What is “Just Transition?”

In recent years, conversations regarding climate change have become more urgent, and countries around the globe have begun proposing and implementing a wide range of policy responses to the crisis. “Just Transition” is the Candian Government’s climate plan. The policy aims to transform Canada’s economy by implementing measures and regulations to reduce the carbon emissions associated with economic activities. With its Just Transition plan, the Federal Government seeks to achieve net-zero emissions by 2050, fulfilling Canada’s emissions reduction commitments from the 2015 Paris Climate Agreement. The plan’s name reflects the Government’s vision of climate action that will not disproportionately harm any particular region or group of workers. The associated legislation has not been made public, as the Government delayed its introduction while it managed the fallout from COVID-19. However, as Canada recovers from pandemic-related challenges, the Government’s focus has returned to its climate agenda. The Minister of Natural Resources, Jonathan Wilkinson has stated that he hopes to introduce the Just Transition legislation early this year. 

With the legislation imminent, the plan has received renewed attention and scrutiny, particularly in Alberta, where Just Transition has become the latest point of contention as the provincial election scheduled for May 2023 approaches. In the absence of legislation, the information known about the project is contained in a briefing document prepared for the Minister of Natural Resources in advance of a June 2022 appearance before the House of Commons Standing Committee on Natural Resources (RNNR) for its study on Creating a Fair and Equitable Canadian Energy Transformation.       

Just Transition and Labour Market Disruptions

Understandably, the anticipated labour market disruptions resulting from the Just Transition plan are controversial, particularly in Alberta where many work within the oil and gas sectors. While concern on behalf of these workers is appropriate, the employment figures discussed in the Just Transition briefing document have been widely misrepresented, painting a falsely apocalyptic economic picture for workers and the overall economy. 

The following passage from the briefing document has often been the source of criticism: “[The Government expects] that larger-scale transformations will take place in agriculture (about 292,000 workers; 1.5% of Canada’s employment), energy (about 202,000 workers; 1% of Canada’s employment), manufacturing (about 193,000 workers; 1% of Canada’s employment), buildings (about 1.4 million workers; 7% of Canada’s employment) and transportation sectors (about 642,000 workers; 3% of Canada’s employment), to help meet the Government’s emission reduction targets” (p. 68). Some have erroneously concluded that all the jobs in the listed industries will be eliminated due to Just Transition. This is clearly not a valid conclusion based on this quote, nor is it reasonable when one considers the full discussion of the labour market disruptions contained in the document. 

In order to establish reasonable expectations regarding the labour market disruptions, it is important to note that many jobs in the aforementioned sectors are expected to play an integral role in a low-carbon economy. For instance, the document discusses the potential role for the oil and gas sectors in areas such as hydrogen-based fuel sources, geothermal heat and power, carbon fiber, asphaltenes, as well as carbon capture, usage and storage (CCUS) technologies (p. 25, 29). Furthermore, the document suggests that many people who currently work in industries that are projected to undergo changes resulting from Just Transition have skills that are highly transferable to emerging industries in the green economy, including engineers, technicians and meteorologists (p. 69). With that being said, the document also acknowledges that some people have skills that will not be as easily transferable to a low-carbon economy and that this group will require support, including retraining opportunities and quality jobs in new sectors (p. 69). 

Just Transition: What to Watch

Successfully implementing Just Transition and supporting individuals who experience employment disruptions as a result of the policy will be an immense challenge for the Government. The magnitude of the challenge is highlighted by the findings of the audit of Just Transition conducted by the Commissioner of the Environment and Sustainable Development. In a report released in April 2022, the Commissioner detailed the Government’s lack of preparedness for supporting workers and communities during the transition to a low-carbon economy. Specifically, the Commissioner found that the Government had failed to create an implementation plan for Just Transition, had not put in place a formal governance structure to coordinate policy implementation, and had not created a measuring and monitoring system to understand the effects of the policy on Canadians. Furthermore, the Commissioner found that the Government failed to adequately support workers and communities affected by the accelerated phase-out of coal-fired electricity, which began in 2018. 

The findings are a troublesome sign for those concerned that the delays in implementing the plan will lead to delays in reducing emissions. The findings are also worrisome for workers and communities who will require support following the implementation of Just Transition. It will be important to evaluate whether the legislation effectively remedies the shortcomings identified by the Commissioner when it is introduced.  

Given the scope and complexity of the Just Transition plan, the briefing document only provides limited insight into what we can substantively expect from the legislation. However, the information within the document aligns with Canada’s commitments in the Paris Climate Agreement and the climate commitments made to Canadian voters during the 2021 federal election. Evidently, both sustainability and economic opportunity are important to Canadians. To what extent the Government is able to advance both objectives concurrently will perhaps be its defining policy legacy.