Resilient LLP (formerly DeMarco Allan LLP)
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Budget 2025: Key Climate, Energy, and Indigenous Highlights

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On November 4, 2025, Canada released a prudent, investment focussed Canada Strong Budget 2025 (“Budget 2025”) that is in line with the global energy transition in all major global economies other than the U.S. In doing so, it has: (i) accepted and embraced the country’s innate nature as a climate-forward, responsible energy, mineral, and nature resource producer with strong Indigenous rightsholders; and (ii) put in place the investment structures and tax incentives to go beyond resource production and lead in the knowledge economy. As with all government announcements, the success of the Budget 2025 strategy will rest on implementation, particularly the speed with which the government, Indigenous rightsholders, and cooperative provincial and territorial governments can manifest the changes outlined in the 2025 Budget. The thrust of the new approach has tell-tale signs of a good investment finance strategy with new infrastructure and resource development funds, tax incentives, and necessary regulatory backstops. It is focussed on economic, infrastructure, and climate outcomes rather than aspirational targets (which Canada has repeatedly missed). Fiscal discipline is reflected in a downsizing (10%) of the public service largely through attrition, AI, and elimination of open positions that can be filled by same. Key climate, energy, and Indigenous elements of Budget 2025 include: Climate Action. Budget 2025 introduces new and proposed funding to support climate action, alongside the formal elimination of federal consumer carbon pricing (see our earlier bulletin here) and other program adjustments and reallocations, including: Direct Delivery Stream for Adaptation and Infrastructure. $6B over ten years, beginning in 2026–27, for a Direct Delivery Stream under Housing, Infrastructure and Communities Canada, to support regionally significant projects related to climate adaptation, retrofits, and community infrastructure. Biofuels Production Incentive. $372M over two years for a Biofeuls Production Incentive to Natural Resources Canada to establish a production incentive for biodiesel and renewable diesel producers (starting in 2026). Elimination of…

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Carney Government Eliminates Consumer Carbon Price

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The Government of Canada on Saturday published an extra edition of Canada Gazette, Part II to eliminate the “consumer-facing” carbon price (i.e., the federal fuel charge), effective April 1, 2025. The change was originally announced by new Prime Minister Mark Carney on Friday as his first official act. The new regulations amend the Greenhouse Gas Pollution Pricing Act (GGPPA) and related regulations. This bulletin briefly summarizes the amendments and highlights key aspects of the associated Regulatory Impact Analysis Statements (RIASs). The amendments most consequentially set the rate of charge applicable after March 31, 2025 set out in Table 5 of Schedule 2 to the GGPPA to “zero” dollars for all 22 types of fuel. The rates previously set out in that table represented a carbon price of $80 per tonne in 2024-25. The Governor in Council (i.e., the Governor General acting on the advice of Cabinet) has the authority to set the fuel charge rates to zero under section 166(4) of the GGPPA. The government has also made related amendments to the Fuel Charge Regulations (particularly around removal of registration requirements after March 31, 2025) and coordinating amendments to the Output-Based Pricing System (OBPS) Regulations.  The RIASs note that: The government estimates that the elimination of the fuel charge will lead to a loss of 12.57 Mt cumulative GHG emissions reductions from 2025 to 2030 (p. 12). The monetized cost of foregone emissions reductions over the 2025-2030 period of the elimination of the fuel charge is estimated to be about $3.83B (in 2024 dollars, discounted at 2% to 2025-26), using social cost of carbon figures for 2025 to 2030 (p. 13). The elimination of the fuel charge increases Canada’s GDP by 0.5% in 2030 (p. 14). The total welfare gains, not accounting for the social cost of carbon, for households would be equivalent to a 0.3% increase in household consumption in…

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Major US and Canadian Banks Exit NZBA

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The six largest US banks, JPMorgan, Goldman Sachs, Wells Fargo, Citi, Bank of America, and Morgan Stanley have each announced their departure from the Net-Zero Banking Alliance (NZBA), a group of leading global banks committed to aligning their lending, investment, and capital markets activities with net-zero greenhouse gas (GHG) emissions by 2050. In Canada, TD, BMO, and National Bank announced their withdrawal from the NZBA earlier today. RBC has also indicated that it is open to leaving the alliance. We anticipate significant changes in the NZBA and additional withdrawals over the coming days. Major US asset managers are also leaving other UN-convened climate coalitions, including the recently announced departure of BlackRock from the Net Zero Asset Managers initiative (NZAM), a multi-trillion dollar international group of asset managers committed to supporting the goal of net zero GHG emissions by 2050. Following BlackRock’s departure, a statement issued by NZAM on Monday indicates that it is suspending activities while the initiative undergoes review “to ensure NZAM remains fit for purpose in the new global context.” Both NZBA and NZAM are organizations under the umbrella of the Glasgow Financial Alliance for Net Zero (GFANZ), co-chaired by Michael Bloomberg and Mark Carney.    For further information or to discuss the contents of this bulletin, please contact Lisa DeMarco at lisa@resilientllp.com.

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Canada Publishes Finalized Clean Electricity Regulations

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Canada’s Minister of Environment and Climate Change (the “Minister”) yesterday announced the finalization and publication today of the Clean Electricity Regulations (“CER”) in the Canada Gazette, Part II (see our earlier bulletin on the draft CER here). CER establishes significant annual emission limits (“AEL”) to reduce greenhouse gas (“GHG”) emissions from fossil fuel-generated electricity generation facilities in all provinces and territories across Canada starting in 2035. Requirements to reduce emissions under CER start in 2035 with a pathway to reaching net-zero in 2050. Environment and Climate Change Canada (“ECCC”) estimates that the CER would reduce approximately 181 megatonnes of cumulative GHG emissions between 2024 and 2050. The CER imposes significant registration, record keeping, and reporting obligations on covered electricity generation facilities.   This bulletin briefly summarizes the key provisions of CER and federal financial support to help decarbonize and expand Canada’s electricity system.   Scope. A “unit” is regulated under the CER if it meets all of the following three criteria: It has an electricity generation capacity of 25 megawatts (“MW”) or greater (or is a new unit located at a facility where the sum of all new electricity generation unit capacity is 25 MW or greater); It generates electricity using fossil fuel; and It is connected, directly or indirectly, to an “electricity system” that is subject to North American Electric Reliability Corporation (“NERC”) standards. A unit that has an electricity generation capacity of less than 25 MW is deemed to meet the first criteria if the unit’s commissioning date is on or after January 1, 2025 and the sum of the electricity generation capacity of all units, other than planned units, that are located at the facility where the unit is located and that also have commissioning dates on or after January 1, 2025 is at least 25 MW.   CER does not apply…

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Canada Implements Clean Economy Investment Tax Credits

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This bulletin complements last week’s update on the Fall Economic Statement Implementation Act, 2023 (Bill C-59). In addition to the climate-related amendments to the Competition Act (read our earlier bulletin here), Bill C-59 implements significant clean economy investment tax credits (ITCs), for clean technology (CT) and carbon capture utilization and storage (CCUS), as well as clean hydrogen (CH) and clean technology manufacturing (CTM). This bulletin briefly summarizes the amendments to the Income Tax Act (the Act) and Income Tax Regulations (the Regulations) that implement the CT ITC and CCUS ITC. Clean Technology Investment Tax Credit. Bill C-59 amends the Act and Regulations to implement the CT ITC, initially proposed in the 2022 Fall Economic Statement and expanded in both the 2023 Fall Economic Statement (FES) and 2023 Budget (read our earlier bulletins here and here). Key provisions of the now implemented and expanded CT ITC include: refundable tax credit for capital invested in the adoption and operation of new clean technology property in Canada from March 28, 2023, to December 31, 2034; rate may be up to 30% of the capital cost of CT property that is acquired and that becomes available for use from March 28, 2023, to December 31, 2033; rate may be up to 15% for property acquired and that becomes available for use in 2034, and will be unavailable after 2034; available for investments in the following types of CT property: equipment used to generate electricity from solar, wind and water energy; stationary electricity storage equipment that does not use any fossil fuel in operation (such as batteries and pumped hydroelectric storage); active solar heating equipment, air-source heat pumps and ground-source heat pumps; non-road zero-emission vehicles and related charging and refueling equipment that is used primarily for such vehicles; equipment used exclusively for the purpose of…

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