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

The document assesses Canada's current emissions trajectory and proposes the adoption of a structured ITMO framework, modeled after Japan's Joint Crediting Mechanism, to help Canada meet its 2030 and 2035 climate targets while promoting its clean-tech sector globally.

• Canada is currently not on track to achieve its 2030 emissions target or its nationally determined contribution (NDC), with economic and population growth continuing to exert upward pressure on emissions, particularly within the oil and gas sector.
• Utilizing ITMOs could significantly lower the cost of meeting climate targets; for instance, purchasing 10 megatonnes of global reductions could save the domestic economy approximately $1.7 billion in 2035, as international credit prices are forecast at $45 to $100 per tonne by 2030.
• The common Canadian assumption that LNG exports can be easily traded for bankable credits is likely incorrect due to strict Article 6 requirements regarding additionality and the need for comprehensive decarbonization strategies.
• COP29 in Baku provided essential operational guidance for Articles 6.2 and 6.4, establishing transparency requirements, public registries, and standardized quantification guidelines to prevent double counting.
• Japan's Joint Crediting Mechanism (JCM) serves as a successful blueprint, having established arrangements with 29 partner countries and over 257 projects, primarily focusing on renewable energy and energy efficiency.
• Canada can leverage specific strengths for ITMO generation, including its advanced methane detection and control technologies, its experience in phasing out coal and scaling renewables in the electricity sector, and carbon removal technologies like direct air capture.
• The author recommends that Canada establish a national Article 6 coordination mechanism within Environment and Climate Change Canada, supported by Global Affairs and Natural Resources Canada, and utilize existing tools like Export Development Canada and the Canada Growth Fund.

APA

Sawyer, D. (2025). Trading on strength: Canada’s clean tech in global carbon markets. Canadian Climate Institute. https://climateinstitute.ca/wp-content/uploads/2025/11/Trading-strength-Canada-clean-tech-global-carbon-markets.pdf

Chicago

Sawyer, Dave. Trading on strength: Canada’s clean tech in global carbon markets. Canadian Climate Institute, 2025. https://climateinstitute.ca/wp-content/uploads/2025/11/Trading-strength-Canada-clean-tech-global-carbon-markets.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://climateinstitute.ca/wp-content/uploads/2025/11/Trading-strength-Canada-clean-tech-global-carbon-markets.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://climateinstitute.ca/wp-content/uploads/2025/11/Trading-strength-Canada-clean-tech-global-carbon-markets.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }