The economic impact of electrification and industrial decarbonization in Canada

• June 6, 2025
• Susan McGeachie

The Global Climate Finance Accelerator was established in response to global efforts to gradually reallocate the flow of capital from high carbon intensive assets to low ones. To change the “no go” investment to “how to”. 

How can a privately owned mid-sized business owner actively participate in – and benefit from – Canada’s national electrification efforts? How can we make it economically viable for this business owner to invest in his own onsite renewable energy generation to power the electrification of his fleet and warehouses? And then how do we aggregate multiple businesses doing the same thing – perhaps just within a single province to start but scaling across the nation – to attract larger flows of capital into a securitized pool of individual, small business investments?

The mid-market is the backbone of the Canadian economy. Finding the “how” to ignite this engine will turn policy ambition into real-world impact. It will also help enable a much-needed diversification of Canada’s economy by ensuring small and mid-sized companies can shape, not just access, the clean economy. That means moving beyond enabling investment for a few large players to a decarbonization investment landscape in which everyone can participate.

Democratizing access to investment serves an important dual purpose: First, it builds a more resilient, diversified economy – people can seek employment opportunities from a rich tapestry of options rather than the limited selection we have today. Secondly, and perhaps more importantly, it would create a culture of shared ownership and excitement around the clean energy transformation, rather than the current indifference we’re experiencing because most people are excluded from the upside of decarbonization. 

The shift to clean energy isn’t just a story about cutting emissions. It’s a story about building industries that will define our country’s prosperity for the next 50 years.

These stories matter, a lesson we can learn from other countries that have set themselves up on radically different paths than the one we seem to be following here in Canada.

Norway, for example, discovered oil in the North Sea in the late 1960s. But instead of simply unleashing private interests to extract it, they nationalized the resource, creating Statoil (State Oil), which was later transformed to Equinor to reflect the company’s evolving strategy beyond oil and gas to renewables. The new name is a blend of “equi” symbolizing equality and equilibrium and “nor” for Norway, underscoring the company’s purpose to serve Norwegians. 

Most importantly, the company’s revenues were channeled into a sovereign wealth fund. Today, that fund is worth over US$1.6 trillion with the proceeds used to invest in education, clean energy, and public infrastructure. 

From the start, Norway saw oil not as a forever fuel, but as a temporary windfall to buy time for what’s next.

What’s often overlooked in this story is just how much cultural alignment that took. While it may have been easier for Norway to build national consensus than in Canada, it still took a deliberate, hard-won effort on the part of government, civil society, and industry. Norwegians had to be convinced that the purpose of this money-making resource should be to invest in a diversified economy. 

That mindset shift was just as important as any industrial policy or legislation.

Here in Canada, we are at a crossroads. We could double down on business as usual. Or we could make a bold choice to treat electrification and decarbonization not as costs to the economy, but as the foundation of a new, future-proofed one.

We won’t succeed if all provinces aren’t working together. 

Canada’s inter-provincial barriers are one of the greatest threats to our economy. 

Many of our provinces are rich in clean energy resources. But we lack the interprovincial transmission infrastructure needed to move electricity efficiently across the country. Major electrification projects need to navigate federal regulations, provincial permitting, municipal zoning, and sometimes multiple court challenges. All of which could be subject to political turnover or policy reversals. 

Investors don’t fear regulation — they fear unpredictability.

Perhaps worse is that raising the investment capital across provinces to pay for national interests is a legal and logistical headache. Securities regulation is fragmented, making it more expensive to raise capital in Canada for businesses trying to operate or attract investors across multiple provinces.

Anyone who plays a team sport knows that a group of players who trust one another and play as a unit can outperform even the most talented individuals who act alone and are critical of one another. Canada is the later – we need a good coach to get us playing like a team. (Maybe now we have one!)

The good news is that the economic and social opportunities ahead of us are massive, and there is still time to capitalize on them. 

Clean electricity opens the door to entire industries: battery manufacturing and recycling (sidebar to Canadian investors to save Li-Cycle!), green hydrogen, electric vehicle supply chains, data centers powered by renewables. In 2023, for the first time, global investment in clean energy exceeded that in fossil fuels. This isn’t about ideology – it’s about markets. And risk management.

Canada has the minerals, the engineers, the large pools of capital, and the know-how to structure the right policy, technology, and investment pathways to get there. 

The opportunity is ours for the taking. 

We decide.

Susan McGeachie is CEO of the Global Climate Finance Accelerator, which convenes partnerships across business, finance, government and academia on strategies, policies, procedures, and tools to finance the deployment of technically viable climate solutions.