Senator Rosa Galvez

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A Short Guide to the Canadian Net-Zero Emissions Accountability Act (CNZEAA)

Introduction

The Canadian Net-Zero Emissions Accountability Act (CNZEAA), adopted by Parliament in June 2021, establishes a framework for attaining net-zero greenhouse gas emissions by the year 2050, joining 15 other countries and 6 provinces to have adopted accountability frameworks to date. This briefing provides insight into the progression of the Act by describing its passage through the legislative process and it highlights the Act’s key features and their implications. For a comparison of how the CNZEAA compares to the accountability laws of other countries, click here.

The Legislative Process

In November 2020, the Government tabled Bill C-12 to enshrine in legislation Canada’s commitment to achieve net-zero greenhouse gas emissions by 2050 and provide a framework of accountability and transparency to ensure the federal government undertake the planning, actions and the monitoring needed to achieve that goal. In May 2021, in the thick of a third wave of the COVID-19 pandemic sweeping over Canada, the Bill was referred to the House of Commons Standing Committee on Environment and Sustainable Development (ENVI), for consideration and study. The Bill of 29 sections was significantly strengthened by over 30 amendments proposed by Members of Parliament with a variety of party affiliations.

The Standing Senate Committee on Energy, the Environment and Natural Resources (ENEV) undertook a pre-study of the bill on June 7th, hearing from 35 witnesses representing 22 groups and five individuals in 11.5 hours of hearings. Notably, the committee heard from four First Nations and Indigenous Climate Action while the House of Commons committee study did not hear from any indigenous witnesses.

There was consensus among witnesses that Bill C-12 is an important piece of legislation and that a climate accountability framework is critically needed. The committee’s pre-study culminated in a report noting a number of important observations, but no amendments. The Bill was debated and approved by the Senate in their final week of sittings before adjourning for the summer and it received royal assent on June 29, 2021.

To learn more about the federal legislative process, consult our guide to navigating the legislative process.

 

Objective of the CNZEAA

The CNZEAA’s purpose is “to require the setting of national targets for the reduction of greenhouse gas emissions based on the best scientific information available and to promote transparency, accountability and immediate and ambitious action in relation to achieving those targets (s.4).”

In order to accomplish this, the Act provides a framework based on planning, progress reporting and third-party evaluations informed by independent expert advice. All these steps can be seen sequentially in the infographic below showing the official steps undertaken between now and 2050 under the CNZEAA. The Act also legislates the target of net-zero by 2050, that is all anthropogenic greenhouse gas emissions are balanced by anthropogenic removals (s.2). However, “nothing in the Act precludes Canada attaining net-zero emissions before 2050 (s.6.1).”

 

Early Action, Higher Ambition

Climate science is clear that early action is crucial to avoid catastrophic consequences. The concerns of experts that the original version of the Act did not go far enough to ensure accountability prior to 2030 were addressed:

  • The purpose section of the bill was amended to add emphasis on “immediate and ambitious action” (4);
  • The first emissions reductions plan is to be published at the end of December 2021, though the Act provides for a 90 day extension at the Minister's discretion;
  • An interim objective for 2026 was added (9 (2.1));
  • Additional progress reports are required in 2023 and 2025 in addition to the 2027 progress report (14(1.1)). Furthermore, the 2025 progress report must contain an assessment of the 2030 target and must include changes being made to course correct if needed to achieve the target (s.14(1.2));
  • The first report of the Commissioner of the Environment and Sustainable Development is to be submitted by the end of 2024(24(4)); and
  • There is now a Parliamentary legislative review in 2026.

These measures ensure almost yearly meaningful accountability “checkpoints” over the next decade.

Reducing emissions to net-zero is a race, not something that we should wait until 2050 to hit. We should do everything possible to reach the goal earlier as is necessary to do our fair share under the Paris Agreement, and nothing in the law prevents that kind of ambition.

 

Target-Setting

The law codifies the 2030 greenhouse gas emissions target by incorporating Canada’s Nationally Determined Contribution, its NDC, for that year under the Paris Agreement (s.7(2)). Canada updated its NDC under the Paris Agreement to 40-45% below 2005 levels in July 2021. Therefore, the 2030 along with the 2050 targets are enshrined in legislation.

Targets for other milestone years must be set at least 10 years and one month in advance (s.7(4)). This will ensure the Government starts planning for future targets sufficiently ahead of time and provide a great opportunity for long term planning and certainty for industry. In addition, clarifications were made to ensure that each greenhouse gas emissions target set under the Act must be a progression from the previous one, preventing backsliding on Canada’s greenhouse gas emissions targets. (s.7(1.1)).

Going a step further, the Bill now requires the Minister of the Environment and Climate Change to publish a high-level description of the key emissions reduction measures to achieve that target and the latest projections of greenhouse gas emissions within a year of setting the targets for 2035, 2040 and 2045 (s.7(5)).

