Canada's Climate Competitiveness Strategy

Teeing up a Federal-Provincial Showdown?

In the hallowed halls of the Canadian parliament in Ottawa, where central planners dream of remaking the nation in their net-zero image, Prime Minister Mark Carney’s newly released Climate Competitiveness Strategy—unveiled in Budget 2025 and trumpeted across the nation from Halifax to Vancouver on November 9—poses as a beacon of economic and environmental enlightenment. It promises Jobs! Innovation! and a “Clean Energy Superpower!” status, all while patting Canada on the back for a 34% drop in carbon intensity since 2005. But when you peek behind the curtain of the bouncy but vague press releases (one has to ask why the same press release was repeated from several different departments), there is a wolf in green clothing sitting at the controls that threatens the energy security and future economic prosperity of Saskatchewan and Alberta.

The strategy’s press releases, pulled straight from Budget 2025’s vague blueprint, lays out six main pillars in aspirational prose:

· strengthening industrial carbon pricing to push so-called “high emitters” towards low-carbon paths;

· providing “clarity” on greenhouse gas regulations to supposedly lure investors;

· boosting clean economy investments via expanded tax credits;

· supporting critical minerals projects for global supply chains;

· mobilizing public-private capital for net-zero transitions, including through the Canada Growth Fund’s Carbon Contracts for Difference;

· and developing shiny new metrics to “track success” – whatever that means. (Is it the Canadian Sustainability Standards Board’s Canada Sustainability Disclosure Standards, which are almost identical to the ISSB standards and are interoperable with the EU’s Corporate Sustainability Reporting Directive?)

It’s a laundry list of buzzwords. But it is also intertwined with existing interconnected policies like methane crackdowns, clean electricity grids by 2035, and EV mandates hitting 20% sales by 2026. Apparently, this will all “Build Canada Strong!” Clearly words are cheap.

What is particularly concerning is that the language is so nebulous that the devil truly lurks in the unreleased details. Provinces and companies are left deciphering the clues, like trying to decode a prophecy from the Sibyl of Delphi, interpreting these platitudes in ways that might be the opposite of what the Liberals actually envision—especially as Canada has signed onto the Open Coalition on Compliance Carbon Markets, signed at COP30 on November 7. This global pact with Brazil, China, the UK, the EU, and seven other nations promises interoperable carbon trading under Paris Article 6, but without specifics. Further information is scheduled to be discussed and revealed at a Ministerial Roundtable on 15 November 2025. Yet, what it seems to indicate is a global interoperability of the methodology and metrics of Monitoring, Reporting, and Verification (MRV) of emissions for Border Carbon Adjustments (BCA) or Carbon Border Adjustment Mechanisms (CBAM).

The shadow of the EU’s CBAM—slated for full enforcement on January 1, 2026—looms large, demanding proof that covered Canadian commodities match Europe’s pricing or face tariffs, as I’ve discussed on these pages before. During his Liberal leadership campaign, Carney himself warned that a Canadian Border Carbon Adjustment (his euphemism for a homegrown CBAM) would be “imperative” to sustain trade with the EU, UK, and beyond, lest domestic climate policies hamstring exporters. He pushed shifting from consumer carbon taxes to industrial pricing and global tools like a CBAM, framing it as a competitiveness shield. But what does this entail in practice? Will it slap $5-10 per barrel on Alberta crudes not certified “low-emission”? Will the Carbon Capture and Storage (CCS) programme, which is touted as the only way to achieve “decarbonized” oil, make Canadian oil uncompetitive in the global market? Will Canadian oil producers or producing provinces have to absorb most of those costs even with the proposed tax credit? Will it force Saskatchewan to accelerate coal retirements before nuclear ramps up? Does this set up Saskatchewan and Ottawa for a constitutional battle?

The strategy’s silence leaves room for worst-case scenarios: sub-national markets like Alberta’s pricing dilemmas and potential production caps or Saskatchewan’s coal power deemed non-compliant and subject to significant industrial carbon pricing that unfairly and unjustly raises consumer and industrial power prices in the province, triggering trade wars and job hemorrhages. Ottawa’s “whole-of-government” and “whole-of-country” facade masks this ambiguity, betting provinces will fold rather than fight; this could be a terrible miscalculation.

Most commentators have focused on Alberta and its desire not only for an oil pipeline to the west or east coasts to diversify trade away from dependence on the United States, but also for the removal of the oil emissions cap. Overlooked are the impacts on Saskatchewan and the brewing confrontation over Saskatchewan’s energy future. The province is a uranium powerhouse supplying upwards of 18% of the world’s fuel (the second largest uranium producer globally) but has no nuclear power plants itself. It also has a significant supply of coal, which currently provides on average around 40% of the province’s baseload power (not capacity, but actual production). On October 20^th, Premier Scott Moe released the Saskatchewan First Energy Security Strategy. It outlines a bold path: nuclear dominance via small modular reactors (SMRs) to supplant retiring coal plants, BUT with coal as a “secure bridge” for baseload reliability until the nuclear power plants can be built, which will not be until around 2040. The plan leverages local resources for affordable reliable power and 5,000 new jobs—while eyeing global nuclear demand and committing to building nuclear power at home. Yet Ottawa’s clean electricity push and carbon pricing blitz, amplified by COP30’s Coalition on Compliance Carbon Markets, threaten to derail it. Federal tax credits might dangle SMR funding, but only if Saskatchewan interprets the vagueness to mean accelerated coal and natural gas phase-outs, hiking coal costs through industrial carbon pricing and risking blackouts if a transition away from what is local and reliable is forced based on arbitrary time lines. Why force a premature exit to a bridge fuel when a nuclear build-out demands time? The interim federal net zero targets ooze arrogance, ignoring Section 92A of the Constitution, which reserves resource control and electricity generation to provinces.

Carney claims this builds “Canada Strong.” Rubbish. It’s a blueprint for weakness and injustice: stalled growth for industries, higher bills for families, and sovereignty surrendered to Canadian technocrats (and Brussels bureaucrats). Levying an industrial carbon price, as part of the Climate Competitiveness Strategy, on jurisdictions like Alberta and Saskatchewan that do not have the same hydro endowment of Ontario, Quebec, British Columbia, and Manitoba (that can claim “clean” power status) is inequitable to the people of the Alberta and Saskatchewan, reinforcing historic grievances and western alienation. Once again, the Laurentian elites are picking winners and losers—and sticking the losers with the bill. If “net zero” (climate competitiveness) means freezing in the dark unless you live beside a waterfall, then net zero is unfair, unconstitutional, and un-Canadian.

If Ottawa persists, the prairies may just have to redefine and defend their energy security without the capital’s blessing. The choice is clear for Saskatchewan and Alberta: assert provincial rights or watch the lights flicker out on affordable reliable power.