Canada won’t meet climate goals without cutting back on oil sands

Canada won’t be able to meet its climate change goals unless emissions from the oil sands are drastically curtailed, according to a report released Tuesday, which urges the government to increase taxes on companies who pollute the environment.

Officials could also reduce emissions by prioritizing government contracts for firms producing clean energy rather than spending money on companies in polluting industries, said the Organization for Economic Cooperation and Development (OECD) report.

“Canada remains one of the OECD’s most energy-intensive, resource-intensive, and carbon-intensive economies with a vast wealth of natural assets in need of protection,” OECD project Head Nathalie Girouard said in a statement.

The country’s overall environmental performance has been positive, Girouard said, citing “the national regulation on wastewater treatment, and renewed leadership in international environmental initiatives.”

Fossil fuel subsidies

Canada ranks third from the bottom out of 35 industrialized countries when it comes to levying taxes and fees on polluters — only Mexico and the U.S. have lower environmental taxes, the OECD said in its first Environmental Performance Review of Canada in more than a decade.

Raising taxes on polluters and making companies pay the “externalities” or hidden costs associated with negative side effects from their activities would speed-up the transition to a greener economy, said Rachel Samson, one of the report’s authors.

“There remains scope for greater use of taxes and economic instruments to address other environmental issues,” Samson said in a statement. “Provinces and territories also need to do more to phase out remaining fossil fuel subsidies.”

Canada spends $3.3 billion on subsidies for fossil fuel firms, according to a 2016 study examining federal and provincial programs for the oil and gas sector.

Ending payouts to polluters is crucial to improving the country’s environmental record, the OECD said.

Liberal government officials did not dispute key findings of the OECD report, but said they are proud of their broader environmental record.

"Today, the Government of Canada is committing to cut its GHG emissions 80% by 2050. We’re leading by example, daring to set ambitious goals and targets and having the determination to meet them,” Liberal MP Scott Brison tweeted on Tuesday.

The report also urged Canada to create more protected areas in line with international targets. Currently, about 10 percent of Canada’s land areas and one percent of marine and coastal areas are protected, significantly below 2020 United Nations targets of 17 percent and 10 percent respectively.