Considering the 2035 target for example, it will need to be set by the Minister at the latest on December 1st, 2024 in which case the high-level description of key measures and projections would be public by December 1st, 2025. The detailed emissions reduction plan in relation to the 2035 target must be established at least 5 years prior to deadline, meaning no later than December 2029 (s.7(4)a, s.7(5) and s.9(4)).

The CNZEAA refers explicitly to the Paris Agreement and Canada’s international commitments but it is likely more work will be necessary for set targets which truly reflect Canada’s fair share of global emissions reduction efforts.

 

Reporting Requirements

The CNZEAA includes detailed requirements for the content of emission reduction plans, progress reports, and assessment reports.

For emissions reductions plans, it is mandatory to include in each plan a description of how Canada’s international commitments with respect to climate change are considered, the projections of the annual greenhouse gas emissions reductions resulting from the plan’s combined measures and strategies, and a summary of cooperative measures or agreements with provinces and other governments in Canada (s.10(1) – especially a.1, b.1, e, f, g). Further, when establishing the plan, the Minister must take into consideration the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) and the advice of the net-zero advisory body (s.9(5)).

A key criticism of the law from experts is that it does not per se impose an obligation to meet targets and does not spell out consequences for failure to achieve a target beyond having to explain why and suggest further actions to address this (s.16). However, it provides for a detailed process that is legally-binding. Further, section 9(1) states that the minister must establish a greenhouse gas reduction plan “for achieving” the target, so there is, at minimum, an obligation to plan for success.

Similarly, progress(s.14(2)) and assessment(s.15(2)) reports must include Canada’s most recent published greenhouse gas emissions projections for the next milestone and details on any additional measures that could be taken to increase the probability of achieving the target if the projections indicate that a target will not be met.

 

Net-Zero Advisory Body

The Net-Zero Advisory Body (NZAB) was established by the Minister of the Environment in February 2021, before the CNZEAA came into force. The NZAB serves to conduct engagement activities and provide advice to the Minister regarding emissions reduction targets, plans, and any other subject asked of it. While most other national accountability frameworks rest heavily on the credibility of an expert advisory body composed of a majority of scientists, the initial panel is more stakeholder-based than scientific.

Adopted amendments specify that the NZAB provides “independent advice” on achieving net-zero emissions by 2050 and on targets and plans (s.20(1)).

With respect to the membership of the advisory body, the Act contains a provision requiring the Minister of the Environment and Climate Change to consider the need for the advisory body as a whole to have expertise in or knowledge of, among other subjects, climate change science, Indigenous knowledge, physical and social sciences, climate change policy at the national, subnational and international levels, energy supply and demand, and relevant technologies (s.21(1.1)).

These explicit requirements of independence and expertise are considered international “best practices”. Still, the ENEV committee report rightly pointed out the critical importance for the body to have administrative independence including control over its own budget and secretariat.

In line with the Act’s objectives of transparency and accountability, the CNZEAA requires the Minister of the Environment and Climate Change to publish the advisory body’s report 30 days after receiving it and to respond publicly within 120 days. Moreover, it requires that the Minister’s response to the NZAB address any difference between the target set, and the target recommended by the NZAB (s.22(2)).

 

Indigenous Rights and Involvement

A set of amendments to the Bill reinforced the involvement of Indigenous Peoples. The preamble now states the Government of Canada’s commitment to considering Indigenous knowledge when carrying out the purposes of the Act. Related amendments require the Minister to consider Indigenous knowledge when setting greenhouse gas emissions reduction targets (s.8(c)) and as an expertise requirement of the advisory body as a whole (s.21(1,1)b)). Emissions reduction plans must also consider the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) (s.9(5)).

 

Other Responsibilities

The Commissioner of the Environment and Sustainable Development (CESD) is a member of the Office of the Auditor General (OAG) of Canada, an independent Officer of Parliament. Typically, the CESD studies, investigates and reports on a variety of topics related to sustainable development. The CNZEAA leverages the powers of the OAG by requiring the CESD to report at least once every five years on “the Government of Canada’s implementation of the measures aimed at mitigating climate change, including those undertaken to achieve its most recent greenhouse gas emissions target as identified in the relevant assessment report (s.24).”

The Minister of Finance must prepare an annual report identifying the key measures being taken by the government to manage its financial risks and opportunities related to climate change (s.23). The report must be made available to the public. This obligation will come into force later than the rest of the CNZEAA when the government chooses (s.29).

 

Conclusion

Proposed as Bill C-12 in November 2020 and receiving Royal Assent in June 2021, this legislation arrives late in the context of climate accountability legislation set forth by other nations and the urgency of undertaking climate action. As a result, the Government of Canada will need to take their responsibility in setting and meeting targets seriously for the sake of current and future generations.

The implementation of these key features will be important since there will be an opportunity for Parliament to comprehensively review the Act five years after it enters into force. The review is to be undertaken by the relevant committee of the Senate, of the House of Commons, or of both Houses of Parliament (s.27.1). The public, experts and parliamentarians will have an opportunity to examine and assess the effectiveness of the Act with the benefit of five years’ experience and be able to make recommendations for improvements to the framework.