The European Union (EU) followed Japan in lodging a complaint with the World Trade Organization (WTO) over subsidies that favor producers using domestic technology. Ontario's Green Energy Act allows the province's feed-in tariff program to pay above-market rates to renewable energy produced with a certain percentage of Canadian equipment. "This is in clear breach of the WTO rules that prohibit linking subsidies to the use of domestic products," said the European Commission in a statement.

An official panel said last week that climate change will cause damage to Canada equivalent to about 1% of gross domestic product (GDP) in 2050 due to flooding, illness, and the death of forests. In addition, the damage could amount to as much as 2.5% of GDP by 2075.

Canada's government and energy industry have launched an effort to reverse proposed European Union (EU) fuel quality standards that would rank Canadian oil sands as one of the earth's most carbon-intensive crude sources. The proposed Fuel Quality Directive would give oil sands a default greenhouse gas value of 107 grams of carbon per megajoule, while conventional fuel is given a value of 87.5 grams. Canada, which has been touting oil sands as a secure and stable energy supply, believes that the directive is discriminatory.

Environment Minister Peter Kent announced last week proposed standards to require new vehicles sold in Canada to have an average fuel efficiency of 100 km on 4.35 litres of fuel by 2025, matching similar American standards. The regulations would also reduce tailpipe emissions over the next five years until more stringent rules take effect in 2017. Kent acknowledged automakers were skeptical. "I've met with representatives of the Canadian auto industry and the American side of the industry and there are concerns," said Kent.

Environment Minister Peter Kent declined to confirm or deny that Canada is pulling out of the Kyoto Protocol, a move that would save the country as much as $6.7 billion and make it the first of 191 signatories to annul its obligations. Kent declined to confirm that Canada would pull out of Kyoto, but he did say the government wouldn't make further commitments to it. "Kyoto is the past," he said at a press conference.

Canada is still legally obligated to cut emissions despite its pullout of Kyoto, the United Nations climate chief said Tuesday. "Whether or not Canada is a party to the Kyoto Protocol, it has a legal obligation under the [U.N. framework on climate change] convention to reduce its emissions, and a moral obligation to itself and future generations to lead in the global effort," said chief Christiana Figueres. Emissions in Canada are estimated to have risen over 20 percent between 1990 and 2009, and the country would have been liable for $13.6 billion under the terms of the Kyoto Protocol.

Canada's Conservative party's plan to battle industrial pollution may be the most costly to government, the most damaging to the economy, and the least effective at cleaning the atmosphere, according to a federal government analysis of climate change policies. "This approach requires many initiatives, likely by three different orders of government, with the associated administrative costs," said the report.

Oilsands projects and their subsidies have become a contentious issue in the Canadian federal elections, as the New Democratic Party's Jack Layton vowed to eliminate C$2 billion in oil and gas subsidies and use the money instead for renewable energy. The party has also proposed a moratorium on new oilsands projects pending efforts to manage their environmental impacts.

Sierra Club Canada and the Canadian Environmental Law Association have asked the Federal Court of Canada for a judicial review of two approvals by the Canadian Nuclear Safety Commission that would allow the shipment of radioactive materials. Michael Binder, head of the commission, said that opposition to the approvals, which would allow Bruce Power Inc. to ship 16 steam generators through the Great Lakes and the St. Lawrence Seaway, is "not any more about safety" and is a ploy by anti-nuclear activists to prey on people's fears.