Fall Economic Statement paves the way for a Green Recovery: energy efficiency, care economy, electric vehicle infrastructure, and nature-based solutions

On November 30, Canada’s  Finance Minister Chrystia Freedland presented the government’s Fall Economic Statement to the House of Commons, Supporting Canadians and Fighting COVID-19.  At over 200 pages, it is the fullest statement to date of how the government intends to finance a green recovery from the Covid-19 pandemic, but Canadians must still wait for a full  climate change strategy, promised “soon”.

The government press release summarizes the spending for health and economic measures, including, for employers, extension of the Canada Emergency Wage Subsidy Canada, the  Emergency Rent Subsidy and Lockdown Support , and new funding for the  tourism and hospitality sectors through the new Highly Affected Sectors Credit Availability Program.  In Chapter 3, Building Back Better,  the Economic Statement addresses the impacts of Covid-19 on the labour market and employment. It includes promises to create one million jobs, invest in skills training, reduce inequality, attack systemic racism, support families through early learning and child care, support youth, and build a competitive green economy.  Most budget allocations will be channeled through existing programs, but new initiatives include “the creation of a task force of diverse experts to help develop “an Action Plan for Women in the Economy”;  launch of “Canada’s first-ever Black Entrepreneurship Program”;  and a task force on modernizing the Employment Equity Act to promote equity in federally-regulated workplaces.  Under the heading, “Better working conditions for the care Economy” comes a pledge: “To support personal support workers, homecare workers and essential workers involved in senior care, the government will work with labour and healthcare unions, among others, to seek solutions to improve retention, recruitment and retirement savings options for low- and modest-income workers, particularly those without existing workplace pension coverage.”

Climate change provisions and a Green Recovery:

Another section in Chapter 3 is entitled A Competitive, Green Economy, which  reiterates the government’s commitment to achieve net-zero emissions by 2050, and reiterates the importance of the Canadian Net-Zero Emissions Accountability Act, currently before Parliament. Funding of  $2.6 billion over 7 years was announced to go towards grants of up to $5000 for homeowners to make energy-efficient improvements to their homes, and to recruit and train EnerGuide energy auditors. A further $150 million over 3 years was announced for charging and refuelling stations for zero-emissions vehicles, and  $25 million for “ predevelopment work for large-scale transmission projects. Building strategic interties will support Canada’s coal phase-out.

Under the heading of Nature-based solutions, proposed investments address the goal of 2 billion trees planted with a pledge of  $3.19 billion over 10 years, starting in 2021-22.  A further $631 million over 10 years is pledged for ecosystem restoration and wildlife protection, and $98.4 million over 10 years, starting in 2021-22, to establish a new “Natural Climate Solutions for Agriculture” Fund.

Reactions from unions, think tanks:

Among those reacting quickly to the Economic Statement, the Canadian Labour Congress  stated generally  “While today’s commitments on key priorities remain modest and reflect past promises, the government has signalled it will make further investments as the recovery begins to take shape.” Unifor issued two press releases, the first stating “This fiscal update shows that Canada’s workers are being heard, and must continue to advocate for the lasting changes required to secure a fair, resilient and inclusive economic recovery”, but a second complains “Canada’s fiscal update fails to support all airline workers .  The Canadian Union of Public Employees similarly issued two statements on December 1:  “Liberals’ economic update offers more delay and disappointment”  and “Canada’s flight attendants union disappointed by the federal economic update” .

Bruce Campbell reacted in The Conversation (Dec. 7)  that “The pace of government action to date does not align with the urgency of the twin climate and inequality crises. Nothing it has done so far is threatening to the corporate plutocracy and its hold on power.”   Several experts from the Canadian Centre for Policy Alternatives contributed to a blog,  A fiscal update for hard times: Is it enough?”, with the answer from Hadrian Mertins-Kirkwood re the climate change provisions : “Planting trees, retrofitting buildings and increasing ZEV uptake doesn’t go far enough without a clear timeline for winding down oil and gas production.”  Climate Action Network-Canada agrees with Mertins-Kirkwood when it states: “ today’s update includes a summary of new and existing spending that we hope will provide an important foundation for Canada’s new national climate plan that we expect in the coming weeks.  ….As part of a larger package, along with Bill C-12, the Canadian Net-Zero Emissions Accountability Act, and the pending new national climate plan, today’s fiscal update provides the backbone to guide Canada through some of the most important global transitions in generations.”

Other reactions:  “Feds’ fall economic statement shortchanges climate” (Corporate Knights, Dec. 2) quotes one observer who calls it  a “meek” effort, and offers a comparison of  the allocations in the Fall statement with earlier proposals from Corporate Knights  and the Task Force for a Resilient Recovery in September . The Energy Mix also cites the Task Force for a Resilient Recovery in its analysis of  the energy efficiency provisions of the Economic Statement , stating, : “the  recommended by C$2.6 billion allocated for a seven-year program raises questions about how seriously the Trudeau government is prepared to confront the climate crisis. In mid-September, the Task Force for a Resilient Recovery called for a $26.9-billion program over five years.”

Costs of climate change in Canada go beyond wildfires and floods: a call for urgent action to build resiliency

 The Tip of the Iceberg: Navigating the Known and Unknown Costs of Climate Change in Canada was released on December 3 by the Canadian Institute for Climate Choices, providing eye-popping evidence of the damage of climate change. Using data from the Canadian Disaster Database (CDD) and the Insurance Bureau of Canada (IBC) – (provided graphically here ) –  the report states that insured losses for catastrophic weather events in Canada totalled over $18 billlion between 2010 and 2019, with the Fort McMurray wildfire of 2016 the largest single weather-related insurance loss event in Canadian history, with nearly $4 billion in insured losses and broader costs of almost $11 billion when property, infrastructure, business interruption, and other indirect economic losses are included.  The report also notes the growing trends: the number of catastrophic events has more than tripled since the 1980s, and the average cost per weather-related disaster has soared by 1,250 per cent since the 1970s.

The main message of this report is directed at policy-makers, and goes beyond costing out the catastrophic losses. It warns that other types of climate change damages are more gradual and less dramatic in extreme events, and that Canada lags the U.S. and other OECD countries in assessing the overall and complex impacts of climate change. The report hearkens back to 2011 as the  last examination of the broad range of national costs to Canada, in Paying the Price: The Economic Impacts of Climate Change for Canada, a report by the now-defunct National Round Table on the Environment and the Economy, archived in the ACW Digital Library .

The main message of the report appears in this 6-page Executive summary , in the three over-aching recommendations, and in these selected quotes:

 “The imperative to reduce greenhouse gas emissions tends to dominate the debate over Canada’s progress in addressing climate change. Yet, as a climate solution, adaptation—ensuring human and natural systems can adjust to the spectrum of effects of climate change— will have a critical impact on the well-being and prosperity of all who live in Canada in the decades ahead. Current adaptation policies and investments in Canada fall far short of what is needed to address the known risks of climate change, let alone those that are still unclear and unknown. This has to change…..

……It’s essential to transition from a state of ad hoc responses to a changing climate and weather-related disasters to one of building resilience. This includes continual learning about what works, what doesn’t, and how to plan for uncertainty. Instead of waiting for more information, the uncertainty inherent in climate change requires acting decisively on what we already know while also developing improved foresight.”

 

The Canadian Institute for Climate Choices intends to follow up from The Tip of the Iceberg with other reports over the next two years, focused on health, infrastructure, macroeconomics and the North.

 

Newly-elected government in Canada outlines its climate priorities; faces first major test in the Frontier mine decision

Canada’s minority government is back in session after the October 2019 election, launched by the Speech from the Throne on December 5.  The Throne Speech traditionally is used to outline government priorities, and signals that Justin Trudeau and his Liberal party will try to stay in power by balancing the demands of the oil and gas proponents in Alberta against the environmental concerns of the rest of the country. The Toronto Star parsed the speech in “What does it mean? The Throne Speech Interpreted “.

