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How Canada Performs > Hot Topics > Environment
Canada’s environmental performance has improved in some areas and deteriorated in others. Some progress has been achieved in the areas of air quality, natural resources management, and energy efficiency. But Canada must do more to lower greenhouse gas (GHG) emissions, to use its freshwater resources more wisely, and to reduce waste—all in an economically feasible way.
The amount of municipal waste generated per capita in Canada has increased steadily over the past few decades, from 510 kg in 1980 to 894 kg in 2007—well above the OECD average. Canada must reduce the amount of solid waste generated and divert more of it from landfills through recycling and other initiatives.
Likewise, Canada’s greenhouse gas emissions per capita increased by 3.2 per cent between 1990 and 2008. Total annual GHG emissions in Canada rose 24 per cent over that period. Although total annual GHG emissions have stabilized in the last few years, emissions continue to rise in some key sectors, including road transportation, mining, and oil and gas extraction. Canada has set an ambitious reduction target for 2020. Canadians therefore need to get aligned—quickly—on a coordinated national action plan to reduce GHG emissions.
Water consumption is also a key environmental issue. Sustainable water management helps maintain adequate water supplies for people and ecosystems. Canada’s water use per capita is over eight times higher than that of Denmark, the top performer for this indicator. Why? Two major reasons for Canada’s excessive use of water are inadequate water conservation practices and prices that are too low to encourage efficiency.
There are numerous examples of innovative strategies other countries are using to improve their environmental performance.
Japan, the U.K., and Sweden rank among the top-performing countries on GHG emissions per capita, earning an “A” grade for that indicator. Japan has significantly reduced GHG emissions from transportation, a sector that accounts for nearly one-fifth of the country’s total GHG emissions. The U.K. has set ambitious GHG reduction targets and has introduced a climate change levy to encourage energy-intensive industries to become more energy efficient. And Sweden is a global leader in developing effective and innovative environmental policy tools.
Japan ranks 1st and Finland ranks 3rd among the 17 peer countries on the municipal waste generation indicator. Japan has developed a broad approach to waste management in an effort to minimize its consumption of natural resources and reduce its environmental impact. Finland established a national waste plan in 1998 and recently set aggressive targets for reducing waste and increasing recycling rates by 2016.
Denmark is a star performer on the indicator for water consumption. Household water use has dropped dramatically since 1989 through the widespread adoption of water-saving devices, effective water metering policies, and cost-recovery pricing.
Japan ranks 5th out of 17 peer countries for GHG emissions per capita, earning an “A” grade. In 2008, Japan’s GHG emissions were 10.2 tonnes per capita—less than half that of Canada’s.
Over the past decade, Japan has made enormous progress in reducing GHG emissions generated by its transport sector, which accounts for nearly one-fifth of the country’s total emissions. Between 2000 and 2008, emissions from road and freight transport declined 12 per cent.1 Two of the policy drivers behind this accomplishment were aggressive fuel economy standards and tax incentives for purchasing fuel-efficient vehicles.
In 1998, Japan introduced its Top Runner Program, which set minimum energy efficiency standards for consumer products such as motor vehicles and home appliances. Under this program, gasoline-powered vehicles produced by Japanese automobile manufacturers were expected to improve their fuel economy 22.8 per cent by 2010 compared with 1995 levels, achieving a fuel efficiency of 15.1 km/litre. These targets were created with significant industry input, via the Japan Automobile Manufacturers Association.
Remarkably, the Japanese auto industry surpassed that target well in advance of the enforcement year, achieving an average fuel economy of 16.9 km/litre by 2008.2 This was achieved through technological improvements in engine and power train efficiency, better aerodynamics, and lower overall vehicle weights.3
Progressively higher fuel-efficiency targets have been set for 2015 and 2020, but the Japanese automobile industry does not expect to meet these targets through further advancements in conventional gas-powered vehicles. Instead, it expects strong growth in the use of alternative fuel and next-generation vehicles—such as hybrid, electric, and fuel cell vehicles—to help bridge the gap.4
The Japanese government also introduced a tax incentive in 2002 for purchasing fuel-efficient vehicles, which reduces the sales tax by up to 50 per cent, depending on the vehicle’s performance. This stimulated a rapid expansion in the market share of certified fuel-efficient vehicles, which grew from less than 20 per cent of all vehicles sold in Japan in 2000 to 80 per cent in 2003 and to 90 per cent by 2008.5
The Japanese government hopes to achieve similar results with the next generation of fuel-efficient vehicles. In 2008, Japan launched its “Action Plan for Achieving a Low-Carbon Society,” which includes a target for expanding the market share of next-generation vehicles from 2 per cent of new car sales to 50 per cent by 2020.6
The U.K. ranks 6th out of 17 peer countries for the lowest GHG emissions, at 10.23 tonnes per capita. The country has made remarkable progress in reducing its GHG emissions over the past two decades: in 2008, total annual GHG emissions were 18.5 per cent lower than in 1990, excluding emissions from land use, land use changes, and forestry (LULUCF).7
Much of this reduction can be attributed to a change in fuels used for power generation. Between 1990 and 1999, the share of electricity generated by emissions-intensive coal-fired plants fell from 65 per cent to 35 per cent, while the share generated by natural-gas-fired plants rose from virtually zero to 30 per cent. Consequently, emissions from the energy sector decreased more than 25 per cent.8
Still, the U.K. government set ambitious targets for reducing GHG emissions in its Climate Change Program, aiming to reduce annual emissions of CO2 by 20 per cent between 1990 and 2010.9 A key policy in the program is the Climate Change Levy, introduced in 2001 to encourage energy-intensive industries to become more energy efficient.
