From the Fraser Institute

By Kenneth P. Green

Prime Minister Mark Carney recently unveiled his new cabinet. And there’s quite a lot of work to do.

Before his election victory, the prime minister exorcised a widely-despised element of Canada’s climate policy, the “consumer” carbon tax, which was imposed directly on Canadians for their consumption of energy (electricity, heating fuel, gasoline). At the same time, in response to President Donald Trump’s tariff war, the prime minister made grand proclamations of future energy glory. “Canada has a tremendous opportunity to be the world’s leading energy superpower, in both clean and conventional energy,” he said. “We are going to aggressively develop projects that are in the national interest in order to protect Canada’s energy security, diversify our trade, and enhance our long-term competitiveness—all while reducing emissions.”

Great plan. So what’s next?

Again, quite a lot. If Prime Minister Carney is serious about reforming Canadian energy policy so Canada can compete against a likely resurgent Trump-driven U.S. energy sector, he must follow this latest bit of tax reform and vocal boosterism with genuine regulatory reform. In other words, the Carney government must repeal the anti-energy regulations implemented by the Trudeau government.

First on the chopping block—Bill C-69, colloquially known as the “No More Pipelines Act,” which created massive uncertainty by introducing vague assessment criteria including “gender implications” for major energy projects including pipelines and LNG export facilities. If Ottawa simplified the project review process, it could help Canada access more lucrative markets for energy products outside the United States.

Then there’s Bill C-48 (colloquially known as the “Tanker Ban Bill”), which changed regulations for large vessels transporting oil to and from ports on British Columbia’s northern coast, effectively banning such shipments and limiting the ability of Canadian firms to export to non-U.S. markets. Tanking the tanker ban should be an obvious sail forward.

Next up, the Trudeau plan to cap greenhouse gas emissions from the oil and gas sector (at 35 per cent below 2019 levels by 2030), alongside major new regulations for methane emissions in the sector. These regulations will likely raise costs and curtail production. By removing them, Ottawa can increase the ability of Canada’s energy sector to compete against a rising U.S. energy sector.

Finally, the Trudeau government’s Clean Electricity Regulations will likely drive electricity rates through the roof while ushering in an age of less reliable electricity supply—a two-handed slap to Canadian energy consumers. Ending these misguided regulations is a no-brainer for the new government in Ottawa.

Prime Minister Carney’s first acts on the Canadian energy file look good. The carbon tax is half-dead (the industrial tax remains in place). And a new pro-energy rhetoric has displaced Trudeau’s “phase it out” framing of Canadian energy policy. But if Carney and his new cabinet are serious about unleashing Canada’s energy potential, reducing dependence on the U.S. market, reaching more lucrative foreign markets, increasing production, and so on, they better get cracking on a regulatory reform agenda lest they find themselves hamstrung by their predecessor’s regulatory legacy.

Kenneth P. Green

Senior Fellow, Fraser Institute

From the Fraser Institute

By Jason Clemens and Tegan Hill

Prime Minister Carney unveiled his new cabinet and did post-announcement media but failed to provide the clarity about his government’s actual views on resource development, particularly oil and natural gas. This uncertainty continues to impede private-sector investment, which our country badly needs.

Uncertainty is an investment killer because it makes it almost impossible for entrepreneurs, businesses and investors to reasonably weigh the risks, potential benefits and hurdles of a potential investment. A broadly recognized measure of uncertainty shows Canadian uncertainty at historic levels. The average monthly uncertainty measure between January 1985, when the data series began and December 2019 just before COVID was 135. The average for the first four months of 2025 was 1,300, almost 10 times higher.

An enormous part of that uncertainty relates to Trump’s tariffs, and the havoc they’re inflicting on entrepreneurs, investors and workers. But contradictions from the federal government in several key policy areas including government spending and borrowing, and energy policy are also creating uncertainty.

Unfortunately, Prime Minister Carney’s recent cabinet appointments and his subsequent media interviews failed to provide clarity.

Consider Tim Hodgson, the new Minister of Energy and Resources. He has a strong background in finance—CEO of Goldman Sachs Canada, chair of Ontario’s electric utility company Hydro One and investment board chair of the Ontario Teachers’ Pension Plan. The latter is important because he oversaw and approved investments in traditional energy companies such as Suncor and Canadian Natural Resources. Hodgson also has ties with the Alberta business community through his board appointments on several Calgary-based companies. His appointment has been interpreted by some that the Carney government will pursue policies to develop our oil and gas sector.

But the appointment of Julie Dabrusin as the Minister of the Environment and Climate Change signals the exact opposite. Dabrusin was the Parliamentary Secretary to the two previous Environment Ministers, Jonathan Wilkinson and Steven Guilbeault. Both opposed several pipeline developments, were instrumental in the introduction of a cap on emissions from the oil and gas sector, and other measures specifically designed to limit—if not actually decrease growth—in Canada’s traditional energy sector. A number of high-profile people in the energy patch, including Alberta Premier Danielle Smith, have already raised concerns about her appointment and what it means for energy development.

The appointments of Hodgson and Dabrusin continue the Carney government’s contradictory approach to policy, seemingly trying to be all things to all Canadians.

In a recent interview with CTV News, Prime Minister Carney simultaneously stated his support for new pipelines to deliver oil and gas to new markets but would not clarify if that meant revising or removing legislation that is broadly seen as a barrier to such developments. More specifically, during the campaign Carney said he would not eliminate Bill C-69, which covers how large infrastructure projects including pipelines are reviewed and approved. It’s widely agreed that Bill C-69 and its evaluation criteria make it almost impossible to build new pipelines in Canada.

Moreover, he failed to clarify whether he would eliminate the government’s current cap on emissions from the oil and gas sector, which is widely accepted as a cap on production. Indeed, according to the independent Parliamentary Budget Officer, the cap would result in less oil and gas production.

These glaring contradictions, which appear to be rooted in attempts to satisfy all Canadians and voting constituents, will need to be clarified at some point. There will come a time—whether it’s a budget (which apparently Canadians won’t see until next year), an application by a company to build a new pipeline, or perhaps just the continuing economic stagnation of the country—when the prime minister will be forced to make a clear choice. Until then, the cost of uncertainty will continue to impose real hardship on Canadians.

Jason Clemens

Executive Vice President, Fraser Institute

Tegan Hill

Director, Alberta Policy, Fraser Institute