On the issue of climate change, here are the actual words of the Throne Speech:

“In this election, Parliamentarians received a mandate from the people of Canada which Ministers will carry out. It is a mandate to fight climate change, strengthen the middle class, walk the road of reconciliation, keep Canadians safe and healthy, and position Canada for success in an uncertain world.”… A clear majority of Canadians voted for ambitious climate action now. And that is what the Government will deliver. It will continue to protect the environment and preserve Canada’s natural legacy. And it will do so in a way that grows the economy and makes life more affordable.

The Government will set a target to achieve net-zero emissions by 2050. This goal is ambitious, but necessary – for both environmental protection and economic growth.

The Government will continue to lead in ensuring a price on pollution everywhere in this country, working with partners to further reduce emissions.

The Government will also:

help to make energy efficient homes more affordable, and introduce measures to build clean, efficient, and affordable communities;

make it easier for people to choose zero-emission vehicles;

work to make clean, affordable power available in every Canadian community;

work with businesses to make Canada the best place to start and grow a clean technology company; and

provide help for people displaced by climate-related disasters.

The Government will also act to preserve Canada’s natural legacy, protecting 25 percent of Canada’s land and 25 percent of Canada’s oceans by 2025. Further, it will continue efforts to reduce plastic pollution, and use nature-based solutions to fight climate change – including planting two billion trees to clean the air and make our communities greener.

And while the Government takes strong action to fight climate change, it will also work just as hard to get Canadian resources to new markets, and offer unwavering support to the hardworking women and men in Canada’s natural resources sectors, many of whom have faced tough times recently.”

 

Reaction from environmentalists and Opposition party leaders appeared in the National Observer, in  “Liberals commit to carbon-pollution target of net-zero by 2050”   (Dec. 5); and in “Throne speech climate commitments dwarfed by spending on Trans Mountain” by the Dogwood Institute .

The Canadian Labour Congress reacted with this generally supportive statement:  “We need bold targets to fight climate change, we owe that to our children …. “We also owe the next generation good jobs and commitments to minimize the impact on workers. Today’s commitments move us towards a greener economy.”   In advance of the Throne Speech, the Green Economy Network, a union network of which the CLC is one member, had made  a harder-hitting statement: “The GEN is demanding that the Prime Minister make climate job creation a priority through investments in renewable energy, energy efficiency and green buildings, public transit and higher speed rail transit.”

Also in advance of the Throne Speech, a group led by the Smart Prosperity Initiative  delivered an Open Letter outlining detailed demands for clean economy initiatives. The twenty-six signatories include leaders from business, environmental advocacy groups, and the United Steelworkers and BlueGreen Canada.

One of the first major tests for the minority government, should it last that long, will be the decision required by the end of February on whether to approve the application by Teck Resources for the massive Frontier oil sands project – a $20-billion, 260,000-barrel-per-day open-pit petroleum-mining project near Fort McKay in northern Alberta. The Canadian Environmental Assessment Agency website provides official documentation, including the July 2019 Joint Review Panel Report , which includes discussion of the  economic and employment impacts of the project (beginning page 883).  Critiques of the Joint Review Panel approval were published in July by The Narwhal here  and the Pembina Institute here .

And now, as Parliament reconvenes and the COP25 meetings are underway, the Frontier mine is becoming the  litmus test of Canada’s climate change policy, as laid out in  “Trudeau will fuel the fires of our climate crisis if he approves Canada’s mega mine”, an Opinion piece by Tzeporah Berman which appeared in The Guardian on December 10.  Also on December 10, Greta Thunberg and fourteen other young people released an Open Letter to government leaders of Canada and Norway, calling on them to block any new oil and gas projects and quickly phase out existing ones. The National Observer explains in  “Greta Thunberg and other youth call on Trudeau to ditch fossil fuels” (Dec.9) .

