Canada Watch: A Reversal in Environmental Policy and Carney’s Political Balancing Act

Of course, Carney still retains some lofty yet vague terminology around clean energy. But he has reordered his priorities: in the short term, economic affordability and national unity outweigh emission trajectories; in the long term, emissions reduction must accommodate Canada’s reality as an energy exporter and resource-based nation. From a pragmatic standpoint, this shift is almost inevitable. Canada’s 2024 greenhouse gas emissions stood at 685 Mt CO₂e, while global emissions totaled approximately 53.2 Gt CO₂e—meaning Canada accounts for roughly 1.3% of the global total. No matter how much Canada sacrifices its domestic energy interests, it cannot unilaterally alter the global trajectory of fossil fuel consumption. If Canada curbs oil and gas production to reduce supply by even a small margin, market gaps will quickly be filled by lower-cost, lower-environmental-standard, and politically less stable oil-producing countries. What Canada loses, instead, are fiscal revenues and jobs that could have been secured during high-price oil cycles. Canada’s environmental policy is only meaningfully enforceable—given real-world considerations such as market access—if major global nations also comply. Yet that precondition has vanished in the populist wave ushered in by Trump. Even Europe—the region most committed to environmentalism—has undergone a dramatic transformation: far-right parties now lead opinion polls or even govern outright—from Farage in the UK, Le Pen in France, Weidel in Germany, to Meloni in Italy—none of whom display the pre-Trump-era enthusiasm for climate action. At this point, clinging to the old environmental policies serves no purpose other than satisfying moral self-righteousness. Moreover, among major oil-exporting countries, Canada’s export structure is uniquely distorted—long over-relying on the United States as its dominant customer. In 2024, Canada exported an average of 4.2 million barrels of crude oil per day, with 93% flowing to the U.S. In 2023, Canada’s hydrocarbon energy exports to the U.S. reached CA$163 billion—accounting for 21% of Canada’s total merchandise exports worldwide. With Trump once again wielding tariffs, borders, and security commitments as bargaining chips, continuing to entrust Canada’s energy export lifeline solely to the U.S. market has shifted from economic inefficiency to strategic folly. This is the core context behind Carney’s push for a new West Coast pipeline. On July 2, Carney and Smith announced the submission of Alberta-to-West-Coast pipeline proposal—capable of carrying one million barrels per day—to the Major Projects Office. The route largely follows the existing Trans Mountain corridor and abandons efforts to overturn the Northern Gateway tanker ban. This pipeline would enable Canadian crude to reach Asian markets, reducing dependence on the U.S. and mitigating the discount applied to oil exported southward. Even more crucially, British Columbia has softened its stance. Eby certainly won’t suddenly abandon NDP support to become a petroleum nationalist—but he acknowledges BC lacks constitutional authority to block a new interprovincial pipeline, and states that BC will not use the courts to obstruct the project so long as the North Coast tanker ban remains intact. This is Carney’s fundamental distinction from Trudeau. Trudeau’s federalism was steeped in moral lecturing—ultimately driving Alberta into anger and BC into resistance. Carney, by contrast, deploys financial compensation and separate bilateral negotiations to embed each provincial premier within a tailored, mutually exchangeable political arrangement.

Canada’s New Politics: Ideals Leftward, Policies Rightward

Ninety percent of Canada’s oil exports go to the United States. In peacetime, this is a stable dependency; under Trump, it becomes an economic hostage drama. Carney announced that U.S. tariffs will cost Canada $50 billion—a figure sufficient to make any finance minister queasy. Yet Canada’s response isn’t outrage—it’s a distinctly Canadian reaction: building more pipelines to reduce reliance on the U.S. Perhaps one day Canada truly will sell its oil to a country that won’t suddenly impose tariffs. Until then, the U.S. remains Canada’s largest customer, greatest risk, and most unpredictable variable. Environmentalists are furious, the oil industry is pleased—and someone inside government has already chosen to walk away. The new agreement’s popularity is distributed with striking regularity: • Oil industry: Finally, relief has arrived. • Environmental organizations: So you don’t actually believe in net zero. • Within government: At least one minister has already resigned to signal dissent. Former Environment Minister Steven Guilbeault resigned, stating he did not wish to be remembered in history as the person who “signed away climate commitments.” Carney’s reply was more subtle: he reaffirmed the net-zero goal but stressed the pathway is now “more pragmatic.” In Canadian political discourse, “pragmatic” usually means: We know what we should do—but now is not the time to do it. Steel and timber: another quiet, resolute counterstrike Beyond energy, Carney’s government unveiled a relief package for the steel and timber sectors—including new 25% tariffs, import restrictions, and reduced transportation costs. Roughly 40% of affected products originate from the U.S., meaning Canada is retaliating against U.S. trade measures in a refined, restrained, and almost courteous manner. It lacks the theatricality of American-style retaliation—but every cut is precise, steady, and silent. The call with Trump: less is more Carney revealed he spoke with Trump this week—but “there’s nothing worth reporting.”

Canada Energy Regulator Approves Trans Mountain Tolls Settlement

10 hours ago

The Canada Energy Regulator approved Trans Mountain's tolls settlement, establishing a new tariff framework and increasing the allowable contracted capacity share to 90%.

reuters

2026-09-28

Canada Energy Regulator Approves Trans Mountain Tolls Settlement

Canada Energy Regulator Approves Trans Mountain Tolls Settlement

FAQ