Canada - Climate
At a glance
‘Environment and climate action’ is a priority of Canada's Feminist International Assistance Policy
In 2018, Canada disbursed US$631 million of its bilateral allocable ODA on projects that targeted action against climate change as a principal or significant objective, making it the 10th-largest OECD Development Assistance Committee (DAC) donor to the issue, in absolute terms.
Canada spent 24% of its allocable bilateral ODA on climate finance in 2018. This is in line with the DAC average of 22% and places Canada 13th out of 30 DAC members.
Climate finance: funding for projects tagged in the OECD’s Creditor Reporting System (CRS) database with the Rio markers for climate change mitigation and/or climate change adaptation. Projects can be tagged with either or both markers.
Each marker has three possible scores:
- Principal, for projects in which climate change mitigation or adaptation is a fundamental and explicitly stated goal;
- Significant, for projects in which climate change mitigation or adaptation is not a key driver but still an explicitly stated goal; or
- Not targeted, meaning the project does not address climate change mitigation or adaptation.
Not all projects are screened against the Rio markers; this funding falls into the ‘not screened’ category.
Canada’s funding for action against climate change increased by 61% between 2017 and 2018, however, spending in this sector remained slightly below the 2016 peak of US$670. The spike in funding in 2016 followed Canada’s pledge to spend CAD2.7 billion (US$2.1 billion) in climate finance over five years which it made in the lead up to the United Nations Climate Change Conference (COP21) and the Paris Agreement Canada plans for these funds to support:
- Climate change adaptation for the poorest and most vulnerable (e.g., CAD30 million or US$23 million to the Least Developed Countries Fund);
- Projects that reduce greenhouse gas emissions (e.g., CAD60 million or US$46 million to establish the Renewable Energy in Small Island Developing State Program);
- The mobilization of private sector capital for climate action (e.g., CAD200 million or US$154 million in funding to a second phase of the Canadian Climate Fund for the Private Sector in Asia); and
- The United Nations Framework Convention on Climate Change (UNFCCC) institutions and mechanisms (e.g., CAD300 million or US$231 million to the Green Climate Fund).
Canada’s approach to international development finance has shifted since the announcement of this additional funding in 2016: As an analysis by the Canadian International Development Platform (CIDP) reveals, Canada’s international climate finance went from being exclusively grant-based to heavily relying on debt instruments or loans.
As of April 2019, Canada had announced more than CAD$1.5 billion (US$1.2 billion) in spending toward its 2015 commitment. The government plans to deliver the full amount by March 2021.
‘Environment and climate action’ is one of the six ‘Action Areas’ outlined in Canada’s Feminist International Assistance Policy (FIAP). Given the country’s overarching focus on gender equality, the government is particularly concerned with the intersection of climate and gender issues, recognizing the ways that women and girls are disproportionately affected by climate change and environmental degradation. The FIAP outlines three areas of focus for Canada’s efforts to tackle climate change and environmental issues:
- Supporting women’s leadership and decision making in climate change mitigation and adaptation efforts, resilience-building, and sustainable natural resource management;
- Promoting gender-sensitive climate policymaking and financing in partner countries; and
- Boosting employment and business opportunities for women in the renewable energy sector.
Canada has shown international leadership at the intersection of climate and gender justice. Climate was a major priority of Canada’s 2018 G7 presidency. By naming gender equality as a cross-cutting theme — which was integrated into the other four pillars of discussion at the G7 Leaders’ Summit in Charlevoix, Quebec in June of 2018 — Canada pushed for an inclusive approach to climate action that addresses the empowerment of women and girls. Despite this rhetorical commitment, analysis by the CIDP and Engineers Without Borders Canada reveals that in 2018, projects tagged as having a principal focus on gender accounted for less than 2% of Canada’s climate-related ODA, suggesting inconsistencies between Canada’s FIAP and its approach to climate finance.
Most of Canada’s financing to address climate change targets both mitigation and adaptation
In 2018, 92% of Canada’s bilateral climate-related ODA focused on climate change mitigation. Interventions aimed at climate change adaptation accounted for 97% of Canada’s funding in this sector. As is apparent from the relative size of these percentages, there is also significant overlap between the two markers. This is because a project can target both adaptation and mitigation. In 2018, the vast majority (89%) of Canada’s climate-related ODA was channeled toward projects tagged with the markers for both climate change mitigation and climate change adaptation. (For more information on the markers, see box.)
