The climate energy transition was a broken promise

Mac Van Wielingen is a founder and past chair of the Business Council of Alberta, chair of Viewpoint Investment Partners, and founder and partner of ARC Financial Corp.

Prime Minister Mark Carney conceded on June 30 that Canada’s emissions will be higher in the next few years than previously projected, calling the earlier plan too expensive and too divisive. This was not just a Canadian political story. It was something much larger.

The man who chaired the Glasgow Financial Alliance for Net Zero, and who helped design the architecture of global net-zero finance, was telling Canadians that the architecture, as implemented, will not deliver what it promised.

Why the retreat? This is a relevant question, not just for Canada, but for virtually all countries of the world.

The answer lies in the fundamentals, not in competing political narratives.

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Start with the arithmetic because it is brutal and not in dispute.

Global emissions rose again in 2025, the fourth consecutive record year. To keep alive the target of limiting the global temperature increase to 1.5 degrees, agreed in Paris in 2015, the UN’s own Emissions Gap Reports gap say emissions must fall 42 per cent below 2019 levels by 2030 and 55 per cent by 2035.

All pledges today will cut up to 10 per cent by 2030 and 15 per cent by 2035.

In Canada, a decade of climate-first policy under former prime minister Justin Trudeau would have reduced emissions by about 10 per cent below base year 2005 levels, a long way from the 40 to 45 per cent now required to meet targets by 2030. Mr. Carney simply read the writing on the wall when he decided to abandon efforts to reach that target. It was one of the easiest decisions he has made.

For concerned citizens who saw net-zero targets as a believable commitment, this performance gap is the whole story. But there is more to the loss of credibility.

The extensive use of the term “energy transition” looks misleading. It rests on the concept of clean non-emitting energy sources replacing hydrocarbons. Based on recent global data published by the Energy Institute, renewable energy grew faster than any other energy source, but the share of hydrocarbons in the total mix barely budged.

Again, the arithmetic is indisputable. Over 36 years since the first Intergovernmental Panel on Climate Change (IPCC) report was released, depending on data source and definitions, hydrocarbons have accounted for 80 to 85 per cent of global primary energy use. Clean energy has been added to a growing system. Demand growth in the total system swamped the impact of renewable additions.

The use of the term “transition” now has the look of a promise broken. The substitution and ultimate replacement of hydrocarbons will not occur over a number of years, nor even decades. It certainly will not be 2050. If it happens, it will be multi-generational. If anything, it is more of an evolution versus a transition.

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Missing emission target commitments and the evident intractability of hydrocarbons in the global energy mix have created a credibility deficit. The conventional explanation for the underperformance is often bad actors, fossil-fuel lobbies, or disinformation. These factors are nowhere near sufficient for explaining what has happened.

There is one foundational misunderstanding that underlies the credibility breakdown.

Modern society and energy are completely locked together.

Treating emission reductions as an absolutist, be-all-end-all priority and subordinating other essential societal priorities was a serious failure in strategic thinking. The result was badly disproportionate trade-offs which had real world consequences and caused extensive pushback.

Territorial accounting for emissions contributed to Europe accepting an overdependence on Russian gas, with now painfully clear devastating consequences.

The energy transition led to higher energy prices which hurt household budgets, with climate-ambition-leading countries Ireland, Denmark, Germany and Britain having among the highest electricity prices in the world. Within the United States, the two climate-leading states, California and New York, have the highest prices.

High energy prices also hurt industrial competitiveness and productivity. Germany and Britain are the clearest examples. Output in the energy-intensive manufacturing sector in Britain has fallen by a third since 2021 and is now at its lowest level since 1990.

In Canada, the oil and gas sector, the highest-value contributor to our economy, was throttled back and opportunities forfeited. Canada is now more trade-vulnerable and scrambling to build energy infrastructure.

Questionable institutional competency and governance also undermined global credibility for climate action.

The clearest evidence that the climate-action retreat is substantive, not merely rhetorical, is the re-anchoring of energy policy in its long-standing fundamentals of security, reliability, affordability, competitiveness, and productivity.

Adaptation and managing the consequences of climate risk should be added to this list as they too have been underweighted or neglected.

In Europe, given record heat deaths this year, consumer groups are pushing for a relaxation of rules against the installation of air conditioning. Market penetration is only 15 to 20 per cent there as compared with approximately 90 per cent in the U.S. and Japan.

In Canada, there is the conundrum that emissions from wildfires over the past three years rival the entire emissions from our human activities, demanding more resources and policy attention.

None of this repudiates climate concern. It is the overdue arrival of realism, accountability and the logic of cost benefits proportionality in policy implementation.

A final point and an important one.

U.S. President Donald Trump did not cause the climate action retreat.

Like Mr. Carney, Mr. Trump simply read the writing on the wall. His policies and rhetoric amplified a pushback already under way. One can see the same phenomenon in many countries in Europe, where anti-climate action has been integral to the rise of populism.

Climate action will continue, but will be reshaped, reformed, and reset within an expanded hierarchy of national priorities.