Catalyzing Change

Executive Summary

Canada’s chemical sector produces thousands of products that we use every day, from cosmetics to food packaging, generating annual revenues of $68.5 billion and more than 90,000 direct jobs. Chemical and fertilizer production is, however, also responsible for 23 megatonnes of direct emissions and an estimated additional 14 megatonnes of supply chain emissions.

Despite the economic importance of the sector and the high level of emissions it produces, the need to transition our chemical industry has been largely overlooked.

A net-zero chemical industry presents an enormous opportunity for Canada. We will need high-value, low- emissions chemicals in a net-zero world—from the plastics in our EVs, to the resins protecting our solar panels against the weather, and the refrigerants in our heat pumps.

Other jurisdictions have made large investments in net- zero chemicals, including pilots with electric crackers and low-carbon ammonia facilities. In the race to a net-zero chemicals future, Canada is starting from a deficit and risks falling further behind if we don’t take action now.

Getting this transition right and seizing the economic opportunity requires forward thinking, and that’s why the chemical sector—in cooperation with federal and provincial governments—must develop a roadmap to net zero. In this report, Clean Energy Canada outlines the key opportunities, technologies, and barriers that such a roadmap should address across five action areas. Industry and government can use this blueprint to help develop a complete and detailed roadmap with clear commitments coming from both sides.

Government and industry must work collaboratively to future-proof Canada’s chemical sector by moving toward high-value, net-zero-aligned products, and by building a net-zero roadmap that includes:

1. Increasing circularity, including through regulation and incentives for recycling;
2. Transitioning to renewable feedstocks and helping ensure their availability;
3. Moving away from higher-emitting energy sources through electrification and fuel-switching;
4. Developing a credible plan for the effective use of carbon capture and storage; and
5. Continued investing in energy efficiency gains.