By Anders Lorenzen
Mark Carney, the former Governor of the Bank of England and the United Nations (UN) Special Envoy for Climate Action and Finance, has become the next Prime Minister of Canada.
In the wake of Justin Trudeau’s resignation, four candidates battled it out for the leadership of the Liberal Party of Canada, with the vote held on March 9, 2025.
Carney faced Chrystia Freeland, Karina Gould and Frank Baylis, and the economist secured 85% of the votes.
Next federal election
As Trudeau resigned ahead of the general election, Carney will not have long before facing a general election in six months, which will occur on 20 October 2025 at the latest.
Therefore, it is unclear how much Carney will change ahead of the election and whether his priority will extend beyond steadying the ship and campaigning.
A break with the Trudeau climate agenda?
Many in the climate community would hope for a more vigorous climate agenda than the one under Trudeau.
When the outgoing prime minister came into power in 2015, he broke with the Conservative Party, where prime minister Stephen Harper had adopted a climate denial approach. He said he would forge a pro-climate action agenda.
Frustrated climate activists
Climate activists grew frustrated by the lack of progress from Trudeau – unwilling to significantly transition the Canadian energy economy away from fossil fuels.
Trudeau continued to support the destructive tar sands oil project and the Keystone XL pipeline, which transported that oil to US refineries. The project was eventually rejected by the incoming Biden Administration in 2021.
With President Trump’s trade war between the US and Canada underway, one of Carney’s first significant challenges will be navigating its economic impact. Meanwhile, climate advocates welcome his victory.
Gould vs Karney
Some would have preferred Gould over Carney, who, data indicated, would be more assertive about climate change. She has a strong track record of progressive climate policymaking, social reform, and climate advocacy.
Financial and climate ideology
Unsurprisingly, Carney favours a market approach to climate action.
While at the Bank of England, he supercharged climate change as a key concern and focus area.
He pushed financial institutions to consider climate risks, and carbon pricing was one of the market-based solutions he supported.
Advocates for the economic benefits of climate action
He strongly advocates and promotes ambitious climate policies, economic opportunities and growth prospects. Analysts and commentators suggest that his finance background makes him a market-driven climate advocate rather than an environmentalist.
His governing will likely be based on a market approach, favouring financial incentives and corporate responsibility rather than outright bans or government intervention.
Concerns
However, some will caution against this approach, as Carney will be more cautious and not implement it at the speed the science demands.
The prevailing argument is that climate targets should be substantial regardless of whether the economy is strong or weak at the given time.
There are also concerns that Carney would still support continued investments in tar sands. In 2021, Greenpeace analysis found that after Carney joined Brookfield Asset Management as a vice chair in 2020, it had invested billions of dollars in fossil fuel projects, including a coal port and an oil sands pipeline.
What climate progress could Carney yield?
Looking at the kind of climate policies Carney is likely to unveil, he has hinted and expressed support for the following:
- Expand carbon pricing with market incentives
- Using carbon capture and storage (CCS) technology to transition fossil fuel phaseout
- Set up a mixed public-private $100B fund to accelerate clean energy investments
- Set up a framework to expand nuclear generating capacity
- Advance and set new carbon capture and storage (CCS) targets
- Market-based incentives for public transport
- Incentivise the private sector to reduce plastic consumption
- Use economic measures to protect indigenous land and communities
- Integrate climate finance rules in global trade
Conclusion
There’s no doubt that Carney will inject renewed energy into the Canadian government where Trudeau had become toxic. On paper, he also signals vast progress in advancing action on climate change.
Carney is a centrist who strongly supports global institutions like central banks and financial entities.
Stable markets
From a market perspective, he is led by stability and is unlikely to do anything that rocks the boat. Right now, he would make any moves that would weaken Canada’s oil and gas and fossil fuel infrastructure sectors.
But as an economist who views climate action as an economic opportunity rather than a burden – understanding the massive potential for ambitious policies. He would certainly not do anything to weaken the power of clean industries; on the contrary, he would do quite the opposite.
He and his party will likely take the position that to achieve meaningful change, they must win the election in six months, and they will supercharge their focus and priorities to achieve that goal.
Anders Lorenzen is the founding Editor of A greener life, a greener world.
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Categories: Analysis, Canada, economy, International Politics
