On October 23, New Economy Canada’s president Merran Smith joined the federal standing committee on Environment and Sustainable development to discuss potential improvements and capability of Canada’s 2030 Emissions Reduction Plan. The following is a summary of her remarks. 

It is important to situate Canada’s Emissions Reduction Plan in the global economic context, recognizing Canada’s urgent need to diversify our trading relationships.

First: Global Investment in clean energy is soaring and costs are plummeting. Last year $3 trillion Canadian dollarswent into renewables, nuclear, grids, storage and electrification, that’s double what went into fossil fuels. Since 2010, the costs of solar power and lithium batteries have dropped by about 90%. Clean energy is now the smart economic choice and the smart energy security choice. This growth is having side benefits for Canada, as we have an abundance of the critical minerals these technologies require.

Second: Our trading partners – and competitors – are already reaping the rewards.

• South Korea’s clean energy exports are up 35% since 2020.  
• The EU’s renewable energy sector already employs over 1.8 million and clean energy investments reached almost 390 billion USD in 2025.

These countries are pairing climate policy with industrial strategy – and it’s paying off. The U.S., moving in the opposite direction, is the outlier.

Third: Canada’s ten largest trading partners outside the United States all have enshrined policy preferences for low-carbon products. The U.K. and European Union have already begun to enact border tariffs on high- carbon goods. 

But, to become the investment destination of choice, governments must create the conditions to support Canada’s innovators and implementers and send strong signals to international investors and customers that there’s no better time to build in Canada and buy Canadian.

Only growing the low carbon economy can offer real stability and long-term value in this new paradigm. 

Enter Canada’s 2030 Emissions Reduction Plan (ERP). It’s typically talked about as environmental policy, but it’s also economic policy. Here are four examples:

1. Pricing industrial climate pollution sends a market signal to industry to invest in technologies that will cut their emissions, and it also sends a market signal to innovators to develop those technologies. The end result is cleaner products and clean technologies we can sell to the world.
   
2. Similarly, the EV Availability Standard sends the same message, not just to auto makers, but also to battery producers, mining and processing companies, and EV charging companies, driving investment, innovation and growth across the supply chain.
   
3. The Clean Fuel Regulations do it too, spurring investment in Canadian biofuels and other clean fuel production. And we could do more in this area.
   
4. And finally, the ERPs focus on clean electricity is critical. As we diversify trade and build Canada’s new economy, clean electricity, battery storage and an interconnected grid will be the foundation of our industrial growth, building off our relatively clean existing grid.  

In summary, the ERP and its policies are working, not just to drive down emissions, but to spur innovation and investment by companies so that they can compete and win in the clean economy. 

Maintaining that policy certainty and durability are key to securing and sustaining investment in Canada’s economy. 

While there is room for some modifications, calibration and, at times, flexibility, Canada needs to continue with the ERP, and importantly, to create clearer connections between the ERP and industrial policy to accelerate both emission reductions and economic growth.