The levy is applied to businesses’ fuel and electricity bills, based on the quantity of energy delivered, at rates that differ according to energy content: the less efficient the energy source, the higher the levy. For example, electricity is the least efficient type of energy subject to the levy, and therefore has the highest tax rate, because much of the energy used to generate electricity is lost during combustion, transmission, and distribution. This end-user approach was chosen because it was viewed as having a lower impact on business competitiveness, while providing an opportunity for energy-intensive businesses to reduce their energy costs.
The U.K. government intended the levy to be revenue neutral, so it was offset by a reduction in employers’ National Insurance contributions. But because this reduction in payroll tax did not benefit all businesses equally, energy-intensive businesses were given the opportunity to receive a discount on the Climate Change Levy by entering into climate change agreements with the Department for Environment, Food and Rural Affairs (DEFRA). Under certain conditions, the agreements allowed businesses to receive an 80 per cent discount on the levy in return for setting and achieving reduction targets for GHG emissions or overall energy consumption. Total emissions targets were set for 2010, although participating businesses were obligated to meet performance milestones every two years to remain eligible for the program.
The Climate Change Levy and climate change agreements are less direct approaches for reducing CO2 emissions, and have been criticized for being less effective than other potential policy mechanisms. Still, by 2010, they were expected to have achieved annual savings of 5.4 million tonnes of GHG emissions generated by the business sector.10
Sweden ranks 1st out of 17 countries for the lowest GHG emissions per capita. In 2008, Sweden’s total annual GHG emissions were 12 per cent lower than in 1990, and 7 per cent lower than in 2000, excluding LULUCF.
There are a number of reasons why the country’s per capita GHG emissions are so much lower than those of other OECD countries. For example, more than half of the country’s primary energy use is derived from hydro and nuclear power (40 per cent) and biomass fuels (17 per cent), while crude oil and oil products account for about a third.11 Consequently, GHG emissions generated by the energy sector are lower in Sweden than in many other OECD countries.
Sweden is also a global leader in implementing effective and innovative environmental policy.12 One of the most significant policies is a carbon tax, first introduced in 1991 when Sweden restructured its energy tax system. By 1995, Sweden’s annual carbon dioxide emissions were 15 per cent lower than they would have been without the tax reforms, according to Swedish government estimates.13 However, the new tax system also provided tax reductions and exemptions for many industrial sectors, mitigating its overall impact and efficiency.
Since then, Sweden has adjusted and refined its environmental policy framework. In 2000, the Swedish government introduced a “green tax shift,” which raised taxes on CO2 emissions and other environmentally harmful activities, while reducing income and employment taxes.14
One of the positive outcomes of the country’s energy and carbon tax system has been a wide-scale shift away from the use of oil as a fuel for district heating plants to the use of biofuels produced from energy crops, forestry waste, and other biomass.15 Some heating plants also use geothermal energy or waste energy from incineration and industrial processes.16 More recently, the use of heat pumps and wood pellet boilers has also increased. As a result, GHG emissions from the residential heating sector fell 40 per cent between 1990 and 2003.
Denmark ranks 1st out of 16 peer countries for the lowest water consumption per capita, earning an “A” grade. In 2002, Danish residents consumed an average of 197 cubic metres of water per person, a mere fraction of the water consumed by Canadian residents that year.
