Goal 9: Foster innovation and green infrastructure in Canada

9.1: Develop quality, reliable, sustainable and resilient infrastructure, including regional and transborder infrastructure, to support economic development and human well-being, with a focus on affordable and equitable access for all
9.2: Promote inclusive and sustainable industrialization and, by 2030, significantly raise industry's share of employment and gross domestic product, in line with national circumstances, and double its share in least developed countries
9.4: By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes

Canada's industrial sector is a major driver of economic activity, including income, jobs and exports. While industry is a significant source of greenhouse gas emissions in Canada, many sectors are taking action to green their industries. For example, between 2008 and 2019, Canada's aviation industry improved its fuel efficiency by 17.8% through actions such as fleet renewal and operational improvements. Canadian ports are also taking action to reduce emissions, including investing in green infrastructure and pursuing the creation of green shipping corridors.

Green infrastructure plays a key role in conserving natural resources and addressing climate change impacts by reducing greenhouse gas emissions and pollution. Upgrading infrastructure and retrofitting industries is part of a more sustainable approach, and investing in green infrastructure, such as low-carbon transportation, climate-resilient and energy efficient buildings and clean energy, helps build healthy and resilient communities, protects against a changing climate, promotes environmental sustainability, drives economic growth and supports a net-zero economy.

As climate change continues, green infrastructure will be increasingly important to sustain economic, environmental and social well-being. For instance, a growing network of zero-emission vehicle chargers will make low-carbon transportation options more accessible to Canadians. At the same time, natural infrastructure such as conserved and restored wetlands and marshes can help prevent climate change impacts such as flash floods and support the conservation and recovery of wild species, including species at risk.

Meanwhile, investing in innovation supports the transition to a net-zero economy while increasing Canada's competitiveness. Innovation can have benefits in areas such as water, air quality, plastic waste and biodiversity, including through increased adoption of clean energy technology, increased resource efficiency and increased demand for low-carbon materials. Research, development and demonstration continues to be needed to develop new technologies and integrate them into existing systems, and to lower capital costs of solutions nearing commercial scale. Sustained innovation over the next decade and beyond will be critical to reduce the costs of technologies and processes that could enable substantial emissions cuts beyond 2030 and support future economic competitiveness.

How the Government of Canada contributes

While the federal government owns approximately 3% of the country's infrastructure, it plays a major role in funding, regulating and setting policies and standards for infrastructure projects. The Government of Canada recognizes the importance of green and resilient infrastructure to achieve a net zero-economy by 2050.

In the spring and summer of 2021, the government led an engagement process on Canada's first-ever national infrastructure assessment and is considering this advice in launching this initiative. The National Infrastructure Assessment will provide an evidence-based and expert-driven assessment of Canada's infrastructure needs over the coming decades to tackle climate change, support the quality of life for Canadians, and enable the country's economy to flourish.

The government has also launched the Green and Inclusive Community Buildings program, which aims to improve energy efficiency in existing buildings and support the construction of new net-zero carbon ones, particularly in areas with populations with higher needs. This 5-year program will support the construction and adaptation of community buildings across Canada to reduce carbon emissions, advance greenhouse gas (GHG) mitigation measures, and encourage best practices in building design for climate change resilience.

Natural Infrastructure Fund

The Government of Canada has established the Natural Infrastructure Fund to support natural and hybrid infrastructure projects to further Canada's commitment to climate change resilience while contributing to national biodiversity goals and targets. The program is being implemented through a two-stream approach that supports projects of diverse sizes, which will increase the use and awareness of the opportunities for natural or hybrid infrastructure to deliver multiple community services and co-benefits.

To lay the foundation for a net-zero buildings sector, the government committed to develop a national net zero by 2050 buildings strategy, the Canada Green Buildings Strategy. The strategy will build off existing initiatives and set out new policies, programs, incentives and standards needed to drive a massive retrofit of the existing building stock, and construction to the highest zero carbon standards, while strengthening the climate resilience of the sector. Actions related to the net-zero building sector can be found in Goal 7 under the energy efficiency theme.

Green bonds

In March 2022, the Government of Canada issued its first-ever green bond. The inaugural issuance is a 7.5 year, $5 billion green bond, the first of many issuances. Green bonds are a specific type of bond in which the proceeds are used exclusively to fund projects with environmental and climate benefits. These investments will be used for projects such as green infrastructure, clean tech innovations, nature conservation, while also growing Canada's economy and creating new, good-paying jobs across the country.

The deployment of innovative and efficient technologies and processes remains critical to unlocking transformational change and achieving decarbonisation in Canada. Industrial emission reduction is essential for Canada to stay competitive and requires investment by and partnership with all levels of government.

To support innovation and clean technologies, the federal government is proposing to establish the Canada Growth Fund to attract private sector investments, reduce emissions, invest in low-carbon industries and support the restructuring of critical supply chains. Meanwhile, the Strategic Innovation Fund's Net Zero Accelerator is investing $8 billion in support of projects targeting technology adoption or development in 3 priority areas: decarbonization of large emitters, shifting Canada's industrial base in sectors such as automotive and aerospace towards a low-carbon model, and development of clean technologies, including a battery ecosystem. Further, at the COP26 climate summit in 2021, Canada joined 22 countries to commit to advance ambitious actions to reduce international aviation emissions and joined 19 countries committed to establish zero-emission green shipping corridors.

In addition, the government has committed to introduce a new Buy Clean Strategy to support and prioritize the use of made-in-Canada low-carbon products in Canadian infrastructure projects.