Final report from Canada’s Ecofiscal Commission recommends stringent carbon pricing to reach 2030 GHG goals

bridging the gapOn November 27, the Ecofiscal Commission announced that their latest research report, Bridging the Gap: Real Options for Meeting Canada’s 2030 GHG Target  will be their last.  This final report brings to an end five years of research and publication which has centred largely on the cost effectiveness and optimal design of carbon pricing for Canada.   Bridging the Gap  recommends that “If governments wish to meet their climate goals at least cost, they should rely on increasingly stringent carbon pricing” – steadily increasing the carbon price by around $20/tonne every year from 2023 until 2030. The next best option is increasingly stringent, well-designed, flexible regulations, including for example, the Clean Fuel Standard. The report argues that “It’s tempting to think that alternatives to carbon pricing will cost us less. But their costs are hidden and actually cost us more. …. Our modelling shows that carbon pricing will grow Canadian incomes on average by $3,300 more in 2030 relative to a policy approach that relies on a mix of subsidies and industry-only regulations…No matter what policy tool—or combination of tools—we use to achieve Canada’s 2030 target, policies will have to be significantly more stringent than they are today. The regulatory approaches we model, for example, require halving the emissions intensity of industrial production by 2030.”

The report provides new forecast results using Navius Research’s GTECH General Equilibrium economic model, to cost and evaluate three options for climate policy which would allow Canada to meet its 2030 GHG target: #1: Carbon pricing with revenues recycled toward percapita dividends and output-based pricing for EITE sectors; #2: A range of regulations and subsidies applied across the entire economy; #3: A range of regulations and subsidies, excluding those that would result in direct costs for households.  Although the authors acknowledge that impacts will be felt on jobs, especially in emissions intensive industries, employment impacts are not estimated or discussed.

Canada’s Green Party and NDP prepare to fight the October election with newly-released Climate Change plans

With unprecedented importance of climate change in the upcoming October 2019 election, and the weakness of the governing Liberal party on the issue, the NDP and Green Party are keenly competing for votes, as described in Aaron Wherry’s analysis for the CBC, “With Singh’s environment plan, the left-centre climate change bidding war begins” (June 1) . On May 16, Canada’s Green Party released a five-page plan called Mission Possible: The Green Climate Action Plan , built on the foundation of the Green Party’s overall policy Vision .  On May 31, the leader of the New Democratic Party released  Power to change: A new deal for climate action and good jobs 

MayElizabeth_GPGreen Party Proposal:  The Green Party’s Mission Possible Plan (press release is here ), “incorporates all the requirements for economic justice, just transition, the guarantee of meaningful work, while also respecting the United Nations Declaration on the Rights of Indigenous People.”  It endorses the Pact for a Green New Deal, and promises to go beyond it, stating: “Canadian Greens applaud their commitment and enthusiasm and wholeheartedly endorse their demands for decisive action on the climate emergency, mainly because we have been describing and promoting this exact thing sometime past forever.”

Specifically, Mission Possible calls for  Step #1 to “Declare a Climate Emergency: Accept, at every level of government, that climate is not an environmental issue. It is the gravest security threat the world has ever seen.”  The 20 action items in Mission Possible include: double  the country’s 2030 emissions reduction target to 60%; maintain carbon pricing; abolish fracking; green and modernize the east-west electricity grid; complete a national building retrofit; ensure that all new vehicles are electric by 2030 and address emissions from international shipping, aviation and the military.  Without using the term “Just Transition”, the recommended actions reflect a recognition of the need for  jobs in the new greener economy, the role of re-skilling, and the need for a gradual transition for workers in the fossil fuel sector.  The controversial bit:  Although the Greens oppose new fossil fuel projects and fracking in Canada and propose to end all foreign oil imports, the plan supports new pipelines to transport Alberta’s oil. They call for a shift for all Canadian bitumen from fuel to feedstock for the petrochemical industry by 2050, and state that “ pipelines would be needed to transport refined product (gasoline, propane, diesel) instead of diluted bitumen.”

