Toby Heaps: Some people think the Inflation Reduction Act was a spectacular success. There are other views as well. What’s your take? Did the policy work?

Jigar Shah: I’m sure everybody is right. I think that we all have to be honest about the fact that the United States had chosen to allow its manufacturing sector to dwindle in a very big and material way, right from 30% of gross domestic product down to about 10% of GDP. I don’t think that what we were doing under the Inflation Reduction Act was going to be solely responsible for changing that trajectory.

I have a lot of friends who are doing very large, audacious things in the cleantech space, and every single one of them, without exception, when they hit a certain milestone, decided to build their manufacturing facility or their first-of-a-kind plant in Asia. A few of them decided to go to Europe or to India or to South America. In general, not a single one of them thought Tennessee or Georgia or Texas was the right place to scale up their plant.

That all changed over the last four years. We got every one of them to consider the United States, and I’d say close to 70% of them ended up choosing the United States after evaluating all of the situations. So from that perspective, we have made a material difference.

TH: That’s encouraging. In Canada, the current government led by Prime Minister Mark Carney has introduced a pack of investment incentives that, through the capital expensing of 100% and tax rebates, amount to about 50 cents on the dollar. So if you invest in most clean-economy investments, you’ll get back half that money in the same year. Do you think that is going to be enough for Canada to become a magnet?

JS: I would suggest that this is not really about numbers. I think that ultimately this is about the animal spirits of the cleantech sector. So the question is, are CEOs looking to Canada to build a facility? And I think right now, the answer is no.

And I don’t think Canada’s ever reached out to them and asked them to come to Canada. And the thing that bothers me the most – not just about Canada, but the U.K. or EU, Australia – is that they believe that the policies themselves are enough to attract companies. And I’m like, no, you need to make some phone calls. You need to reach out proactively to the top 400 companies and say, “Have you looked at Canada? Can I keep you on the phone for 45 minutes and explain it to you? Can I introduce you to a front-door person that will guide you through the entire Canadian process and introduce you to all of the three-letter acronyms and help you find the right programs?”

I’m focused on people who have raised at least $200 million of corporate capital. We’re not talking about the long tail of companies that have raised a seed round. We’re talking about people who’ve been able to get all their milestones reached, and now they’re at a very clear inflection point where they need public policy to be able to get to the next level.

TH: A lot of coverage in Corporate Knights magazine has focused on how the private sector and private capital can turbocharge this energy revolution. Do you think it’s capitalist Kool-Aid, this idea that the private sector is going to make up the bulk of the capital that gets deployed? Or do we really need the public sector to pony up, like they are now for the military spending?

JS: It’s an ongoing argument. I don’t know that I am smart enough to know what the conclusion is, but if you look at the solar, battery storage, critical minerals, EV sector in China, I would say that at least 70% of all the capital that China has put into that sector has been completely and utterly wasted right now. You may say, well, look at what they got for it: they have all this commanding market share and all this other stuff, right? But they haven’t ever raised their prices to the point where the profits of the winners are paying off the losses of the losers. China has no home runs. The question is, do you want to copy that exactly in the United States or Canada? My sense is no. So what do you want to do that’s different?

What we did in the United States was we said we’re going to be private-sector-led, government-enabled. We said the private sector has to vote with the $200 million worth of cash that they’ve given these companies, and then we’re going to match them with public-sector dollars that they need to get to the next stage, to really be able to get their costs down. And that worked really well. I would say the losses out of the U.S. system from the Inflation Reduction Act have been remarkably low. Let’s say we awarded 100 projects. Maybe 40 of them have failed, but of those 40, we’ve released almost no money because they had to meet certain milestones to get the money.

TH: You’re someone who doesn’t just focus on what’s already here but imagines what could be possible. Let’s say we’re sitting in our rocking chairs in 2050. What’s the prize? What could things look like?

JS: Well, I think we already see it. The beauty of our space is that every single thing worth talking about takes 50 years. We started seeing cellphones in the 1970s, but the technology didn’t really become powerful until the iPhone came out in 2007. Solar panels are the same.

When you look at where we are today, we’re in a place where there was disruption in Pakistan, in Nepal, in Ethiopia, and instead of choosing to move to diesel fuel, the entire country chose to move to solar and battery storage. So now, 20% of the entire grid in Pakistan has been transformed in three years into solar power.

You see the same potential in Canada or in the United States. Balcony solar means that you buy the solar panel from Home Depot, you unbox it, and you just stick it on your balcony, and then you plug it into the outside wall socket. And it’s super cost-effective, even in places that don’t get as much sun.

Now the question becomes what else is going to be cool? It is very obvious that everyone is moving to electric vehicles. Whether it’s 10% a year, or 25% or 50% a year, they’re all moving to electric vehicles. If you have 40 gigawatts of batteries, which is what we have already in the United States, and then you end up with 400 gigawatts of batteries [with the addition of EVs], which we will have here in the next few years – that backs up the entire U.S. grid during the spring and the fall. What do you need to unlock that? Vehicle-to-grid technologies. Why do people want to install those technologies? Because 15% of U.S. households already have backup gas or diesel generators, so they’ve already voted with their pocketbooks to pay for that.

