It has been estimated that the total annual capital required to reach net-zero by 2050 in Canada is in the order of $125 to $140 billion, while current annual investment is only between $15 and $25 billion. Funding from the private sector is vital to bridge this gap—thus the need for sustainable finance.
In 2019, Canada’s Expert Panel on Sustainable Finance released its final report, which included 15 recommendations intended to “bring sustainable finance into the mainstream.” The recommendations were structured around three pillars, including “foundations for market scale” and “financial products and markets for sustainable growth”. Since the release of this report, the Government of Canada has made commitments to push forward sustainable finance with a focus on areas including federal green bond issuance and climate-related financial disclosures.
One of the Expert Panel’s recommendations was the establishment of a “Canadian Centre for Climate Information and Analytics” (C3IA) as an authoritative source of climate information and decision analysis.79 Increased access to climate data, while not in itself sufficient to leverage the private capital needed for Canada to reach net-zero by 2050, will support broader and more transformative measures including the above-noted climate-related financial disclosures. It will be especially effective when used to support transition plans for organizations in the public and private sectors. It has been noted that “data issues are frequently raised in discussions regarding impediments to allocating capital to sustainable finance solutions.”80 The Expert Panel noted the potential to build on existing initiatives such as the Canadian Centre for Climate Services (CCCS) and the Canadian Centre for Energy Information, with additional dimensions including interoperability with other data and tools for adaptation of scientific information into financial and economic analysis that is “decision-useful”. It also noted that “the intersection between data and analysis is the focus of the proposed… C3IA.”
Unfortunately, as of yet, insufficient progress has been made on the establishment of the C3IA. In late 2021, the Institute for Sustainable Finance (ISF) measured progress on the Expert Panel recommendations, finding that the recommendation to establish the C3IA was one of three on which the least progress had been made.
In the 2030 Emissions Reduction Plan, the Government committed to “develop a climate data strategy to ensure that the private sector and communities have access to data to inform decisions on planning…” As part of this strategy, the Government should make a funding commitment to establish a Canadian centre for decision-useful climate information, similar to the C3IA, in consultation with the Sustainable Finance Action Council sub-committee that has been established to examine the issue. Engagement with Indigenous communities and integration of Indigenous knowledge should be part of this initiative.
$15 million over three years for the establishment of a Canadian centre for decision-useful climate information. [ECCC, StatCan]
See also Supporting evidence-based decision making: improving environmental science and data, later in this document.