High Performance Outcomes for Canada’s Infrastructure

In June 2021, the Government of Canada sought input on Building the Canada We Want in 2050: Engagement Paper on the National Infrastructure Assessment to identify infrastructure priorities and ensure that infrastructure supports net zero climate targets by 2050. The engagement process called for input on three priority topics:

• Assess Canada’s infrastructure needs and establish a long-term vision
• Improve coordination among infrastructure owners and funders
• Determine the best ways to fund and finance infrastructure

Renewable Cities submitted recommendations for infrastructure that supports clean, compact, connected communities.

Assessing Canada’s infrastructure needs and establishing a long-term vision

Shared Priorities

Canada’s long-term infrastructure vision should be built around ten shared, interrelated priorities that respond to social, economic and environmental challenges.

1. IPCC 1.5°C climate targets
2. Equity
3. Ecosystem protection and restoration
4. Resilience to climate change impacts and shocks
5. Food security and farmland protection
6. Prosperity
7. Public health, acting on top preventable causes of death and disease related to unsustainable urban form
8. Congestion management
9. Civic infrastructure deficit management
10. Public value for dollar spending, maximizing returns for taxpayers

GHG Sectoral Priorities

To meet Canada’s 2030 and 2050 climate targets, greenhouse gas emission sectors will require a strategic focus driven by the specific characteristics of each sector and subsector.

• Super-Sized Sectors: without significant progress in these sectors, deep emission reductions cannot be achieved. Top priority: light duty vehicles
• Surging Sectors: These sectors are critical because without immediate action they fundamentally undermine meeting 2030 targets. Top priority: urban freight
• Slow Stock Turnover Sectors: These sectors demand immediate action, otherwise carbon emissions will be locked in, threatening 2050 targets and increasing transition costs. Top priority: new buildings
• Natural Sequestration and Storage Sectors: Protecting natural systems that sequester and store carbon is essential. Top priority: natural areas and greenspace protection
• Stubborn Sectors: Sectors that are extremely difficult to decarbonize demand special attention because they typically require multiple complex strategies. Example: cement
• Sunset Sectors: Sunset sectors, such as oil and gas extraction, require careful consideration to assess the optimal ways to phase out and modify for clean energy production. Example: retooling refineries and upgrading distribution networks to accommodate renewable fuels

Infrastructure Investments Compatible with Net Zero Targets & Shared Priorities

Improving coordination among infrastructure owners and funders

Multi-Level, Multi-Sectoral Governance: A multi-level, multi-sectoral governance approach should be central to infrastructure assessment and planning. This tactic is often found behind progressive step changes toward net zero happening around the world. Notable examples include B.C.’s Energy Step Code Council, the Netherlands’ advanced institutional approaches to transportation electrification and sea level rise, and California’s Sustainable Communities and Climate Protection Act, which drives multi-level government, transit and stakeholder collaboration on integrated land use and transportation infrastructure plans.

Coordinated Outcomes: Every level of government should have strong standards and well-defined roles to help facilitate coordinated outcomes. Local governments have planning authority and should handle the finer details on planning, analysis and modelling processes. Provincial and federal governments should establish clear performance outcomes (e.g., GHG reduction targets by urban region) and essential planning requirements and processes, such as scenario modelling and multi-criteria analysis.

Capacity Development: Capacity development is essential for supporting coordination, governance and program delivery, as well as understanding infrastructure needs and implications. Key actions include applying multi-criteria options analysis and life cycle costing, building senior government spatial modelling capacity and adopting integrated design processes.

Criteria to Drive Performance: A wide variety of criteria should be considered to drive high performance outcomes:

• Minimum & Threshold Criteria: Provide funding for infrastructure that meets pre-determined criteria for achieving GHG reductions and other shared priorities (e.g., resident and job density thresholds that support different types of transit infrastructure and service frequency).
• Bonusing Criteria: Provide financing increases based on performance improvements (e.g., a sewage treatment plant project receives extra financing if renewable natural gas is generated).
• Conditionality Criteria: Focus on well-established infrastructure investments that cost-effectively meet climate targets and shared priorities (e.g., providing infrastructure for medium to high-density, mixed-use areas rather than greenfield developments).
• Leveraging Criteria: Focus on investments that strengthen performance outcomes (e.g., augment investment into local bus services if affordable housing is integrated into bus exchanges).

Determining the best ways to fund and finance infrastructure

From an Infrastructure Canada perspective, a key question is public value for tax dollars. Public spending is limited and poor financial tools with inadequate performance criteria could exacerbate intergenerational inequity––a growing threat in Canada at every level of government.

Financial Tools: Consider flexible financing tools that reflect different types of infrastructure needs, including:

• Forgivable Loans to incentivize future performance, such as rapid transit investments based on land use policies, that increases residential and employment density
• Loans not grants, for infrastructure investments with high ROI and investments with high lifecycle cost savings relative to traditional, carbon-based infrastructure (e.g., urban light and medium duty freight, taxi and ride hailing zero emission vehicles)
• Bundled revolving funds and financial policy tools such as unique loan products or revolving funds—developed by Infrastructure Canada, provinces, local governments, utilities, transit authorities or other publicly regulated players—to send sharp price signals to the marketplace and drive market transformation

Zero Emission Economy Impact Investment Culture: Infrastructure Canada should lead a national social innovation process to create a zero emission economic impact investment culture, mobilizing diverse local, provincial and federal policy instruments—financial and otherwise—that send sharp price signals to the marketplace.

Read Renewable Cities’ full submission: Toward High Performance Outcomes_Infrastructure Canada