Government of Canada Releases Fall Economic Statement: Key Energy and Climate Highlights
Deputy Prime Minister and Minister of Finance Chrystia Freeland yesterday released the federal government’s Fall Economic Statement 2020, entitled Supporting Canadians and Fighting COVID-19 (the FES). The FES is broadly focused on measures to fight COVID-19, support Canadians through the pandemic, and build back better.
This bulletin outlines key energy and climate highlights from the FES:
Nature-based climate solutions. The FES highlights three government proposals to advance nature-based climate solutions in Canada:
Natural Climate Solutions for Agriculture Fund. $98.4 million over ten years, starting in 2021-22, with $1.6 million in remaining amortization, to Agriculture and AgriFood Canada to establish a new Natural Climate Solutions for Agriculture Fund. The fund will leverage $85 million in existing programming and will be guided by a new Canadian Agri-Environmental Strategy supporting the sector’s actions on climate change and other environmental priorities toward 2030 and 2050.
Implementation of natural climate solutions to reduce emissions related to ecosystem loss. Up to $631 million over ten years, starting in 2021-22, with $0.1 million in remaining amortization, to Environment and Climate Change Canada (ECCC). The government intends to work with provinces, territories, conservation organizations, federal landowners and Indigenous communities to implement climate smart, natural solutions to reduce greenhouse gas emissions related to ecosystem loss.
Funding for 2 billion trees initiative. Up to $3.16 billion to Natural Resources Canada (NRCan), over ten years, starting in 2021-22, with $2 million in remaining amortization, to partner with provinces, territories, NGOs, Indigenous communities, municipalities, and others to plant 2 billion trees.
Sustainable Finance Action Council. A commitment of $7.3 million over three years for the Department of Finance and ECCC to create a public-private Sustainable Finance Action Council aimed at developing a well-functioning sustainable finance market in Canada. The Action Council will make recommendations on critical market infrastructure needed to attract and scale sustainable finance in Canada, including enhancing climate disclosures, ensuring access to useful data on sustainability and climate risks, and developing standards for investments to be identified as sustainable. The government will launch the Action Council in early 2021.
Small modular reactors (SMR). The government intends to launch an SMR Action Plan by the end of 2020 to lay out the next steps to develop and deploy SMRs. The government intends to work with interested parties, including New Brunswick, Ontario, Alberta and Saskatchewan.
Border carbon adjustments (BCAs). The government is exploring the potential of BCAs and intends to discuss the issue with international partners. The government indicates that it will work with like-minded economies, including the European Union, the United States and Mexico, to consider how a BCA approach could fit into a broader strategy to meet climate targets while ensuring a fair environment for businesses.
Green bonds. The government intends to issue its first ever green bond in 2021-22 and will continue to assess options on the appropriate structure for a federal green bond issuance and provide more information in the context of the 2021-22 Debt Management Strategy, to be presented in Budget 2021.
Zero emission vehicle (ZEV) infrastructure. The government intends to provide $150 million in funding for ZEV infrastructure over three years to NRCan, starting in 2021-22, to help increase confidence that charging and refuelling stations are available and conveniently located.
Home energy retrofits. $2.6 billion over 7 years, starting in 2020-21, to NRCan to help homeowners improve their home energy efficiency by providing up to 700,000 grants of up to $5,000 to help homeowners make energy-efficient improvements to their homes, up to one million free EnerGuide energy assessments, and support to recruit and train EnerGuide energy auditors to meet increased demand. Additional information on home energy efficiency grants is expected to be provided in a future announcement, and eligibility for these grants will be retroactive to December 1, 2020.
Strategic transmission interties. As part of its $10 billion Growth Plan, the Canada Infrastructure Bank (CIB) has earmarked $2.5 billion for clean power and is currently working in collaboration with provincial and regional partners to connect Canadians to clean electricity across Canada through the Atlantic Loop and other regional projects. The government is also proposing to provide $25 million in 2021-22 to help some proponents complete engineering assessments, community engagement and environmental and regulatory studies. This work will help inform and complement the CIB’s efforts to identify and address financial gaps in the projects.