Climate

Oh Canada! Soon 80 Percent Of The Economy Could Have A Carbon Price

CREDIT: shutterstock

On Wednesday, the Premier of Ontario, Canada’s most populous region by a large margin, said it’s time the province made good on its long-running intention of implementing a carbon price. Premier Kathleen Wynne said that Ontario will reveal a carbon price this spring after agreeing in 2008 with California, Quebec, and British Columbia to create such a scheme as part of the Western Climate Initiative.

“We are going to move very quickly,” said Wynne. “We are facing a global situation and it’s only responsible that Ontario do its part.”

If Ontario joins Quebec and British Columbia in establishing a carbon price, it would mean that more than 80 percent of Canada’s economy would be covered under such a plan. Alberta, home of the GHG-intensive tar sands, also has a carbon scheme but only for very large sources of pollution. In place since 2007, the regulations are yet to have a significant impact, though they are likely to be strengthened later this year. Right now, Alberta emits more carbon dioxide than Ontario and Quebec combined.

Altogether these provincial efforts are creating a national patchwork that the oil- and gas-friendly federal government led by Prime Minister Stephen Harper may have to address this year as the international community prepares for major climate talks in Paris at the end of 2015.

“In Canada you have to make a big distinction between sub-national efforts, which are considerable, and federal climate policy, which is intermittent and stuttering, but goes back 20 years,” Dave Sawyer, an environmental economist based in Ontario, told ThinkProgress. Sawyer believes the federal government will have to start working to align these sub-national systems, and that 2015 could be the year that movement starts to happen.

“You can expect the Canadian federal government to make some announcements this year,” said Sawyer. “They are going to have to engage the international community going into the climate talks.”

Sawyer said that even if Canadian provinces like Alberta wanted to impose stricter carbon regulations, the major concern is that massive U.S. oil and gas production is not currently subject to anything similar, and likely won’t be for years.

“The sectors are in direct competition for the U.S. market,” said Sawyer. “So one can sit in the U.S. and say ‘oh, Canada is not doing much,’ but if the U.S. moves then that creates space for Canada to get more aggressive.”

California and Quebec are already engaged in a joint cap-and-trade system and are aggressively pursuing Ontario and some U.S. states, like Washington, to join. British Columbia, for its part, has imposed a carbon tax rather than implement a cap-and-trade system.

It is unclear which avenue Ontario will pursue, though Sawyer said indications point to Ontario joining Quebec in the cap-and-trade program. Without either system in place, the province has still managed to cut emissions six percent below 1990 levels, primarily by closing all their coal-fired power plants. The carbon price is intended to put the province on course to meet its more ambitious goals of reducing emissions 15 percent below 1990 levels by 2020 and 80 percent by 2050.

Ontario’s Environment Minister Glen Murray will be hosting a sub-national summit this summer to help Canada prepare for the U.N. climate conference.

The Keystone XL pipeline debate is another major issue that will play out throughout Canada in 2015. As the U.S. Congress votes on Keystone approval bills that Obama has threatened to veto, Prime Minister Harper is engaging in his own form of political theater. On Wednesday, Harper unexpectedly postponed the annual ‘Three Amigos’ summit with North American leaders Barack Obama and Mexican President Enrique Pena Nieto. According to the Globe and Mail, the move allows Harper, who is up for re-election this year, to “avoid an awkward side-by-side news conference with Mr. Obama” at a summit that would most likely be headlined by the acrimonious Keystone debate.

Keith Brooks, director of the clean energy program at Toronto-based Environmental Defence, told ThinkProgress that the Harper government has made action on climate change challenging in a number of ways.

“They have made it difficult by characterizing carbon pricing as being a ‘job killing carbon tax’ for years,” he said. “And they’ve driven a narrative that pits Canada’s economy against our environment.”

Brooks noted one other major issue driving the environmental and climate conversation in Canada right now: low oil prices.

“We’ve been talking about the volatility of oil for a long time, and highlighting the risks of a heavy economic reliance on oil and gas,” he said. “It’s time for Canada to get off the boom and bust roller coaster and move toward a clean economy, which is clearly where the future lies. Carbon pricing will help us get there.”