(Montreal) The Government of Canada presented its plan on Monday morning to end “inefficient fossil fuel subsidies”.
Senior Canadian government officials have unveiled guidelines and an assessment framework for departments to follow in determining what constitutes an “inefficient fossil fuel subsidy”.
Subsidies that “disproportionately benefit the fossil fuel sector, support only fossil fuel-related activities, and promote the consumption of fossil fuels” can no longer be granted from today.
However, this plan does not preclude commitments that have been made in the past.
How much public money will the government save with this plan? How many inefficient subsidies does Ottawa currently give to the fossil fuel industry?
Senior federal government officials were unable to answer those questions in a technical media briefing Monday morning.
Six categories of exemptions
The devil is in the details, because there is a set of criteria that will allow public funding to continue for the fossil fuel industry.
Here is the list of the six categories of exemptions:
- A subsidy that “enables significant reductions in net greenhouse gas (GHG) emissions in Canada or internationally in accordance with Article 6 of the Paris Agreement”;
- One that “promotes clean energy, clean technology or renewable energy”;
- One that “makes it possible to provide essential energy services to a remote community”;
- One that “allows us to offer short-term support within the framework of an emergency intervention”;
- One that “encourages Indigenous economic participation in fossil fuel-related activities”;
- One that “supports lean production processes or projects that come with a credible plan to achieve carbon neutrality by 2030”.
A long-standing promise
Since the 2015 election campaign, which allowed Justin Trudeau’s Liberals to obtain their first of three consecutive mandates, they have promised to reduce subsidies to the fossil fuel industry.
This commitment, also made by Canada at the G20, has not been fulfilled since. In their most recent election campaign platform, in 2021, the Liberals promised that this would be done by the end of 2023.
In December 2022, Ottawa presented a first draft of its plan, publishing the guidelines to end new direct subsidies for investments and fossil fuel projects abroad, including those owned by Canadian companies.