By Nia Williams
CALGARY, Alberta (Reuters) – Canada faces a challenge hitting its 2030 target to cut carbon emissions 40-45% below 2005 levels because of the speed and scale of changes needed to decarbonize the economy, the country’s independent budgetary watchdog said on Wednesday.
The assessment from Yves Giroux, the parliamentary budget officer (PBO), underlines the difficulties facing Canada, a vast, cold country that is the world’s fourth-largest oil producer, as it seeks to slash emissions within a decade.
Prime Minister Justin Trudeau announced a tougher emissions target of 40-45% in April but no details of how the government plans to meet that goal. Before the beefed-up target was unveiled, Canada had announced policies to achieve emissions cuts of 36% by 2030.
Canada’s highest-polluting sectors are transportation and oil and gas. The PBO report said “extraordinary measures” would be needed to achieve the 40-45% decarbonization target and to widely deploy necessary technologies like electric vehicles and small-module nuclear reactors for the oil sands.
“While technologies to achieve this reduction are currently available, the scale and speed of the changes will make it challenging to achieve,” the report said.
The PBO report also assessed the impact of federal policies targeting a 36% cut by 2030, including the flagship carbon levy of C$170 a tonne and other “non-price” policies such as building retrofits and transportation subsidies.
It found the combined measures would cost the equivalent of a carbon levy of C$211 a tonne, and reduce Canada’s real GDP by 1.4% by 2030, although the report stressed climate change itself would have potential costs and that unforeseen breakthrough technologies could reduce the economic impact.
“Our assessment shows that the largest economic impact of reducing emissions will fall on the transportation and oil and gas sectors,” Giroux said in a news release.
($1 = 1.2305 Canadian dollars)
(Reporting by Nia Williams; Editing by Peter Cooney)
