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NRT Policy Research (NRT Review – March 2012)

The NRT's policy agenda for 2012 is packed with upcoming reports, stakeholder workshops, and fresh new insights. We are wrapping up our Climate Prosperity series and finalizing work on two references from the Minister of the Environment.

Check out what we're working on:

- Building business resilience in a changing climate

- Canada and the global transition to a low-carbon economye

- Federal, provincial and territorial climate change policies

- Life cycle approaches to sustainable development

Climate Prosperity Report 5

Building Business Resilience in a Changing Climate: Learning from Leaders

Over the past year, the NRT has undertaken research and convened stakeholders to explore the exposure and preparedness of Canadian businesses to the risks and opportunities of a changing climate. Building from the climate adaptation experiences of thirteen pacesetting firms, we have compiled a roadmap for business success in a changing climate comprised of three phases:

Phase 1: Raise awareness.

Because the range of climate and physical effects — and in turn the range of possible business impacts is broad — firms must first understand the consequences of both increasingly severe weather and gradual changes in climatic conditions for their organization. A Hydro-Québec case study shows how they identified areas of activity particularly sensitive to a changing climate through consultation with staff from various divisions as a key first step.

Phase 2: Assess and manage risks and opportunities

To prioritize actions, firms must assess specific risks and opportunities, identify options for managing them, and decide how to implement responses. A Whistler Blackcomb case study show how they took stock of future snow conditions in developing their climate change strategy to diversifying its offerings to enhance off-peak revenues, invest in additional grooming, snowmaking and snowfencing, and build resilience into infrastructure at the planning stage.

Phase 3: Build climate resilience across the enterprise

A further phase is then to embed climate resilience from the boardroom to the copy room. The RBC case study shows how they put thorough risk management and investment due diligence processes in place, adding new risk dimensions to its credit review process, and identifying key sectors most likely to be affected by the impacts of climate change.

These lessons and more will appear in three reports to be released this spring. First, our case studies report, intended for adaptation practitioners, documenting successful strategies and tactics of thirteen companies to build business resilience in a changing climate. These companies are: Cameco Corporation, Royal Bank of Canada, Hydro-Québec, Tolko, EBA Engineering, JD Irving, Summerhill Pyramid Winery, Rio Tinto Alcan, Coca-Cola, Whistler-Blackcomb, Entergy, Munich Re, and BC Hydro. Second, we will release a dynamic business-focused report with a “how-to”, also recommending priority actions for business. Third, our policy advisory report will provide information on why the issue matters for public policy and advice to businesses and governments on what each group can and should do to enhance private-sector action to manage the risks and opportunities of a changing climate.

Climate Prosperity Report 6

Canada and the global transition to a low-carbon economy

This report will build on the NRT’s Climate Prosperity series’ first report - Measuring Up, which benchmarked Canada’s global competitiveness in low-carbon performance against other large economies – and its third report – Parallel Paths, which examined Canada’s climate policy options in the context of a highly integrated North American economy with policy uncertainty in the United States. Report 6 goes further, aiming to inform Canada’s public and private sector decision-makers on the evolving economic risks and opportunities facing Canada in the global low-carbon transition. Our goal is to produce a policy framework that will guide Canada towards a robust, resilient, and prosperous low-carbon economy. New research is being used to articulate a low-carbon growth plan that will ensure Canada’s economic growth and competitiveness under expected future global carbon constraints. The NRT assesses opportunities in domestic and international low-carbon goods and service (LCGS) sectors, and determines how Canada can best position itself to capture the benefits of this transition and manage the associated risks. We have focused our research on areas that influence Canada’s competitiveness, including energy and emissions, trade, innovation, labour markets, investment, and governance.

Consistent with the NRT’s process, this program has involved a combination of research and convening. In addition to in-house research conducted by NRT staff, we have commissioned several new studies. Recognizing that regional perspectives are essential to the successful development of a low-carbon growth plan, the NRT undertook, over the course of November and December 2011, a Canada-wide convening program in coordination with its regional partners: the Canada West Foundation, the Mowat Centre for Policy Innovation, Ecotech Québec and the Atlantic Canada Opportunities Agency (ACOA). A total of nine dialogue sessions were held from coast-to-coast.

