The world must go to net zero emissions. It’s imperative. Canada is doing its duty to help slow climate change. Indeed, in its most recent budget, the federal government provided $21 billion in tax credits to stimulate investment in low-carbon technologies. This part of Canada’s climate change policy is strong.
However, funding for adaptation to extreme weather events is insufficient. And this, although it is urgent to act. Think of floods, forest fires, extreme heat and a dozen other events that disrupt people’s lives and the economy.
In one year, Quebec has been hit by several extreme weather events, including a derecho in May 2022, a freezing rain storm in April 2023 and flooding this spring. In recent days, more than 150 forest fires have ravaged the province. Alberta and Nova Scotia are also burning. Remember that the fires that hit Fort McMurray in 2016 alone caused nearly $9 billion in damage. These disasters show the urgency for governments to invest more to protect people.
In the federal budget, about $25 million a year is earmarked to help Canadians and businesses adapt to climate change. These funds will be used primarily to establish a low-cost flood insurance program to protect high-risk residents, and to modernize federal flood assistance to provinces.
But the budget provides next to nothing for wildfires and extreme heat. This is surprising considering that in 2021 alone, Quebec was hit by 16 extreme heat waves and recorded 149 heat-related deaths.
The budgeted funding is in addition to the $1.6 billion announced in the 2022 National Adaptation Strategy for adaptation measures. The Strategy represents an important commitment on the part of the federal government, and as such deserves congratulations. That said, while this funding – which Emergency Preparedness Minister Bill Blair has called a “down payment” – is a step in the right direction for Canada, funding for climate change adaptation remains grossly insufficient. .
Disparities with the United States
Not only is there a lack of funding in Canada for climate resilience across all hazards, but there are also significant disparities with what the United States, our largest trading partner, is doing. Last year, the Inflation Reduction Act allocated some US$30 billion for adaptation, funding the development of agricultural practices, forest fire protection and coastal strengthening. Additionally, President Biden’s 2023 budget provides another US$18 billion for climate change resilience and adaptation programs.
Looking at these figures, we see that the Canadian government invests three to four times less per capita than the American government.
Adding to this imbalance is another problem: Canada is warming three times faster than the United States, which greatly increases the intensity and cost of severe weather across the country.
Extreme weather conditions continue to expose flaws in our supply chains, electricity networks, transportation routes and communication networks – not to mention the many infrastructure interdependencies. This will certainly have a disproportionate impact on Canada’s GDP relative to the more resilient US economy.
So: where should Canada invest its funds to “catch up” and close the gaps in climate change adaptation?
First, starting this year, funding for Natural Resources Canada’s Greener Homes Initiative must be increased by $1 billion over five years. Currently, this program provides grants to improve the energy efficiency of homes. New funds should be earmarked for adaptation measures to create a one-stop shop to help people improve the energy efficiency of their homes, but also to protect them against floods.
Second, funding for the Disaster Mitigation and Adaptation Fund (DMCAF) must be increased to $10 billion over five years starting in 2023. This Infrastructure Canada program supports public infrastructure projects designed to reduce natural disasters and climate change risks such as floods, forest fires and droughts.
These financial commitments may seem colossal. Rather, they should be seen as an investment to protect our economy. We often hear that investing in adaptation is expensive. It’s wrong. In fact, studies by the Global Commission on Adaptation (of which Canada is a founding member), the World Resources Institute, the Insurance Bureau of Canada and the Intact Center for Climate Adaptation show that every dollar invested in adaptation generates, at a minimum, $3 to $8 in avoided losses per decade.
Hurry up. There is an urgent need for the federal government and the private sector to invest together to limit the cost of extreme weather events. The spring 2023 “greenhouse gas reduction budget” is to be supplemented by an “economic statement on adaptation to climate change” in the fall. Closing the gap will allow Canada to protect its people and its economy as the climate continues to pose a growing challenge, fueled by irreversible change.