Message from the Chief Executive Officer
I am proud to introduce the 2023 edition of Canada’s Energy Future (EF2023)—our most ambitious report yet, and the Canada Energy Regulator’s (CER) first long-term outlook modeling net-zero by 2050.
As with past versions of Canada’s Energy Future, EF2023 explores how possible energy futures might unfold for Canadians over the long term. In this analysis, we begin with the end goal in mind: net-zero greenhouse gas (GHG) emissions in 2050, and use our models to identify pathways to that point. This is a different approach compared to past versions of the report where we ran our models without restrictions, giving us insights into what a given premise meant for the future.
In this report we explore a key question about Canada’s energy future: what could reaching net-zero emissions by 2050 look like? This report is not a prediction or a recommendation. It presents net-zero scenarios that can help Canadians and policy makers see what a net-zero world could look like, visualize the goal, and make informed decisions.
We know that modeling the pathways to net-zero is a big challenge. Canada’s energy system is complex and diverse, and how we produce and use energy in net-zero world will be dramatically different than it is today. As you’ll read in this report, there are some key components of this dramatically different world:
- Electricity becomes the cornerstone of the net-zero energy system. Devices that we use every day that use fossil fuels are replaced by technologies that use electricity. By 2050, technologies like electric vehicles and heat pumpsDefinition* become commonplace.
- Low-carbon fuels like hydrogen and biofuels enable the energy system’s path to net-zero, while carbon capture, utilization, and storage (CCUS)Definition* helps to reduce emissions in many industries and the power generation sector.
- In a future with ambitious global climate action, global demand for fossil fuels falls steeply, reducing oil and natural gas prices and Canadian production of those commodities.
Uncertainty is inherent in all energy modeling exercises, including EF2023. And I am sure not everyone will agree with the assumptions we made, nor our findings. To address uncertainty about the future, we look at three scenarios in EF2023, two of which explore net-zero. We also introduce five additional “What if” cases that ask how changing some of our assumptions could impact Canada’s pathway to net-zero. Our analysis is a means to understand what the future could look like under a certain premise and set of assumptions. Relying on just one scenario to understand the energy future implies too much certainty about what could happen.
It is important to state that the pathway to net-zero is broader than the technical and economic considerations that are the primary focus of EF2023. Policy choices, the regulatory landscape, Canada's journey towards Reconciliation, and societal preferences will each play a critical role in Canada’s energy future. EF2023 is another step in the CER’s net-zero modeling journey. We continue to learn and look forward to building on this report in the years to come.
The CER’s energy information work is a key part of our mandate as an independent regulatory body. We do not develop government policies nor assess the appropriateness of such policies, and the assumptions, narrative, and results in EF2023 do not represent an official government position or policy direction. Canada’s Energy Future contributes analysis and data to help inform Canada’s energy dialogue for policy makers, the energy industry, and Canadians looking to make informed energy choices.
Additional CER work is underway to support Canada’s emission reduction ambitions, beyond the energy information we provide to Canadians. For example, in collaboration with Natural Resources Canada, we are working to develop a regulatory framework for renewable energy projects and power lines in Canada’s offshore areas, an activity within the CER’s regulatory responsibility. We are also working to make sure we are ready to oversee the transportation of hydrogen by pipeline should such a facility be proposed within the CER’s jurisdiction. In addition, we recently updated the GHG emissions and climate change information that companies need to provide the CER when they are seeking approval for a project.
Consultation and collaboration have always been key to the success of the Canada’s Energy Future series. Our work is better when we hear the perspectives of others. Over the past 18 months we have sought advice and feedback from experts within the federal government, particularly Natural Resources Canada and Environment and Climate Change Canada. We also sought advice from some of the top energy system modeling experts outside of government, both in Canada and internationally. Finally, many experts responded to a technical discussion paper and survey on our preliminary approach. I would like to thank all of those who participated in these activities.
I would like to close by thanking the dedicated staff at the CER who contributed to EF2023. This report is the CER’s latest contribution to the very important public dialogue on what the pathways to net-zero might look like. I am excited to share these scenarios with Canadians and look forward to the interesting discussions ahead as we navigate Canada’s dynamic energy future.
Gitane De Silva,
Chief Executive Officer
Canada Energy Regulator
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