Now if you have a car, and that car is a 125-kilowatt-hour battery, you can back up your whole house with that car. And once it’s backed up that way, well, now the utility can send it a signal saying, “We’re going to pay you 30 cents a kilowatt-hour, because otherwise we’ll have rolling blackouts because the natural gas plant that we were counting on failed, and so we’d like to pay you to basically save the grid.”

We’re in this situation where that technology works today, and when we’re in our rocking chairs in 2050, everyone will have them. They will be ubiquitous. And our children will say, “Well, duh, like, obviously.”

TH: When I talk to older utility guys, they kind of roll their eyes at the vehicle-to-grid idea and say, “Okay, well, tell me where that’s actually happening.”

JS: It’s happening at complete scale in the United Kingdom. It’s at a point where Octopus Energy is giving people free power on a regular basis to charge their electric vehicles. Because there’s a lot of excess wind and solar during certain times of the day. Remember, 90% of everything we need to do with the grid with electric vehicles can be done with managed charging, what they call V1G. Then there’s another 8% of what can be done with vehicle-to-home, where you never export back into the grid, you just take the home off-grid. So we could get 98% of the value without updating any of our standards that are in place now.

The 2026 Global 100 list puts speed in the spotlight

TH: Do you think geopolitically, has China sort of got themselves in a dominant spot that’s going to be pretty significant for this next century?

JS: China has clearly overplayed their hand. I think they don’t know it yet, but they have. Xi Jinping has been in power too long. And now he’s pissed off everybody. He’s pissed off India, Turkey, Malaysia, Vietnam – anyone who manufactures stuff, he’s pissed off all of them. So now the question becomes how long can they continue to lose money?

Remember, we have many more iterations of technology that you and I know about. Like, solar panels are not done, right? We got perovskites and other things that are coming in. Electric vehicles are not done. We have technologies in the queue that’ll double the energy density of lithium-ion batteries. We have no reason to share any of that technology with China now.

So when we decide not to share that technology with them and instead share it with India or Mexico or other places, we’ll see where it goes. Yes, it’s going to take us a solid 10-year effort to actually diversify the supply chain, which is exactly how long it took after the Arab oil embargo for us to diversify the supply chains for oil. We know how to do it. It’s a playbook. We’re executing on it now, and I think in 10 years’ time, we’re going to be quite a bit more diverse.

Toby Heaps is co-founder and publisher of Corporate Knights.

The post How to scale up the green economy appeared first on Corporate Knights.

Since I was a teenager, this has been my favourite quote. It hits home with the message that everything we do matters, and that, like the butterfly effect, you never know what mighty waves will rise from tiny ripples.

My second favourite quote served as the unofficial slogan for Robert F. Kennedy’s 1968 presidential campaign, borrowed from George Bernard Shaw: “Some men see things as they are and ask, ‘Why?’ I dream things that never were and ask, ‘Why not?’”

My third: If a tree falls in the forest and no one is around to hear it, does it make a sound?

These three quotes capture why the Global 100 exists: to amplify the ripples, to show what is possible, and to ensure the sound is heard.

The journey started 25 years ago when I knocked on the door of sustainability research pioneer Michael Jantzi (founder of what became Morningstar Sustainalytics) to see if he would help us produce our first ranking of Canada’s best corporate citizens. He agreed, and as a token of gratitude – after we published the ranking in Canada’s largest business newspaper – I gave him a framed copy with a plaque that read “You measure, we publish, they change.”

In 2005, we launched the Global 100 in partnership with Innovest Strategic Value Advisors (which later became MSCI ESG), founded by the visionary genius Matthew Kiernan. By necessity – and because of the sorry state of disclosure – those early rankings violated almost every tenet of a meaningful benchmark, except one. While they did rely on opaque black-box methodologies measuring supposedly hundreds of indicators, there was a shared purity of intention among our early collaborators: identify the 100 large companies from around the world, across sectors, doing the most to move the needle toward a more sustainable world where people can thrive in tandem with the planet.

By 2010, we brought the research in-house and made the methodology 100% transparent. This became a core tenet of our approach and a litmus test whereby anyone could replicate our results. As Don Lindsay, former CEO of Teck Resources, put it, “We like the Global 100 because it is clear why we are in or out and what we need to do.”

Disclosure limitations initially constrained us to measuring operational aspects of companies like emissions, taxes paid and board diversity. While these things all matter, the vagaries of voluntary disclosure meant we were often penalizing the best reporters, and on a bigger-picture scale we were missing what mattered most: the portion of a company’s core business that actually moves the world in a more sustainable direction.

In 2018, we came up with a rules-based industry-by-industry definition of sustainability and introduced the clean revenue indicator that measured what portion of a company’s revenue was sustainable. This evolved into sustainable revenues, then sustainable investment and aligned compensation.

The 2026 Global 100 list puts speed in the spotlight

This year, after passing 27 red-flag basic exclusionary hurdles (including board diversity and taxes paid), the Global 100 ranking is now 100% based on the portion of a business that makes the world more sustainable. We’re not abandoning operational impact – rather we’re doubling down on a more powerful measure. Much of the operational impact we once struggled to measure is now captured in our publicly available Corporate Knights Sustainable Economy Taxonomy, which clearly defines what is sustainable in each industry and is updated with further texture each year.

For more than two decades, we have stayed the course in our quest to help companies embrace the sustainability revolution. All along the way, we have been guided by three core principles:

1. Pure intention. This is our north star.
2. Focus on what matters most. Less is often more.
3. Radical transparency. This way, others can trust but verify our work.

