Gattinger Election Series Part 2 - Energy And Climate In Party Platforms: Lots Of Plans, But Are They Implementable?
Climate change and energy are prominent in this year's federal election. This three-part series digs into what Canadians think about climate change (Part I is available here), how the parties have positioned themselves on energy and climate (Part II, below) and the top energy and climate issues for an incoming government (Part III, which will appear next week, following the election).
Part I of this series noted that Canadians’ appetite for climate action has grown over the last year, but that their confidence the country can actually reduce emissions is weak. Many see governments as part of the problem, not the solution.
Are the parties’ plans for energy and climate likely to change that? Possibly.
On the plus side, the major parties have all put forward far more detailed plans on energy and climate than they have in recent elections. This is good news.
But are the plans implementable? Implementation has been a persistent stumbling block for Canada: Ottawa leaves a long trail of ambitious climate targets that it has failed miserably to achieve. The country has struggled to reduce emissions in the real worlds of federalism, reconciliation, community preferences, oil and gas production, investor confidence, regulatory systems and energy security.
That both Conservative and Liberal governments have failed over the years is a testament to how challenging it is.
Will now be any different? Maybe.
This is a watershed election for Canada on climate: the first where all parties are demonstrating they take climate change seriously and have put forward detailed plans. An independent assessment of the plans using a leading climate model shows the Conservative plan would achieve its 30 per cent emissions reduction target by 2030 with a modest decline in GDP growth (of note, for the first time, the party developed its plan with the support of independent climate models).
The same model showed the Liberals’ fall 2020 climate plan would achieve its 31 per cent reduction target, and previous simulations suggest the party’s updated target of a 40-45 per cent cut in emissions could likely be achieved with the new measures it announced in late August (more on the measures below). As with the Conservative plan, the model suggests there would be a modest decline in GDP growth to 2030 (2.5 per cent, compared to 2 per cent for the Conservative plan). The NDP plan to reduce emissions 50 per cent by 2030 scored very poorly for having an implicit carbon price of $500 and a major loss of GDP growth to 2030 (6.5 per cent).
The positive assessment of the Conservative and Liberal plans is encouraging. But climate models are one thing. Making change happen in the real world is another. A walkthrough of key measures in the three parties’ plans highlights some of the gaps.
All parties are committed to net zero emissions by 2050 and their plans include targets for 2030: the Liberals a reduction of 40-45 per cent (the government’s updated Paris pledge from April 2021), the Conservatives a reduction of 30 per cent (Canada’s original Paris commitment) and the NDP a reduction of at least 50 per cent. All three are also committed to carbon pricing, with the Liberals retaining their commitment from last fall to increase the carbon tax in the years to come. What’s not clear is how much the Liberals will increase the tax. Will they retain last fall’s plan to increase it to $170 per tonne by 2030 or are they envisaging something more? And where will they take output-based pricing for industry?
As for the NDP, they have committed to retain the Liberals’ plan to increase the tax to $170 to 2030, but the platform stipulates they will remove ‘loopholes’ for ‘big polluters.’ It’s not at all clear what they would do on this front or how. It’s even less clear what the party means with its commitment to establish national and sectoral carbon budgets. What does this mean and how will they implement it?
The Conservative platform commits to a carbon price of $20 per tonne for households, growing to $50 by 2030. Rather than recycle revenues back to consumers through the tax system, the Conservatives commit to depositing individuals’ tax payments into a Personal Low Carbon Savings Account that they can use to pay for things that reduce their emissions. It’s an interesting idea to incentivize change, but how on earth will it be administered? It sounds like a nightmare.
There are multiple commitments in the platforms to reduce emissions from energy production and consumption. All three parties are committed to mandating a percentage of new sales of zero emission vehicles in the future, with the Conservatives committing to 30 per cent of new sales by 2030, the Liberals 50 per cent by 2030 (100 per cent by 2035) and the NDP 100 per cent by 2035. This raises many questions. Will manufacturers be able to scale up production this quickly, particularly when demand for batteries will be skyrocketing the world over? What will vehicle prices look like? How affordable will this be for consumers?
Similar questions arise around innovation and federal support for technology development and deployment. All platforms see them as critical, and include support measures for hydrogen, alternative energy, batteries and energy storage. The Liberal and Conservative plans also support carbon capture, utilization and storage, along with critical minerals and mining. Support for small modular nuclear reactors is only mentioned in the Conservative platform, but the Liberal government has developed an SMR roadmap and action plan, so presumably would carry this forward if elected.