A number of common themes emerged from these sessions. We heard that Canada’s strength was in its people through our talented workforce, our energy expertise, and our innovation and R&D capacity. We also heard that a low-carbon transition is necessary but difficult. Identifying key areas of risk and opportunity will be required, such as transportation, energy efficiency technology commercialization, and electricity production. Inter-regional cooperation was highlighted as an area that could yield significant benefits particularly with respect to providing low-carbon electricity but also in other areas such as energy efficiency. Participants stressed that the government has an important role to play as a facilitator and enabler of the transition, in providing leadership and creating longer-term certainty.

Paralleling its research, the NRT conducted three issue-specific convening sessions, providing a top-down perspective from sector experts to complement both our in-house research and the bottom-up perspective obtained through regional convening. These expert convening sessions on the topics of energy, trade and innovation, drew leading thinkers from industry, government, and academia. We are targeting release of this report for June, 2012.

Ministerial Reference 1: Federal, Provincial and Territorial Climate Change Policies

The National Round Table on the Environment and the Economy (NRT) has been asked by the Minister of the Environment to undertake a comprehensive assessment of provincial/territorial climate change plans and policies in order to better inform federal actions aimed at meeting Canada’s 2020 greenhouse gas emissions reduction target.

Meeting the Government of Canada’s 2020 emissions reduction target of 17% below 2005 levels will – by necessity – require the combined contribution from all initiatives and from all levels of government. Understanding what can be expected from federal, provincial and territorial plans and policies will be a key contribution to knowing what needs to be done to achieve this target. The Ministerial Reference directs the NRT to conduct an analysis of provincial/territorial climate change plans and policies so as to assess their likely contribution to achieving Canada’s target and to help inform federal policy approaches.

The report will contain background information on Canada’s emissions as a nation to date. It will analyze provincial/territorial climate change plans, drawing out common efforts and unique approaches. Original modelling and analysis of both provincial/territorial and federal climate policies will be presented to indicate an estimate of the emissions reductions expected from current and future provincial and territorial climate change initiatives by 2020. The report will also indicate how current and proposed federal and provincial/territorial climate change policies can make an impact in greenhouse gas emission reductions beyond 2020. Finally, the report will offer advice on what instruments and mechanisms should be explored further in Canada so as to inform the Government of what will work best for Canada as we move forward.

The NRT’s report will be delivered to the Minister of the Environment at the end of March, 2012 and released publicly later in the spring.

Ministerial Reference 2: Life Cycle Approaches to Sustainable Development

The Minister of the Environment has asked the NRT to consider how Life Cycle Approaches can truly contribute to bringing the environment and the economy together. Taking a Life Cycle Approach to sustainable development involves identifying, understanding and reducing the environmental/material inputs and their impacts throughout the entire life cycle of a product, technology, or process. Life Cycle Approach-based concepts, tools and methodologies also have the potential to increase production efficiencies, market share, and achieve greater economic competitiveness for the private sector.

The NRT undertook research to better understand the drivers for life cycle approaches, the risks of not using such approaches and the opportunities associated with life cycle approaches. Results of this research were discussed with experts and stakeholders through various workshops and roundtable sessions between November 2011 and February 2012.

With this report, the NRT will give advice and recommendations to help the Government of Canada assess how Life Cycle Approaches could contribute to long-term sustainability in Canada. We will assess what role the Government could play to facilitate successful take-up of Life Cycle Approaches, within government and in the private sector.

This report will emphasize the role life cycle approaches could play to enhance Canada’s competitiveness. It will explore other potential benefits such as increased environmental and economic gains through the use of life cycle approaches within internal government operations and decision-making. It will point to a few key priority areas for actions for the Government of Canada, emphasizing the urgent need to address market access and trade issues affecting Canadian companies. The report will be delivered to the Minister of the Environment at the end of March 2012, and released later in the spring.