This is a guest post by Clare Demerse of Clean Energy Canada.

Canada’s premiers and prime minister headed home from Vancouver last week having launched a brand-new climate change negotiation process. Set against a backdrop of clean tech power brokers and pipeline skirmishes, the lead-up to last week’s meeting generated headlines mainly for the faultlines it brought to the surface.

No doubt about it: Tough conversations are coming, especially about the best way to price carbon pollution. But as the hot rhetoric cools down, here are four reasons for optimism based on the results of last week’s First Ministers’ meeting.

First, this initiative is unprecedented. The politicians who signed the declaration said they’ll try to craft something we’ve never had before: a national plan to hit a climate target.

Under Paul Martin, we saw a climate plan proposal from Ottawa — but it was federal rather than national, and most of it didn’t go into effect. Prime Minister Stephen Harper, of course, never offered a serious plan to cut greenhouse gas pollution in line with Canada’s targets. And during the long years when Ottawa was missing in action, some premiers raced ahead, while others barely got out of the starting gate.

So if last week's agreement works — which, of course, is still a very big “if” — the outcome will be a Canadian first.

Second, this process gets the right players involved.

Climate change is way too big to fit neatly into an environment minister’s portfolio. It’s also an energy issue, an infrastructure issue, a finance issue, a transportation issue, and so on. To really succeed in tackling climate change, you need leadership right from the top — the puzzle pieces just don’t line up without it. Premiers and prime ministers need to make climate action a priority, decide in broad strokes how to go about it, and then give their ministers marching orders to get it done.

Similarly, we need both Ottawa and the provinces at the table; climate change is an area of shared jurisdiction. The federal government can provide funding, set (some) national standards, and negotiate for Canada at global climate talks, but provinces make crucial decisions about electricity and energy development.

So federal, provincial and territorial First Ministers are the right cast of characters to get Canada on track. It won’t be easy, of course — regional tensions were already on full display in Vancouver — but this participant list opens up the possibility of success.

Third — as Saskatchewan Premier Brad Wall reminded everyone more than once — this was always a discussion about the economy, not “just” the environment. And that’s a good thing.

As the declaration puts it, the transition to a clean economy “is necessary to ensure the future prosperity of Canada and Canadians.”

Exactly. Our analysis, published last week, concluded that clean energy just had its best year ever globally, with US $367 billion invested — nearly 50 per cent more than new investment in fossil fuel power.

You don’t even have to take our word for it. The CEO of Enbridge, best known for its Northern Gateway oil pipeline proposal, said this week that power generation — particularly from renewables — is “going to be a significant element of growth both in North America and globally.”

But while the U.S., China, Japan, and Mexico (to name just a few) saw their clean energy investment grow in 2015, Canada’s dropped by 46 per cent relative to the year before.

We need to reverse that trend as soon as possible — our competitors certainly aren’t standing still. Which brings us to a final reason this meeting matters: the process that the leaders announced last week can deliver a plan to build Canada’s clean energy economy.

The traditional approach to climate negotiations has been to fight about the allocation of pain. Who will make the deepest cuts? Who will charge the highest prices? For obvious reasons, those are not easy political conversations — and the vastly different emission profiles of Canada’s provinces make them even trickier.

But with the global economy making a rapid shift from fossil to clean energy, there’s now a huge opportunity to talk about. Instead of arguing about what we’re going to cut, it’s time to figure out what we’re going to build.

We can’t tackle climate change without building a clean energy economy. At its core, the recipe for reducing greenhouse gas pollution in Canada (and anywhere else) is simple: invest in clean power and then electrify everything. Move away from using fossil fuels to drive our cars and heat our homes; use clean power instead.

In Canada, this means building far more clean power, along with a smarter grid and a new generation of cars, buildings and industrial processes. And there’s money to be made every step of the way.

First Ministers acknowledged that reality in their declaration, which mentions the economy nearly as often as it does the climate. One of the four working groups this meeting established has a mandate to “stimulate economic growth, create jobs, and drive innovation” — and will do its work under the direction of ministers of economic development.

To reap those economic benefits, leaders need to use the months ahead to set ambitious clean energy goals for Canada — and then commit to policies to meet them. How much new clean power will we bring onto the grid? How many more electric vehicles will be on the road by 2030? How many buildings will we retrofit with state-of-the-art technologies to cut energy waste? How much clean technology will we be selling to the world? And in the process, how many new jobs will we create?

Canada’s governments, and all of us, need to seize this opportunity. Last week's meeting moved us a step closer to doing so.

