Fueling Change: The journey to end fossil fuel subsidies in Canada

Canada has introduced the first transparently published guidelines to prevent new inefficient fossil fuel subsidies, building on its 2022 commitment under the Glasgow Statement. While the framework adopts the World Trade Organization's definition of subsidies and establishes a definition of inefficiency, critics and the IISD highlight loopholes, such as exemptions for 'abated' fossil fuel production involving carbon capture and storage. A significant gap remains in domestic public financing for fossil fuels, which Environmental Defence estimated at CAD 19 billion from the Federal Government in 2022. The government has pledged a plan to end this domestic public financing by fall 2024.

• Canada has established a framework of guidelines on inefficient fossil fuel subsidies to prevent the introduction of new measures that constitute such subsidies. This policy follows a 2022 commitment to end new direct public support for the international unabated fossil fuel energy sector under the Glasgow Statement.
• The framework utilizes the World Trade Organization's definition of fossil fuel subsidies and introduces a comprehensive definition of 'inefficiency' to cover direct transfers, foregone revenue, transfer of risk, and the provision of goods and services.
• The framework contains exemptions for six categories, including support for clean energy, essential energy for remote communities, emergency responses, Indigenous participation, projects with credible net-zero plans by 2030, and those enabling significant carbon emissions reductions. This includes support for 'abated' fossil fuel production using technologies like fossil-derived hydrogen and carbon capture and storage (CCS).
• A major policy gap exists regarding domestic public financing for fossil fuels, which represents the majority of Canada's financial support for the sector. Environmental Defence estimated that the Federal Government provided approximately CAD 19 billion in such financing in 2022. The government has announced a plan to end this financing by fall 2024.
• Combined public financial support from the governments of Canada and British Columbia for liquefied natural gas projects is projected to reach CAD 3.93 billion by 2030.

APA

Tervit,, T. (2023). Fueling Change: The journey to end fossil fuel subsidies in Canada. International Institute for Sustainable Development. https://www.iisd.org/articles/success-story/journey-end-fossil-fuel-subsidies-Canada

Chicago

Tervit,, Trish. Fueling Change: The journey to end fossil fuel subsidies in Canada. International Institute for Sustainable Development, 2023. https://www.iisd.org/articles/success-story/journey-end-fossil-fuel-subsidies-Canada.

Wikipedia

{{cite report |last1=Tervit, |first1=Trish |title=Fueling Change: The journey to end fossil fuel subsidies in Canada |publisher=International Institute for Sustainable Development |date=13 October 2023 |url=https://www.iisd.org/articles/success-story/journey-end-fossil-fuel-subsidies-Canada |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{tervit2023fueling, author = {Tervit,, Trish}, title = {{Fueling Change: The journey to end fossil fuel subsidies in Canada}}, institution = {International Institute for Sustainable Development}, year = {2023}, month = oct, url = {https://www.iisd.org/articles/success-story/journey-end-fossil-fuel-subsidies-Canada}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }