Over the long term, good environmental policy is good economic policy

Policymakers in Germany understood that and today Germans are reaping the benefits of their foresight in the form of cutting-edge innovation, superior global competitiveness, and hundreds of thousands of quality jobs. Canada should get on board.

By Peggy Nash

It’s difficult to imagine that only 40 years ago, Germany was one of Europe’s worst environmental stragglers. Today, seen as a model of environmental success, at the time it was known for forests ravaged by acid rain, waterways contaminated with toxic heavy metals, and air blackened from the burning of high-sulphur coal.

Key policy decisions in the 1980s transformed the country from environmental pariah to green leader by investing heavily in environmental rehabilitation and establishing a framework that allowed companies to actually profit from higher environmental standards. Policymakers in Germany understood then that contrary to conventional wisdom, over the long term good environmental policy is good economic policy—and today Germans are reaping the benefits of their foresight in the form of cutting-edge innovation, superior global competitiveness, and hundreds of thousands of quality jobs.

The rest of the world is catching up. With climate change looming, fossil fuels growing scarce, and countries around the world making record green investments, we are in the midst of a global clean technology and clean energy boom. With the right mix of public investment and market solutions, Canada can also become a major player in the green economy, creating whole new sectors of family-supporting work in green technology, conservation and renewable energy along the way—but to succeed, a new approach from the federal government is necessary.

The raw materials for a successful transition to renewable energy are abundantly present in Canada: a recent study estimated that with the appropriate policy supports and targeted investment, as much as 96 per cent of Canada’s electricity could come from low-impact renewable energy sources, generating 77,000 jobs in the renewable power sector alone in the next two decades. The need for a transition to clean energy is also clear; temperatures in Canada have already risen 1.3°C since 1948, and the resulting impacts present real risks to our environment, our communities, our health, and our prosperity.

Unfortunately, under this government Canada is near the bottom of the global heap in terms of investment in green initiatives. Only eight cents of every dollar of Canada’s stimulus spending went to green areas such as energy efficiency, renewable energy, sustainable transport, sustainable agriculture, and ecological infrastructure. The global average is double that investment.

Without federal leadership, we are being leapfrogged by increasingly greener countries—including our main trading partner. By failing to keep pace with U.S. President Barack Obama’s stimulus investment in renewable energy on a per capita basis, Canada has missed out on as many as 66,000 quality jobs in the last two years alone. To supply technology for the shift to renewable power, Americans will be turning to countries like China, South Korea, and Australia that have made substantial investments in green energy innovation—leaving Canadian companies struggling to compete.

The fact is that federal support of renewable energy has been a boon to the economy. For every dollar spent by the government, the ecoENERGY for Renewable Power program has been able to leverage seven dollars of private investment. Despite the clear return on investment, major federal support for renewable power effectively ended in December 2009, when the funds were fully allocated a year and a half ahead of schedule and the federal government failed to renew the program.

Compounding this on-again, off-again approach to support for renewable energy is the government’s continued insistence on providing more than $2-billion in special tax benefits to fossil fuel producers each year. These subsidies artificially lower the cost of production and boost earnings for already-profitable fossil fuel companies, leaving green energy projects at a competitive disadvantage. Despite committing to ending these counter-productive subsidies at the 2009 Pittsburgh G-20 meeting, the Harper government has taken only token steps in that direction.

The lack of policy certainty puts private investment in renewable energy projects at risk and reduces our ability to compete in the international marketplace, intensifying one of the most significant challenges in the shift to renewable energy: the federal government’s refusal to move forward on a carbon price. Unlike costly, ineffective sector-by-sector emissions regulation, a carbon pricing system that rewards efficiency, innovation and early action will support Canada’s continued economic growth while delivering real emissions reductions.

Doing our fair share to tackle climate change will also mitigate the financial risks associated with severe weather events like floods, droughts and forest fires, which are all exacerbated by climate change. These disasters, as many provinces experienced this spring, can devastate entire economic regions.

Canada can be a leader on these fronts, but a new federal commitment to renewable energy, clean technology and meaningful environmental regulation has to begin now. Germany’s example showed the world that going green represents a significant economic opportunity, not a threat. The future will belong to countries that are primed to seize that opportunity, and for the sake of our economy’s sustainability, Canada must be among them.

Originally published in The Hill Times on July 11, 2022

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Jan 30: Pub Night with Peggy Nash (Thunder Bay, ON)

Jan 29: Debate After Party with Peggy Nash (Halifax, NS)

Jan 29: NDP Leadership Debate

Jan 28: Meet and Greet with the Candidates at Chester-St Margaret’s AGM

Jan 28: Meet and Greet with the Candidates at the Halifax West AGM

Jan 27: A Kitchen Party with Peggy Nash (St. John’s, NL)

Jan 24: Pub Night with Peggy Nash at Carleton University (Ottawa)

Jan 21: London Day of Action and Meet & Greet with Peggy Nash

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