Clare Demerse is a senior policy advisor in Ottawa for Clean Energy Canada, a climate think tank that is a project of Simon Fraser University’s Centre for Dialogue. 

You can click here to read more about Prime Minister Justin Trudeau and climate change.

Image: Prime Minister of Canada

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Clean energy investment surged to $497 billion worldwide in 2015 while in Canada investment in renewables experienced a massive 46 per cent plunge to around $5.4 billion, according to a new report released Monday by Clean Energy Canada.

Global investment is up from a total of $420 billion in 2014 with nearly one-third of of new investments occurring in China. Spending on renewables increased in the U.S. by seven per cent, in India by 23 per cent and in Mexico by 114 per cent.    “Canada’s performance was out of step with its peers in 2015,” Clare Demerse, senior policy adviser at Clean Energy Canada, told DeSmog Canada. "This should be a wakeup call, although we hope this is a one-off and not the start of a trend."

Cheaper technology can partially account for the drop in investments in Canada. In the U.S., for example, over the last six years the unsubsidized cost of wind energy went down 61 per cent and 82 per cent for utility-scale solar PV. 

The amount of money invested in Canadian clean energy may have been cut in half last year, but the construction of new renewable energy projects only slowed by 30 per cent, according to Clean Energy Canada.   “When you couple [clean energy's] declining costs with free fuel from the wind, sun, water, biomass and the earth’s heat, you have a formula for ever increasing competitiveness with fossil fuels,” the report states.

Source: Clean Energy Canada, 2016

Uncertain Clean Energy Policy in Canada Played a Role

Imprecise policies and a lack of clean energy regulation created uncertainty for investors in Canada, the report finds.   “Pipelines trumped power lines as a national priority,” it concludes.

Canada has no national climate framework or greenhouse gas regulations for the oil and gas sector. The bulk of Canada's climate action in recent years has emerged at the provincial level.   “In the longstanding absence of federal climate leadership, provinces led the charge," Demerse told DeSmog Canada. But, she added, "some of the provinces that are big players in clean energy were rethinking policies in 2015. Uncertainty is hard on investors.” 

British Columbia, a province praised in recent years for its world-class carbon tax, is investing heavily in a liquefied natural gas (LNG) export industry as well as the major Site C hydrodam. A recent review of B.C.'s Climate Action Plan found the province is unlikely to meet its climate targets. 

Ontario, Canada’s leader in wind power, confirmed it will spend over $25 billion on refurbishing aging nuclear reactors to clean up the province’s electrical grid instead of doubling down on domestic renewable energy or importing relatively cheap water power from Quebec.   However, some progress on provincial climate policies was made at the end of 2015.   Ontario and Manitoba both announced they are joining North America’s largest carbon market by linking up with the Quebec-California cap-and-trade system. A new Alberta government unveiled plans to phase out coal, cap oilsands emissions and introduce a carbon tax. Saskatchewan also set admirable renewable energy targets, which aim to have half of the province's electricity coming from renewable sources by 2050.

According to Clean Energy Canada these provincial targets need to be translated into clear policy to boost investment in the sector. 

Canada’s Clean Energy Potential Barely Scratched 

“Canada is incredibly well positioned for clean energy success,” Demerse told DeSmog. "Yes, we may have the third largest oil reserve in the world, but we are also the third biggest producer of hydroelectricity. And we have the potential to do so much more with our clean energy resources."

Demerse believes this week’s national climate strategy meeting between the federal government, Indigenous leaders and the premiers is the perfect opportunity to lay the foundation for a clean energy plan for Canada. 

“The new federal government can do a lot to change this. Adopting real, meaningful clean energy targets would provide more certainty for investors,” Demerse said.   According to a groundbreaking study led by Stanford Engineering Professor Mark Jacobson that examines how countries can run off of 100 per cent renewable energy by 2050 , Canada has only begun to scratch the surface of its ‘clean energy superpower’ potential.

  Canada's energy mix in 2050 according to Jacobson's analysis. Source: The Solutions Project.

“The main barriers to getting to 100 per cent clean energy are social and political, not technical or economic,” Jacobson said during a climate and energy forum in Washington, D.C., last November.   Canada already generates roughly 60 per cent of its electricity from renewable sources and this is nearly all from hydroelectricity or waterpower. By comparison, Germany produced just over 30 per cent of its electricity from renewable energy in 2015, which was mostly from wind, solar and biomass. Canada has one of the world’s cleanest electrical grids.   But currently, non-water based renewables like wind and solar make up a mere three per cent of the electricity Canada generates.   The Stanford study projects solar and wind could make up 21 per cent and 58 per cent respectively of all of Canada’s required energy by 2050. Waterpower in Jacobson's 2050 scenario becomes the junior partner to wind and solar at 16.5 per cent of the total Canadian energy mix. The study's authors conclude there is no need to build additional hydro dams like the Site C dam in B.C. or continue with nuclear power generation.

