Policy Analysis

Federal budget 2021 and the environment

On the right track, but definitely not the transformative change needed.

The federal government is allocating billions of dollars to supporting a post-pandemic “green recovery”. In total, $17.6 billion has been earmarked to reduce greenhouse gas emissions and support a low-carbon economy.

The overarching goals of the budget are to reduce greenhouse gas emissions by 36% below 2005 levels by 2030 (a small increase from 30% below 2005 levels) and to conserve 25% of lands and oceans by 2025.

Here’s a partial breakdown of how that $17.6 billion will be portioned out:

  • $5 billion on top of $3 billion already pledged to the Net Zero Accelerator for helping large-emitting companies (e.g. oil and gas, steel, aluminum, cement, etc.) to reduce emissions and transition to low-carbon alternatives;
  • $1 billion for attracting private investment to Canadian clean technology businesses;
  • Halve corporate tax for clean energy and electric vehicle manufacturers;
  • Business tax credit for carbon capture, utilization, and storage (CCUS) as part of a goal to increase annual carbon capture from 4 Mt to 15 Mt;
  • $319 million for CCUS research;
  • Issuing a “green bond” for funding conservation, clean technology, and green infrastructure;
  • $4.4 billion program for interest free loans of $40,000 for homeowners and landlords for retrofitting homes with green improvements;
  • $1.4 billion for climate resiliency projects (e.g. wildfire mitigation, stormwater management, ecosystem restoration);
  • Support for Indigenous Guardians and partnerships with Indigenous peoples to conserve lands and species at risk;
  • $200 million to Natural Infrastructure Fund to support green and hybrid infrastructure projects, and;
  • Increase carbon price to $170 per tonne of emissions by 2030.

Many of these measures, such as the loans for homeowners and partnerships with Indigenous peoples, are good steps in the right direction. It is especially heartening to see a government that is willing to spend money on public infrastructure after years of governments tending to decry the institution of government and slashing budgets and services across the board.

But the opposition and many environmental groups say that this budget does not make bold enough moves to create the transformative change that is necessary for a swift transition to a low-carbon economy. First, the reliance on the public sector along with investments in oil and gas could slow down transition efforts. Second, while CCUS, offsets, and net-zero plans may reduce emissions at home, the companies that participate in these programs often just unload them somewhere else. Finally, aside from the green bond, there is little to no plan for how the government will pay for all of this, especially since they voted down a robust wealth tax recently and did not include it in the budget.

The moves laid out in the budget are welcome and necessary, but we need bigger, bolder strides if we are going to effectively tackle the climate crisis.


5 comments on “Federal budget 2021 and the environment

  1. Pingback: Federal budget 2021 and the environment — Adapt Ontario – GLOBALYNC – Humanity

  2. I believe that Canada’s environmental plan should also include mass solar energy harvestation. For one thing, it may no longer be prudent to have every structure’s entire electricity supply relying on external power lines that are susceptible to being crippled by unforeseen events, including storms of unprecedented magnitude (many Texans may now be realizing this). There also are coronal mass ejections to consider, albeit their damaging effects are rare, in which power grids are vulnerable to potentially extensive damage and long-lasting power outages.

    Personally, I would really appreciate the liberating effect of having my own independently accessed solar-cell power supply (clear skies permitting, of course), especially considering my/our dangerous reliance on electricity. Each building having its own solar-cell-panel power storage system — at least as an emergency/backup source of power — makes sense … albeit not to the various big energy corporation CEOs whose concern is dollars-and-cents profit margin. If solar-panel universality would come at the profit-margin expense of the traditional energy production companies, one can expect obstacles, including the political and regulatory sort. If it notably conflicts with corporate big-profit interests, even very progressive motions are greatly resisted, often enough successfully.

    Of course there will be those, usually Internet trolls, who will mock the idea for ‘not being realistic’. One based his rebuttal solely on the erroneous notion that if it were possible to have such independent solar-power generation and storage, it would have been done by now and made a few people very wealthy. Unfortunately, when such illogic is widely believed, it’s much easier for some entity to maintain an outdatedly problematic but still very profitable status-quo energy system.

    Liked by 1 person

    • Thank you for this! It’s a great idea. There are a couple municipalities in Ontario (Brampton is one) that are experimenting with community energy/decentralized energy plants but I’m not sure what percentage of those plants are planned to incorporate solar energy. You’re definitely right – decentralized renewable energy would greatly increase the resilience of our energy systems.

      Liked by 1 person

      • Thank you.

        There already are fossil-fuel-powered generator systems that engage once the regular electric-grid flow gets cut off, so why not use clean solar energy instead of the very old school and carbon intensive means? Albeit, if such solar-power universality would come at the expense of the traditional energy production companies, one can expect obstacles, including the political and regulatory sort.


  3. Green recovery is a good way of funding the environment. Thank you 😊


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