The National Observer summary of the plan is here , and CBC summarizes it in “Greens call for a doubling of Canada’s carbon emissions reduction target”. CBC also discusses the most controversial elements  in “ Elizabeth May wants to only use Canadian oil — a plan Quebec’s Green Party leader can’t support” .

singh facebook photoNew Democratic Party: Power to change: A new deal for climate action and good jobs   was released by the NDP on May 31 – a plan which aims to reduce Canada’s emissions to 38 per cent below 2005 levels by 2030, achieve net carbon-free electricity by 2030, and create at least 300,000 good jobs.  Proposals to reach the targets include: Immediate elimination of fossil fuel subsidies ( valued at  $3.3 billion, which would be reinvested in clean strategies); a Low Carbon Industrial Strategy which would, for example, use Buy Canadian procurement;  establishment of a new Canadian Climate Bank,  capitalized with $3 billion from  the federal government to invest in clean technologies; a Clean Communities Fund to support investments in innovative community-owned and operated clean energy projects; make all new buildings in Canada “net-zero ready” by 2030 and retrofit existing buildings by 2050;  continuation of the federal electric vehicle purchase subsidies with  $5,000 federal purchase incentive (rising  in time to $15,000 for made-in-Canada vehicles), plus exemption on the federal sales tax for working families; electrification of Canada’s transit fleets by 2030, and a commitment to  work with municipalities towards establishing fare-free transit.   Other important proposals:  enact  an Environmental Bill of Rights guaranteeing clean air, land, and water for Canadians, and tackle pollution with a ban on single-use plastics by 2022, and develop extended producer responsibility legislation to hold companies responsible for the entire lifecycle of their plastics products and packaging.   The platform is summarized in the Toronto Star and in the National Observer in  “NDP climate plan hinges on electrification, helping workers impacted by climate change”.

The NDP tries to differentiate itself from the Green Party chiefly by its emphasis on jobs and workers, promising to create at least 300,000 good jobs in energy efficiency retrofits, affordable housing, renewable energy, infrastructure, and transit.  Specifically, it pledges to make the Employment Insurance system more responsive to the realities of transition by making  easier to qualify for EI, and giving workers the option of taking EI-based training before being laid off , and to receive EI if they leave a job to go back to school.  The plan further promises to address injustice for Indigenous communities in training opportunities and education, as well as injustice for women, racialized Canadians, Indigenous peoples, and other under-represented groups for apprenticeships. The plan also pledges to create a framework for enshrining Community Benefits Agreements in federally-funded infrastructure projects. The controversial position for the NDP  occurred before the release of Power to Change, and is described by The Energy Mix in  “Singh discovers new interest in climate, declares against oil and gas fracking in wake of B.C. byelection loss” (May 14) .  As a result of the NDP’s position opposing the LNG terminal in Kitimat and the Coastal Gas pipeline project, some union leaders in B.C. are “not happy with Jagmeet Singh, according to The Toronto Star (May 15). 

NDP Reveals ‘Ambitious’ Climate Change Plan” in Vice (May 31) quotes positive reaction from spokespersons from Environmental Defence and 350.org , but includes the criticism of the Liberal Minister of Environment and Climate Change: “The NDP would do almost as much harm to the economy as the Conservatives want to do to the planet,” … “The NDP want to do some of the things we are already doing to fight climate change, but their approach would threaten jobs and hurt workers.” Similarly, the Toronto Star published “ NDP’s $15-billion climate plan greeted with mixed reviews” , which gives voice to the criticisms of the Green Party and Liberal political leaders , as well as Chris Ragan of the Ecofiscal Commission. From the Globe and Mail, ” NDP Climate Policy is serious but not radical“.

In contrast, the United Steelworkers issued a press release  calling the NDP plan  “the most comprehensive environmental platform of any of the parties”… “This climate plan is worker-oriented and jobs-centred. … this plan specifically mentions working with labour and refers to the recommendations of the Task Force on Just Transition for Canadian Coal Power Workers and Communities.”