The following is a re-print of the March 2025 edition of Shift Storm, the CCPA’s monthly newsletter which focuses on the intersection of work and climate change. Click here to subscribe to Shift Storm and get the latest updates straight to your inbox as soon as they come out.
Canadians will elect a new federal government on April 28 in the midst of an unprecedented political crisis.
The daily threats levied against Canada’s sovereignty and economic stability by the new U.S. administration are showing no signs of abating. The election is shaping up to be a test of which party voters believe can best hold the line against Trump in the years to come.
Important questions are coming to the fore. How can Canada disentangle itself from American political and economic influence? What does a more independent Canadian economy even look like? And how do we balance a short term crisis response with a longer term vision?
These are fundamentally the right questions for the moment (not something to be taken for granted during any election campaign). But arriving at the right answers will require more imagination and foresight than we have seen so far from our political leaders.
From coast to coast, governments are all-in on eliminating interprovincial trade barriers—a move with overblown benefits that would actually limit some of the very policy tools those governments have for responding to Trump. Federal parties of various stripes are promising to cut tax rates—a move that would cost billions of dollars and do nothing to diversify the economy (while funneling benefits to the highest income earners). And politicians across the political spectrum are touting new fossil fuel infrastructure, such as oil pipelines and liquified natural gas (LNG) terminals, as a viable path forward—a move that not only flies in the face of our climate commitments but also ignores a looming global oversupply crisis for both oil and LNG.
At a moment that demands visionary public leadership, a political consensus is emerging around knee-jerk deregulation, tax cuts and fossil fuel infrastructure—the very policy agenda that facilitated the corporate-led integration of the North American economy over the past several decades. As the oil industry’s recent about-face on carbon capture, carbon pricing and climate action more broadly illustrates, the private sector simply cannot be trusted to lead on issues vital to the public interest. Without public leadership, there will be no transition—either away from the U.S. or toward a cleaner economy.
I will be watching this campaign closely for signs that federal leaders understand the bigger picture. A productive, independent, zero-carbon economy by 2050 remains both a possibility and a necessity. But doubling down on decades of deference to the private sector will not get us there.
As if there isn’t enough news to keep track of these days, there was also a ton of important research released in the past month. Let’s get into it.
Storm surge: this month’s key reads
Net-zero industrial policy the key to net-zero climate policy
Canada’s Net-Zero Advisory Body (NZAB), which offers independent climate policy advice to the federal government, turned heads a few years ago when it called for a focus on industrial policy. What does building stuff have to do with reducing greenhouse gas emissions? The bottom line is that our emissions are a function of the economy, which means we can’t reduce our emissions in a meaningful way without making structural changes to the economy itself. Industrial policy is the best tool we have for pulling it off.
A new report from NZAB, Collaborate to succeed, explores this idea in more detail. It recommends the federal government prioritize strategic sectors, convene key stakeholders, set goals and align policies to support those sectors. It’s not groundbreaking stuff, and it generally aligns with my own research on green industrial policy, but the fact that it comes from NZAB is important. We cannot treat climate action as independent from economic strategy. That’s how you end up with a government that puts a price on carbon pollution to discourage fossil fuel use while simultaneously subsidizing further fossil fuel production.
I particularly appreciate NZAB’s emphasis on protecting and scaling up Canadian-owned and Indigenous-owned firms, as well as the need for more public planning capacity. I would have liked to see a greater discussion of direct public investment, however. Strategic state interventions in key supply chains (e.g., in electricity transmission) can unlock significantly more private investment (e.g., in electricity generation) while maintaining public control over backbone infrastructure.
Unions call for stronger, more inclusive industrial planning
The federal government convened the Union-Led Advisory Table in 2022 to offer advice on key issues facing workers in Canada. The group of 15 labour union leaders recently published its final report, Unions Power Prosperity, which tackles a wide range of priorities.
A few recommendations in the report stand out to me. The first is a call for a renewed sector council program. Sector councils bring together employers, unions and other key stakeholders to understand and prepare for industrial and workforce transitions. While these councils still exist in Canada in some sectors and regions (especially in Québec), many at-risk industries lack institutionalized coordination. For example, the recent U.S. attacks on Canada’s steel and aluminum industries are already leading to layoffs, but Canada does not have processes in place to coordinate with workers in those sectors.
Second, the advisory table calls for mandatory community benefit agreements (CBAs) for federally funded construction projects. CBAs are an underutilized tool for advancing social priorities through infrastructure spending, including by ensuring that a minimum share of the work created by public investments goes to workers from historically marginalized groups. Diversifying the building trades is both an equity issue and an economic necessity as the current workforce ages into retirement.
The full report offers dozens more recommendations that provide a useful snapshot of the Canadian labour movement’s current thinking.
Research radar: the latest developments in work and climate
Canadian emissions are not falling nearly fast enough. Canada’s overall greenhouse gas emissions were down by less than one per cent in 2023 according to the latest national inventory report. To put us on track to hit our short-term and long-term climate targets, we need to be cutting emissions by closer to 5 per cent per year. Oil and gas continues to be the biggest sticking point. Fossil fuel extraction alone accounted for 30 per cent of Canada’s emissions in 2023.
PBO emissions cap analysis misses the point. The proposed federal oil and gas sector emissions cap would directly tackle the industry’s pollution problem. Unfortunately, a new assessment of the policy by the Parliamentary Budget Officer overstates its costs while explicitly ignoring the benefits. It’s a big misstep from the PBO, which otherwise plays an important role in assessing public finances.
