2024 Reports 1 to 5 of the Commissioner of the Environment and Sustainable Development to the Parliament of Canada—Funding offered under Net Zero Accelerator initiative failing[...]

Ottawa, 30 April 2024-A report released today by Commissioner of the Environment and Sustainable Development Jerry V. DeMarco found that Innovation, Science and Economic Development Canada was unable to attract the largest-emitting manufacturing industries to decarbonize their operations through its Net Zero Accelerator initiative. This initiative aims to reduce greenhouse gas emissions and contribute to meeting Canada's 2030 and 2050 climate goals by incentivizing manufacturing companies to reduce their emissions.

Out of the 55 companies that emitted at least 1 megatonne of carbon dioxide in 2021, only 15 applied to the initiative and, of those 15, only 2 signed a contribution agreement. After $3.2 billion was committed through a total of 17 contribution agreements with both large and smaller emitters, companies committed to reducing their emissions by just 6.2 megatonnes, less than 1% of Canada's total emissions. For the companies applying for funding, the audit found the application process to be very lengthy and complex. The companies reported spending an average of 407 hours to complete their applications, and the department took an average of 20 months to get a contribution agreement finalized and signed.

The audit found that Innovation, Science and Economic Development Canada did not always follow international and government standards to estimate emission reductions and that it did not consistently apply its assessment methodology across all projects. As a result, it did not always know the reductions that would be achieved through the funding received by each company.

"Surprisingly, there is no overarching industrial decarbonization policy to provide Innovation, Science and Economic Development Canada with a clear picture of which industries are most in need of funds to reduce emissions," said Mr. DeMarco.

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The 2024 Reports of the Commissioner of the Environment and Sustainable Development, Report 4-Strategic Innovation Fund's Net Zero Accelerator Initiative-Innovation, Science and Economic Development Canada, is available on the Office of the Auditor General of Canada website.

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