Conclusions & Recommendations

By identifying 11 clean growth indicators, this report set out to achieve three main objectives.

First, it defines clean growth—within the context of climate change—as inclusive economic growth that reduces greenhouse gas emissions, strengthens resilience to a changing climate, and improves the well-being of Canadians. This definition will guide future Institute work in the clean growth research stream and offer an approach that could usefully be adopted by all levels of government in Canada. Thinking about climate change, economic, societal, and environmental challenges in an integrated way can help shift from a focus on trade-offs towards collaborative solutions that achieve multiple objectives simultaneously. This type of approach will become increasingly important as action to address climate change accelerates.

Second, it provides a framework for measuring Canada’s clean growth progress over time. By tracking the indicators identified in this report, Canada can quantify clean growth success over time and inform an ongoing dialogue within and outside governments on optimal pathways and policy choices. We offer these clean growth indicators not as a definitive guide but rather as a starting point to a broader conversation on how Canada can address climate change while also meeting important economic, societal, and environmental objectives. This broader conversation would benefit from contributions of people with different perspectives, backgrounds, experiences, and interests from across Canada.

Third, it helps identify opportunities for government policy to better support clean growth. Benchmarking progress helps identify past successes as well as next steps in Canada’s transition as a country. Areas or regions where progress has been slow or sliding backwards on one or more indicators can signal the need for new or expanded policy. Areas or regions where progress has been strong can highlight important lessons learned that could be accelerated or replicated elsewhere.

Based on our analysis, the three main findings below emerge. For each, we make recommendations for governments. We also highlight areas for further exploration in cases where our analysis does not suggest definitive recommendations but does highlight potential policy options or questions that merit further consideration and analysis.

The more governments understand the interconnectedness of climate and non-climate actions, the better the chance of cost-effectively achieving multiple objectives. Our analysis has only scratched the surface. Complex and interconnected drivers underpin each of our proposed indicators of clean growth. As Canada ramps up ambition to reduce GHGs and as the impacts of a changing climate intensify, understanding climate-economy-well-being interconnections will become more important.

With the right policies and actions, reducing GHG emissions, improving resilience, growing the economy, and increasing well-being can be mutually reinforcing. However, the level of effort required should not be underestimated. It is easy to say that Canada wants to achieve economic growth and significant GHG reductions at the same time but much harder to spell out how to do so. It is also easy to say that no one should be left behind, but much more difficult to put mechanisms in place to protect vulnerable Canadians.

Recommendations For Governments

Establish explicit cross-mandate accountabilities within government. To achieve simultaneous progress on climate, economic, and well-being outcomes, governments should select and design policy packages with more than one objective in mind. This will not happen without clear direction from government leaders (such as mandate letters) and formalized horizontal governance structures (such as a low-carbon growth committee) that clarify shared objectives and priorities. This direction could apply to climate change policies, economic policies, environmental policies, or social policies at all levels of government. While there will inevitably be some trade-offs and compromises, it is often possible to improve overall outcomes through careful collaborative design and complementary measures. Sometimes one policy instrument, carefully designed, may be appropriate. In many cases, however, multiple policy tools from different levels of government and departments will be most effective.

Area for further exploration for governments and policy researchers:

Strategic clean growth assessments. Several governments in Canada require policy proposals to include a strategic environmental assessment. The federal government has also developed a climate lens for major public investments in infrastructure, and now requires a strategic assessment of climate change for designated projects under the Impact Assessment Act. It is worth exploring an expansion of these tools to explicitly incorporate a broader set of criteria linked to clean growth objectives. For example, while an infrastructure project would naturally consider general economic objectives such as near-term GDP or jobs it might not consider longer-term low-carbon growth objectives such as ensuring exports align with the anticipated global low-carbon transition. A low-carbon growth lens could lead to a greater emphasis on “enabling” infrastructure investments that support low-carbon technology development and adoption (e.g. electricity transmission, hydrogen-ready pipelines, carbon capture and storage pipelines).

Measuring clean growth is not a simple exercise. In some cases, the indicators are so multi-dimensional that they are difficult to measure with only a handful of statistics. In others, the data are not available to comprehensively assess progress.

Data are fundamental to identifying connections and interactions relevant to clean growth. Data allow for governments to measure progress and can inform potential course corrections. Investing in new and better data that connect climate change to economic growth and the well-being of Canadians will lay the foundation for future research and the development of policies that support clean growth success. The ambition and scale of Canada’s climate change goals merits a similar scale of effort to improve data, and the financial and human capacity needed for its development.

There are multiple important data gaps highlighted in this report. We highlight some of the key priorities for measuring clean growth below.

Recommendations for governments:

Better connect GHG data to the economy. Clean growth research and policy development requires easily accessible GHG data that match GDP, employment, trade, and other data (Indicator #1).

Improve GHG data for Canada’s territories. Researchers need better data to include territories in comparative analyses with provinces (Indicators #1 and #7).

Collect more and better data on the costs of extreme weather events. The consistency and comprehensiveness of the Canadian Disaster Database should be improved (Indicator #2).

Broaden cleantech data to include more climate-relevant technologies. Cleantech data should include economic activities that may not be purely “clean” but are consistent with low-carbon growth pathways. It should also include technologies that support adaptation and resilience to a changing climate (Indicators #3 and #5).

Tag public infrastructure investments for better tracking. We propose slotting climate-related infrastructure investments into four categories: 1) low- or no-carbon, 2) low-carbon enabling, 3) resilient, and 4) natural (Indicator #6).

Develop more complete metrics of societal vulnerability to a changing climate. Vulnerability to a changing climate depends on multiple factors, including pre-existing sensitivities such as poverty or underlying health conditions, exposure to climate impacts, and ability to adapt before and after climate events occur. Right now, few metrics fully capture all components (Indicator #9).

Improve data on wetland and marine ecosystem trends and related climate implications. Canada needs an organization with capacity comparable to the Canadian Forest Service for ecosystems such as wetlands and coastal and estuarine areas to coordinate improved measurement of carbon sinks and sources and undertake analysis on climate resilience benefits (Indicator #11).

Our indicator analysis highlights some key areas where Canada could accelerate progress:

Decoupling of GHGs from GDP is inconsistent across the country, with the economies of several provinces still closely tied to GHG emissions. Decoupling economic growth and GHG emissions will require a focus on three areas: reduced emissions intensity of existing sources; reallocation of resources from high-carbon economic activity towards low-carbon economic activity; and accelerated entry and growth of low-carbon firms.
Growth in the development of clean technologies has been slow and concentrated in a handful of provinces. The sector will not provide the growth and jobs needed without significant expansion.
Low-carbon technology adoption has been uneven across sectors, with increasing emissions in road transport and commercial buildings.
Job loss related to climate change transition has been limited to date, but certain sectors, communities, and individuals could be at risk in the future.
Human activities continue to drive losses in climate-related ecosystem services.

The analysis also flagged some opportunities that are not being fully captured with current approaches:

There is a wide range of investment possibilities in low-carbon and resilient infrastructure, which could generate employment opportunities for vulnerable regions and individuals while laying the foundation for future low-carbon growth and resilience to a changing climate.
There are additional opportunities to generate health benefits from reduced air pollution, particularly in relation to urban transportation.

Further research and analysis will support comprehensive policy development in these areas, but there is scope for near-term investment to plant the seeds for future clean growth.

Recommendation for governments:

Use near-term investments to support a long-term clean growth transition. The indicators we have developed in this report are measures of long-term success. Yet policies and investments made today can plant the seeds that grow into long-term low-carbon and resilient economic growth. Governments can play a key role in overcoming barriers to private investment, particularly at a time when economies are struggling and capital is limited. Investments in long-lived infrastructure that is not low-carbon or resilient will also have lasting consequences.

Areas for Further Exploration by Governments and Researchers:

Connect technology development with technology adoption. Given that a lack of domestic technology adoption is a key barrier to growth for clean technology companies, policy tools aimed at accelerating adoption rates could incorporate consideration of areas where Canadian companies are showing signs of success but struggling to find domestic buyers. This could help grow strong domestic markets that better position Canadian companies for international success.

Connect economic development and skills policies to climate-related employment risks and opportunities. Some communities and regions may be more vulnerable than others because they have a concentration of employment in an at-risk sector. Individuals with lower levels of skills or education may also be at greater risk. A stronger connection between forward-looking climate change transition scenarios and economic development and skills policies could help reduce vulnerability and connect people with low-carbon growth opportunities.

Target urban transportation. With slower levels of technology adoption in transport, rising GHG levels, and increased evidence of a link between urban air pollution and adverse health outcomes, our indicators show multiple reasons to consider a greater emphasis on clean urban transportation.

Slow the loss of climate-related ecosystem services. Slash burning practices of logging companies, draining of wetlands for agriculture or development, deforestation for industrial activities, and many other actions are reducing the benefits that current and future Canadians obtain from nature. The changing climate will exacerbate many of the pressures on ecosystems.

Support more Indigenous-led opportunities. Indigenous-led initiatives can achieve multiple economic, social, environmental, and climate benefits. Additional support for Indigenous protected areas, land management, renewable energy projects, resilient housing, fire management, and other opportunities could help accelerate clean growth progress in Canada.

While this report does not provide a single clear pathway towards clean growth, it identifies many interesting research and policy questions that can help identify possible pathways. These questions will be better answered with improved data. The Canadian Institute for Climate Choices will continue to further analyze the issues raised, engaging organizations from across Canada in the process.