Major Economies Push Ahead on Emissions Reductions
Despite political distractions in North America, global efforts to cut greenhouse gas emissions remain strong and are increasingly driven by economic incentives. India, the world’s third-largest emitter, will launch a national carbon trading system next year and has already achieved its target of generating half its electricity from non-fossil fuel sources—five years ahead of schedule.
The European Union, a key Canadian trading partner, is working toward a target of cutting emissions 90% below 1990 levels by 2040. The bloc remains on track to meet its 2030 goal of a 55% reduction, having cut emissions by 8% in 2023 alone. Record renewable installations have driven this progress; in June, solar power generated more electricity than any other source in Europe.
China’s Electrification and Carbon Market Expansion
China’s commitment to electrification is reshaping global energy trends. Its growing renewable capacity has begun to reduce reliance on coal, cutting national emissions in early 2024 despite rising electricity demand. The country’s carbon market, already the world’s largest, is expanding to include sectors such as steel, cement, and aluminum.
Transport electrification is advancing rapidly, with roughly half of all new cars sold in China last year being plug-in models. This shift is influencing global markets: the International Energy Agency projects that electric vehicles will account for more than one-quarter of all new cars sold worldwide in 2024. China and the EU have also strengthened cooperation on climate initiatives, further solidifying the global clean energy transition.
Implications for North America and Canada
In the United States, momentum toward electrification has fluctuated but remains supported by strong economic drivers, including rapid renewable growth in states like Texas. Companies such as Enbridge are making significant investments, including nearly $1 billion in a large solar project. These developments signal that the economic logic of clean energy is becoming increasingly hard to ignore.
For Canada, the opportunity lies in leveraging its high proportion of emissions-free electricity—currently at 80%—and its potential for dispatchable clean power. However, fragmented provincial grids pose a challenge to the goal of “electrifying nearly everything.” Expanding clean power generation and interprovincial transmission will be key to attracting investment and decarbonizing industry, buildings, transportation, and emerging sectors like artificial intelligence.
National Strategy and Competitive Advantage
A coordinated national approach to clean electricity could support economic autonomy, dismantle internal trade barriers, accelerate decarbonization, and create opportunities for Indigenous communities. Such a strategy aligns with current federal priorities for projects deemed in the national interest.
The technology, resources, and political will to build larger, cleaner, and smarter energy systems already exist in Canada. Failing to act risks ceding competitive advantage in a global economy where clean energy and economic growth increasingly go hand in hand. The choice for policymakers is clear: seize the opportunity to lead in the energy transition or risk being left behind.
