Economy
CEGE Indicators Platform
This page combines data from the following indicators:
Overview
- The energy system is being challenged when it comes to deep energy transition. Investment is historically low and declining. Energy consumers have been free-riding on power sector reform for a decade or more.
- Investments in and exports of energy products are pillars of prosperity in Canada. To remain engines of growth over the long term, energy producers must crowd in investments that will speed the deployment of critical decarbonization technologies that further slash the emissions intensity of the upstream sector.
- Reliable, affordable, net-zero energy is a public good. Governments must mobilize whatever resources necessary to complement shortfalls in private funding for investment in the energy transition.
Value Added
Sustainable growth balances the use and availability of economic, environmental, and social resources.
Measurement: Gross domestic product (GDP)
Quick Insights
- Exporters and consumers face ongoing challenges because of COVID-19. Working from home, travel restrictions, and other pandemic-related behavioural changes have caused structural changes in our economy.
- Value added in the energy sector fell 6 per cent in 2020 before recovering to within 1 per cent of pre-crisis levels by the end of 2021.
How Does This Indicator Help Gauge a Better Future?
Relevant UN Sustainable Development Goals
SDG 8—Decent work and economic growth
- 8.1 Sustain per capita economic growth in accordance with national circumstances
- 8.2 Achieve higher levels of economic productivity through diversification, technological upgrading, and innovation, including through a focus on high value-added and labour-intensive sectors
- 8.4 Improve progressively, through 2030, global resource efficiency in consumption and production and endeavour to decouple economic growth from environmental degradation
SDG 12—Responsible consumption and production
- 12.2 By 2030, achieve the sustainable management and efficient use of natural resources
Investments in Capacity
Investing in infrastructure and innovation builds long-term economic potential.
Measurement: Investments in non-residential fixed capital
Quick Insights
- Declining investment in the energy system is a serious threat to Canada’s long-term transition. Compared with 10 per cent a decade ago, investment in the energy sector was just 5 per cent of net non-residential capital in 2019.
- Electric vehicle (EV) adoption and building retrofits are essential to reaching near-term 2030 targets. Rising investment in transport is a positive trend. But capital investment needs to rise substantially over the next decade to allow a deep transition among energy consumers in these sectors.
- EV sales are anticipated to soar in the coming decade. Still lacking, however, are the new energy supply chains required, expanded manufacturing capacity, and consumer confidence. Is Canada’s economy ready for the magnitude of change?
How Does This Indicator Help Gauge a Better Future?
Relevant UN Sustainable Development Goals
SDG 8—Decent work and economic growth
- 8.1 Sustain per capita economic growth in accordance with national circumstances
- 8.2 Achieve higher levels of economic productivity through diversification, technological upgrading, and innovation, including through a focus on high value-added and labour-intensive sectors
- 8.4 Improve progressively, through 2030, global resource efficiency in consumption and production and endeavour to decouple economic growth from environmental degradation
SDG 12—Responsible consumption and production
- 12.2 By 2030, achieve the sustainable management and efficient use of natural resources
Global Reach
International trade and investment are crucial to Canada’s prospects as a small open economy.
Measurement: Export of goods and services, by industry
Quick Insights
- In the near term, energy producers must concentrate on diversifying operations to supply lower-intensity fuel to export markets. In the long term, energy producers must invest in and develop new manufacturing industries to leverage Canadian resources in non-energy use markets.
- For energy consumers, enhanced stability in the wake of the COVID-19 pandemic will come by diversifying away from the United States and China and into rapidly expanding middle-class markets in Southeast Asia and Africa.
- The energy transition is fuelling demand for new technologies and raw inputs. Energy consumers like agriculture, forestry, and metal miners will come to resemble energy producers in their own right.
How Does This Indicator Help Gauge a Better Future?
Relevant UN Sustainable Development Goals
SDG 8—Decent work and economic growth
- 8.2 Achieve higher levels of economic productivity through diversification, technological upgrading, and innovation, including through a focus on high value-added and labour-intensive sectors
SDG 9—Industry, innovation and infrastructure
- 9.1 Develop quality, reliable, sustainable, and resilient infrastructure, including regional and transborder infrastructure, to support economic development and human well-being, with a focus on affordable and equitable access to all
- 9.4 By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes, with all countries taking action in accordance with their respective capabilities
Operating Environment
Favorable operating conditions encourage stable, sustained economic growth.
Measurement: Multifactor productivity (MFP), by sector
Quick Insights
- Canada’s energy sector is proving to be nimble and innovative under pressure. Since 2014, employment per unit of output has fallen steadily even as output grew and capital investment tapered off.
- To manage the cost of the energy transition, Canadian firms must learn to do more with less. Energy efficiency should be top of mind for energy consumers and producers. Both need more innovative ways to run leaner, cleaner companies.
How Does This Indicator Help Gauge a Better Future?
Relevant UN Sustainable Development Goals
SDG 8—Decent work and economic growth
- 8.2 Achieve higher levels of economic productivity through diversification, technological upgrading, and innovation, including through a focus on high value-added and labour-intensive sectors
SDG 9—Industry, innovation and infrastructure
- 9.1 Develop quality, reliable, sustainable, and resilient infrastructure, including regional and transborder infrastructure, to support economic development and human well-being, with a focus on affordable and equitable access to all
- 9.4 By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes, with all countries taking action in accordance with their respective capabilities
- 9.5 Enhance scientific research, upgrade the technological capabilities of industrial sectors in all countries, in particular developing countries, including by 2030, encouraging innovation and substantially increasing the number of research and development per 1 million people and public and private research and development spending
SDG 11—Sustainable cities and communities
- 11.2 By 2030, provide access to safe, affordable, accessible and sustainable transport systems for all, improving road safety, notably by expanding public transport, with special attention to the needs of those in vulnerable situations, women, children, persons with disabilities, and older person
Growth Prospects
Growth prospects attract much-needed resources to build long-term economic capacity.
Measurement: Foreign direct investment (FDI)
Quick Insights
- The decline in foreign investment in energy needs to be reversed. New capital is essential to funding the alternative energy technologies required to sustain Canada’s resource and energy sector over the long term.
- Canada’s main competitive advantage in attracting new foreign investment should be simple. We need to demonstrate how energy extraction and refining can be at an even higher standard of sustainability and social inclusion than it already is
How Does This Indicator Help Gauge a Better Future?
Relevant UN Sustainable Development Goals
SDG 8—Decent work and economic growth
- 8.2 Achieve higher levels of economic productivity through diversification, technological upgrading, and innovation, including through a focus on high value-added and labour-intensive sectors
SDG 9—Industry, innovation and infrastructure
- 9.1 Develop quality, reliable, sustainable, and resilient infrastructure, including regional and transborder infrastructure, to support economic development and human well-being, with a focus on affordable and equitable access to all
- 9.4 By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes, with all countries taking action in accordance with their respective capabilities
- 9.5 Enhance scientific research, upgrade the technological capabilities of industrial sectors in all countries, in particular developing countries, including by 2030, encouraging innovation and substantially increasing the number of research and development per 1 million people and public and private research and development spending
SDG 11—Sustainable cities and communities
- 11.2 By 2030, provide access to safe, affordable, accessible and sustainable transport systems for all, improving road safety, notably by expanding public transport, with special attention to the needs of those in vulnerable situations, women, children, persons with disabilities, and older person
For a deeper look, read our issue briefing:
Measuring What Matters: An Energy-system Perspective on Sustainability