Canadian Biomass Magazine

Budget 2023 a ‘missed opportunity’ for clean fuels investment: CFA

March 29, 2023
By Canadian Fuels Association

The Canadian Fuels Association (CFA) and its members appreciate the federal government’s recognition for low-carbon fuels, including biofuels and hydrogen, in Budget 2023. The lack of targeted measures in support of Made-in-Canada low-carbon fuels is a missed opportunity. We will continue to collaborate with government as part of the ‘biofuels consultation’ to advance clean fuel production in Canada.

“The U.S. Inflation Reduction Act (IRA) is a game-changer and Federal Budget 2023 falls short in establishing investment parity for clean fuel production in Canada,” said Bob Larocque, president and CEO of the CFA. “Billions of dollars of investments are awaiting final decision and lack of clarity and targeted measures only adds to the uncertainty for the future of low-carbon fuel production in Canada.”

The potential consequences of the IRA for Canadian low-carbon fuel production are becoming clear. “We’re already seeing the first dominoes start to fall, with significant announcements being made in the U.S., making us more reliant on U.S. imports to meet our climate goals and undermining our energy security and self-sufficiency. Opportunities for family-sustaining, value-added jobs through the fuel supply chain will also be lost to the U.S. CFA and our members will actively continue to work with federal government to ensure investments for low-carbon fuels remain in Canada,” Larocque continued.

Three years ago, CFA released Driving to 2050 which highlighted the opportunities and importance of scaling up domestic, low-carbon transportation fuels, as we continue to diversify the energy mix on our way to Net-Zero. CFA members currently have plans to implement large-scale renewable diesel, sustainable aviation fuel (SAF), hydrogen and ethanol projects, as well as investments worth $8B with the potential to deliver 10 MT of greenhouse gas (GHG) reductions.


As noted in Federal Budget 2023 “hydrogen, biofuels, and biomass – will be critical sources of energy where electricity would be inefficient or impractical.” However, lack of clarity, urgency and targeted measures will limit our near-term potential to decarbonize the transportation sector that Canadians rely on today.

“Canada has all the ingredients to be a world leader in low-carbon transportation fuels – energy infrastructure, sustainable feedstocks and expertise. However, the North American market for fuels is open and highly integrated, making a competitive investment climate critical to the Canadian economy, and Budget 2023 is a missed opportunity,” Larocque concluded.

We encourage the government to act quickly to facilitate consultations and look forward to seeing more concrete measures for low-carbon biofuels as we’ve seen for other sources of clean transportation energy. Otherwise, we risk missing the investment window and opportunity to capitalize on clean energy investments.

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