Canada's climate action efforts are facing a mix of progress and challenges, according to a new report from RBC. The Climate Action Barometer, which measures climate progress across the economy, fell due to policy shifts and trade tensions with the U.S. Despite this, momentum continues through incentives for electric vehicles, provincial retrofitting programs, and renewable energy projects, including a landmark carbon capture initiative in Alberta.
Financing for oil and gas decarbonization has declined sharply, dropping 21% between 2023 and 2025 to a five-year low. This pullback is attributed to a lack of policy certainty, though extensions of the Carbon Capture Investment Tax Credit and Carbon Contracts for Difference aim to reverse the trend.
The report also highlights that climate change impacts are unevenly distributed. Women reported more health effects than men, and younger generations bear the heaviest financial burden. However, only 11% of businesses surveyed saw significant cost increases from sustainable policies, suggesting that many emissions-reduction technologies have reached cost parity.
Ottawa is proposing a 'credit multiplier' to support Canadian biofuel producers, aiming to level the playing field with U.S. policies. The proposal would provide more compliance credits for domestically produced biofuels, though industry groups are pushing for even higher multipliers. Meanwhile, Canada's $50 billion utility bill to double its electricity grid is part of Budget 2026, focusing on affordability, energy security, and export expansion.
At COP31 in Ankara, Turkey, the focus is on turning climate promises into action. Key themes include electrification, methane reduction, climate-resilient cities, and low-carbon industrialization. The summit's goals align with Canada's climate objectives, emphasizing the need for sustainable infrastructure and value chains.
The sustainable finance taxonomy is still evolving, with a final methodology report identifying 'green,' 'transition,' and 'abatement measures' as key investment categories. The abatement measures category, related to oil and natural gas production, will undergo further research to determine its inclusion in the framework.