The challenge of reducing Canadian emissions

There are two main obstacles to achieving meaningful carbon reductions: underlying drivers of emissions and likely unequal transition costs across regions.

Underlying drivers include the cold climate (i.e., Canada requires more energy for heating than do temperate climates), large geography and growing population (i.e., more energy needed for transportation across a dispersed infrastructure), industrialized economy (i.e., the source of our emissions), and considerable natural-resources endowments supporting large-commodity industries (i.e., extraction often results in high carbon emissions). These factors are reflected in Canada’s GHG emissions profile (data current as of 2019—see figure 1):

The oil and gas sector is the largest source of Canadian GHG emissions, accounting for 26.2% of the country’s total.

The transportation sector is the second-largest source, with 25.4% of total emissions. This reflects freight and passenger transportation, the latter of which has seen rising emissions due to population growth and the shift from cars to light passenger trucks (including vans and SUVs).

Buildings are the third-largest source, comprising 12.4% of GHG emissions. The shift toward a service-based economy has increased the need for office space; meanwhile, emissions from residential buildings have decreased slightly, despite strong population growth.

Heavy industry accounts for 10.6% of emissions, reflecting production in areas such as manufacturing and processing.

The agricultural sector accounted for 10%—barely changed from 2000, as decreased emissions from animal production were offset by increasing emissions related to crop production.

The electricity sector is responsible for 8.4% of the country’s total emissions output. Although a great example of meaningful reductions—with a 53% decrease in emissions from 2000 to 2019 due to progress in decarbonizing the power sector—more work is still required.

The second major hurdle to emissions reductions is trying to ensure that associated costs are equitably distributed across the country. Provinces with greater reliance on high-emitting industries will face potentially greater transition costs, with the energy sector concentration in Alberta, Saskatchewan, and Newfoundland and Labrador a good case in point. Household GHG emissions also vary across Canada, reflecting a variety of factors such as population densities, average temperatures, and family size and incomes. Still, energy source matters most in determining household emissions profiles. For example, despite a cold climate, Montreal has the lowest average household emissions of all major Canadian cities, because hydro power meets much of its residential energy needs, including home heating. On the other hand, Edmonton and Calgary have the highest average household emissions, largely due to extreme weather, low population density, and coal-fired electricity generation.As Canada designs and implements policies to cut emissions, reducing the disparity in regional burdens will be paramount, as this is an essential element in building consensus on the best plan to reach our national emissions targets.