Image Credit: NAIT via Flickr 

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Prime Minister Justin Trudeau confirmed Wednesday the federal government will meet with Indigenous leaders and premiers in Vancouver in early March in the hopes of laying out the framework for a national climate strategy.   “I look forward to working with the premiers on combatting climate change and moving toward a greener, more sustainable Canadian economy better positioned to compete globally in the areas of clean knowledge and technologies,” Trudeau said in a media release.

The Prime Minister announced he will meet with Indigenous leaders on March 2 to inform a national climate framework discussion with the premiers in a First Ministers' Meeting scheduled to take place March 3. First Ministers' Meetings did not occur under former prime minister Stephen Harper.

According to Clare Demerse, Ottawa-based energy policy adviser with Clean Energy Canada, the meeting provides an unprecedented opportunity to discuss Canada's renewable energy transition.   “The right people will be in the room to move forward on a national approach [to climate change]," Demerse told DeSmog Canada. "Whether it’s electrical production, or natural resources extraction, provinces make big decisions on energy in Canada."

Meeting to Capitalize on Low-Carbon Economy

According to the Prime Minister's press release, the Vancouver meetings "will focus on effective ways to adapt to climate change, reduce greenhouse gas emissions, and capitalize on the opportunities presented by a low-carbon economy to create good-paying and long-term jobs." 

“We’d really like to see the conversation in Vancouver be about what we're going to build, not just about what we’re going to cut,” Demerse said. “How many electric cars will we see on the road? How are we going to make buildings more energy efficient? How much solar, wind and water power needs to be produced in 2020 or 2030?”   “This is not to say reduction targets shouldn’t be discussed. But the discussion needs to be more focused on the ‘how’ instead of just the number."   Canada was one of the only countries among the world’s top ten greenhouse gas gas emitters not to provide a national clean energy plan to the United Nations in the lead up to the Paris climate talks last December. Other heavy emitters like the United States, European Union, China and even Mexico submitted plans with clean energy targets along with their GHG reduction targets.    The $125 billion the Liberal Party promised during the federal election to invest in infrastructure could go a long way encouraging provinces and territories to adopt strong climate policies.    “The low-carbon infrastructure dollars could be used to reward a province or territory for raising its carbon price, or for adopting stronger climate policies,” Demerse said.   Green infrastructure and public transit were two priorities in the Liberals infrastructure spending pledge. The Liberals also committed to increasing Canada’s Low Carbon Economic Trust to $2 billion.

Feds Could Set a National Minimum Carbon Price

Carbon pricing could also play an important role during the first ministers meeting.   “The First Ministers will consider all policy measures at their disposal to make sure Canada can take advantage of the significant appetite for expertise in the clean growth economy,” the PMO announcement states.   Currently, British Columbia, Alberta, Ontario and Quebec all have some sort of carbon pricing system: either cap and trade or carbon tax. Last December, Manitoba announced it would join Ontario and Quebec’s cap and trade market, which is linked with California’s.   Unlike his predecessor, Trudeau is a supporter of making polluters pay for their greenhouse gas emissions. He is also an advocate of the provinces and territories choosing the system that suits them best.   The problem now lies with the different prices on emissions in different provinces. B.C.’s carbon tax is $30 per tonne of carbon, but Quebec’s carbon price, which is meant to fluctuate, is about half that.    “Eventually Canada will want one coherent national carbon pricing market. The bigger the market, the more diverse the opportunities to reduce emissions,” Demerse said.   “But we aren’t quite there yet, and certain provinces have done a lot of leg work to create their own carbon pricing systems. So, to create consistency between the different system and jurisdictions, the federal government should set a national minimum price on carbon."

Image Credit: PMO Photo Gallery

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Canada can reduce its carbon footprint by 90 per cent, play its part in the fight against climate change and grow its economy at the same time according to a recent report by the United Nations Sustainable Development Solutions Network. 

“This is a really important piece of analysis for Canada. It shows that we can cut our carbon pollution dramatically by 2050, making a strong contribution to tackling climate change, while growing our economy by over 200 per cent,” Clare Demerse, a senior policy advisor at Clean Energy Canada says.

