In the legislated policy scenario presented on the Canada Energy Dashboard (federal and provincial policies legislated as of January 2023), Canada’s economy grows at an average annual rate of 1.77-1.90% from 2020 to 2050. In all net zero scenarios, this growth rate is lower, but still positive.
In all 216 net zero futures presented on the Canada Energy Dashboard, Canada’s economy continues to grow annually out to 2050, while achieving the goal of net zero emissions.
The average annual growth rate ranges across net zero scenarios from 1.00-1.84% from 2020-2050. The low end of this range represents a net zero future where low carbon technologies including solar, wind, batteries, carbon capture and storage, and hydrogen are high cost, there is low availability of emissions offsets, including no commercial deployment of direct air capture, and there is low global demand for Canadian oil. The upper end of this range is a more technology-optimistic scenario, in which the cost of these low carbon technologies comes down, direct air capture technology becomes commercially available, and global demand for Canadian oil remains consistent with current demand.
Some sectors in Canada’s economy experience significant investment and grow at a greater rate in a net zero future.
Looking at total economic growth rates masks longer term structural changes that are occurring within Canada’s economy in a net zero future. For example, the “low carbon economy” booms in response to net zero (where the “low carbon” economy is defined here as technologies, services and resources that increase renewable energy supply, enhance energy productivity, or improve infrastructure and systems that transmit, store and use energy while reducing emissions).
The low carbon economy grows at a rate of 5.2-7.6% from 2020 to 2050 across net zero scenarios, with cumulative investment in these sectors, such as renewable electricity, electric vehicles, low carbon fuels and carbon capture technologies amounting to $2.1-3.3 trillion (CAD 2015) between now and 2050 in response to net zero policy.
This highlights a significant opportunity for growth in sectors that are aligned with Canada’s 2050 goal as our economy transitions to achieve net zero emissions.