Guided by our principles, we made the tough decision to let go of roughly 25 key performance indicators to focus on just four metrics: the portion of revenues and investment that are sustainable, how fast sustainable revenues are growing, and what percent of CEO compensation is linked to sustainability.

Since the founding of the Global 100 ranking, we have invested countless hours collecting data on all those different metrics, trying to get the angel in the detail right and defending the indicators in our ranking formula. The decision to simplify and refocus the ranking on our core mission did feel in part like a loss, but it puts us in a better place to weed out noise and tap into the signal to serve our core purpose of highlighting the business beacons for a more sustainable world.

We’re honoured to present this year’s Global 100 companies. These organizations show what kind of world is possible, sending out fast-growing ripples that give us a chance to rise to meet the mighty challenges of our time.

Toby Heaps is co-founder and publisher of Corporate Knights. 

The post Publisher’s Note: Doubling down on impact appeared first on Corporate Knights.

For the past few summers, however, hostile forces have launched a relentless assault on Canada – setting forests ablaze and forcing hundreds of thousands of Canadians from their homes. Across the country, millions choked on acrid smoke. In just three years, this enemy has burned an area nearly half the size of Alberta, leaving behind charred landscapes and shattered communities.

That enemy is wildfires. Once part of nature’s regeneration cycle, they are now four times more destructive than they used to be, driven by hotter, drier conditions. Megafires of this scale are the new normal. While wildfires are inevitable, the scale of the damage is not. Our inaction has made the crisis far worse than it needs to be.

If these attacks had been made by a foreign adversary, we would be operating at “DEFCON 1,” deploying every resource at our disposal. Yet even though nearly 8% of Canada’s forests have burned in just three years, progress has been slowed by fragmented jurisdictions, small step increases in funding and piecemeal measures – challenges that governments and agencies have long struggled to overcome.

Investing billions now could prevent tens of billions in losses later, while sparing Canadians the worst human and health impacts.

– Toby Heaps, publisher and CEO, Corporate Knights

Meanwhile, Canadians endure record displacement: 352,000 people forced from their homes across 2023, 2024 and 2025. In 2023 alone, 98% of Canadians experienced at least one day of smoke-filled air. South of the border, more than 100 million Americans were placed under air-quality alerts in 2023, and more than 80 million in 2025 – alerts driven primarily by smoke from Canadian fires.

This is not just a domestic emergency; it is a continental one, arriving at a sensitive moment in Canada–U.S. relations. Republican lawmakers and Trump allies are already voicing anger over the smoke from Canadian wildfires that has blanketed U.S. cities, and they are unlikely to stay quiet while tens of millions of Americans suffer through air-quality alerts traced directly to Canada’s inaction.

Core defence capabilities

Make no mistake: this is a security threat of the highest order. It is national defence. NATO’s agreed definition of defence expenditure – published by its defence expenditure division – is the standard by which all allies report. Under the new framework, members must reach 5% of gross domestic product by 2035, with 3.5% allocated to core defence requirements such as personnel, operations, equipment, research and development, and infrastructure, and up to 1.5% devoted to defence- and security-related investments in resilience and civil preparedness. Not surprisingly, these big new buckets of money are already inspiring many claims – including plenty of creative accounting.

But wildfire-readiness assets – if owned and operated by the Canadian Armed Forces (CAF) – can be credibly structured as core defence capabilities. Satellites and drones directly serve military needs in surveillance, reconnaissance and Arctic sovereignty operations. Water bombers, while deployed in summer fire seasons, can be structured as CAF assets for year-round training, logistics and Arctic readiness. Surge personnel trained under CAF operational control strengthen national readiness by providing deployable capacity.

RELATED

Canadian groups call for dramatic increase to wildfire defence funding

Massive wildfires are forcing governments worldwide to budget more for disaster

Canada should include climate solutions in its defence spending

In practice, these assets could remain military-owned and under CAF command but be made available to provinces through formal support arrangements during fire season. Because wildfire deployments are limited to a short season, these assets remain available to serve military needs – from surveillance and sovereignty to training and logistics – for most of the year, making them credible candidates for classification as core defence expenditure under NATO’s rules.

Canada’s fire-management agencies work tirelessly under immense pressure, but the scale and intensity of today’s fires routinely push even their best efforts to the breaking point. They need stronger national backing to match the new reality.

Invest in prevention

This is not a call to reinvent the wheel. Ottawa has already funded programs like FireSmart, the Wildfire Resilient Futures Initiative and the Wildfire Resilience Consortium of Canada. Prevention – through fuel management, prescribed burns and Indigenous-led stewardship – remains essential. But prevention cannot substitute for suppression. The brutal reality is that Canada simply lacks the surge capacity needed when fire seasons escalate to “all hands on deck,” as they now do almost every year.

This summer, the national preparedness level was stuck at Level 5 – the highest – for virtually the entire season, with only a few days of relief. That meant every available resource was already committed. When new fires erupted, there was nothing left to send. That gap between what we have and what we need is the true measure of our vulnerability.

Canada’s wildfire crisis is measured not only in scorched forests and evacuations: annual suppression costs now exceed $1 billion, and over the past five years wildfires have caused more than an estimated $30 billion in economic damages, from destroyed homes and shuttered businesses to health impacts from smoke. A small fraction of fires – about 3% – cause nearly all of the destruction. Research shows that with better surveillance, faster response and targeted prevention, damages could be reduced by as much as 78%. Closing that gap requires federal leadership and serious investment.

