What a fossil fuel phaseout could mean for sustainable jobs in Canada

COP28 is wrapping up this week and there is still a chance that the final global agreement coming out of the conference may at long last address the biggest elephant in the room and call for a phaseout of fossil fuels, despite record attendance by fossil fuel lobbyists.

However, the initial draft text shows the words “phase out” have been excluded, following leaked reports of behind the scenes influence from OPEC oil interests. The final agreement is still up in the air, but one thing is clear: the momentum around a fossil fuel phaseout at this year’s summit signals the writing on the wall.

Simultaneously, the sustainable jobs act is moving through the House of Commons, having passed through committee last week despite unprecedented filibustering. This legislation aims to build and support a workforce for the net-zero economy, with strong engagement from affected workers and communities.

What would a global commitment to fossil fuel phaseout mean for sustainable jobs in Canada?

For one, it would add momentum to the influx of green jobs and investment that is already underway. Clean energy jobs in Canada are ramping up. There is no shortage of work to be done to produce and transport renewable energy, reduce energy demand, and grow low-carbon industries if we are to reach our climate commitments. The transition is already underway in the auto manufacturing sector, where Unifor autoworkers have been advocating for the transition to electric vehicles and negotiating to ensure good long-term jobs for their members.

Jobs in the clean-energy sector are forecasted to grow seven per cent per year to 2.7 million by 2050 in a net-zero Canada, far outpacing jobs lost in the fossil-fuel sector. And just last week, Canada was among over 120 nations at COP28 that committed to tripling renewable energy capacity and doubling the rate of energy efficiency improvements in the next six years, further accelerating the transition.

If the global agreement is reached, the jobs created under the sustainable jobs act would need to be aligned with plans to phase out fossil fuel production and use. Some temporary jobs within the traditional energy sector will be required, for instance, to clean up and reclaim shuttered oil and gas sites. But supporting job creation in fossil fuel production isn't strategic — even if these roles are tied to reducing emissions, they only set workers up for yet another transition in years to come when demand declines. Adding a strong definition and compass for “sustainable jobs” in the legislation and implementation would help ensure investments are moving in the right direction.

A global agreement to phase out fossil fuels would also kick-start a planning process for a wholesale energy transition across Canada’s economy. This would be an opportunity to sketch out a clear roadmap to an economy beyond oil and gas through a proactive, collaborative process with workers, Indigenous governments, and affected communities at the table.

Canada could learn from Germany’s coal transition process, which assembled a coal commission of nearly 30 stakeholders from unions, industry, NGOs, academia, and communities in coal regions who agreed to a phaseout timeline, path, and policies. Now, the regions where coal mines and power plants are scheduled to shut down receive annual funding from the national government to support regional economic development in other industries.

Canada’s sustainable jobs act partially creates the grounds for such a collaborative process, bringing together a partnership council of labour, industry, and Indigenous Peoples to engage with affected communities across the country and advise the government on sustainable jobs efforts. But it is missing a few fundamental pieces: joint decision-making, collaborative planning at the regional level, and a phaseout mandate.

To align sustainable jobs with a move away from fossil fuels, Canada needs a transformative green industrial strategy. Such a strategy would signal and incentivize suitable low-carbon industries and inform regional planning, investment, and job creation.

Most importantly, the green energy economy and job creation must respect the authority of Indigenous Peoples. While some Indigenous groups are seeking ownership in fossil fuel projects, many Indigenous Peoples have opposed and resisted fossil fuel development given the disproportionate impacts of extraction projects and climate change that they face. At the same time, Indigenous communities are the largest asset owners of clean energy in the country outside of utilities, and there are endless opportunities to scale up investment in Indigenous-led solutions.

The green economy cannot re-entrench the inequities of the fossil fuel paradigm.

There is no guarantee the transition will be smooth. It is incredibly complex and will undoubtedly face unforeseen roadblocks. But with a global agreement to phase out fossil fuels and a strong sustainable jobs act, Canada can chart a course that supports workers, spurs job growth, and increases equity toward a fossil-free future.

Laura Cameron is a policy adviser for IISD’s energy team working in the areas of fossil fuel subsidies, just transition, and oil and gas policy in Canada. With a master’s degree in Indigenous governance and a bachelor’s in biology, her interdisciplinary interests centre on environmental justice and community-led climate action.