The incredible shrinking climate PM
Prime Minister Mark Carney announced the electric vehicle mandate in Canada would be paused. / TWITTER PHOTO
When Mark Carney became prime minister, one could be forgiven for thinking climate leadership might be a major part of his tenure. For more than a decade, the former central banker and UN climate envoy had been one of the world’s most consistent voices linking climate risk and financial stability. Instead, his first act was to eliminate the consumer carbon price — the Trudeau government’s flagship climate policy and one he himself had once endorsed.
Now, he's putting the electric vehicle mandate on pause, citing the Canada-U.S. trade war as the prime reason to continue moving the country from a global climate leader to a laggard.
“People don’t understand how someone who has championed climate issues for 15 years can suddenly become prime minister of a G7 country and stop talking about climate change,” one Liberal MP told CBC News on condition that they not be named.
Decarbonization and economic growth are not mutually exclusive. For Canada, aligning the economy with climate commitments is the best insurance policy against physical damage from climate change and economic isolation in a carbon-constrained global marketplace. There is plenty of data and scientific evidence to back this up — something Carney knows well.
Flat emissions
From 2009 to 2022, GDP grew at an average annual rate of 2.3%, while industrial GHG emissions stayed almost flat, rising just 0.02% per year, according to Statistics Canada.
More broadly, between 2005 and 2023, Canada reduced total GHG emissions by 8.5% through significant cuts in electricity and heavy industry emissions.
Meanwhile, the Canadian Climate Institute estimates that for every $1 invested in adaptation, the economy gains $13–$15 in direct and indirect benefits.
Environment and Climate Change Canada estimates that by this year, climate-related damage is projected to cost Canada $25 billion annually, equal to 50% of the projected annual GDP growth.
“These losses could rise to $78 billion and $101 billion annually by 2050 for a low- and high-emissions scenario respectively, and $391 billion and $865 billion respectively by 2100,” the ECCC reported. The Canadian Climate Institute predicts climate change will cause job losses and reduce productivity, which will raise prices and undermine the economy.
Against all of this, President Donald Trump has rolled back the Inflation Reduction Act’s clean-energy subsidies in the U.S., weakened federal climate standards and embraced tariffs as a core economic tool. His administration’s “energy dominance” agenda has brought U.S. oil and gas output to record levels.
Risking friction
In Ottawa, Carney is preserving the industrial carbon price, where emitters pay about $65 per tonne in 2025, rising to $170 by 2030. The government is exploring border carbon adjustments — a policy that could protect Canadian exporters from Europe’s carbon tariffs, but risks further friction with Washington.
The Canada-U.S. trade war is testing this divergence but if we are to protect our industries, climate must be a consideration.
Carney has pledged to address the issue soon. “There'll be a more comprehensive approach for climate competitiveness as part of our global industrial competitiveness strategy, and you'll see that in the coming weeks,” the prime minister said Friday.
Still, Washington’s policy volatility raises a core risk: if Canada softens its climate agenda while the U.S. abandons it altogether, Europe and Asia may treat both North American economies as climate laggards, exposing exporters to costly carbon tariffs — and hampering any efforts to diversify away from the U.S.
Cutting the consumer carbon tax and the EV mandate may be politically prudent, especially in today’s economic landscape, but Carney needs to at least explain to Canadians that addressing climate change is still a priority, rather than remaining quiet and simply making one-off policy announcements.
“Elbows up” means thinking strategically. For Canadians, climate and the economy aren’t separate issues; they converge in the cost of groceries, the stability of jobs, the size of insurance bills and whether Canada stays competitive on the world stage.
If Ottawa’s silence becomes a retreat, Canada risks being lumped in with the U.S. as a climate laggard — precisely when global capital is chasing clean, stable jurisdictions.
Carney may not be talking much about climate at the moment, but Canada’s long-term competitiveness still hinges on whether he governs as the climate advocate he once was — or as the political pragmatist he now appears to be.
