Canada’s environment minister talked to Paul Wells about the fate of the oil sands, cabinet leaks and the country’s roadmap for tackling climate change in a Maclean’s Live discussion
Q: I have been reading since the lockdown began that you and some other ministers were very active in advancing a strong climate agenda. Did the Throne Speech reflect your preoccupations?
A: There was a period where, obviously, everybody was sorting out how to get things done. And then there was a period of time where we had the opportunity to go out and have conversations with a whole range of folks—industry, environmental organizations, academics—about how we might think about the growth phase coming out of the pandemic. And I think that was reflected in the Throne Speech. The specific language was that we will bring forward immediately an enhanced climate plan that will demonstrate how we will achieve and exceed our current 2030 targets.
Q: If it’s coming out immediately, you must have a recent draft of it in your office or on your laptop. Is it essentially ready to go?
A: I wouldn’t say we’re quite there, but we’re pretty close. Certainly my aim is to be able to bring it forward before the end of the year.
Q: The 2030 target is a 30 per cent reduction below emissions in 2005. Canada is on track to be 77 megatonnes short of that target. What’s changed?
A: The issue is around climate change or science issues. They’re not political issues. We actually know that the world needs to transition toward a net zero future, with the developed world getting there around 2050 and the developing world not that long afterwards. In order to do that, you need to make substantive progress to position yourself in 2030 to actually get to net zero.
Q: You need to come up with new measures to be in range of meeting that.
A: It’s either new stuff, or it’s accelerating work that was already under way and actually doing it faster. And, certainly, there were elements of this in the platform commitments that we made in 2019—so, the planting of two billion trees, and the home retrofits, and a number of other things. But we need to make progress. Some of that is in the industrial area, some of it is in the oil and gas space, some of it is transportation, and a good chunk of it is buildings. I spent almost 20 years running clean tech companies. There are lots of opportunities where you’re not talking about building a new rocket ship—you’re talking about implementing technologies that exist now and working with industry to get there.
Q: How much of an impact has the pandemic had in reducing emissions? I keep hearing that nobody’s driving, nobody’s flying, but I don’t believe I’ve seen numbers that would indicate the scale of that effect.
A: It’s substantial in the short term, but banking on that to actually address the climate issue in the long term is not a thoughtful way to approach it. There may be some residual effects—you know, more people working from home rather than driving—but those impacts are unlikely to be significant. Even during the worst of the pandemic, global emissions declined by about eight per cent, and those have already started to tick back up as industry comes back online.
Q: One of the things that I thought would be nearly automatic in a second act of a Trudeau government was that the carbon tax implemented at the end of the first mandate would just be increased—you increase the tax and the effect increases. But I get the impression that’s not at all on the table.
A: Well, I would say everything is on the table. That would include considerations around price. It would include regulatory considerations, tax-related considerations, investment considerations. But the price on pollution is the most efficient way to reduce greenhouse gas emissions. If you’re going to try to achieve the Paris targets—which [Erin] O’Toole [the new Conservative leader] has committed himself to, and I commend him for that—and you’re going to try to do that without a price on pollution, it’s going to be really interesting to see how you put together a credible climate plan.
Q: So again, if it’s obviously the most efficient way to reduce emissions, then science tells me just increase the carbon price. And increase the rebates, too.
A: It definitely is on the table. There should not be a place in this country where it’s free to pollute.
Q: A lot of the conversation over the summer seemed to assume that we can essentially move into this low-carbon future and everyone will have fun doing it. I’m skeptical.
A: There are some areas where you are going to have to make some significant changes in terms of how we do things. But for countries that address it early, this will be a source of opportunity.
Q: Your government waited, really, into the last year of its first mandate before taking its most significant step, implementing the carbon tax. There seems to be a reluctance to take action that produces a real change in the numbers. I don’t need to tell you: if you met the 2030 target, you would be the first Canadian government to have met a carbon target.
A: Wait for a few weeks. What you will see will be bold and it will position Canada on a trajectory to exceed those targets. It’s the reason I’m actually sitting here in Ottawa rather than sitting back at home with my family. At the end of the day, climate is the crisis on the horizon.
Q: Seamus O’Regan, the natural resources minister, said recently that there is no path to a net zero carbon future that does not involve nuclear energy. Is that part of your plan?
A: Minister O’Regan is correct, in the sense that there are areas of the world where there probably is no path to net zero without nuclear energy. And on a go-forward basis, it’s certainly part of the mix of non-emitting technologies that will be competing for the provision of electrical energy. But it’s going to be competing with solar and wind and geothermal and hydrogen and a whole range of other things; it will need to demonstrate that it is both commercially viable and cost wise.