By powering transportation, buildings and electricity with largely renewable energy (water-power, wind, solar) and biofuels and applying wide spread use of greenhouse gas (GHG) capturing technologies such as carbon capture and storage (CCS) in the oil and gas sector the report argues Canada can cut its GHG emissions production by 90 per cent by 2050 based on 2010 levels.

The catch is none of this can happen unless Canada implements policies effectively regulating the production of GHG emissions, something the federal government has so far been unable to do.

“Many of the major changes described in the Canadian decarbonization pathway will not occur without strong policy signals, which will require public support and in many cases will be driven by public pressure,” the UN network concludes. 

Electrification of the Economy Is the Key to Reducing GHG Emissions 

Reducing GHG emissions of transportation and buildings sectors by 97 per cent and 96 per cent respectively are the “two of the core foundations of the Canadian deep decarbonization pathway.” The key to reaching these targets is a substantial shift to renewable energy.

Canada's projected GHG emissions by sector by 2050 in a 90 per cent GHG emissions reduction scenario. Source: UNSDNS

“Decarbonizing electricity production is essential, since it is a precondition to reducing emissions throughout the rest of the economy through electrification,” the report states.

Water-power (Canada’s largest source of renewable energy), biomass, wind and solar are projected to lead the way in decarbonizing Canada’s electrical supply with wind and solar generating as high as 17 per cent and 10 per cent of Canada’s electricity respectively.

Oil consumption for transportation will need to plummet with the majority of Canadian vehicles running off of biofuels, hydrogen or electricity in the 90 per cent GHG emissions reduction scenario. The report sees a slight shift to mass transit (trains, buses) over personal vehicles and a large transformation from trucks to trains for freight.

Electricity production (left) and fuel consumption (right) by source by 2050. 

“The results the modelers presented are one way to hit the target they were given, but they’re not a prescription. As they point out, Canadians and our governments will need to make policy choices about what kind of low-carbon path makes the most sense for us,” Demerse told DeSmog Canada.

British Columbia’s successful and surprisingly popular carbon tax and Quebec’s cap-and-trade system are two homegrown Canadian climate policy examples Prime Minister Stephen Harper’s government could follow to fulfill Canada’s international responsibilities to cut global warming GHG emissions.

Report Surprisingly Projects Oil and Gas Output Will Double by 2050

The report assumes Canada can remain an oil and gas “energy superpower” in a world that has gone nearly zero-carbon. The report predicts Canadian oil and gas production will double by 2050 as well.

“The report’s assumptions on global oil demand seem a little unrealistic. Studies have shown that demand will drop as countries transition to low carbon economies,” Professor Mark Jaccard, an energy economist at Simon Fraser University says.

Canada's GHG emissions by sector (2010 baseline). Source: UNSDSN

“If Canada is able to power its cars and buildings with virtually zero fossil fuels by 2050, why wouldn’t the rest of the world want to do the same? If global demand for oil drops, oil prices will drop too — and then we would see far lower production than the oilsands industry is counting on today,” Demerse told DeSmog Canada.

To keep the oil and gas sector in play in a near zero-carbon scenario the report recommends Canada employ widespread use of technologies such as carbon capture and storage (CCS) in the sector. CCS captures carbon emissions, and converts them into a dense fuel that can be transported to sites below ground for storage.

Canada only has one operational CCS project. The Pembina Institute, an energy policy think tank, predicts Alberta alone will need twenty-five large-scale CCS projects to meet its own GHG emissions reduction targets.

“Why would companies adopt expensive CCS (carbon capture and storage) technology if at the moment they can dump waste into our atmosphere for free?” Jaccard says.

The authors of the report admit CCS is not “commercially viable” in Canada at the moment given “current climate policy stringency.” The low price on carbon and lack of regulations on GHG emissions in the Canadian oil and gas sector provide very little financial incentive for companies to invest in expensive technologies that decrease the carbon footprints of their operations.

“Until there are regulations on carbon in Canada technologies like CCS are going nowhere,” Jaccard told DeSmog Canada.

Unclear If the Oilsands Have A Place In A Decarbonized Canada

The UN network behind the report is unable or unwilling to say if the oilsands (also called tar sands) industry, the fastest growing source of GHG emissions in Canada, has a future in a low carbon Canada. The report cites “literature conflicts on whether production from the oil sands can be cost-effective in a deep decarbonization scenario.”

