Welcome to Economic Insights, your twice-weekly deep dive into the major projects and policy shifts shaping the Canadian economy.

Stories we are following:

– Permanent Building Canada Act powers needed to attract investment, says Dabrusin. 

Federal Environment Minister Julie Dabrusin defended her government’s push to make permanent the Building Canada Act’s special regulatory powers, which originally came with a sunset clause barring Ottawa from designating national interest projects past 2030.

The Building Canada Strong Act, tabled this week, proposes to remove the sunset clause that was negotiated in by the Conservatives and Bloc Québécois in June 2025.

Asked by iPolitics whether she’d be comfortable with a future government — a Conservative minority, for instance — benefiting from those powers, Dabrusin didn’t directly address the scenario, instead pointing to the urgency she says Canadians feel around building energy security and sovereignty.

“People feel very strongly that there’s a lot of work ahead of us,” she said. “We’re talking about Churchill Falls; that is not a fast project to complete.” 

We have that story.

– Direct air capture startup ready as Canada eyes carbon credit exports. 

On Thursday, Environment and Climate Change Canada announced that Ottawa is exploring rules to trade Internationally Transferred Mitigation Outcomes, or ITMOs, the mechanism set out under Article 6 of the Paris Agreement that lets countries cooperate on their climate targets by trading verified emissions reductions and removals across borders. 

Deep Sky, a Montreal-based carbon removal project developer behind an ambitious direct air capture facility in Innisfail, is celebrating the news. 

“We’ve been working on this for over a year, getting Canada to move forward with a framework,” said the company’s government affairs specialist, Mathieu Bouchard.

The nearest-term opportunity for the firm is CORSIA, the Carbon Offsetting and Reduction Scheme for International Aviation run by the International Civil Aviation Organization in Montreal.

More on that here.

– Volkswagen delays production at Ontario electric vehicle battery plant until 2029.

The opening of a massive Volkswagen electric vehicle battery plant in southwestern Ontario has been pushed back two years until 2029.

PowerCo Canada, a subsidiary of the German automaker, says it is delaying production at the $7-billion factory in St. Thomas, Ont., in order to align the project’s timeline and product strategy with evolving market demand, technological advancements and the Volkswagen Group’s long-term strategy.

It says the later opening date will allow for next-generation battery technology while retaining the flexibility to scale over time as market conditions evolve. 

CP reports. 

By the numbers:

$700 million: The amount of money the federal government committed to help build the Volkswagen electric vehicle battery plant in St. Thomas, Ontario, in 2023. 

15 per cent: The equity in the Trans Mountain pipeline Ottawa is offering to First Nation groups along the route, much lower than what most expected.

$20.6 billion: The value of the two-way trade between Vietnam and Canada, as Ottawa rolls out the red carpet for President Tô Lâm Thursday.

Major projects watch:

– Eby is borrowing from the Carney playbook and making major projects a big part of his “Build B.C. Strong” reelection campaign. The NDP Premier hints potential for more major projects, just days after his government green lit the FortisBC Tilbury LNG expansion. 

– Canada’s cleantech sector generated about $43.3 billion in GDP and $10.8 billion in exports in 2024, figures that surprise many Canadians—including people in government, says Peter McArthur, chair of the Canada Cleantech Alliance. More from the Energy Mix.

– Communication is getting better as Indigenous communities take a greater interest in energy projects and assume leadership roles in projects as well, according to participants in an energy conference hosted by the North Shore Mi’kmaq Tribal Council this week. CBC has that write up.

– The rumour mill on Parliament Hill is expecting an imminent designation of the West Coast Oil Pipeline as a national interest project.

Headlines: