Canada’s continued investment in oil and gas infrastructure and exports is part of a deeply concerning global trend that will see key fossil-producing countries extract more than double the volume of fossil fuels in 2030 that would be consistent with limiting average global warming to 1.5°C, a new report concludes this week.

That extreme overshoot puts “a well-managed and equitable energy transition at risk,” the 2025 Production Gap Report concludes.

The 90-page report, the latest in an annual series by the Stockholm Environment Institute (SEI), the Winnipeg-based International Institute for Sustainable Development (IISD), and Climate Analytics, profiles 20 fossil fuel-producing countries and tracks the misalignment between governments’ production plans and the 2015 Paris Agreement goal of holding warming to well below 2°C. It finds that by 2030, countries plan far more fossil fuel production than would be safe for the climate—about five times too much coal, 30% more oil, and nearly double the gas. Those national plans also go well beyond their own climate mitigation pledges, by 35% in 2030 and 141% in 2050.

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Canada is among the countries planning fossil fuel production at levels inconsistent with net-zero goals, while continuing to support production financially and through policy. The country shows up as the world’s third-largest oil exporter and sixth-largest gas exporter, producing more than six gigatonnes of carbon dioxide equivalent per year in oil, and increasing gas production from about five to more than six gigatonnes annually.

IISD policy advisor and report co-author Olivier Bois von Kursk told The Energy Mix that Canada has invested a lot in fossil fuel infrastructure in recent years, and that could continue under the One Canadian Economy Act after it was fast-tracked through Parliament this summer.

“It was flagged recently that a new pipeline might be of strategic interest for the new Carney government, von Kursk added, noting that it’s unclear whether it will actually get built.

As signs of industry support, the report cites Export Development Canada data showing C$32 billion in financing and more than C$18.5 billion in loan guarantees for the Trans Mountain Pipeline expansion project since 2018, and the launch of Canada’s first large-scale LNG export facility in July. “Many governments are still thinking in straight lines, and their plans for fossil fuel production imagine a world in which the energy transition either doesn’t happen at all, or continues to happen at a very incremental pace,” Climate Analytics’ Neil Grant told a media conference.

Von Kursk added that Canada is one of several countries that are “highly dependent on fiscal revenues for their fossil fuel exports,” so that most of its economic expansion plans are dedicated to these exports.

“That’s one of the main factors, I think, that is driving that growth, right at the moment when we expect a peak in fossil fuel demand,” he said. “That’s a big concern.”

The report highlights the 2024 Canadian Sustainable Jobs Act as one example of how producers can plan for a just transition away from fossil fuels.

“Over the past 10 years, we’ve seen renewable energy come down in cost and be deployed quite rapidly,” said SEI senior scientist Derik Broekhoff. “One of the key implications is that governments need to take deliberate steps to ensure a just transition away from fossil fuels.”

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The authors note national governments are expected this year to submit new nationally determined contributions (NDCs) under the Paris Agreement for reducing emissions through 2035. Of the 20 countries analyzed, Canada is one of six that have already submitted their NDCs ahead of the COP30 climate summit in Belém, Brazil, pledging to cut emissions  between 45 and 50% below 2005 levels over the next 10 years.