adoption of ZEVs, access to new vehicles, and Canada’s ability to reach its emissions reduction targets. Canada should focus efforts on regulating vehicle emissions (rather than sales), deploying enabling infrastructure before implementing mandates, and prioritizing incentive programs for fleet vehicles and rideshare drivers to transition to ZEVs.

Canada’s commercial transportation sector needs a plan for hydrogen vehicles, why don’t they have one?
The Government of Canada is also mandating that 35 percent of all medium and heavy-duty vehicles sales be ZEVs by 2030. Heavy industrial vehicles will largely utilize hydrogen fuel cell technology; however, Canada has very few hydrogen fueling stations to support industrial transitions to medium and heavy-duty ZEVs. The 2030 plan should provide greater support for de-risking investments in new technologies and enabling infrastructure that is critical to decarbonization, such as hydrogen ecosystems.

Will Canada leverage its energy sector to support global decarbonization?
Ongoing conflict in Europe has reinforced the need for Canadian leadership to support international energy security. At the same time, Canadian energy products and innovative clean technologies hold significant opportunity to displace carbon intensive alternatives within international markets. To that end, Canada should deploy a net zero strategy that seeks to sustainably develop its energy sector and maximize global decarbonization efforts – instead of maintaining a focus on domestic reductions.

Will Canada invest and become a global leader in nuclear power?
In Europe, regulators recently proposed to include nuclear power and natural gas in a select group of energy sources, alongside renewables such as wind and solar power, to help reduce greenhouse gas emissions. The Government of Canada seems to be going in a different direction – the Canada Green Bond Framework excludes nuclear energy from green financing and the 2030 ERP does not provide a cogent strategy for increasing nuclear power generation using the latest technologies. Nuclear is vital to Canada’s decarbonization efforts and the federal government should provide more direct support to offset significant capital costs involved in nuclear power generation. This initiative would be consistent with the recent joint agreement between the governments of Alberta, New Brunswick, Ontario, and Saskatchewan that outlines their plan to provide safe, reliable, and zero-emissions energy to power our economy.  

Canada has a scientific and economic imperative to decarbonize. To ensure Canada’s pathway to net zero is competitive, enhances investment, creates jobs for Canadians, and leverages regional strengths, how we get there matters.

While the 2030 Emissions Reductions Plan provides an initial framework for how Canada will advance towards net zero, our business community is still waiting for Ottawa to develop a cohesive plan that supports Canadians in each region of Canada.

Collaboration between the public and private sectors is vital for ensuring Canada’s workforce is equipped to succeed, clean technologies are deployed, and our collective economic and environmental ambitions are realized.

Going forward, the Chamber will work with our members and leverage our Net Zero Council, which brings together business leaders from across Canada, to provide the Government of Canada with analysis and tangible recommendations for improving Canada’s 2030 emissions reduction plan and overall net zero pathway to 2050.”

About the Canadian Chamber of Commerce — The Future of Business Success

The Canadian Chamber of Commerce is Canada’s largest and most activated business network — representing 450 chambers of commerce and boards of trade and more than 200,000 businesses of all sizes, from all sectors of the economy and from every part of the country — to create the conditions for our collective success. The Canadian Chamber of Commerce is the undisputed champion and catalyst for the future of business success. From working with government on economy-friendly policy to providing services that inform commerce and enable trade, we give each of our members more of what they need to succeed: insight into markets, competitors and trends, influence over the decisions and policies that drive business success and impact on business and economic performance.

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Contact

Phil Taylor

Canadian Chamber of Commerce

E-mail: ptaylor@chamber.ca (fastest response time)