On May 15, 2015, Environmental Minister Leona Aglukkaq announced the federal government’s plans to reduce Canada’s greenhouse gas (“GHG”) emissions to 70% of the 2005 Canada-wide levels by the year 2030. Perhaps most controversially, the federal proposal avoids placing regulations on the oil sands.
Minister Aglukkaq’s announcement came on the heels of Canada’s submission of its Intended Nationally Determined Contribution (“INDC”) to the United Nations. The INDC outlines Canada’s plan to address climate change over the next fifteen years. The three key aspects of Canada’s INDC are: (i) forecasted regulatory developments for Canadian industry sectors; (ii) technology investment; and (iii) inter-governmental cooperation regarding climate change policy.
The INDC submissions process finds its roots in the UN Framework Convention on Climate Change (“Convention”). As an original signatory to the Convention, Canada committed to reducing the effects of worldwide climate change.1 In furtherance of this commitment, Canada is expected to develop climate change action plans in the form of INDCs. Accordingly, the May 15, 2015 INDC was submitted in anticipation of an international UN negotiation which will provide a foundation for climate change policy development in the future.2
Concerning regulation, Canada’s INDC aspires to reduced GHG emissions by 27% between 2015 and 2030 by working closely with all “major emitters” in a way that ensures that “Canada’s economic competitiveness is protected”. Specifically, The INDC forecasts regulatory development in the following sectors: natural gas fired electricity, manufacturing and oil and gas. Regarding the first two sectors, the INDC states that the federal government is currently developing additional regulatory measures which will reduce GHG emissions from natural gas-fired electricity and fertilizer manufacturing. For the oil and gas sector, the INDC indicates that the federal government is currently developing additional regulatory measures to address methane emissions. Minister Aglukkaq specifically indicated in her announcement that these regulatory changes will be influenced by recent similar proposals in the United States.3
To complement regulatory change, the INDC emphasises the importance of investing in “innovative production technologies”. To this end, the INDC states that “Canada will focus climate-related investments in innovative production technologies to continue to drive further improvements in environmental performance in the oil sands and other growing sectors”.
Finally, the INDC indicates that provincial governments will play an important role in regulating climate change and reducing GHG emissions, suggesting that climate change will be a topic of discussion for the federal/provincial/territorial Canadian Council of Ministers of the Environment. Reinforcing the inter-jurisdictional nature of the environment, Alberta Premier-elect Rachel Notley recently stated that she plans to ensure the province plays “an active role in dealing with the issue of climate change”.4 The federal announcement comes in advance of several provincial climate change milestones, including the June 30, 2015 expiry of the Alberta Specified Gas Emitters Regulation, and an upcoming meeting between Ottawa and the provinces on emissions, in advance of a significant climate change conference to take place in Paris at the end of this year.
While the INDC explicitly proposes regulatory change for the natural gas fired electricity, manufacturing and oil and gas sectors, the federal government does not offer any specific details on what to expect from these changes. It remains to be seen whether the May 15, 2015 INDC submissions are little more than a “dress rehearsal” for a broader climate change policy yet to come from the federal government, which is integrated with related U.S. emissions policies. If “practice makes perfect” in climate policy, expect further announcements from the federal government which provide some substance to its evolving emissions target policies. To the extent that the policies announced to date constitute prologue, it remains to be seen whether they are ultimately directed at Alberta’s oil sands.