Net-Zero Challenge

The Net-Zero Challenge is a Government of Canada initiative that encourages businesses and organizations to develop and implement credible, effective plans to transition their facilities and operations to net-zero emissions by 2050, or earlier. It is a voluntary, made-in-Canada program that gives participants a framework and guidance for their net-zero planning. Details are on the Government of Canada Net-Zero Challenge page.

Environment and Climate Change Canada officially launched the program in August 2022. It is open to companies and organizations operating in Canada, and it supports planning, emissions reduction, target-setting and transparent reporting of progress. For suppliers, the program matters because federal procurement documents now refer to it directly, as described in the 2023 government announcement on businesses joining the challenge.

What participants do under the Net-Zero Challenge

The challenge asks organizations to move beyond general pledges and prepare a plan that sets out how they will reach net zero. The federal guidance focuses on four things: planning, reducing emissions, setting targets and reporting progress openly. Participation is not a procurement program in itself. It is a climate-action initiative that other federal policies and solicitations have chosen to recognize.

The government has also described the program as a possible way for companies to meet federal procurement and funding requirements. That link to buying is why bid teams see the name in solicitation documents.

Link to the federal GHG Disclosure Standard

The Treasury Board of Canada Secretariat issued the Standard on the Disclosure of Greenhouse Gas Emissions and the Setting of Reduction Targets, often called the GHG Disclosure Standard. It applies to federal procurement contracts valued at more than $25 million, according to the Treasury Board announcement on new green standards for major contracts. Relevant suppliers must disclose greenhouse gas emissions and set reduction targets.

Participation in the Net-Zero Challenge can serve as evidence of compliance. PSPC's guidance on implementing the standard states that this evidence can come from the supplier's parent company when the parent participates.

Where the requirement appears in PSPC and defence solicitations

PSPC supply arrangement terms name the challenge. The solutions-based services supply arrangement, the professional audit support services supply arrangement and the task and solutions professional services arrangement each state that a supplier may be requested or required to join Canada's Net-Zero Challenge. The requirement can apply when submitting a bid, offer or arrangement, or after contract award.

The same environmental-considerations language appears in CanadaBuys documents for Department of National Defence requirements, including a request for proposal for spare parts and other defence solicitations. Participation can be required or permitted at the solicitation stage or the contract stage.

Accepted equivalents

Federal solicitation language can recognize approved equivalents to the Net-Zero Challenge. These include the United Nations Race to Zero and the Science Based Targets initiative (SBTi), as shown in a CanadaBuys request for proposal. Each solicitation sets its own definition and evidence requirements, so the equivalent must match what the document accepts.

What it means for a supplier bidding on Canadian public contracts

The practical requirement depends on the solicitation. A supplier may need to demonstrate participation in the Net-Zero Challenge or an accepted equivalent, provide emissions disclosures and reduction targets, or join the initiative as a condition of bidding or contract award. Read the environmental-considerations clause in each bid document and check whether the contract value brings the GHG Disclosure Standard into play. Do not assume that participation alone satisfies every requirement. Suppliers that plan to bid on larger federal work should have their emissions data, targets and proof of participation ready before a solicitation closes.