That is why a diverse group of credible national organizations – including the Canadian Association of Fire Chiefs, the Council for Clean Capitalism, Ducks Unlimited Canada, the Mining Association of Canada, Nature Canada, World Wildlife Fund Canada and Protect Our Winters Canada – is calling for a federal investment of $4.1 billion over five years to build a dedicated aerial firefighting fleet, expand satellite and drone surveillance, and train thousands of additional firefighters to provide the surge capacity Canada now lacks. Put simply: investing billions now could prevent tens of billions in losses later while sparing Canadians the worst human and health impacts.

Canada is on fire. We need a firefighting surge capacity – funded, trained and ready to deploy – because our current system is being stretched beyond capacity. The question is no longer whether we can afford it. The question is whether we can afford not to.

Let’s not wait until we can no longer see the forest because the trees are all gone.

Toby Heaps is co-founder and publisher of Corporate Knights.

The post Canada is under attack by wildfires. It’s time to respond like it’s national defence. appeared first on Corporate Knights.

The convergence of this moment and your leadership gives us a rare chance to break free from the status quo. We cannot let this golden opportunity to make Canada a beacon for the world slip through our fingers. 

Like a championship hockey team, Team Canada Inc. has all the right ingredients – talent, capital and resources – to win big on the global stage. 

As Canada’s head coach, we’re counting on you to channel the wisdom and boldness of our hockey legends, making the tough calls so we can finally deliver on Sir Wilfrid Laurier’s century-old promise that the 20th century would be the century of Canada. That can be true for the century we’re in now, if we avoid getting stuck in the past with outdated technology. 

Where do we play? Fossil fuels are fading, even as their lobbyists grow louder, while clean industries — renewable energy, regenerative agriculture, clean AI, electrification and modular construction – are rising with unstoppable momentum.

In electro-economics, the more you build, the cheaper it gets; in petro-economics, the more you extract, the higher the cost. Do we invest in the future or cling to the past? Like the Great One, we need to skate to where the puck is going. 

Who do we play with? Will we keep relying on a single, increasingly unreliable trading partner for three-quarters of our exports? Or will we reach for opportunity by diversifying with traditional allies and markets like China and India, where nearly 40% of global growth will occur by 2050? It’s time for some bold deal-making to set up more productive games with our rivals in the spirit of Alan Eagleson’s 1972 hockey Summit Series between Canada and the Soviet Union. 

Who owns Team Canada Inc.? Do we settle for branch-plant status and domestic oligopolies, or do we become masters in our own house – with an inclusive wealth fund, stronger support for co-ops and employee ownership, and a strategy to scale Canadian champions? Denmark, with just six million people, is home to global leaders in cleantech, shipping, beer and pharma. We’re not too small or too poor – our AAA credit rating and $14 trillion in institutional capital say otherwise. Let’s play with our elbows up like the legendary Gordie Howe. 

How do we stop scoring on ourselves? Our slow-moving bureaucracy and risk aversion have stalled $89 billion in clean economy funds and cost us billions more in trade barriers, red tape, wildfires and fragmented energy systems. It’s time to move fast, break the right things and unite as one economy – not 13 – while ensuring that Indigenous communities have real equity in our future. We can’t afford to put Steve Smith (who scored the most infamous goal on his own net in the 1986 Smythe Division final) on the ice.  

How do we keep our skills sharp? Denmark invests 1.7% of GDP in active labour market policies – six times more than Canada – helping workers retool for the jobs of tomorrow. The Organisation for Economic Co-operation and Development puts us near the bottom of advanced economies. Are we ready to invest in our people and win, just as Scotty Bowman always did with his teams? 

Let’s seize this chance and play to win – because the 21st century can still be Canada’s century, if we have the courage to skate hard to where the puck is going, pass boldly and shoot for the stars.

Toby Heaps is co-founder and publisher of Corporate Knights. 

The post Publisher’s Note: Canada needs to play to win appeared first on Corporate Knights.

If we don’t get to a much stronger place soon, we may cease to be a nation-state at all.

We’ve long been aware of the risks of the elephant next door. We have risen to the challenge when called for, before and after Confederation. 

When the United States invaded Upper Canada in 1812, under the leadership of British Major-General Robert Ross, we literally ate their dinner (President Madison fled, leaving an untouched feast) and burned the White House down.

The boldest play we can make is to forge a soup-to-nuts clean energy superpower, from critical minerals and batteries to smart grids, financial wizardry and engineering know-how.

After Confederation, to unite Canada and thwart U.S. expansionism, Sir John A. Macdonald, along with a team of builders and financial wizards, led the most consequential nation-building project in our history, pounding in the last spike of the 4,700-kilometre Canadian Pacific Railway in 1885.

The elephant and the polar bear

Here we are in 2025 with the elephant trumpeting again. Trudeau Sr. likened us to a mouse in this dynamic, but by relative weight – and I hope attitude – we are more of a polar bear. What would a polar bear do? According to Inuit lore, polar bears are seen as powerful spiritual beings embodying strength, resilience and adaptability. A polar bear knows the full meaning of “We the North,” and a polar bear never rolls over (unless it’s playing or cleaning itself). 

How do we build a stronger Canada? It starts with a stronger economy.

We can take inspiration from some of our winter sport heroes. We need to “skate to where the puck is going.” That means investing where fortunes are rising, not falling. With apologies to Harold Innis, the famed political economist, hewing wood and drawing water (and, soon, drilling for oil ) is not where the money is. The clean energy economy is the locomotive for 21st-century growth. As measured by Corporate Knights and others, it is growing twice as fast as the rest of the economy and is now the dominant driver of economic growth across sectors and the world. 

The boldest play we can make is to forge a soup-to-nuts clean energy superpower, from critical minerals and batteries to smart grids, financial wizardry and engineering know-how. 

We have all the ingredients to do this. The only thing missing is leadership.

We have a need for speed

It’s one thing to say we are going to be a clean energy superpower; it’s quite another to make it happen. The goons from the status quo industries have been going into the corner and coming out with the puck for a long time: case in point, 10 years after Trudeau was elected on a promise to price pollution, the biggest oil companies are still polluting for free. That’s why we need to keep our elbows up, to make sure we don’t lose the puck.

Markets and geopolitics are moving too fast for us to go slow. No time for Royal commissions or expert panels. We have a need for speed. Like the masters of metamorphosis featured on p. 32, we need to dare to push the limits of what is possible, faster than we have ever gone before. 

In the spirit of friendlier times with our neighbour, we can take a page out of Franklin D. Roosevelt’s first 100 days, where he passed 15 major bills and delinked the dollar from the gold standard, laying the way for major public investments (in the order of 6% of GDP for six years) that saved the United States from the Depression. 

Let us hope the next leader of our land brings the resilient spirit of a polar bear, the vision of the Great One (on the ice, not off), the sharp elbows of Mr. Hockey and the daring speed of the Crazy Canucks. Mix all that with a little financial wizardry, and we will make magic happen.

Toby Heaps is the co-founder, publisher and CEO of Corporate Knights. 

The post Publisher’s Note: Canada’s next leader must skate to where the puck is going appeared first on Corporate Knights.

There is much evidence to justify this sentiment. Case in point: his pick for energy secretary, oil wildcatter Chris Wright, said last year, “There is no climate crisis, and we’re not in the midst of an energy transition, either.” But what if a different outcome is possible?

To explore this question in a clear-eyed way, two things matter: how much can a president tip the scale on climate solutions, and in which direction will it tip?

Let’s follow the money: the United States accounts for 15% of global investments in climate solutions, so 85% of the action is elsewhere (mostly China).

Download research brief from Corporate Knights: Sustainability transition gains momentum

Also, don’t forget that while the executive branch of the U.S. government can be a powerful bully pulpit, there are other influential actors, including the private sector, state and local governments, and civil society.

It’s also worth reviewing Trump 1.0.

Despite Trump’s promises to “bring back coal,” a record 50 coal plants were shuttered during his first term, plus another 51 announcements of closures as the economics of coal went into the toilet.

In terms of U.S. energy investments, green energy and fossil fuels ballooned across the board during Biden’s presidency, but green energy as a proportion of total energy investments were not that much different than in Trump’s time (55% versus 51% in each of their last years in office).

President Trump 2.0 is not a blanket negative and could be an inadvertent net positive on the sway he holds over the world’s march toward a climate solutions economy.

  – Toby Heaps, Publisher, Corporate Knights

Many people still believe that the primary factors driving demand for green power and electric cars are politically driven subsidies, but that is no longer the case. Economic logic is now the primary driver. Green power and electric cars have become a lot cheaper to the point where they are now better bargains than their fossil fuel counterparts – without subsidies. Solar and wind combined with battery power are now cheaper than fossil fuels in most cases.

Despite all the market imperfections, for every $1 invested in fossil fuels globally, $2 is now invested in clean energy, while electric or hybrid cars now account for more than half of new cars sold in China.

Three factors that matter most to climate solutions

There are a few important elements to keep in mind when evaluating the potential impact of Trump’s presidency.

1. Red tape: 2,500 gigawatts of green energy in the United States is in limbo waiting for grid connection permits, roughly double the entire installed electricity capacity.

2. Interest rates: They represent up to 40% of renewable energy costs when rates are high.

3. Oil prices: When the price of oil goes up, it increases the earnings, economic clout and political power of oil and gas companies.

In other words, if you have less red tape to tangle up green energy projects, lower costs of capital and lower oil prices (so big oil has less cash in its jeans to tip the political scales), then you get more climate solutions deployed.

And there is a wild card this time: Elon Musk, who recently reiterated his long-standing mission to achieve national and individual energy independence underpinned by a vertically integrated sustainable-energy ecosystem.

Three factors that may work in favour of clean power

Trump’s impact on renewables won’t be all negative, for several reasons:

1. Musk’s new role in the White House overseeing a vast deregulation agenda will not be all bad news for the environment. Fossil fuel projects will be green-lit faster, but renewables will benefit too, and we already know they have the cost-competitiveness to be market winners.

2. Trump loves low interest rates (and he is happy to twist the Fed’s arm as required) because they buoy stock markets (potential inflationary effects of tariffs be damned).

3. Trump’s obsession with cheap gas contributed to cutting the valuation of oil and gas companies in half during his first term, a stark contrast to the 100% increase we saw during Biden’s presidency.

