In this era of trade wars and geopolitical rupture, Canada has a unique opportunity to build its industrial base by attracting low-carbon investment away from the United States.
That’s the message of “A Canadian Advantage,” a new report released today by Clean Prosperity and the Transition Accelerator.
The report compares the incentives in Canada and the U.S. for investment in 14 low-carbon sectors, including electricity, critical minerals, batteries, low-carbon fuels, and carbon management. It identifies specific steps that Canada should take to sharpen its competitiveness.
The Trump administration has pivoted away from climate policy, but has not entirely turned its back on low-carbon technologies. Canada must identify and seize the right opportunities to achieve leadership in strategic sectors.
“Canada has a competitive advantage for attracting investment in a volatile and uncertain world,” said Brendan Frank, co-author of the report and vice president of policy at Clean Prosperity.
“We offer stability,” said Frank. “We should build on that advantage by following through on last year’s federal-Alberta memorandum of understanding and reforming Canada’s carbon markets to deliver predictable revenues to low-carbon projects.”
“Canada has a competitive advantage for attracting investment in a volatile and uncertain world. We offer stability.”
Brendan Frank, Vice President of Policy, Clean Prosperity
How Canada can build its competitive advantages
The report argues that Canada should start by following through on commitments in the 2025 federal-Alberta memorandum of understanding to strengthen carbon markets.
Guaranteeing carbon credit revenues can give Canada an advantage over the United States in attracting investment in hydrogen, sustainable aviation fuel, renewable energy, and cement production and gas-fired power generation with carbon capture.
In addition, Canada needs a more focused industrial strategy. Canada should prioritize technologies and projects that maximize value across domestic supply chains. Canadian governments should coordinate with leading firms and stakeholders to tailor policy according to evolving needs.
“The United States is cutting support for industries of the future, and Canada should exploit the gaps that has opened up with a targeted industrial strategy,” said Travis Southin, report co-author and future economy lead at the Transition Accelerator. “That means prioritizing where to compete, coordinating with the private sector, and continuously adapting the policy mix to achieve our goals.”
