Canada’s auditor general wants to know whether the federal government is doing a good job protecting its assets — including dams, buildings, vehicles and more — from the increasingly severe impacts of climate change.

The Department of National Defence received a notification letter — obtained by Canada’s National Observer through an access to information request — that the auditor general is launching a performance audit of “Protecting Federal Assets From Climate Change.”

The audit is for the government-wide Greening Government Strategy but pays special attention to three key departments — Fisheries and Oceans Canada, National Defence and Public Services and Procurement Canada — to assess their progress on protecting their assets, services and activities from climate change.

The federal government manages more than 34,000 buildings, 20,000 engineering assets including wharves and dams and a fleet of 40,000 vehicles and boats, according to the auditor general. It would cost more than $110 billion to replace those assets.

Purchasing, building and maintaining it all involves “massive scale investments that come out of the public treasury … and climate change is putting pressure on these things,” Daniel Henstra, a professor of political science and co-director of the Climate Risk Research Group at University of Waterloo, said in a phone interview with Canada’s National Observer.

“We’re already seeing more intense floods, wildfires, heat waves — all of these hazards directly threaten federal assets and can also disrupt critical services like … defence operations [and] transportation routes,” Henstra said, pointing to the atmospheric river in BC that washed out roads and bridges, caused billions in damages and resulted in the closure of 80-kilometres of the Trans Canada Highway in November 2021.

The Department of National Defence owns a lot of federal assets. Its property portfolio alone — which includes 21,000 buildings, 2.2 million hectares of land and 13,500 works such as jetties, airfields, training areas and roads — has a replacement value of approximately $28 billion, according to a 2024 report. And that does not account for the vehicles and other non-property assets.

The military is particularly vulnerable to one impact of climate change: thawing permafrost, which can seriously degrade Canada’s military investments, said Henstra.

“We could reliably count on certain areas of the country where the ground is just always frozen, right? So we’ve built infrastructure on that: runways, radar stations, military bases,” Henstra said.

“These types of northern facilities could be disrupted by thawing of the permafrost that causes cracking in the ground as it melts, which undermines the foundations. And these are multi-billion dollar defence investments, and we’re looking to make billions and billions more of these investments,” he said. Prime Minister Mark Carney said he is ramping up military spending to five per cent of GDP by 2035, so the value of assets owned by the Department of National Defence will balloon. With a focus on Arctic defence, more of those new assets will be vulnerable to permafrost thaw.

Researchers are getting better and better at projecting the impacts of climate change, particularly when it comes to extreme weather events, which pose myriad risks to federal infrastructure, he said, including wildfire, flooding and heat waves. 

“Heat waves are a problem for energy systems because electricity demand goes up and there’s a higher risk of outages,” Henstra explained. “Federal energy facilities might see cascading failures if critical assets were to fail simultaneously.”

Short, intense bursts of precipitation spells serious trouble for a lot of infrastructure and systems. Municipal drainage systems and sewage plants can’t handle that amount of water, he said, noting that although this is a municipal example, many of these assets have been built with federal money and will need to be rebuilt with federal funding.

“Another of the high-confidence projections on climate change is sea level rise … and that means problems for coastal assets,” Henstra said. Sea level rise exacerbates coastal erosion, which spells trouble for infrastructure positioned along Canada’s 243,042-kilometre coastline (the longest coastline in the world). And storm surges — a massive push of water level during a storm — can swamp and flood coastal infrastructure and are expected to increase in frequency and severity with climate change.

For example, wharves and ports are “critical” to protect from climate impacts, especially with the Government of Canada’s new economic development push to get products to new markets, Henstra said.

The Department of Fisheries and Oceans (DFO) is already struggling to deal with the escalating costs of climate change, reporting by Canada’s National Observer revealed earlier this year.

DFO manages an extensive range of infrastructure and assets, including bases, search and rescue stations, harbours, wharves, hatcheries, laboratories, field camps, light stations, telecommunications towers and bridges. It would cost $7.1 billion to replace just the small craft harbours used by fishermen, coastal communities and tourism companies. The DFO’s coast guard assets are valued at $1.5 billion.

There are two sides to the Greening Government Strategy, Henstra explained. One is adapting to deal with the impacts of climate change and the other is slowing or stalling climate change by reducing greenhouse gas emissions, for example, by retrofitting old buildings to be more energy efficient or building new low-emissions buildings and avoiding fossil fuel heating systems. 

Public Services and Procurement Canada (PSPC) is “one of the most muscular instruments of the government” because it is a “massive buyer of all kinds of goods and services,” Henstra said. For example, it is in charge of buying electric vehicles for the federal government’s fleet. 

“If procurement is tweaked and … we skew the weighting of different decision criteria on who the types of things we’re going to buy and who we’re going to buy them from, it can be really used to achieve all kinds of policy objectives,” Henstra said.

The results of the audit are expected this spring. The Greening Government Strategy was audited in 2022 for its progress on reducing greenhouse gas emissions. It found departmental plans to reach net-zero by 2050 lacked details, reporting was often incomplete or unclear and that the Treasury Board of Canada Secretariat did not account for indirect emissions from burning fossil fuels in vehicle fleets. This time around the audit will look at resilience and adaptation.

— With files from Rochelle Baker

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