Bottom line for climate action: president Trump 2.0 is not a blanket negative and could be an inadvertent net positive on the sway he holds over the world’s march toward a climate solutions economy.

If you believe in economic logic, the takeaway is that the right time to go all in on the energy transition was yesterday. The second-best time is now, and that’s true no matter who’s president of the United States.

Toby Heaps is co-founder and publisher of Corporate Knights. 

The post Trump 2.0 could have some unintended upsides for the energy transition appeared first on Corporate Knights.

It was a sunny Saturday, and my co-adventurer and I had paddled through the shimmering waters of Georgian Bay and landed on the distant Beckwith Island, home to beautiful sand beaches on Lake Huron. I had glanced at the weather, noting that a lightning storm was expected to roll in the next day (which we had planned to avoid), but I neglected to check the prevailing wind currents.

Around 4 a.m., I awoke to 50-kilometre-per-hour winds battering the tent and quickly pulled up the wind charts on my trusty BlackBerry. To my dismay, the high winds would hold steady for the next 48 hours.

This was a bit of a problem. I needed to be back in Toronto to present our latest sustainable investment research to attendees at a summit hosted by the Principles for Responsible Investment, whose signatories manage US$121 trillion in assets. 

We tried calling a water taxi, but none were seaworthy in the high winds. So we called members of the Beausoleil First Nation, on whose territory we were trespassing (albeit lightly and with great awe). Sue, who runs the Bayshore Variety, Video & Restaurant on Christian Island, answered the phone and said to give her 10 minutes. Constable Elijah from the Anishinabek Police Service quickly called me back. I confessed our trespasses, but her focus was getting us to safety. A half hour later, a large sturdy Ontario Provincial Police ship motored into the bay to ferry us back to the mainland.

It hit home that we are all in this together, and the human instinct when someone is in harm’s way is to help.

We are all in harm’s way when it comes to the floods, fires and sweltering heat brought by extreme climate change. People, governments and businesses are doing more than we tend to appreciate to get us out of this climate conundrum – which is why more than twice as much clean energy was added to the global mix the past few years compared to conventional energy.

But it isn’t fast enough.

Just like I got distracted by the lightning storm and failed to take note of the prevailing wind patterns, as a society we pay too much attention to the storms and flashes of the political economy, unaware of the prevailing winds of the real economy.

Let’s be clear here: the sustainable clean energy economy is experiencing exponential growth. It is going parabolic because most clean technology options are superior and only getting better.

Corporate Knights data shows that for the large companies that make up 80% of global market capitalization, sustainable revenues and capital expenditures are growing more than twice as fast as everything else over the past five years. This trend holds across sectors and regions and puts the sustainable economy on a path to dominate the global economy by the end of the next decade.

People bay at the moon for political leadership, but it didn’t seem to matter who was president of the United States the past eight years when it comes to this sector. Oil and gas continued to rise under both administrations, yes, but there was no stopping the clean economy, regardless of rhetoric at the top. Clean energy investment surged under Trump and Biden, comprising the bulk of all energy investment under both guys in each of their last years in office, according to data from Clean Investment Monitor and the International Energy Agency’s World Energy Investment. 

While the die is cast on the direction of travel of our global economy, we can speed it up.

Rather than climate transition plans, we need economic transition plans focused on the high-growth areas of our economy – and the climate solutions (the highest-growth part of the economy) will come along for the ride. The main business association in Europe (BusinessEurope) recently embraced this logic, as did the Business Council of Australia a few years ago.

These business associations have critical roles to play in setting the parameters for what is seen as politically possible, and both the U.S. and Canada would do well to get on board.

Roughly 150 countries have set a goal for net-zero, and this target is now backed by financial players representing $150 trillion in combined assets (a 30-fold increase over the past four years). Paraphrasing former governor of the Bank of Canada Mark Carney, when society sets a clear goal and technology makes it possible, it becomes increasingly profitable to become part of the solution and increasingly costly to be part of the problem.

That’s where we are right now. If we want to deploy these climate solutions to power and move our economies, there are some basic things we need to do.

Number one: stop gridlocking renewable-energy potential by updating energy-regulator mandates to focus on rapid permitting and shortening the grid-connection queue. According to the IEA, 1,650 gigawatts (more than double the 666 GW added this year) of clean energy capacity in advanced development stages is waiting for grid connections.

Number two: stop allowing incumbents from the fossil fuel sector (including those with vested interest in dragging out the decline of the internal combustion engine economy) to weaponize our fears about losing jobs (subsidized to the tune of $10 million per job) to China, delaying inevitable balance-sheet write-downs. It does not serve our interest to make trade in low-carbon goods and services a political football.

Number three: start spending more public money now. While the private sector will provide the dominant supply of capital in the latter half of the race to net-zero by 2050, publicly sourced money will be necessary to close the climate investment gap (which sits around 5% of GDP) between now and 2030.

With technology on our side, staying in touch with the prevailing economic winds, and the public purse to help us through choppy waters, blue skies are ahead.

Toby Heaps is co-founder and publisher of Corporate Knights. 

The post Publisher’s Note: Harnessing high winds in times of urgent action appeared first on Corporate Knights.

Affordable electric vehicles that are made in China could open up the Canadian EV market to millions of middle-class families.

But the news comes at a fraught time. Following a similar move by the United States, the Canadian government is considering punitive tariffs on Chinese EVs, with the consultation period August 1.

