On November 4, 2025, Finance Minister François-Philippe Champagne tabled the 2025 federal budget, calling it “one of the most ambitious, pro-competitive measures for Canada in a generation.”

Hours later, he joined a crowd of lobbyists, journalists, and Liberal loyalists at an Ottawa brasserie for a “Prudence and Prosecco” post-budget party — a fitting metaphor for a government intent on celebrating itself while the country’s climate ambitions go flat.

For weeks, the budget had been billed as the moment Mark Carney’s government would finally unveil its long-promised Climate Competitiveness Strategy—a plan to position Canada as a winner in the clean-energy transition.

Strategy? What strategy?

What emerged instead was a document with no new measures to cut emissions, no mention of targets for absolute reductions, and no fresh funding for clean technology or transition programs.

The omissions come at a dangerous time. Canada is the only G7 country whose emissions have risen since 1990 – the base year for the UN Framework Convention on Climate Change. Even the government’s own projections show that its current plan will fall short of its 2030 target to cut emissions 40–45 per cent below 2005 levels.

Meanwhile, the effects of climate change are no longer abstract: nearly eight per cent of Canada’s forests have burned in the past three years, cities are enduring weeks of dangerous air quality warnings, rising heat kills one person a minute worldwide, and droughts are threatening food security and access to clean water.

Experts were quick to condemn

Environmental groups and policy analysts were swift in their verdict.

“This was an opportunity for Canada to supercharge the energy transition needed for a strong, future-focused economy,” said Keith Brooks of Environmental Defence. “Instead, it offers little substance and no new measures.”

Andrew Gage of West Coast Environmental Law was blunter: “Canada was already not doing enough, and now we’re going to do less.”

One senior researcher at the Canadian Centre for Policy Alternatives called it “the most climate-negative budget in more than a decade.”

Squinting to see the positives

Some commentators, however, strained to find a silver lining, mostly praising the budget not for what it did, but for what it didn’t do.

Chief among these supposed positives was that the government had not cancelled its industrial carbon-pricing system—a policy that has been the backbone of Canada’s emissions reduction plans since its launch in 2019.

Canada’s commitment to industrial carbon pricing should never have been in doubt. The system covers about 600 facilities responsible for roughly 40 per cent of national emissions and accounts for an estimated 20 to 48 per cent of all planned emissions reductions by 2030. It is the single most effective policy Canada has to cut greenhouse gas emissions. The budget promises to “strengthen the system over time”, but offers no concrete details about what needs to be fixed and provides no indication of how or when those reforms might occur.

In reality, the program is already under strain. Saskatchewan is openly defying federal rules, having declared itself “carbon tax free” as of April 1 this year. Alberta stated in May that, despite federal law requirements to do so, it will not increase its industrial carbon price.

Under the Greenhouse Gas Pollution Pricing Act, Ottawa is obliged to impose a federal backstop when provinces fail to comply. So far, the Carney government has chosen not to intervene.

Now, Budget 2025 announces that Canada is “committing to enforce the law”.

Finishing the methane regulations

Another promise in Budget 2025 is a pledge to “finalize enhanced methane regulations.” No date was offered, merely another assurance that the work is underway—an implicit admission that it remains unfinished.

Methane is an exceptionally potent greenhouse gas, trapping about 28 times more heat than carbon dioxide over a century and more than 80 times as much over 20 years.

Cutting methane emissions from oil and gas operations is intended to deliver nearly one-fifth of Canada’s total emissions reductions by 2030, making it the third-most important emissions reduction policy, after carbon pricing and the oil-and-gas emissions cap.

Yet Ottawa’s “enhanced” methane rules were first promised in 2021, drafted in 2023, and have now been delayed twice.

Investing in critical minerals

The one substantial new pot of money—$2.4 billion over five years—is earmarked for critical minerals projects.

That may look like a climate investment, but it is better understood as an industrial and security measure.

Canada’s reserves of lithium, nickel and rare-earth elements remain underdeveloped, while China controls roughly 90 per cent of global supply.

Building a domestic supply chain is essential not only for the clean-technology sector but also for national security and industrial resilience.

It’s an investment that is sensible and overdue, but it hardly constitutes a climate strategy.

Launching a Youth Climate Corps—to rescue the Boomers?

The budget’s one overtly green-sounding new initiative is a $40 million allotment for a Youth Climate Corps (YCC)—a national service program meant to put young Canadians to work on energy retrofits, forest restoration, climate adaptation, and emergency response to floods and wildfires. 

Modelled on the Civilian Conservation Corps of the 1930s, the idea has long been championed as a way to marry climate action with job creation and civic renewal.

It is, in principle, a good idea, but at $20 million a year, the program will fund perhaps 350 full-time positions nationwide. It falls short of the Liberals’ campaign pledge and is well below the $1 billion annual investment advocates say is needed to make it consequential.

There is a dark irony in this. Our government, willing to pour billions into the oil and gas sector, now proposes to train a few hundred young people to help respond to the floods, fires, and heatwaves those same subsidies help to fuel.

The bad and the ugly

Whatever modest positives could be teased from Budget 2025 were eclipsed by cuts and delays to programs important to Canada’s climate plans.

At least $3 billion in climate-related spending was axed, part of a broader $60 billion reduction in federal programmes over five years. The casualties include home-energy-retrofit grants, the Net-Zero Accelerator for clean technology, public-transit funding and even the pledge to plant two billion trees.

Despite a record deficit and sweeping cuts across government programs, Ottawa still found money to expand the very fossil-fuel subsidies it pledged to phase out fifteen years ago.

Both the carbon-capture tax credit and a tax break for liquefied-natural-gas (LNG) facilities were extended, at an additional cost of $325 million over five years.