The government has put in place several tax measures to support the adoption of clean technologies. It has expanded Classes 43.1 and 43.2 to include more properties eligible for an accelerated capital cost allowance for investments in specified clean energy generation and energy conservation equipment. The government has also introduced a measure to reduce corporate income tax rates for qualifying zero-emission technology manufacturers. Finally, the government has proposed to establish an investment tax credit of up to 30%, focused on net-zero technologies, battery storage solutions, and clean hydrogen.

Sustainable Development Technology Canada helps Canadian companies develop and deploy clean technology innovations by delivering critical funding support and promoting the development of a robust Canadian market. Since its inception in 2001, Sustainable Development Technology Canada has committed approximately $1.38 billion to almost 540 projects. The Strengthened Climate Plan included continued support to Sustainable Development Technology Canada with an additional $750 million to support start-ups and to scale-up companies to enable pre-commercial clean technologies to successfully demonstrate feasibility as well as to support early commercialization efforts.

Finally, to advance a critical pathway in Canada's transition to a net-zero economy, Canada is supporting the development and deployment of Carbon capture, utilization and storage (CCUS) technologies, including through research, development, and deployment funding support and laboratory research as well as the development of a CCUS Strategy and a CCUS Investment Tax Credit.

The Clean Growth Hub

The Clean Growth Hub is a whole-of-government focal point for clean technology focused on supporting companies and projects, coordinating programs and tracking results. It helps clean technology developers and adopters identify the federal programs and services most relevant to their needs, simplifying access to government programs and reducing duplication of effort. Services are available to firms of all sizes in the clean technology space and across all sectors of the economy.

Sustainable finance

Sustainable finance refers to the incorporation of climate and environmental considerations throughout financial decision making. In turn, this enables the mobilization and alignment of private sector investments in climate and environmental objectives. In May 2021, the Government of Canada launched the Sustainable Finance Action Council (SFAC) to help lead the Canadian financial sector towards integrating sustainable finance into standard industry practice. SFAC will make recommendations on critical market infrastructure, with an initial focus on climate-related financial disclosure, green and transition investment standards, and climate data for the financial sector.

In Budget 2022, the Government of Canada announced that the SFAC will develop and report on strategies for aligning private sector capital with the transition to net-zero, with support from the Canadian Climate Institute and in consultation with the Net-Zero Advisory Body. It also announced that the federal government is committed to moving towards mandatory reporting of climate-related financial risks across a broad spectrum of the Canadian economy, based on the international Task Force on Climate-related Financial Disclosures (TCFD) framework.

Subsequently, in May 2022, the Sustainable Finance Action Council Terms of Reference were updated, seeking advice on a variety of issues. These include: aligning private sector investment with the transition to net-zero and developing a net zero capital allocation plan; highlighting the remaining obstacles to bringing mandated climate-related financial disclosure into the mainstream in Canada; and, coordinating input to the global baseline standards of the of the International Sustainability Standards Board and adopting the standards in Canada.

Canada's Crown corporations will also demonstrate climate leadership by adopting the TCFD standards, or complying with more rigorous and acceptable standards as applicable to the public sector at time of disclosure, as an element of their corporate reporting. To ensure Crown corporations are transparent about issues that matter to Canadians, Budget 2021 announced that Crown corporations are required to implement gender and diversity reporting beginning in 2022.

Recognizing the importance of nature, the Government of Canada has joined the Task Force on Nature-related Financial Disclosures, which will provide a similar framework to the TCFD, but with an aim to support corporate and financial institutions to assess, manage and report on their dependencies and impacts on nature.

The federal government welcomed the International Financial Reporting Standards (IFRS) Foundation's selection of Montreal to host one of the two central offices of the new International Sustainability Standards Board (ISSB). The government is committed to supporting the start-up of the Montreal office and positioning Canada as a leader in sustainability reporting.

Thawing permafrost in Canada's Arctic coastal communities

Warming caused by climate change will have a disproportionate impact on infrastructure in Canada's Arctic coastal communities due to the thawing of permafrost. Permafrost is a layer of earth beneath the surface that remains frozen for more than 2 consecutive years. As permafrost thaws, it can cause the surface to shift and destabilize. This in turn causes the foundation of buildings and other forms of infrastructure such as roads and airports to sink and crack, impacts water flow and absorption, and leaves shorelines more susceptible to erosion from wave activity. In regions such as Nunavut, where infrastructure has been designed specifically for stable permafrost conditions, significant investments will be needed to meet the infrastructure challenges posed by climate change.

Stakeholder perspective: Upcycled onions

The circular economy offers tremendous opportunities to turn waste into a new economic resource! In southern Ontario, the RePurpose Incubator - a program within Circular Opportunity Innovation Launchpad (COIL) - successfully identified a new upcycled value chain for 6,000 megatonnes of onion byproduct that was going to waste. Through several months of research, nutritional and environmental analysis as well as workshops, it was determined that an upcycled concentrated onion juice would be the highest-value economic and environmental opportunity that would address a previously-unidentified gap in the market. This innovative value chain has the potential—when fully implemented—to generate additional value of $1.7 million per year. Also, the upcycled product will return 897,000 meal equivalents to the food system, and reduce (Scope 3) greenhouse gas emissions by about 795 tonnes per year of carbon dioxide equivalent based on the footprint used to grow the onions.

Source: Circular Opportunity Innovation Launchpad

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2022 to 2026 FSDS

2022 to 2026 Federal Sustainable Development Strategy

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