Recommendations for a “made-in-Canada” approach
As the shift toward clean energy gathers speed, fuelled in part by the U.S. Inflation Reduction Act, Canada is under pressure to accelerate the flow of private investment to fund the country’s energy transition.
Our research shows that Canada can succeed and remain competitive without trying to match the subsidies and incentives in the Inflation Reduction Act, by using limited public funds to leverage private investment.
New analysis suggests adopting a “made-in-Canada” approach: one that ensures Canada can remain competitive through additional policy supports and increased certainty to attract capital investment.
A made-in-Canada approach
Canada’s clean-growth challenges require a strategic and urgent response. The Institute’s research has seven recommendations, including:
- Orient public support around fixing market and policy failures, to avoid over-subsidizing projects that would have been economically viable without, or with less, government support.
- Use financial support instruments that optimally share risks and returns between the Canadian public and private investors.
- Build “exit strategies” for public support.
- Ensure the Canada Growth Fund’s governance models combine a clear mandate with political independence and strong accountability.
- Require that the Fund’s investment portfolio has a minimum share of projects with Indigenous majority ownership.
A series of international case studies that consider promising policy instruments from around the world. Each study assesses the strengths and limitations of a different policy instrument.
Guidance on phasing out public finance for fossil fuel production.