Such tariffs would be a mistake. Chinese EVs should be accepted for sale in Canada without the tariffs, as long as they meet Canadian standards and are made by companies that do not employ forced labour in their supply chains.

Every year, Canadians buy more than 1.5 million new cars, most of them from foreign countries, and some of them made in China.

Canadian households want and need affordable electric vehicles, sooner rather than later. And reasonably affordable Chinese electric sedans and mid-sized crossovers are available for export to Canada now.

The charged debate over whether to deny Canadians access to affordable Chinese EVs is triggering claims that without a high tariff, China would flood the market and put Canadian auto workers out of work.

But those risks are being exaggerated. Nearly 90 per cent of the cars assembled by Canadian auto workers are exported, and that’s still going to be the case for EVs.

While it’s realistic to expect some job losses among Canadian auto workers from more imports of affordable Chinese EVs, they would be minimal, on the order of 2 per cent. And more importantly, there would also be jobs created.

If Chinese EVs grew to 20 per cent of new car sales over the next five years, by 2030 it would save the families that bought the vehicles $9-billion in fuel and maintenance costs. The money would recirculate in local economies, generate more than $1.5-billion in revenue for Canadian utilities and eliminate 12 million tonnes of greenhouse gas emissions. Even under a wide range of assumptions, the net effect would be more wealth circulating in the Canadian economy.

There is not much risk that Chinese EVs will “flood the market,” as tariff proponents claim. Chinese automakers are more interested in margin than market share. In Australia, Europe and other markets, they’re pricing their products competitively.

The arrival of Chinese EVs into Canada would make it an affordable option for families looking for a new car for $35,000 to $45,000. Otherwise, they will have to turn to a combustion vehicle that would lock in poorer performance, higher fuel and maintenance costs, air pollution and greenhouse gas emissions that would persist well into the 2030s.

RELATED:

• Electrifying driving in Canada will cost just 10% more than what we already spend
• Want to make EVs more accessible? Share them
• GREEN house effect: Calculate the savings from electrifying your home

The risk of opening a back door to the U.S. market by allowing cars made in China to be sold in Canada is a red herring. It would be easy for the United States to apply its tariffs on any Chinese-made vehicles (using the vehicle identification number) trying to cross the border for sale.

And with regard to any Chinese-made batteries or parts short of a fully assembled vehicle, it would be relatively straightforward for Canada to apply surgical tariffs on these parts to stay onside with the United States-Mexico-Canada Agreement, without preventing Canadian consumers from purchasing affordable EVs.

It’s true that China’s electricity supply used to make EVs is dirtier than North America’s, but the pollution the EVs save during their lifetime far outweighs that disadvantage.

The charge that Chinese cars are made with forced labour must be taken seriously. It is already illegal to import products tainted with forced labour, although Canada has yet to stop any Chinese products from entering the country under this law. In any case, this law should be enforced at the individual company level, rather than by a tariff that would shut out any Chinese-made EV, including those made in China by Western carmakers like Tesla, Honda and General Motors.

The switch to electric cars and trucks is accelerating exponentially around the world, and EV supply chains are routinely subsidized by governments, nowhere with greater vigour than in Canada. Allowing Chinese-made EVs into Canada will broaden the market for EVs, help bring the country to the forefront of an economic megatrend, and spur competition.

The electricity needed to charge those cars will generate cash flow for Canadian utilities, helping them prepare for the growing role of electricity in our energy system. More EVs will also increase the pressure on apartment building owners, condominium corporations and municipalities to build out the charging infrastructure that we need.

From time to time, an issue comes along where Canada’s interests do not align with those of the United States,’ and where asserting an independent Canadian policy is warranted. This is one of those times. Let them in.

This piece was first published in The Globe and Mail. 

Toby A.A. Heaps is CEO of Corporate Knights and Ralph Torrie is the Director of Research at Corporate Knights.

The post Canadians want EVs they can afford – China has them. Let them in. appeared first on Corporate Knights.

Like many in the environmental movement, I long thought of political conservatives as a nemesis for the environment. I came by this association honestly: from my grandfather, who co-founded the Co-operative Commonwealth Federation, the predecessor to the left-leaning NDP, to my mother, who once told me that if we elected the Progressive Conservatives in the 1988 federal election, they would chop down all our trees. 

Later, however, after I co-founded Corporate Knights magazine and launched a survey, asking leading environmentalists who had been the greenest Canadian prime minister and U.S. president in history, I was surprised that on both counts, conservative leaders won the green star: Brian Mulroney and Theodore Roosevelt. I remember how moved Mulroney was, when I contacted him to inform him of this recognition from what were normally hostile quarters (reportedly, he considered his “Greenest Prime Minister in Canadian History” award as his most cherished honorific). I was also moved by how prominent environmentalists, including David Suzuki and Elizabeth May, took to the airwaves when Mulroney was crowned the greenest PM, free of any enmity for him, to celebrate the genuinely good things he had done on acid rain and for the ozone layer. It was a nice example of love triumphing over hate.

If there is one thing we know, it is that the environment cannot be a political football. It has to be a trans-partisan issue in which every party and leader can imagine themselves as heroes, especially now in these times that require heroic and sustained climate action.