Image Credit: Blue Green Canada, United Nations Sustainable Development Solutions Network

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A new report from Pembina Institute says that the proposed TransCanada Energy East pipeline could generate up to 32 million tonnes (Mt) of additional greenhouse gas (GHG) emissions from the crude oil production required to fill it. Thirty-two million tonnes of carbon emissions is the equivalent of adding 7 million cars to Canada's roads, exceeding the projected emissions of the Keystone XL pipeline proposal.

The Keystone XL pipeline, in comparison, would generate 22 Mt of additional GHG emissions through oilsands production, according to a previous report by Pembina. The estimated emissions impact of Energy East is "higher than the total current provincial emissions of five provinces."

The $12 million Energy East pipeline, proposed by TransCanada in August 2013, would have the capacity to transport 1.1 million barrels per day (bpd) of oilsands and conventional crude oil from Alberta to New Brunswick. According to the report, the volume of new oilsands production associated with Energy East would represent up to a 39 per cent increase from 2012 oilsands production levels.

Figure 1: Greenhouse gas emissions associated with Energy East compared to those of selected provinces. Climate Implications of the Proposed Energy East Pipeline: A Preliminary Assessment. The Pembina Institute, 2014.

Oilsands production is currently Canada's fastest growing source of GHG emissions, and is set to nearly triple between now and 2030, according to Environment Canada. Report authors Clare Demerse and Erin Flanagan told DeSmog Canada that this growth is "the single largest barrier to achieving [Canada's] 2020 climate target."

Given that Canada is set to miss its 2020 emissions reduction target by 122 Mt with current measures, Demerse and Flanagan see the Energy East proposal's potential to add a new source of GHGs from the oilsands as "significant and troubling."

The authors stress that the report, titled Climate Implications of the Proposed Energy East Pipeline, only assesses the pipeline's upstream, "Well-to-Refinery Gate" emissions impact, rather than the downstream, "Well-to-Wheel" emissions of the crude oil being transported, which would include emissions released by its combustion in vehicle engines. The actual climate impact of Energy East would therefore be even greater than figures in the report.

"The oilsands are already Canada's fastest-growing source of carbon pollution and the Energy East pipeline would help to accelerate production. Any regulatory review should include not only the impact of the pipeline itself, but also the impact of producing the crude that would flow through it," said Demerse, Federal Policy Director at Pembina.

Figure 2: Change in GHG emissions by economic sector, 2005-2020. Climate Implications of the Proposed Energy East Pipeline: A Preliminary Assessment. The Pembina Institute, 2014.

Demerse and Flanagan hope that the report will urge the National Energy Board (NEB) to undertake a more thorough appraisal of Energy East's environmental impact than its review of Enbridge's Northern Gateway proposal, saying that they wanted to submit their findings "before the National Energy Board decides on the format of its review."

The authors note that "many Canadians asked for consideration of the impacts of oilsands production in the Northern Gateway hearings," so if the NEB chooses a "more complete and balanced review of the Energy East proposal – one that looks at the environmental impacts of filling the pipeline as well as the pipeline infrastructure itself – I think the regulators would simply be catching up to where Canadians already are."

TransCanada is set to submit its regulatory application for Energy East to the NEB later this year.

The report recommends that the NEB "include the pipeline's full upstream impacts in the scope of its review, and that the federal government should end its delays and adopt strong emissions regulations for the oil and gas sector."

The report mentions that carbon capture and storage (CCS) technologies have been found to lower oilsands production emissions, but adds that "Canada lacks the kind of stringent climate policies that would provide a strong incentive for those kinds of investments," especially considering the high cost of such technology.

ICO2N, a group of energy companies invested in developing CCS technology, estimates that a carbon price of $125/tonne is necessary to justify capture of approximately 15 per cent of oilsands CO2.

The authors believe that approving projects like Energy East and Keystone XL could "see less emphasis on, and less encouragement of, clean energy investment in Canada" when the country needs to be "starting the transition to a clean energy future."

"The oilsands industry plans to triple production by 2030 and building new pipelines is necessary to realize those ambitions. We need to look at the full scope of impacts when evaluating pipelines," said Flanagan.

In its 2013 World Energy Outlook, the International Energy Association (IEA) modelled a scenario where countries take the action required to keep global warming below 2 degrees C, and found that global demand for oil would likely peak in 2020 and fall thereafter. Demerse and Flanagan suggest that Canada needs to "keep that kind of long-term picture in mind when we're considering a pipeline proposal that could last for 30, 40 or 50 years."

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