A new Conservative government is taking a more moderate approach to Canada’s climate policy, promising to scrap a $100 million subsidy for renewable energy sources that would have helped Canada meet its ambitious climate goals.
The Liberals also are seeking to slash funding for solar power subsidies in a bid to boost solar installations.
The subsidies were part of the Liberals’ climate policy and the Conservatives have also pledged to phase out the subsidies in 2019, although critics have warned that doing so could hurt Canada’s solar industry.
Prime Minister Justin Trudeau and Environment Minister Catherine McKenna announced in January that the government would scrap the subsidies and instead focus on a strategy that would help countries transition to a low-carbon economy.
The plan is expected to be formally announced next week.
Trudeau told reporters at the time that he was committed to ensuring that countries transition from fossil fuels to renewable energy and that Canadians are not disadvantaged by the decision.
“I will always defend the Canadian taxpayer against those who would undermine their interests by seeking to protect their financial interests,” he said.
In a statement, McKenna said the government was taking a “sensible” approach to climate change.
The minister said the move would “help build momentum for a strong economy, secure Canada’s future and foster job creation for Canadians and Canadian businesses.”
She added that the decision “reflects our clear commitment to the climate and the global community.”
The Liberals have promised to phase in a cap-and-trade system to cap carbon emissions from fossil fuel power plants by 2030, but critics have said that would harm the industry by making it more expensive to produce electricity and putting pressure on the economy to cut emissions.
Trudeau has said he wants to see “green” energy as a central pillar of the new government’s economic plan, and McKenna has said that Canada’s energy sector would be a key part of that plan.
A new report from the left-leaning think tank Climate Action Tracker said Canada’s carbon emissions could increase by as much as 14 per cent if Canada does not phase out subsidies for renewables.
The study noted that the subsidies, which were introduced in 2008, were largely designed to help Canadian provinces reduce their carbon footprints by boosting renewable energy production and helping them to meet emissions targets.
In the meantime, some of the most lucrative energy contracts in the country were awarded to companies with the lowest-cost solar panels.
The report also found that solar energy subsidies have helped to keep many jobs in the solar industry and to provide a boost to the economy, and could help Canada reach its climate targets by 2030.
But the report found that many of the subsidies are not “cap-and trade” subsidies, meaning they are set at a lower price for consumers than would otherwise be possible.
The Canadian solar industry employs about 4,400 people in Canada, and the subsidies have created a “profoundly negative” situation, according to the report.
Environment Canada said in a statement that the Liberals are taking a step in the right direction, but it’s not enough.
“We know that climate action is necessary to protect our environment, and we are taking steps to ensure that our economy and our communities are safe and prosperous,” said Environment Canada spokeswoman Lauren LeDoux.
The decision to scrap the $100M subsidy “will not be enough to save the world from the ravages of climate change, and will not help the clean energy industry to continue to grow and diversify,” she said.
The government has been criticized for its decision to cut the subsidy, which had been the focus of a $1.2 billion environmental assessment process, as it came amid an energy boom and was expected to deliver $500 million to the country’s clean energy sector.
The Liberal government has said the subsidy was a “mistake” and said it will now focus on “how to build on this legacy to ensure the clean technologies we have today can provide a safe, clean and resilient future.”