In this week’s EconMinute, we’re talking about GHG emissions by economic sector.
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In March, the federal government released the 2030 Emissions Reduction Plan (ERP). The ERP is Canada’s latest climate plan and reflects a strengthened emissions reduction target—40-45% below 2005 levels by 2030. To get us there, the plan outlines the sector-by-sector contributions to the overall reduction target.
- The oil and gas sector is expected to make the largest contribution to the 2030 target—reducing 81 megatonnes (Mt), or 42% from 2019 levels.
- The electricity sector is also expected to see a large decrease in emissions by 2030—reducing 47 Mt, or 77% from 2019 levels.
- The agriculture sector is very close to its 2030 targets and only needs to remove 2 Mt from the economy by 2030, or 3% below 2019 levels.
Since the release of the ERP, Canada completed its National Inventory Report (NIR), containing the official accounting of national emissions for 2020. Canada realized its largest single-year reduction in emissions in 2020, falling by 9% over 2019 levels and demonstrating progress towards the 2030 targets. However, this reduction is likely temporary as it is primarily the result of public health measures limiting normal economic activity during the first year of the COVID-19 pandemic.
- Transportation saw the largest reduction in emissions between 2019 and 2020—a drop of 27 Mt, or 15%. This is unsurprising as the pandemic decreased vehicle use and aviation travel.
- The oil and gas sector also saw significant declines between 2019 and 2020—12 Mt, or 6%.
- Looking forward to 2030, just over 200 Mt of annual emissions will still need to be removed for Canada to hit its target. However, this number likely underestimates the extent of emissions reductions required as 2021 emissions are expected to rebound to 2019 levels.