On March 29, 2022, the federal government released its 2030 Emissions Reduction Plan. This is a relatively comprehensive, long-term plan to reduce emissions from today to 2050. The Plan reiterates established emission reduction targets, associated policies and goes into more depth in-terms of what will be needed across sectors, emission sources, provinces, etc.
The Plan includes mention of nearly all forms of energy production and storage, including renewables, bioenergy, and emerging technologies including SMR and hydrogen (for transportation in particular). Provincial and territorial submissions were included to outline their supporting goals and measures.
Select highlights important for the Atlantic provinces include:
- Carbon pricing future (after 2030): The federal government will “explore” policies to help “guarantee” the future price of carbon pollution. This includes exploring legislative approaches to support a “durable” price on carbon pollution. More will be shared in 2023.
- Clean Electricity Standard: The federal government will require net-zero electricity production by 2035 and is currenting developing the Clean Electricity Standard (CES). The government previously released a discussion paper and is working to design the Standard.
- Atlantic Loop: The Loop was reiterated as a cog in several parts of the Plan. Funding was committed in Budget 2022 ($250 million over 4 years) to support pre-development activities for clean electricity projects of national significance, such as inter-provincial electricity transmission projects and small modular reactors.
- Carbon capture: The Plan highlighted the importance of developing a carbon capture, utilization, and storage (CCUS) strategy. A new tax credit was announced in the 2022 Budget.
However, the costs associated with accomplishing the 2030 Emission Reduction Plans, were not included. The Plan references significant new public funding to support these measures, which were further outlined in the federal government’s 2022 Budget.
Some highlights from the 2022 Budget include:
- The New Canada Growth Fund will be a public investment stream which includes $15 billion over the next 5 years;
- The Low Carbon Economy fund will be extended for seven years ($2.2 billion in total);
- Expanding areas of focus for Canada Infrastructure Bank to include investing in SMR, clean fuel production, hydrogen production, transportation and distribution, CCUS;
- Extending the iZEV program until March 2025. The eligibility will be broadened, and more details will be announced soon. This funding should amount to $1.7 billion in total;
- A new Carbon Capture, Utilization and Storage Tax Credit (providing $2.6 billion in credits over 5 years for eligible equipment used to capture carbon and storage requirements are met; and,
- A new Critical Mineral Exploration Tax Credit (providing income tax benefits (flow-through) for individuals investing in specified mining shares).