Globe Climate: What to watch for in Ottawa’s 2022 budget this week

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Good afternoon, and welcome to Globe Climate, a newsletter about climate change, environment and resources in Canada.

There are myriad ways to build a wardrobe that prioritizes sustainability as much as style. For the 2022 edition of The Globe and Mail’s annual Canada’s Best Dressed List, standout garmentos highlight the sartorial potential of an eco-friendlier closet. Check out the outfits and the stand-out visual presentation to go along with it.

Post a photo of your eco-fashionable contender to Instagram and tag the picture @globestyle and #GlobeStyleBestDressed.

Now, let’s catch you up on other news.

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Noteworthy reporting this week:

1. Adam Radwanski says that the oil and gas industry is ready for carbon pricing, but Ottawa must ensure it’s here to stay
2. A lawsuit asks the courts to toss out B.C.’s latest climate accounting report, saying the province has not met its legal obligation on climate targets.
3. From The Narwhal: ‘This was our forever home’: floods, climate change and the end of one Alberta community

A deeper dive

Federal budget will need to explain climate plan details

Ryan MacDonald is the editor for climate, environment and resources at the Globe. For this week’s deeper dive, he talks about what to expect in terms of climate in the upcoming federal budget.

We here at Globe Climate love a good budget. And the federal government’s Emissions Reduction Plan unveiled last week was something of a mini budget of its own, with the Liberals vowing to spend an additional $9.1-billion to achieve Canada’s goals to cut emissions by 40 per cent to 45 per cent below 2005 levels by 2030.

While that plan came in at a hefty 270-pages, there are still many key details related to climate that will need to be explained in the budget itself. Here’s what to watch for:

Carbon capture: For oil sands producers and heavy industry in Canada, there is nothing more important than the details of the federal Liberal government’s investment tax credit for carbon-capture projects. For critics, it’s another subsidy for the fossil fuel industry. Let’s see if the government can get the balance right –because Canada needs to use every tool in its emissions-reduction toolbox if it’s to meet its goal of net zero by 2050. Most observers say the tax credit will need to cover at least half of construction costs for these projects, which require massive scale to be effective, to get off the ground. The Globe’s energy reporter Emma Graney breaks down the projects under way and under consideration.

Transportation: Getting Canadians into zero-emissions vehicles (ZEVs) is a huge priority for Ottawa. The government has an ambitious plan. Now the details must be worked out:

• Ottawa wants to institute a mandate that at least 20 per cent of new cars offered for sale by 2026 be zero emissions vehicles. The target will rise to 60 per cent in 2030 and 100 per cent in 2035. One issue is whether, despite the narrow time frame, the 20-per-cent target will be strictly regulated and enforced. While the government has sent clear signals about that being the case with its later sales targets, it has sent mixed signals around the nearer-term one. The auto industry opposes ZEV mandates and has urged Ottawa to move slowly on the requirements;
• With auto makers moving to build bigger, more expensive electric cars, SUVs and trucks, will the government adjust its ZEV rebate program? Currently, a suite of electric, hydrogen and longer-range plug-in vehicles are eligible for up to $5,000 in “incentives” from the federal government. Automakers say that incentive needs to rise to $15,000. Ottawa has plans to provide $1.7-billion to extend the incentives program, but didn’t provide details;
• Finally, will the 2026 sales quotas apply to a manufacturer’s sales across the country overall, or will the target need to be met in each province and territory? That’s an important consideration because in B.C. and Quebec – which are the only two provinces that have both a sales mandate and a rebate program that tops up the federal incentive – zero-emissions vehicles made up 12 per cent and 10 per cent of registrations in the third quarter of 2021, respectively. In Ontario, where there is no rebate program, the figure was 3 per cent. In Manitoba, New Brunswick and Saskatchewan, it was less than 2 per cent.

There will also be measures to support the green economy. One thing is clear: The first budget for a post-pandemic economy is coming at a crucial time. The world is running out of time to meet the challenge posed by a warming planet. Today, the latest IPCC report is urging the world to stop procrastinating and to embrace solutions.

-Ryan

What else you missed

• B.C. defers logging across an additional 1.7 million hectares of at-risk old growth
• Talks on ‘Paris deal’ for nature fail to secure agreement
• Climate change could cost U.S. budget US$2-trillion a year by end of century, White House says
• Climate-related disasters pose ‘major’ growth threat in Middle East and Central Asia, IMF says
• World’s top banks pumped $742-billion into fossil fuel industry in 2021, report says
• Greta Thunberg aims to drive change with The Climate Book
• Alberta chooses six projects to explore developing Canada’s first carbon-storage hubs

Opinion and analysis

Tim McKay, Alex Pourbaix, Bij Agarwal, Brad W. Corson, Derek Evans, Mark Little: Pathways Alliance plan can help lead Canada to a clean energy industry and a net-zero future

Editorial board: The Liberals have a new plan to fight climate change. It might even work

Green Investing

From Jeffrey Jones: A new global accounting body, which has a major office in Montreal, has taken its first steps to establish formal reporting standards for corporate sustainability in efforts to improve transparency and discourage greenwashing.

From Mark Rendell: Canada’s export credit agency is looking to capitalize on the growing trend for sustainable investing, launching a set of new financial tools aimed at supporting socially oriented businesses and helping large greenhouse gas emitters reduce their carbon footprint.

• Power Corp. of Canada buys Lios Partners to create new agri-food private equity fund
• As good as gold? Bullion funds grapple with ethical investing

Making waves

Each week The Globe will profile a Canadian making a difference. This week we’re highlighting the work of Justin Nanninga doing sustainable farming.

Hi I’m Justin Nanninga. I farm two hours northwest of Edmonton. I’m a zone 5 director with Alberta Canola, also Alberta’s representative to the Canola Council of Canada. I’m chair for Gateway Research Organization, an applied research association. Five of the last six years have had above normal rainfall; this past year was very hot and dry.

After years of being in crop insurance claims and not being profitable it was time to do something different. I started a local grower group, which has now grown to 12 producers. We decided to cut back on fertilizer and replace it by introducing plants with our cash crop that would make the tied up fertilizer available. This gets the soil beneficials to start working and cycling to produce organic fertilizer.

In view of climate stability, farming will need to adapt, lowering emissions from equipment or fertilizers, while increasing the amount of carbon capture. Regenerative agriculture is a broad topic, and every farm will have a different answer. We will continue to be a no-till farm. We will reduce our dependence on fertilizer and chemicals. This is our first step in a journey toward becoming a more risk tolerant farm. Our farm will grow a better, healthier product for the consumer, and provide the next generation with an opportunity to farm better as well.

- Justin

Do you know an engaged individual? Someone who represents the real engines pursuing change in the country? Email us at GlobeClimate@globeandmail.com to tell us about them.

Photo of the week

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Catch up on Globe Climate

• What does it take to move an entire city?
• How the B.C. flood changed lives forever along Highway 8
• Russian oil ban puts spotlight on Canada, and our climate ambitions
• In Russia’s war against Ukraine, energy is a weapon

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