Picture by: Kris Krug by way of Flickr (License: CC BY-NC-ND 2.0 DEED)

COP28, the world’s foremost local weather convention, is understood for spawning stress and frustration, however this latest one appeared particularly fraught.

That is the primary COP the place contributors discovered themselves face-to-face with the truth of breaching the 1.5 C warming restrict that was the central aspiration of the 2015 Paris Settlement. It was additionally the primary to be chaired by an oil and gasoline govt, placing a crude highlight on the conflicting pursuits which have change into entrenched on this United Nations course of.

However all was not misplaced. The closing wording of the COP28 settlement – which required consensus amongst all nations and the chair – codified a dedication to transition away from fossil fuels in vitality methods.

To anybody being attentive to world oil and gasoline demand future forecasts, even beneath present insurance policies, the COP28 settlement shouldn’t be a shock. As governments roll out their local weather insurance policies, deployment of renewable vitality has been quickly growing, whereas the prices of energy from these sources and battery storage lower.

This final result additionally presents a dilemma for Canada, which, whereas positioning itself as a local weather chief, additionally occurs to be the world’s fourth largest oil producer and fifth largest gasoline producer. Including to the issue is that the fossil-fuel sector is Canada’s fastest-growing supply of emissions.

The world is beginning to discover. Canada was publicly referred to as out on the UN’s September Local weather Ambition Summit for being, “one of many largest expanders of fossil fuels final yr” – a doubtful distinction for a rustic whose federal authorities is proclaiming itself aligned with the Paris Settlement.

So how does a fossil-fuel producing nation sq. the circle with its local weather ambitions and data that fossil-fuel demand will drop within the coming many years, if not earlier?

For Canada to be aggressive sooner or later world financial system, it should put money into industries that will probably be rising within the coming years, which it has been and is ready to proceed doing.

In 2022, for instance, the EV provide chain attracted 13 per cent of all overseas direct funding into this nation. The Convention Board of Canada expects it to buoy up manufacturing projections in 2024, not like petroleum and coal merchandise that have been dragging down our manufacturing gross sales numbers this fall.

It’s an indication of issues to come back: Jobs modelling from Clear Power Canada reveals that there will probably be 700,000 extra vitality jobs in a net-zero 2050, with progress in clear vitality employment outpacing the decline in fossil fuels.

However for this nation to really be aggressive, it additionally signifies that Canada should be certain that air pollution from present fossil-fuel manufacturing declines to each hit the nation’s emissions targets and entry markets more and more involved with carbon depth.

The federal authorities, to its credit score, has achieved an admirable job threading this needle. New federal methane rules, funding tax credit and the emissions cap on the oil and gasoline trade are – setting apart the objections from sure premiers – the appropriate strikes. However they need to not come at the price of investing sooner or later financial system.

For instance, Ottawa has already supplied up a beneficiant carbon seize, utilization and storage (CCUS) tax credit score, which represents an estimated $10-billion serving to hand to the oil and gasoline trade’s decarbonization ambitions. And but, the sector remains to be asking for billions extra taxpayer {dollars} for the expertise on the heels of a yr laden with windfall oil and gasoline income.

The truth is that relying solely on carbon seize expertise to chop oil and gasoline emissions will probably be enormously costly and remains to be unproven on the scale required. It’s hardly an efficient use of the general public checking account when Canada’s vital minerals, automotive manufacturing and clear vitality (to call just a few) are poised for progress.

Certainly, the evident prioritization of the CCUS tax credit score each by way of timing and generosity over its funding tax credit in cleantech and clear electrical energy raises some questions – particularly when it must be the opposite method round.

Canada has lengthy had a cultural fixation on its fossil-fuel trade that has elevated it past its precise contributions to the financial system, fanned partially by a sequence of Albertan premiers. However good governance means safeguarding future Canadian jobs and financial prosperity over the calls for of 1 sector, irrespective of how massive a job it has performed up to now.

The world has agreed to transition away from fossil fuels, and proof suggests the shift is already nicely underway. It’s time Canada confronted this actuality.

This publish first appeared within the Globe and Mail.