My old boss Ralph Nader formed the Critical Mass Energy Project in 1974 as a national anti-nuclear umbrella group, which was largely successful in stopping the expansion of nuclear power. Many environmentalists oppose nuclear energy because of the radioactive waste that sticks around for thousands of years. I was always skeptical about nuclear power because of the high costs (due in part to a web of regulatory requirements), but I was also rankled by how the nuclear lobby dismissed renewables. While I still don’t think building new nuclear is the way to go (it takes too long and costs too much), I am in favour of extending and keeping existing emissions-free nuclear online (see Eugene Ellmen’s exploration of the topic).

Many people were involved in the creation of Canada’s carbon tax, including myself. I co-authored a $100-billion carbon tax plan in 2007 launched alongside members of Parliament from three of Canada’s four national parties (guess who was missing), which almost immediately inspired John Baird, then the Conservative environment minister, to coin the attack line “a tax on everything.” Later, at a meeting of decision-makers in Winnipeg, I put forward the idea for a made-in-Canada carbon tax where the money stayed in the provinces, which was welcomed by Gerald Butts, the future principal secretary to the current Liberal prime minister, as “bad policy but good politics” and in 2018 became the law of the land.

Unfortunately, the carbon tax (as our director of research notes) is tailor-made for dividing people, which certain politicians (not just conservative) have gone to town on. And many of the biggest polluters managed to insert fine print that exempted them from paying much at all. It’s little wonder that many big polluters, from Exxon to Suncor, supported a carbon tax, and environmentalists were slow to appreciate this. Although it seemed like a wonderful idea to many political stripes at the time, the love affair with the carbon tax has not panned out, partly because it is individualist and punitive in nature and does not tap into the cooperative “build it together” spirit that is required to lay out the solutions to power a climate-friendly civilization. 

Not all shibboleths are long-held. Some are being formed as we speak, as the meat-industry lobby foments the belief that plant-based foods are too processed and expensive to be an effective climate solution. More on that in our “plant power” package.

For the sake of the planet, it’s time for all of us to shed the shibboleths that no longer serve the higher good, to come together in protecting the only home we have from spiralling into climate chaos. 

Rather than ostracizing, demonizing or lionizing, the path forward for climate action can be more inclusive, open-minded and clear-eyed, but focused on the practical nuts and bolts and love of the future we can build together.

Toby Heaps is the co-founder and publisher of Corporate Knights.

The post Publisher’s Note: The times call for heroic climate action – and shedding long-held beliefs appeared first on Corporate Knights.

In particular, the budget, released Tuesday, failed to clarify how the government plans to make up for its $14-billion climate funding shortfall – the gap that Corporate Knights has identified between federal commitments and funds disbursed as of the end of fiscal year 2024.  

While the federal government didn’t trumpet climate as a priority in its main communications about the budget, new climate funding over the next 10 years was the single largest spending increase in the budget, with a total of $14.2 billion in new climate funding commitments through 2035, according to calculations by Corporate Knights.  Two-thirds of that climate funding is via clean-economy tax credits meant to expire by 2035, while most new spending items are fanned out over the next five years.

The federal government has upped the ante on its running tally of climate funding commitments from 2015 through 2035, from more than $120 billion in Budget 2023 to more than $160 billion in Budget 2024. (While $40 billion in climate spending has been announced this year, only $14.2 billion of that was new in this budget.) But Budget 2024 reissued the same drawn-out timeline for the five climate-investment tax credits that were announced last year. And most of the new spending is backloaded into future years, with less than $1 billion flowing in 2024 to close Canada’s climate funding gap.  

When it released the 2022 budget, the federal government estimated the overall climate funding gap in Canada to be up to $125 billion per year. Over the next 10 years, planned federal climate investment averages $15 billion per year, mostly in the form of investment tax credits. 

This leaves a gaping hole of up to $110 billion a year, which the federal government along with other levels of government and the private sector will need to fill if Canada is going to meet its climate commitments and seize upon clean-economy growth opportunities.  

The federal government expects investments and tax credits for carbon capture, utilization and storage and clean technology to receive royal assent by June (six months after they were introduced in Parliament). It also plans to introduce legislation for the other previously announced tax credits for clean hydrogen, clean technology manufacturing and clean electricity this fall. The government plans to introduce a sixth climate-investment tax credit announced in this budget, called the Electric Vehicle Supply Chain Investment Tax Credit, in 2025. 

The government now estimates that its suite of climate-investment tax credits is worth up to $93 billion, up from $80 billion in Budget 2023. Normalized to gross domestic product, this would translate to about $1 trillion in the U.S., on par with the higher end of clean-economy funding the U.S. Inflation Reduction Act will provide.  

Considering that the lion’s share of the federal government’s planned climate funding over the next decade is via tax credits, it is concerning that none of the government’s six clean-economy tax credits worth $93 billion has yet been passed into law. 

But the government’s current timeline indicates that the most recently announced tax credit for EV supply chains may not be passed into law until after the next federal election. As the United States showed with the Inflation Reduction Act (with total climate spending ranging from $369 billion to $1.2 trillion), targeting clean-economy growth through more straightforward tax rebates tied to actual clean-economy outputs (such as kilograms produced of clean hydrogen), it is possible to move much faster with larger sums of money.  

 The federal budget’s running tally of climate funding commitments through 2035 leapt by almost $40 billion over the past year to $160 billion.

The post Climate was biggest winner in 2024 budget, but climate funding gap persists appeared first on Corporate Knights.