During the North American Leaders Summit held in Ottawa on June 29, 2016, Prime Minister Justin Trudeau, United States (US) President Barack Obama, and Mexican President Enrique Peña Nieto announced the North American Climate, Clean Energy, and Environment Partnership, which reflects the leaders’ shared vision for a clean energy economy. The Partnership is supported by an action plan (the Action Plan) that details the activities to be pursued by the three countries in order to achieve a “competitive, low-carbon and sustainable North American economy”.

As reported in our earlier blog, energy ministers from Canada, Mexico and the United States signed a Memorandum of Understanding (MOU) on Climate Change and Energy Collaboration on February 12, 2016 during the North American Energy Ministers Meeting in Winnipeg. The June 29 announcement builds on the MOU with a range of initiatives to support the North American leaders’ stated goals, including a target to achieve 50% clean power generation by 2025 through clean energy development and deployment, clean energy innovation and energy efficiency. This target will be achieved by:

  • scaling-up clean energy through domestic initiatives, including Mexico’s Energy Transition Law and new Clean Energy Certificates, the US Clean Power Plan, and Canada’s actions to further scale-up renewables, including hydro;
  • collaborating on cross-border transmission projects, including for renewable energy;
  • conducting a joint study on the opportunities and impacts of adding more renewables to the power grid on a North America-wide basis; and
  • aligning efficiency standards across all three countries, including a commitment to promote industrial and commercial efficiency through the voluntary ISO 50001 energy performance standard and to align a total of ten energy efficiency standards or test procedures for equipment by end of 2019.

On the climate change front, the leaders committed to implementing the Paris Agreement, which includes a goal to limit temperature rise this century to well below 2oC, while pursuing efforts to limit the temperature increase to 1.5oC. As the three countries work to implement their respective Nationally Determined Contributions, the parties will cooperate on climate mitigation and adaptation measures. In addition, the leaders committed to:

  • adopting a comprehensive Montreal Protocol hydrofluorocarbons (HFCs) phase-down amendment in 2016, and to reduce domestic use of HFCs;
  • phasing out fossil fuel subsidies by 2025 and urging the G20 to make commitments to reduce methane emissions in the oil and gas sector and to improve the environmental performance of heavy-duty vehicles; and
  • aligning approaches to account for the social cost of carbon and other greenhouse gas (GHG) emissions when assessing the benefits of emissions-reducing policy measures.

Further, Canada, the US and Mexico set out commitments to address short-lived climate pollutants such as methane, black carbon, and hydrofluorocarbons, which are significantly more potent than carbon dioxide. In particular, Mexico announced that it will join Canada and the US in committing to reduce their methane emissions from the oil and gas sector by 40% – 45% by 2025. To that end, the three countries will look to develop and implement federal regulations to reduce emissions from existing and new sources in the oil and gas sector as soon as possible. The leaders also committed to developing and implementing national methane reduction strategies for key sectors such as oil and gas, agriculture, and waste management, including food waste, as well as taking action to reduce black carbon (soot) emissions in North America and promote alternatives to hydrofluorocarbons.

The Action Plan also includes a number of initiatives on transportation and biodiversity conservation, including:

  • accelerating deployment of clean vehicles in government fleets and working with industry to encourage the adoption of clean vehicles by consumers;
  • convening industry leaders and other stakeholders by spring 2017 as part of a shared vision for a competitive and clean North American automotive sector;
  • implementing aligned light-duty vehicle (LDV) and heavy-duty vehicle (HDV) fuel efficiency and/or GHG standards out to 2025 and 2027, respectively;
  • implementing aligned ultra low-sulphur diesel fuel and HDV exhaust air pollutant emission standards by 2018;
  • aligning LDV exhaust and evaporative air pollutant emission standards with full US Tier 2 standards by 2018 and fully phase in Tier 3 standards by 2025, while also implementing ultra low-sulphur gasoline standards;
  • supporting the adoption by all countries in 2016 of the market-based measure proposed through the International Civil Aviation Organization to allow for carbon-neutral growth from international civil aviation from 2020 onwards and joining the first phase of the measure adopted;
  • reducing GHG emissions from maritime shipping and continued work through the International Maritime Organization (IMO) to support implementation of a North American Emission Control Area that includes Mexico;
  • collaborating with Indigenous communities and leaders to incorporate traditional knowledge in decision-making, including in natural resource management, where appropriate;
  • renewing regional, bilateral, and trilateral activities in support of migratory bird and habitat conservation; and
  • implementing programs to conserve and improve biological corridors for whales and other species and their habitats, including their food chains and ecosystem quality.

The Action Plan represents a renewed push to strengthen continental ties among the three countries, and establishes climate change as a key policy driver for reducing GHG emissions from the oil and gas sector, boosting the development of clean power and building new cross-border transmission lines. The Action Plan also shares common objectives with provincial climate change and clean energy initiatives, including Alberta’s Climate Leadership Plan and Ontario’s Climate Change Action Plan. The newly announced initiatives under the Action Plan will no doubt feed into the development of a pan-Canadian framework for clean growth and climate change. In March 2016, four working groups were established at the First Ministers’ meeting to address four priority areas: (i) clean technology, innovation, and jobs; (ii) carbon pricing mechanisms; (iii) specific mitigation opportunities; and (iv) adaptation and climate resilience. With the working groups due to report back to the Ministers with recommendations in October 2016 and the implementation of commitments under the Action Plan, the fall agenda is shaping up to be a busy one for both provincial and federal decision-makers.