These are laudable commitments — innovation and technology deployment are crucial to emissions reductions — but they raise multiple questions about implementation. Canada performs poorly on technology deployment and scale-up. Do we have the necessary pipelines of collaboration between innovators, academia, industry, investors, policymakers, regulators and communities to move ideas from the lab bench to widespread use?
The sorry answer, unfortunately, is that for the most part we don’t.
The Liberal and NDP platforms include commitments to reduce the emissions profile of the electricity sector, with the Liberals committing to net zero by 2035 and the NDP net zero by 2030 and 100 per cent non-emitting by 2040 (the Conservative plan does not include targets to reduce emissions in the power sector). All platforms point to the need to reduce emissions in industry, buildings and transportation, with regulations and incentive programs for things like clean fuel, efficiency, electrification and retrofits.
Again, all laudable goals, but they raise many questions about implementation. Will communities support all the new electricity projects needed to meet rising demand and to move low emitting power from generators to consumers? How will the provinces react given that electricity is largely under provincial jurisdiction? Who will shoulder the costs of all of this and how will it effect energy prices? Will all of this be done with an eye to maintaining electricity reliability? The more things are electrified, the more devastating power outages will be to health, safety and the economy. This will be far more than just the lights going out.
This is perhaps where the platforms are the weakest. None of their climate plans are anchored in energy security — ensuring energy is available, reliable and affordable. Political, public, and industry support for durable emissions reductions will hinge on energy security. Here the NDP deserves some credit as the only platform that explicitly mentions energy security in its climate section, albeit only in relation to Indigenous and northern communities and smart grid technology. The issues are much broader than this. Overall, the parties don’t seem to see energy security as fundamental to durable emissions reductions.
The platforms differ the most substantially on oil and gas, with the NDP saying they will phase out all fossil fuel subsidies, pass legislation to ban future subsidies and raise 2025-2030 methane reduction targets.
The main Liberal commitment on oil and gas is to achieve net zero in the sector by capping emissions at current levels and cutting them with five-year targets beginning in 2025. While it’s not clear what the targets will be, the Liberals commit to setting milestones for 2025 and 2030 based on advice from the Net-Zero Advisory Body. The Liberals also commit to reducing methane emissions 75 per cent below 2012 levels by 2030 (40-45 per cent by 2025).
The Conservatives are the most explicit about a positive role for oil and gas in Canada’s energy future, and the only platform to include a section dedicated to energy. They commit to developing an LNG export strategy, making energy exports and energy security a diplomatic priority with the U.S., promoting environmental, social, governance and Indigenous performance (ESG-I), and reviving the Northern Gateway pipeline project. The party also commits to repealing Bill C-48 banning oil exports from B.C.’s North Coast and passing legislation to criminalize blockades of critical energy infrastructure.
Here again there are many open questions about implementation. How will the Liberals engage with the provinces on plans to cap and cut oil and gas emissions? If not approached deftly, this could stoke bitter conflict and even provoke a national unity crisis. For the Conservatives, would Enbridge be willing to come back to the table on Northern Gateway? And would criminalizing blockades amplify conflict and dissent over energy and climate?
The process of reconciliation with Indigenous peoples looms large on these topics. The Conservative platform is the only to support Indigenous engagement in all energy projects, whether oil and gas or renewable, including with a $5 billion capital fund. The Liberals and NDP support Indigenous communities’ engagement in renewable energy projects, but what about oil and gas?
All of the above raises major questions about the investment environment. Transforming Canada’s energy system to lower emitting configurations will require vast sums of public and private capital, along with the ability to permit and construct a mind-boggling amount of new energy infrastructure, including for new energy sources and technologies. Does Canada have an attractive investment environment for this? Does the country have the regulatory frameworks, community support, and federal-provincial collaboration needed for change at this pace and scale? For the most part, the party platforms are silent on these questions. The Conservative platform commits to reforming the impact assessment process to strengthen the investment climate, although if not done carefully this too could increase uncertainty in an already uncertain environment.
All told, while the climate platforms differ in their targets, the nature of individual measures, dollar amounts, and areas of emphasis, they are all moving in the same direction: bending Canada’s emissions curve downwards. This is good news — Canada may finally be moving towards consensus on emissions reductions.
But will the country also move towards energy and climate plans that are implementable? The party platforms suggest Canada still has some big blind spots on implementation.
Part III of this series will put forward recommendations to the incoming government to address the gaps.