The extensions amount to an admission that these incentives have barely been used since their original announcement; the industry’s much-touted wave of “decarbonization” projects has yet to materialize.

The budget also all but abandons plans for a binding cap on emissions from the oil and gas sector, claiming it will “no longer be required.”

The oil and gas sector accounts for about 30 per cent of Canada’s total emissions, the largest of any sector, and the cap—developed through industry consultations—was expected to deliver between 7 and 34 per cent of the reductions needed for 2030.

When first announced, then-minister Steven Guilbeault stressed that the target simply reflected what industry itself said was technically achievable without cutting production.

It’s hard to see how making such an essential part of Canada’s emissions reduction plan into a voluntary program helps protect Canadians.

In a surprising move, the budget announces plans to weaken the federal law designed to curb greenwashing. Experts warn that loosening these standards will not only allow major polluters to mislead the public but will also disadvantage genuinely sustainable startups, whose credibility depends on clear, enforceable definitions.

The government’s Electric Vehicle Availability Standard—which once required 20 per cent of new car sales to be zero-emission by 2026—remains suspended. The budget offers only that “next steps” will be announced “in the coming weeks,” effectively confirming another delay.

Even the sustainable-finance taxonomy, long demanded by investors to define what counts as “green investment,” has been postponed until 2026.

Predictably disappointing

Budget 2025 makes clear that Canada has a renewed focus on fossil-fuel production for export as a central pillar of its economic strategy—and that climate measures will not be allowed to get in the way.

It is a disheartening—if not entirely unexpected —turn for the federal government, given its embrace of the fossil fuel sector.

Officials admit privately that the lobbying efforts to influence the budget were relentless. Since Mark Carney’s victory, Canada’s largest oil and gas interests—the Canadian Association of Petroleum Producers, Pathways Alliance, Canadian Gas Association, and pipeline giants Enbridge and TC Energy—have logged 177 meetings with federal officials, a third of them in September alone.

The result is a budget that acknowledges the global clean-energy boom even as it steers Canada in the opposite direction.

This as economists and analysts are warning that economies that fail to disentangle themselves from oil and gas will be left behind by those that do.

Yet Ottawa is doubling down on subsidies to a sunset industry—a move that benefits foreign investors while making Canada’s economy less competitive in the long term.

The eerie part

What makes this turn more unsettling is who seems pleased.

Alberta Premier Danielle Smith and Saskatchewan’s Scott Moe, usually eager to denounce federal climate policy, responded to the budget with uncharacteristic calm.

Smith even praised ongoing negotiations on a memorandum of understanding covering clean-electricity standards, carbon pricing, the emissions cap, and a new pipeline to the British Columbia coast.

That these premiers are suddenly satisfied suggests they see progress toward their goals: weaker national standards and greater oil-and-gas expansion.

No cause for a toast

In the end, Champagne’s “Prudence and Prosecco” party may have been aptly named. There was certainly prudence—of the political, risk-averse kind—and presumably plenty of prosecco, but nothing worth celebrating for the climate.

Behind the bubbly rhetoric of competitiveness lies a government unwilling to lead the transformation Canadians need. The glasses clinked in Ottawa as if prosperity and stability could still be poured from a bottle of oil.

Here are the other major climate stories from the week of November 3 to 9, 2025:

COP: As COP30 opened in Brazil, the UN released a report saying global warming could be limited to less than 3 degrees Celsius this century if countries act faster. EU ministers struck a last-minute deal to set a 2040 emissions target of 90% below 1990 levels, but allowed flexibility that weakens it.

Renewable Energy The Economist comments this week that China’s vast renewable capacity has made wind and solar cheaper than fossil fuels, exporting affordable clean tech that helps others decarbonise while expanding its global influence.

Oil and Gas Sector: In a bid to preserve their market dominance, U.S. officials told Europe to rely more on U.S. oil and gas instead of renewables. The economic outlook for fossil fuels continues to be poor as oil prices were largely flat after hitting two-week lows as weak demand and a global oil glut weighed on the market.

Carbon Markets: The Guardian published a thoughtful report about how discredited forest carbon credits have crashed the market, cutting off funds for projects such as Kasigau in Kenya. Reforms are underway, but demand is still uncertain.

Business Emissions: Sixteen U.S. attorneys general, led by Florida, warned Microsoft, Google and Meta not to comply with the EU’s new sustainability and due-diligence laws, calling them unlawful and hinting at legal action. The move amounts to U.S. officials pressuring firms to defy European climate and ESG policy.

Deforestation: European countries backed a $2.5 billion plan to protect the Congo rainforest. This, while scientists criticized the protection of natural carbon sinks like forests and wetlands as insufficient and a distraction from the need to rapidly draw down fossil fuel use.

Greenwashing: As Canada moves to weaken its greenwashing laws, one expert warns the rules were working—and that loosening them will invite deception and hurt honest green firms.

Extreme Weather: In the aftermath of Hurricane Melissa, scientists say the storm’s extreme strength was made much worse by the climate crisis. The death toll increased to 75 as more victims were discovered, and the Jamaican Prime Minister, Andrew Holness, said Melissa caused damage to homes and key infrastructure roughly equivalent to 28% to 32% of last year’s gross domestic product.

Wildfires: Government officials confirmed that Ontario suffered one of its worst wildfire seasons this year, with fires and burned area surging. Experts blame hotter, drier conditions driven by climate change, while officials urge stronger emission cuts and preparedness.

Drought: With drought conditions still “extreme,” New Brunswick is urging residents to conserve water this winter. Some wells have already run dry, and officials warn that deeper drilling may be needed if rains do not return.

Health Impacts: Alberta First Nations chiefs warn that oilsands tailings are poisoning their land and fuelling cancer rates. They’re demanding independent studies and an immediate halt to plans to discharge treated waste until it’s proven safe.