Big Ideas for Sustainable Prosperity: Policy Innovation for Greening Growth

The need to build a cleaner, more innovative economy is now seen as a pressing policy priority for Canada by governments, as well as by a growing list of businesses, think tanks, and NGOs.¹ For example, the federal government’s latest Speech from the Throne (Canada 2015a) and the mandate letters to ministers (Canada 2015b) both devote considerable attention to this issue, while many provinces have similarly targeted the area as a top priority (e.g., Ontario 2016). This emerging focus has also been amplified by the Paris Climate Accord (UNFCCC 2016), which sets a bold mandate for Canada (and other nations) to transform to a low-carbon economy by 2030.

This attention reflects both economic and environmental policy drivers. The global economic landscape is shifting toward one that increasingly will reward countries (and companies) that are energy efficient and eco-innovative, pollute less, and sustain their natural capital, according to a growing list of some of the world’s most respected economic authorities (OECD 2015; European Commission 2012; World Bank 2012; CCCE 2010; McKinsey & Company 2014; WBCSD 2010). Meanwhile, the shift toward greener growth is driven by unprecedented and rising environmental stresses—such as climate change, water security, and biodiversity loss—coupled with the accelerating pace of technological change to address those problems (Elgie 2015; CCA 2013).

The changing global marketplace creates both opportunities and risks for many parts of Canada’s economy. Clean-technology firms can tap into a global market expected to exceed US$2 trillion by 2020 (UNEP 2013). For natural-resource and manufacturing firms, there is growing pressure to improve environmental performance (as Canada’s oil industry is discovering)—but for those that succeed, boosting resource and energy efficiency represents an estimated US$2.9 trillion economic opportunity by 2030 (Heck, Rogers, and Carroll 2014).

The next five years are likely to be a critical window for establishing the policy frameworks required across Canada to drive a shift to greener growth. In anticipation of this opportunity, and with a view to helping inform these efforts, Sustainable Prosperity (a national research network) brought together a group of prominent environment and economy experts for a two-day conference at the University of Ottawa in 2014, devoted to Big Ideas for Sustainable Prosperity—Policy Innovation for Greening Growth. The articles in this special issue reflect the ideas and discussion generated at that conference.

The articles that follow are not typical academic papers. The mandate for the authors was to produce ‘‘big think’’ pieces, to help spur new ideas and to generate original research questions about the range of policies needed to drive greener growth. Accordingly, authors were asked not to present new research (although that could inform their arguments) but instead to identify significant policy challenges or changes that are necessary, along with the key research questions needed to inform and accelerate those policy changes.

The range of issues discussed by the authors was extensive, and grouped together they present a broad slate of policy priorities and research questions that must be addressed. The special issue starts by confronting this challenge head-on, with a landscape paper by Edward Barbier, ‘‘Building the Green Economy,’’ which suggests that a policy strategy for green growth both in Canada and across North America requires addressing three issues: environmentally harmful subsidies, the inadequate use of market-based incentives, and insufficient policy support to enhance green innovation. Barbier argues that these issues are interdependent, and that by developing an integrated policy strategy that phases out environmentally harmful subsidies, enhances the use of market-based incentives to stimulate more economywide green growth, and recycles the savings or revenues generated from these policies to finance public-sector support for private-sector green innovation, governments can help lead the economy onto a greener and more sustainable growth path.

The remaining papers are clustered into four topic areas, starting with building a low carbon economy. James Meadowcroft, in ‘‘Let’s Get This Transition Moving!,’’ argues that the shift to a low-carbon economy in Canada should be thought of as a major societal ‘‘transition’’ and informed by...