Canada’s carbon emissions rose in 2021, says report

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According to an independent climate institute, Canada's carbon emissions increased in 2021 but remained below pre-pandemic levels.

The Canada Climate Institute estimates Canada's 2021 carbon emissions at 691 megatonnes, owing to activity across various sectors and oil and gas production levels.

Statistics Canada and Simon Fraser University's Canadian Energy and Emissions Data Centre data show that Canada produced 738 megatonnes of carbon emissions before the COVID pandemic.

Dave Sawyer, a principal economist at the Canada Climate Institute, said despite the increase from 2020, he lauded emissions not "bouncing back" when Ottawa lifted its COVID lockdowns as a "good thing."

"It's roughly a good news story that, yes, there is more activity coming out of COVID, but policy drivers and market drivers are working to keep emissions down," said Sawyer.

"They are lower than they would have been otherwise."

The institute uses trends in energy efficiency and emissions reduction drivers, such as carbon pricing, to offset the estimate. 

Though Canada did not fully reopen in 2021, the institute concluded that the economy grew more rapidly than its emissions, suggesting Canada can grow its economy responsibly moving forward.

According to its report, Canada's emissions fell 2% per unit of GDP compared to 2020.

Ottawa's climate modelling from Budget 2021 unveiled its climate policy forecasted a national emissions reduction of 36% below 2005 levels — the benchmark year for Canada's 2030 climate targets per the Paris Climate Accord. However, that falls short of their commitment to reducing emissions by 40% to 45% over the next decade.

The federal government intends to reduce emissions from where they are today to about 440 megatonnes by 2030 and then to net zero by 2050.

But the energy and climate think-tank Pembina Institute concluded that no government will meet its 2030 or 2050 net-zero goals, as provinces and territories did not include 95% of emissions generated in Canada in their respective 2030 target or climate plans.

"No jurisdiction has developed pathways to describe how net zero can be achieved," reads the All Hands on Deck report.

However, the Canadian Climate Institute claims that early 2021 estimates indicate climate policies initiated by individuals, businesses, and the federal government make a difference, such as energy efficiency, public climate financing, the clean fuel standard and the carbon tax.

The Parliamentary Budget Officer (PBO) estimated that Ottawa would add $120 per tonne in carbon tax by 2030. Between 2018 and 2022, the federal carbon tax backstop increased by $10 per tonne per year, reaching $50 per tonne in 2022.

On April 1, 2023, the carbon tax will increase to $65 per tonne with subsequent $15 increases each following year until 2030.

The institute estimates that emissions declined below 2005 levels in all sectors except oil and gas, transport and buildings. According to the PBO, the real GDP for oil and gas and transportation will fall under these targets by 10.8% and 16.2% by 2030, respectively.

Sawyer adds that Ottawa needs more accurate and timely estimates to allow for "course correction" and "early action" by governments to help Canada meet its climate targets.

The federal government lags 16 months behind in reporting emission figures from the moment industry, and consumers emit carbon, citing its methodology and consultations with provinces and territories. 

While Environment and Climate Change Canada's official 2021 numbers will arrive this spring, the Canada Climate Institute hopes to release its 2022 data in August — eight months before Ottawa releases its numbers for the same calendar year.

"We are seeing a response to those policies," said Seton Stiebert, an adviser to the institute. "We are hoping they accelerate."

Environment Minister Steven Guilbeault pivoted from the report Wednesday to attack the "decade of inaction from the Conservatives," claiming the Trudeau Liberals "are effectively bending the curve on emissions."

Conservative climate critic Gérard Deltell responded: "After eight years of Justin Trudeau, the Liberals have not met a single climate target they set for themselves, all while Trudeau's carbon tax has made everything from food to fuel more expensive for Canadians."

Under a Conservative government led by Pierre Poilievre, he pledged to address climate change "through technology, not taxes."

"Instead of admitting failure, Trudeau continues to make up new targets to miss and is tripling his expensive carbon tax on Canadian families," continued Deltell.

Finance Canada officials communicated that eight out of ten families receive more rebates than they pay at the pump when the federal fuel charge is applied in backstop provinces.

However, the Canadian Taxpayers Federation (CTF) refuted Ottawa's claim that "families are going to be better off" with the carbon tax and climate rebates. 

The same PBO report uncovered that the carbon tax would cost the average household between $402 and $847 in 2023 after the rebates. It states the top 20% of earners in Alberta and Saskatchewan will pay a whopping $7,402 and $5,123 by 2030, respectively.

The Canada Climate Institute also admitted that emissions had risen overall under the current Liberal government despite supposed reductions in 2019 and 2020. This trend has persisted since Prime Minister Brian Mulroney's administration decades ago.