Last week the Government of Canada delivered on a longstanding commitment to end fossil fuel subsidies, effective immediately.

Though the new rules are far from perfect, if they are applied with integrity they will make it impossible for the government to justify new public handouts to the oil and gas sector.

These new rules are a big deal

Fossil fuels are causing the climate crisis. Any spending which leads to the expansion of the oil and gas sector, or locks in current levels of fossil fuel production, will make it harder to avoid catastrophic climate change. Ending fossil fuel subsidies is a really big deal.

These new rules should also free up billions for climate solutions, such as building more renewable energy, electrifying public transit and making our homes and buildings more energy efficient.

And it wouldn’t have happened without you and thousands of other people who support our work to stop funding fossils.

But there are some loopholes

The new rules have some troubling exemptions, especially for fossil gas (known as natural gas) and dangerous distractions – including carbon capture and storage (CCS) and hydrogen –  which only serve to prolong our dependence on fossil fuels, without delivering meaningful reductions in greenhouse gas emissions.

The inclusion of these loopholes demonstrates the ongoing influence of the oil and gas industry –  Canada’s most polluting sector – on government decision making in developing climate policy.
Learn more about the climate villains who keep lobbying for ongoing fossil fuel subsidies here.

Fortunately, to justify any new fossil fuel subsidies, federal departments must prove that any new spending doesn’t hinder the transition to renewable energy and aligns with a pathway consistent with limiting global heating to 1.5°C. This would rule out any spending on new oil, gas or coal projects.

The new rules don’t cover everything 

These new rules ending about fossil fuel subsidies have a glaring omission: they won’t apply to public financing funded through Export Development Canada and other crown corporations.

That’s a problem: most of the support to the oil and gas industry is being provided through Export Development Canada. Take last year. In 2022, the federal government provided over $20 billion to oil and gas companies. Around $19 billion of that was support from Export Development Canada for domestic oil and gas projects.

Next up: ending all financing to to the fossil fuel sector  

The Government of Canada has promised to eliminate public financing from crown corporations for fossil fuels – but only by Fall 2024.

That’s too late. With so much of the planet on fire today, we cannot afford another year of ongoing fossil financing.

We need news rules to end this support – and we need them quickly.

Take action today! Tell Canada to stand up to Big Oil!