Trading on strength: Canada’s clean tech in global carbon markets

The document asserts that Canada is falling behind its 2030 and 2035 emissions targets and should utilize Internationally Transferred Mitigation Outcomes (ITMOs) to achieve cost-effective reductions. It suggests that Canada can leverage its strengths in methane detection, clean electricity, and carbon removal technologies to create bilateral agreements, similar to Japan's Joint Crediting Mechanism (JCM). The report warns that simple liquefied natural gas (LNG) export deals are unlikely to meet strict Article 6 additionality requirements and recommends establishing a national coordination mechanism to integrate climate finance with trade and sustainable development goals in the Global South.

• Canada is currently failing to meet its 2030 Nationally Determined Contribution (NDC) and is far from the reductions needed for mid-century carbon neutrality, largely due to economic growth and a growing oil and gas sector.
• Utilizing ITMOs can significantly lower the cost of meeting climate targets compared to domestic-only mitigation. For example, replacing 10 megatonnes of domestic reductions with international credits could save the Canadian economy nearly $1.7 billion in 2035, as international credits are projected to cost between $45 and $100 per tonne by 2030.
• The belief that liquefied natural gas (LNG) exports can easily generate bankable credits is outdated; such exports must be part of a broader decarbonization strategy to meet strict Article 6 additionality and leakage criteria.
• Japan provides a successful model through its Joint Crediting Mechanism (JCM), which has established formal agreements with 29 partner countries and over 257 projects, primarily focusing on renewable energy and energy efficiency.
• Canada can leverage specific technological strengths to generate ITMOs, including methane detection and control, its experience in phasing out coal for clean electricity, and carbon removal technologies like direct air capture and low-carbon concrete.
• The COP29 in Baku provided the necessary operational guidelines for Articles 6.2 and 6.4, removing previous uncertainties regarding transparency, double counting, and sustainable development goals.

APA

Sawyer, D. (2025). Trading on strength: Canada’s clean tech in global carbon markets. Canadian Climate Institute. https://institutclimatique.ca/wp-content/uploads/2025/11/Miser-forces-technologies-propres-Canada-marches-mondiaux-carbone.pdf

Chicago

Sawyer, Dave. Trading on strength: Canada’s clean tech in global carbon markets. Canadian Climate Institute, 2025. https://institutclimatique.ca/wp-content/uploads/2025/11/Miser-forces-technologies-propres-Canada-marches-mondiaux-carbone.pdf.

Wikipedia

{{cite report |last1=Sawyer |first1=Dave |title=Trading on strength: Canada’s clean tech in global carbon markets |publisher=Canadian Climate Institute |date=November 2025 |url=https://institutclimatique.ca/wp-content/uploads/2025/11/Miser-forces-technologies-propres-Canada-marches-mondiaux-carbone.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{sawyer2025trading, author = {Sawyer, Dave}, title = {{Trading on strength: Canada’s clean tech in global carbon markets}}, institution = {Canadian Climate Institute}, year = {2025}, month = nov, url = {https://institutclimatique.ca/wp-content/uploads/2025/11/Miser-forces-technologies-propres-Canada-marches-mondiaux-carbone.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }