What does it mean for Canada’s “green” finance rules to actually be green? And why are fossil fuels knocking at the door? Watch this informative and clear presentation from Jessica Carradine, Climate Finance Consultant at Environmental Defence Canada, as we unpack one of the most important climate policy fights happening right now — keeping fossil fuels out of Canada’s sustainable taxonomy. SLIDES 2026-10 CCL Canada taxonomy Why this matters: The federal budget is coming, and we’ll be lobbying MPs in late November. For the past couple of years, CCL volunteers have been calling for fossil fuels to be kept out of Canada’s sustainable taxonomy. This call will get you up to speed and ready to lobby with confidence. About Jessica: Jessica Carradine (she/her) is a Consultant on the Climate Finance team at Environmental Defence Canada, where she works to advance credible climate finance policy with a focus on sustainable finance taxonomies and transition plans. She was previously a Senior Analyst at Investors for Paris Compliance. Suggested reading: Preliminary Summary of the Business Future’s Pathway report Sustainable Investment Guidelines (Taxonomy) Takeaway: Budget 2025 reconfirmed the federal government’s support for the arm’s-length development of sustainable investment guidelines, also known as a “taxonomy”. These guidelines are intended to be an important (voluntary) tool for investors, lenders, and other stakeholders, by credibly identifying “green” and “transition” investments. What is a taxonomy? A taxonomy is a set of criteria used to identify activities and investments that are eligible for an investment label as “green” (such as renewable energy) or “transition” (such as technology for decarbonizing high-emitting industrial processes). Sixty other jurisdictions, (including the EU), have put taxonomies into force, or are planning to. Why is a taxonomy important? A taxonomy could be used by financial institutions or corporations to issue green or transition bonds, and by investors to evaluate the credibility of sustainable investment products, reduce financial risks and drive down greenhouse gas emissions. A taxonomy could also be relevant to climate action plans and reporting required by entities under climate aligned finance legislation, such as Sen. Rosa Galvez’ Bill S-238. How will the taxonomy be developed? The Canadian Climate Institute, working with the investor-led initiative Business Future Pathways, will lead the development of these guidelines. A new independent Taxonomy and Transition Planning Council has been established. In the summer of 2026, we empowered our volunteers to give feedback on their questionnaire to exclude fossil fuels and strongly disagree with an abatement category. In September the Business Future Pathways group released a report and we were heard (see above). What is the timeline for developing the taxonomy? The Taxonomy Council is expected to finalize sustainable investment guidelines for six (yet to be determined) priority sectors – three by the end of 2026, and three by fall 2027. What will be the priority sectors for the taxonomy? The list of priority sectors has not yet been determined, but the federal government has previously listed as priority sectors: electricity, transportation, buildings, agriculture and forestry, manufacturing and extractives (including mineral extraction and processing), and natural gas. It is worth noting that the EU taxonomy includes, subject to certain conditions, natural gas and nuclear electricity generation in the “transitional” category.
BACKGROUND INFORMATION
Preliminary Summary of the Business Future's Pathway report
Sustainable Investment Guidelines (Taxonomy)
Sustainable Taxonomy with Jessica Carradine – Tuesday, October 13, 2026
Posted on September 24, 2026 in Education
The group overseeing the writing of Canada’s new taxonomy rules have published a report on the public consultation held last summer. They received 179 submissions (only) from individuals and organizations – including some CCLers. They will publish a final report on taxonomy by year end.
From the outset they said that their proposed inclusion of an “abatement” category (in addition to “green” and “transition” categories) would be a world first and was controversial. CCL objected to this category as it would allow some fossil fuel projects to claim climate alignment. A large majority of the consultation participants also objected as the report says:
“Roughly two-thirds of public respondents opposed the category while roughly one-quarter articulated support conditional on strong guardrails. Of those who responded to the question, opposition to the existence of the category was strongest among individuals and NGOs. These respondents raised concerns that the category could extend the life of fossil fuel assets, result in carbon lock-in or stranded-asset risk, or differ from approaches used in other taxonomies, leading to challenges with interoperability.”
One of the report’s three advisory groups also objected to this category.
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