Since 1989, Denmark has significantly decreased household water consumption through focused national efforts to reduce water waste.28 For example, Copenhagen Water launched a water conservation program in 1989 comprising public education campaigns, leak detection and repair, and changes to water prices and taxation. As a result, domestic water consumption in the Greater Copenhagen Area decreased 22 per cent between 1989 and 1998.29
Similar gains in water conservation have also been achieved nationally. According to the Danish Water and Wastewater Association, overall water consumption in Demark decreased 18.5 per cent between 1997 and 2006. Domestic household water use, in particular, decreased 12.6 per cent.30 This is mainly because of:
Danish water utilities do not lose much water through leaks or other system issues—only about 7 per cent of the overall supply.32 Factors that influence the degree of water loss include the overall state of the distribution infrastructure, the length of the distribution network, and efforts to detect and repair leaks. Water loss in Canada’s municipal distribution networks averages about 13 per cent.33
1 Organisation for Economic Co-operation and Development, OECD Environmental Performance Reviews: Japan (Paris: OECD, 2010), 123.
2 Japan Automobile Manufacturers Association, Inc., 2009 Report on Environmental Protection Efforts (Tokyo: JAMA, 2009), 9.
3 Ibid., 7.
4 Ibid., 9.
5 Organisation for Economic Co-operation and Development, OECD Environmental Performance Reviews: Japan (Paris: OECD, 2010), 138.
6 Ibid., 128.
7 LULUCF refers to changes in GHG emissions due to human activities related to land use, land management, and forestry. This includes wildfires, controlled burning, and cropland conversions. LULUCF is excluded from the GHG emissions data used here because of significant fluctuations in annual LULUCF emissions.
8 Organisation for Economic Co-operation and Development, OECD Enviromental Performance Reviews: United Kingdom (Paris: OECD, 2002), 218–219.
9 U.K. National Audit Office, The Climate Change Levy and Climate Change Agreements (London: NAO, 2007). 10.
10 Of the 5.4 million tonnes of GHG emissions saved, 3.5 million is attributed to the Climate Change Levy and 1.9 million is attributed to the climate change agreements, based on the findings of a 2005 study by the Cambridge Econometrics and Policy Studies Institute (National Audit Office, 2007).
11 Ministry of Sustainable Development Sweden, Sweden’s Fourth National Communication on Climate Change (Stockholm: Ministry of Sustainable Development Sweden, 2005), 6.
12 Organisation for Economic Co-operation and Development, OECD Environmental Performance Reviews: Sweden (Paris: OECD, 2004).
13 Bengt Johansson, “Sweden Workshop on Innovation and the Environment: Economic Instruments in Practice 1: Carbon Tax in Sweden,” Workshop on Innovation and the Environment. Workshop held at Paris, June 1, 2000 (accessed December 14, 2010).
14 Organisation for Economic Co-operation and Development, OECD Environmental Performance Reviews: Sweden (Paris: OECD, 2004), 102.
15 Ministry of Sustainable Development Sweden, Sweden's Fourth National Communication on Climate Change (Stockholm: Ministry of Sustainable Development Sweden, 2005), 7.
16 Swedish District Heating Association, “What Is District Heating?” (accessed December 15, 2010).
17 Organisation for Economic Co-operation and Development, OECD Environmental Performance Reviews: Japan (Paris: OECD, 2010), 150.
18 Ibid., 158.
19 Ministry of the Environment, Government of Japan, “Japan's Approach to the 3Rs,” 3R Initiative (accessed January 11, 2011).
20 Ministry of the Environment, Government of Japan, Japan’s Experience in Promotion of the 3Rs (Tokyo: Ministry of the Environment, April 2005).
21 Organisation for Economic Co-operation and Development, OECD Environmental Performance Reviews: Japan (Paris: OECD, 2010), 157.
22 Organisation for Economic Co-operation and Development, OECD Environmental Performance Reviews: Finland (Paris: OECD, 2009), 76.
23 Ibid., 82.
24 Daniel Loughlin and Morton Barlaz, Strengthening Markets for Recyclables, A Worldwide Perspective: Finland (Raleigh, North Carolina: North Carolina State University, December 2003), 10 (accessed June 15, 2011).
25 Ibid., 10.
26 The Paperinkeräys Group, “Nationwide Environmental Service Prodvider, Recovered Paper Wholesaler, and Producers Association,” The Paperinkeräys Group (accessed January 10, 2011).
27 Ministry of the Environment, Towards a Recycling Society: The National Waste Plan for 2016 (Helsinki: Ministry of the Environment, Finland, 2009).
28 Aquaterra, International Comparisons of Domestic Per Capita Consumption (Bristol, U.K.: Environment Agency, 2008).
29 Ibid., 11.
30 Danish Water and Wastewater Association, Water in Figures 2007 (Skanderborg: DANVA, 2007), 4.
31 Organisation for Economic Co-operation and Development, OECD Environmental Performance Reviews: Denmark (Paris: OECD, 2007) 65 and 77.
32 Danish Water and Wastewater Association, Water in Figures 2010 (Skanderborg: DANVA, 2010), 27.
33 Environment Canada, “Water Use—Withdrawal Uses” (accessed November 25, 2010).