When companies convey false, misleading or unsubstantiated claims of environmental benefits or clean, green, renewable, sustainable, or non-emitting, they are considered to be engaging in greenwashing.
The Discussion Paper correctly emphasizes that industrial carbon pricing systems must avoid “managed ambiguity” that weakens price signals, undermines investor confidence, and misdirects capital toward activities that do not deliver durable emissions reductions. This concern is expressed clearly in the paper’s treatment of output-based pricing systems, credit oversupply, banking risks, and emissions-reduction accounts that may dilute real compliance obligations.
Yet this same discipline is not applied to hydropower, which continues to be treated in Canadian climate and energy policy as categorically “non-emitting,” despite substantial and long-standing peer-reviewed literature demonstrating that hydropower reservoirs emit greenhouse gases—particularly methane—through organic matter decomposition, drawdown zones, degassing, and reservoir management practices.
Methane is not a marginal issue. It is a potent greenhouse gas with a high near-term warming impact, precisely within the time horizon that carbon pricing is intended to influence investment and emissions trajectories. Excluding reservoir methane from carbon-pricing logic while tightening requirements for industrial emitters creates a clear inconsistency in how “emissions” are defined and governed across sectors.