Climate inaction to cost the world trillions. What are the benefits of climate action anyway? According to a new report co-published by the University of Cambridge and Boston Consulting Group, Too Hot to Think Straight, Too Cold to Panic, global economic growth will be reduced by 15 to 34 per cent by the end of the century in the absence of new measures to tackle climate change. Crucially, that’s more than ten times the cost of achieving net-zero. For Canada, we’re staring down climate costs in the hundreds of billions of dollars per year within decades, which could largely be avoided with climate investments merely in the tens of billions of dollars per year. The report recommends that governments and businesses be required to calculate and report on the “net cost of inaction” of any policy or investment they propose. It’s a sound suggestion for reframing the real costs of climate change (and exactly the sort of big picture thinking ignored in the PBO analysis).
US$2 trillion in fossil fuel assets could be stranded by 2040. A new report from the UK Sustainable Investment and Finance Association, Stranding, reaches the similar conclusion that the world is on track for US$12 trillion in climate related losses by 2050. If, on the other hand, the world gets serious enough about climate action to mitigate those costs, it will result in more than US$2 trillion worth of fossil fuel assets becoming stranded within fifteen years. Canada is the fifth most exposed country to stranded asset risk, according to the report, with potential liabilities on the order of US$80 billion. That checks out with my own research, which estimates $70 billion in stranded assets from the oil sands alone in a global net-zero scenario. The bottom line is that we’re facing massive costs regardless of the pace of climate action. The surest way to mitigate those costs is to stop investing in fossil fuel infrastructure.
Electricity utilities need to shift from reactive to proactive planning. A new report from Efficiency Canada, No Margin for Error, offers a deep dive into electricity system planning in Canada. The report criticizes the lack of coordination within and between provinces, which is a barrier to scaling up renewables capacity to meet growing electricity demand in a net-zero scenario. A more integrated east-west grid is a vital prerequisite for decarbonizing many regions of the country, as a recent feature in Canada’s National Observer explores.
Oil industry profiteering drove Canada’s affordability crisis. New research by Jim Stanford and Erin Weir, Counting the Costs, documents how the oil industry exploited Covid-era inflation to overcharge for fossil fuels. Profiteering by oil companies cost the average household $12,000 between 2022 and 2024. That’s far more than the cost of supermarket profiteering, which came under much greater public scrutiny. Among other solutions, the report calls for windfall taxes on the oil and gas industry—a sensible idea that happens to be popular with voters.
New infrastructure projects highlight the promise and peril of federal industrial policy. The federal government announced a $217 million investment in the Wasoqonatl Transmission Line, which will move electricity between Nova Scotia and New Brunswick. It follows on the heels of last month’s announcement of high-speed rail in the Toronto-Québec corridor. Both are important nation-building projects, but both depend on private partnerships. If history is any guide, relying on profit-seeking partners for public interest projects is likely to raise costs and reduce service quality, as a long read in The Breach explores.
First members named to Canada’s just transition council. The Sustainable Jobs Partnership Council was created by the Sustainable Jobs Act to advise the federal government on issues concerning workers in Canada’s energy transition. The first members, including labour and Indigenous representatives, have now been announced. The council will deliver its first report by the end of the year.
Next phase of EU green industrial policy takes a step back from climate. The European Commission released its Clean Industrial Deal, which builds on the now six-year-old European Green Deal. As an example of green industrial policy, the new document offers more ambition and a greater clarity of vision than anything Canada has ever produced. However, the Clean Industrial Deal is a retreat from the European Green Deal in important ways. European climate activists have criticized its focus on lowering energy prices and increasing private competitiveness over the broader goal of reducing emissions through public projects.
Regional industrial strategies key to job creation and community wellbeing. The UK-based Institute for Public Policy Research published Regional Economies, which argues that specific regional industrial strategies are essential in the context of any broader national strategy. Without place-based investment, many communities that depend on fossil fuel jobs today will never be able to transition to alternative industries. Foregrounding regional strategies is something I’ve often argued for in the Canadian context.
Spain emerging as a world leader in national just transition policy. The Elcano Royal Institute in Spain published From phasing-out to phasing-in, which breaks down that country’s efforts at a just transition away from coal power. The UK-based Just Transition Finance Lab published Spain’s just transition energy tenders, which looks specifically at how Spain has leveraged labour and social conditions in procurement contracts to promote job creation and local economic development (similar to the CBA idea discussed above). Together, these papers paint a picture of a country that has delivered one of the most concrete just transitions anywhere in the world so far. It’s a terrific example for Canada to learn from.
Australian coal town showcases a worker-led just transition. Another informative case study this month comes from the town of Collie in Western Australia. A new piece published by the UK-based Institute for Human Rights and Business breaks down the history, politics and impact of just transition efforts in the town. Collie is halfway through its phase-out of coal power, but already it has made great strides in diversifying the economy and retraining the workforce. The effort is being co-led by labour unions and multiple orders of government. It’s a far more comprehensive and effective approach than has been taken in any coal town in Canada.
A just transition for low-income countries requires more state capacity. The UK-based Overseas Development Institute has published Inclusive and sustainable economic transformation, which puts the focus of decarbonization on low and middle income countries. It’s a huge report that covers a lot of ground, but the big takeaway for me is the importance of public capacity for long-term planning. No country, regardless of wealth or income, can ensure a more inclusive and sustainable economy through market measures alone.Come talk green industrial policy with me! This year’s Progress Summit takes place April 9-11 in Ottawa. The Wednesday afternoon workshop on green industrial policy may be of particular interest to Shift Storm readers. I’m slated to speak on a panel during the workshop and would love to see you there!
