Tuesday, January 18, 2022
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Sustainable Business – EDC


Contributing to Climate Action Through Export Credit 


EDC Has Taken Innovative Steps toward helping Canada Deliver on Its Climate Change Commitments  


Catherine Decarie, Senior Vice-President, Corporate Affairs, Export Development Canada (EDC)

The adoption of the Paris Agreement in 2015 marked a turning point in the world’s fight against climate change, and world leaders pledged to work together to tackle this global challenge. Canada committed to taking a leadership role in the fight and to support the efforts of developing countries to adapt to the adverse effects of climate change.   


Catherine Decarie

The United Nations Framework Convention on Climate Change (UNFCCC) requires developed countries to lead the way in reducing greenhouse-gas (GHG) emissions and to support developing countries by funding action on climate change above and beyond any financial assistance they already provide to these countries.  

This reporting was not without challenges. First, because the largest impacts of climate change are felt by developing countries, the UNFCCC climate-finance commitments only take into account transactions in those countries. However, producing renewable energy and clean technology solutions is capital-intensive and most companies in this space are developing first-of-their-kind technologies and are often relatively new to exporting. These cleantech companies, therefore, seek export destinations they are more familiar with – a common approach taken by many exporters. For instance, EDC’s research shows 65 per cent of Canadian exporters started exporting to the US while 22 per cent started in other OECD markets. This is a logical first step — these markets are close to Canada and have strong economies, providing safe environments for new exporters.  

Overcoming this challenge was a shared effort between the Government of Canada and EDC. A key part of EDC’s business model involves collaborating with Canada’s Trade Commissioner Service (TCS), which places trade commissioners, who provide advice and problem-solving to Canadian exporters, in 161 offices globally. Canada’s 2017 federal budget deployed more trade commissioners in developing countries. These key resources, in turn, are able to highlight opportunities for Canadian cleantech companies within these developing markets. EDC is working closely with these trade commissioners to facilitate the introductions our cleantech exporters need to increase business in those lesser-known markets.  

Second, as a newer participant to this initiative, EDC had no formal process or internal software to help employees track these climate-finance transactions. Our Environmental Assessment team was therefore vetting all deals manually — a time-consuming endeavour.  However, two of EDC’s ongoing corporate priorities are to increase business in emerging markets and to help grow Canada’s clean-tech sector. These priorities will allow us to increase our support to Canadian companies in developing markets and demonstrate the importance of investing in our tracking and reporting systems going forward.  


As part of the Canadian delegation to the Organisation for Economic Co-operation and Development (OECD), EDC supports continuing discussions on how export credit agencies can address climate change.  

As an example of our co-operation with OECD Common Approaches, a set of recommendations on environment and social due diligence for export credits, we implemented the OECD Sector Understanding (SU) on Export Credits for Coal-Fired Electricity-Generation Projects. The policy aims to limit export credit support for new coal-fired power plants (CFPPs), a notable goal for ECAs as they are the primary funders for most plants.  

However, for some developing countries, particularly those with low national-electrification rates, coal-fired power may be their best and most cost-effective option to ensure that their population has access to electricity.  As a result, coal-fired power may be essential to their national energy policies.  

While the OECD policy takes energy poverty into consideration, EDC created its own policy that goes a step further in defining the projects we will or will not support. EDC considers support to existing coal-fired power plants on a case-by-case basis, provided the funding is for modernization that lowers CO2. In this respect, Canada is well positioned to help as Canadian companies have developed leading-edge technologies that support energy needs in developing countries while reducing harmful environmental impacts of coal-generated electricity. EDC saw an opportunity to support these Canadian exporters while also ensuring alignment with the Government of Canada’s action on climate change.   

EDC is currently analyzing the varieties of CFPP modernizations to further refine expectations around CO2 emissions reductions. In addition, we implemented our policy six months ahead of the formal effective date, making ours the first ECA to adopt the sector understanding.  


EDC’s mandate is to provide financial and risk mitigation solutions, knowledge and connections to Canadian exporters, thereby reducing barriers to trade and helping companies tap into opportunities in global markets. The above examples highlight the work EDC has done to bridge practical approaches for business with policy solutions on climate change. We strive to continually research and refine our approach to supporting the Government of Canada’s efforts to address climate change. 

That said, ensuring a cleaner and greener world will take more than just Canada’s efforts. It will require the combined effort of governments, businesses, financial institutions, and others acting on these international standards. It will require us to come together, share ideas and experiences and find common ground and opportunities to learn from each other and act in lockstep.  


About the Author 

In her role as Senior Vice-President, Corporate Affairs and Secretary, Catherine Decarie leads critical corporate and business advisory functions that oversee EDC’s strategic relationships with government, media, private sector partners and civil society. Ms Decarie sets the course for the organization’s external engagement and the sharing of EDC’s story with the public and key stakeholders.