Clean Energy Canada | Fall Economic Statement response: Canada is realizing the benefits of building a clean economy, but speed is critical to stay ahead
November 21, 2023
OTTAWA — Mark Zacharias, executive director at Clean Energy Canada, made the following statement in response to the federal government’s Fall Economic Statement:
“Over the past couple of years, Canada has made—and attracted—big investments in its rapidly growing clean energy sector, from major EV and battery manufacturing plants, to renewable power, to green hydrogen and steel projects. The IMF anticipates Canada will lead the G7 in growth next year, and already the country has seen the third-most foreign direct investment in the world in the first half of 2023, more per capita than our G7 allies (in 2022, the EV supply chain alone attracted 13% of all foreign direct investment into Canada).
“A number of measures in today’s Fall Economic Statement will further Canada’s competitiveness while ensuring those benefits are broadly felt. The Indigenous Loan Guarantee Program will advance Indigenous leadership in the clean economy as equity partners, whether they are generating and transmitting clean electricity in their territories or developing clean hydrogen and critical mineral projects.
“While it’s encouraging to see a timetable for rolling out the various clean Investment Tax Credits proposed in Budget 2023, operationalizing these incentives as soon as possible is vital to prevent Canada from ceding ground to other markets—like the U.S.—where the financial rules are already in place. In particular, the Clean Electricity Tax Credit will be foundational for Canada’s competitive advantage going forward and should be prioritized. Canada must also move faster on getting major projects built by streamlining assessments and permitting for net-zero-aligned projects while meeting high environmental standards and commitments to Indigenous peoples.
“Exploring options to make climate disclosures mandatory for corporations is a key step to align Canada with leading jurisdictions, as financial decisions must be reconciled with the reality of climate change, though we would like to see a clear timeline for implementation.
“Support for clean ammonia production in the Clean Hydrogen Investment Tax Credit is a positive move in an emissions-intensive industry that has not to date benefited from equal access to decarbonization support. Ammonia production is positioned to be a key part of the hydrogen sector and is currently the basis for almost all nitrogen fertilizer used to grow food across the country and the world. Clean ammonia, made from clean hydrogen, also has a number of other potential roles in a decarbonized economy, including as low-carbon fuel for shipping.
“Mandating the Canada Growth Fund to spend $7 billion of its $15 billion allocation on carbon contracts for difference will help businesses de-risk important emission-reducing projects and help them get built. However, the government should look to unlock the full potential of this measure under its industrial carbon price.
“Ultimately, the federal government’s focus on building a sustainable economy—through both targeted investments and supportive policy—is bearing fruit and keeping Canada in a global race whose prize is too big to ignore. More than anything, the government must now expedite the implementation of a few more key measures, particularly its investment tax credits, to ensure a strong economy built to thrive far into the future.”
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