Interestingly, in 2018, far more of Canada’s bilateral funding was channeled toward projects which named climate change as a principal goal than as a significant one. Canada spent US$460 or 18% of its bilateral allocable ODA on principal funding in this sector, far above the DAC average of 7%. Only 7% (US$171) of funding was channeled toward projects which included climate change as a significant objective (DAC average: 15%). The switch toward more principal funding occurred in 2017 when for the first time, Canada spent more of its bilateral ODA on projects with a principal climate change-focus than projects with only a significant climate change component. It is possible that these changes are a result of the lumpy nature of annual investments and disbursements rather than substantive policy shifts. Despite these promising increases in overall funding for climate-related issues, in 2018 most (76%) of Canada’s bilateral allocable ODA still did not target climate change or was not screened against the climate change marker.
Of the US$631 million in bilateral ODA that Canada spent on climate change mitigation and/or adaptation, 35% went to projects in the energy sector. Agriculture (including forestry, fishing, and rural development) accounted for 31% of this funding, followed by other multisector activities (such as natural disaster response strengthening) which accounted for 10%.
Most of Canada’s climate financing is channeled through multilaterals; the GEF is one of Canada’s key mechanisms to address global environmental commitments
Canada contributes most of its climate financing through multilaterals. This includes contributions to the following multilaterals:
- Global Environment Facility (GEF): Between 2014 and 2018, Canada contributed CAD233 million (US$180 million) to the GEF, which the government considers its key mechanism to address climate change-related issues in international development.
- Green Climate Fund (GCF): At the G7 Summit in Biarritz, France in August of 2019, Canada announced CAD$300 million (US$231 million) in funding for the GCF for 2020-2023.
- International Finance Corporation (IFC): The partnership between the Government of Canada and the World Bank’s International Finance Corporation (IFC) to mobilize private capital for global climate action began in 2011 as the IFC-Canada Climate Change Program (funded with CAD291 million or US$225 between 2011 and 2018). In 2018, the program was expanded to include the IFC Blended Climate Finance Program (CAD250 million or US$193 million) and the Canada-IFC Renewable Energy Program for Africa (CAD150 million or US$116 million).
- Asian Development Bank: In 2017, Canada announced CAD200 million (US$154 million) in funding for the second phase of the Canadian Climate Fund for the Private Sector in Asia, managed by the Asian Development Bank. The fund is used to encourage the participation of private sector actors in climate change mitigation and adaptation. It supports low and lower-middle-income countries as well as upper-middle-income small island states in Asia and the Pacific.
- Inter-American Development Bank: In 2012, Canada announced CAD250 million (US$193 million) to establish the Canadian Climate Fund for the Private Sector in the Americas. The fund aims to catalyze up to US$3 billion in private sector investment in climate change mitigation and adaptation in Latin America and the Caribbean. The fund is managed by the Inter-American Development Bank. In its most recent funding phase (2019-2024) Canada contributed CAD224 million (US$172 million).
Canada funds several additional multilateral organizations taking action against climate change and improving environmental governance through Environment and Climate Change Canada (ECCC). In FY2017/18, ECCC disbursed CAD21 million (US$16 million) in ODA to various environmental organizations including UN agencies, the Multilateral Fund for the Implementation of the Montreal Protocol on Substances that Deplete the Ozone Layer, research institutions, and climate risk assessment initiatives.
GAC sets development policy, including for climate financing; Canada’s Ambassador for Climate Change plays a coordinating role
Global Affairs Canada (GAC), headed by the Minister of Foreign Affairs and the Minister of International Development under the overall guidance of the Prime Minister, leads Canada’s international development and humanitarian assistance. This including pushing forward the Canadian government’s commitments to make the country a “global leader” in the international fight against climate change.
GAC works in collaboration with ECCC on international climate change-related issues. ECCC provides technical and environmental advice on GEF programming and priorities and disburses ODA to various multilateral organizations working on environmental issues.
In the lead up to the 2015 COP21 conference, Canada appointed an Ambassador for Climate Change who is responsible for coordinating Canada’s efforts to promote green growth and tackle climate change internationally.
Unless otherwise indicated, all data in this section is based on commitments. For more information, see our Donor Tracker Codebook.