Fossil fuels remain the backbone of Canada’s energy consumption despite years of government policies aimed at encouraging a transition to cleaner energy sources, according to a new study released Tuesday by the Fraser Institute.

The report found fossil fuels accounted for 76.3 per cent of Canada’s domestic energy consumption in 2024, down only slightly from 76.8 per cent in 1995.

The independent public policy think tank said the findings illustrate Canada’s continued reliance on oil, natural gas and other fossil fuels across key sectors of the economy.

Transportation remains overwhelmingly dependent

According to the study, fossil fuels supplied 98.7 per cent of the transportation sector’s energy use in 2024.

The report also found fossil fuels accounted for 74 per cent of industrial energy consumption and 50.6 per cent of residential energy use, with natural gas remaining the primary source of home heating.

“There is a lot of misunderstanding about the reality of energy production and consumption in Canada today, which is still heavily dependent on fossil fuels and will be for many years to come,” co-author Kenneth P. Green said in a statement.

Related Stories:

Energy sector plays major economic role

Canada’s energy sector represented 6.9 per cent of the country’s total economic output in 2025.

Among the provinces, Alberta had the largest share of economic activity tied to the energy sector at 30.1 per cent of provincial gross domestic product.

Newfoundland and Labrador followed at 22.7 per cent, while Saskatchewan ranked third at 21.5 per cent.

Call for policies grounded in current energy use

The report argues policymakers should recognize the country’s continued dependence on fossil fuels when developing future energy policies.

“Fossil fuels remain essential to Canadians’ living standard as they provide reliable and affordable energy and are a major economic driver,” said Elmira Aliakbari, the Fraser Institute’s director of natural resource studies.

The Fraser Institute describes itself as an independent, non-partisan public policy research organization that does not accept government funding for its research.