Q: A lot of people see small modular reactors as being a big part of the future of the oil sands. Do you agree?
A: It’s certainly possible. Finding ways to get rid of the burning of natural gas would help us with respect to emissions intensity. One option is small modular reactors. Another could be electrification, in certain cases. It could be the use of hydrogen in place of natural gas.
Q: So, when Canada’s natural resources minister says “there’s no path to net zero without nuclear,” you’re saying that may be true, but not necessarily—that we may not increase the total amount of nuclear energy production in Canada?
A: Right. It may be true in certain jurisdictions in the world. It certainly may be true in parts of Canada. Ultimately, it will compete with other sources of energy, and the winner will be the one that can provide electrical energy at the lowest cost.
Q: Does the oil sands have a future in a world where you’re trying to reach the targets that you’re trying to reach?
A: I get asked all the time: why did the government agree to build a pipeline? And why don’t you essentially require that the oil and gas industry be phased out in the short term? There are a whole bunch of answers to that, but one is: this is a transition. To get the net zero by 2050 will take time. Three per cent of the cars being sold in Canada today are zero emission; 97 per cent use gasoline. And so, in the context of the continued use of gasoline, Canada needs to ensure that it monetizes the value of the resources it has.
But in the longer term, I think what we need to do is be working with the industry on how can you continue, even in a net zero universe, after 2050, to extract energy value from hydrocarbon resources without the carbon. There are new technologies that are being developed. Those are pathways where there is an enormous amount of opportunity for the federal government to partner with Alberta and Saskatchewan and British Columbia.
A Suncor oil sands surface strip mine near Fort McKay, where once there was boreal forest (Ian Willms)
Q: Is this where we get the notion of Alberta being a major manufacturer of car batteries?
A: Well, it’s certainly possible. It could be a major manufacturer of a whole bunch of things. Part of the work that they’ve been doing at Alberta Innovates over the last number of years is what they called “bitumen beyond combustion,” which is: are there alternative applications for bitumen in a universe where combusting it is a problem? At the end of the day, Canada has enormous incentive to try to find pathways to continue to actually extract value from its existing resources without carbon. The problem is the carbon. It’s not the source of the energy.
Q: What I hear from people in the oil sands is: this is all great, but because there’s a 2050 target, I still get to have a car, you still get to get driven to the airport after this interview. But someone making a decision about whether to invest in the oil sands today doesn’t make that investment. And so, the oil sands pay now—and by extension the entire Alberta economy, and therefore the Canadian economy pays now—for this zero net carbon future. That hurts in a lot of ways, including the strength of the federation. Is there a way to moderate that effect?
A: Absolutely. If you think about where the investment community is headed globally, it is focusing increasingly on environmental issues and increasingly on climate. What we need to be doing is working with producers and working with provinces and territories to make the improvements [to produce] the least carbon-intensive fuels. To the extent that we are doing that work, we will actually find ways to draw international capital into this. Many of the companies in Canada in the oil and gas sector recognize that. Many of them have made commitments to net zero by 2050, including people like Cenovus, MEG Energy, and others.
Q: Canada, in some circles, has got a reputation as a place that’s not worth investing in because it’s hard to make projects go forward. There’s squabbling among jurisdictions—the sort of rationale that led Teck to abandon its Frontier mine project. Is there a necessary contradiction between Canada being climate virtuous and Canada being a destination for investment?
A: No, and in fact, I actually think that it’s entirely the opposite. If we do not actually become leaders in addressing the climate issue, particularly as regards to the energy sector, we’re going to struggle very much to attract investment.
Q: In the immediate aftermath of the federal election, it seemed like the biggest thing we were going to have to worry about over the next little while was federal-provincial relations—and then bigger problems came along to remind us of a sense of scale. But is another First Ministers’ meeting on climate and energy something we can envisage? At some point, you’re going to have to confront these contradictions in the federation more or less directly.
A: I think the next First Ministers’ meeting is probably on health care. Whether we have another one on climate, I don’t know. We haven’t made that decision at this point. But I do think that there is work that we need to do to try to find pathways to constructive conversations and to set aside some of the things that we don’t agree on, like pollution pricing.
I spent several years as a federal-provincial relations specialist for Saskatchewan. There is very rarely a time when there are not disagreements between the federal government and the provinces. At the end of the day, though, the test of better relations is—can you find areas in which collaboration is possible, and can you park some of the issues upon which you don’t agree in order to make progress for Canadians? That’s what we need to do.
Q: The government seemed to take these tensions pretty seriously, though, when they made Chrystia Freeland minister for intergovernmental affairs, and when she spent essentially most of the last quarter of 2019 parked in Alberta and Saskatchewan. Does a pandemic simply erase those tensions?
A: No, I don’t think a pandemic erases those tensions. The tensions are primarily around the climate energy nexus. I do think that there are opportunities for discussions in areas where there are probably a lot more common interests than perhaps we have identified in the past, and some of it is definitely around technology.
You do hear sometimes different people in both levels [of government] saying things publicly in the media. But I would tell you behind the scenes I have a good relationship with my counterpart in Alberta, Minister [Jason] Nixon. I have a very good relationship with my counterpart in Saskatchewan, Minister [Dustin] Duncan. When we have issues, we typically reach out to each other and discuss them. Doesn’t mean we always agree.
I would also say that the biggest issue that has been a lightning rod is the price on pollution. I believed that issue was politically settled in the last election, where more than two-thirds of Canadians voted in favour of a price on pollution. The judicial process has now virtually come to a conclusion. But I do believe that, assuming that the federal position is upheld, which I believe it will be, that that issue can be put behind us and we can move forward.
Q: The reason I asked about increasing the carbon tax is that I hear increasingly from climate activists that a simple carbon tax is not the best way to direct the development of a clean future. They say it smacks too much of letting the market do all the work, and they would rather regulate and subsidize. How do you react to those kinds of critiques?
A: I honestly think there’s a middle ground there. We’ve never said that a price on pollution is the only tool that we would use. There are other things that we know that we want to do, that the price on pollution over a long period of time might incent people to do, but it would take much longer: for example, building out a refuelling infrastructure for either hydrogen or electric vehicles. It will be a while before there is enough of an incentive for companies to actually take that on.
So, we are using a number of different policy levers. One of them is the price on pollution, [plus] some regulations, and both tax incentives and investments. At the end of the day, what people want to know is the output. Do you get the megatonnes that you need to get to to achieve the reductions that science tells us you should?
Q: I want to talk about Bill Morneau—not simply to be mischievous, but because I immediately thought of the rest of the cabinet when he left. Because for two weeks before he left the cabinet, I was reading about private conversations that he had had with the Prime Minister during which it was said there had been disputes over policy direction. And I thought, well, how the hell is anyone going to be a cabinet minister ever again in a world where they have no guarantee that their private disagreements with the PMO won’t be reported by the PMO? Did that thought cross your mind?
A: Some of the leaks were people who pretend to know something who are talking to folks in the media about what they may or may not know. I think that’s very unfortunate. I had a very good relationship with Minister Morneau. I did not think that was fair to him, and I think the Prime Minister is of the same view, that that was not a fair nor an accurate portrayal of what transpired.
At the end of the day, our job is to come forward [with] policy recommendations that are based on the analysis and the thoughts of our departments, of our consultations. Sometimes that does involve robust conversations with our colleagues, and yes, at times with the Prime Minister. And at the end of the day, conversations should be conversations that we can have without fear that they’re going to appear on the front page of the Globe and Mail.
Q: Although, I just wanted to emphasize, it’s perfectly okay if they wind up in Maclean’s.
A: [laughter] Fair enough.
Q: Now, you said that in a few weeks I’ll have something to report on. Is this the sort of timeline within which you want to release this plan for exceeding 2030 targets?
A: My aim is certainly to have something out before the end of the year.
Q: That’s well ahead of the next COP [the semi-annual global summit of participants in the Paris process]. Is it possible that it could slide until closer to the next conference?
A: Well, it’s certainly possible. Everything is somewhat subject to what happens with COVID-19. But my intention is to have something to bring forward to Canadians before the end of the year.
Q: You’re going to have to legislate some of that stuff—is it going to wind up in a budget implementation document at some point?
A: There will be some elements—probably less the 2030 plan, but we have committed to legislation that would put in place binding five-year increments to net zero by 2050. That was a promise we made during the campaign that will require legislation.
Q: And in the nature of things, I think that would be the sort of thing that a minority government could fall over. How closely do you consult with the opposition parties in an environment like this?
A: Before COVID, I actually talked a fair bit to my counterparts in the other parties. During COVID, it’s been a little bit more challenging, but I’ve certainly heard from my colleagues both in the Bloc and the NDP. Of course, the Conservatives have gone through a change with respect to who their critic is. But I certainly hope to [talk] in the next little while.
The biggest lightning rod is the price on pollution. That issue was politically settled in the last election.
This interview appears in print in the December 2020 issue of Maclean’s magazine. Subscribe to the monthly print magazine here.
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