If one ignores a very large gap in the centre of Canada – Saskatchewan and Manitoba – the country now has a “pan-Canadian” strategy for tackling climate change through things like stricter building codes, reducing methane emissions in the oil and gas sectors and building new transmission lines between provinces.
Late Friday, December 9, Canada’s first ministers jointly announced they had signed onto a national strategy that includes a commitment to reduce greenhouse gas emissions through a suite of policies that will almost certainly result in higher building and energy costs for Canadians.
Saskatchewan Premier Brad Wall refused to sign on to the framework and Manitoba is taking a wait-and-see approach.
B.C. Premier Christy Clark also threatened not to sign the framework, saying she wanted a guarantee that other provinces will pay roughly the same carbon pricing levels as British Columbia.
Ontario and Quebec have opted for cap-and-trade, rather than a carbon tax; under cap-and-trade, the actual price that will be placed on carbon is much lower than what B.C. residents would pay.
B.C.’s carbon tax has been frozen at $30 per tonne since 2013. As part of the new framework, it will need to rise in lockstep with Canada’s national carbon pricing scheme, which would see carbon prices rise to $50 per tonne by 2022.
B.C. may actually benefit from the new pan-Canadian climate plan, since it commits to building new transmission lines between provinces, which could provide B.C. with new markets for what could be a surplus of hydroelectric power, once Site C dam is built. And the plan also commits to clean technology – a sector that is fairly robust in B.C.
The new framework include the following commitments by the provinces:
• new building codes that require energy efficiency;
• building more charging stations for electric vehicles;
• increased investment in “clean” electricity;
• increased interties and smart-grid technology “to phase out the reliance on coal, make more efficient use of existing power supplies”;
• reducing methane emission from the oil and gas sector; and
• enhanced focus on carbon sequestration in forests wetlands and agricultural lands.
The new framework was praised by the Pembina Institute as an important part of meeting Canada’s 2030 GHG reduction targets.
“We applaud the first ministers’ effort made to date and expect continued collaboration and swift implementation of all recently announced climate measures,” Pembina executive director Ed Whittingham said. “In particular, it is essential that provinces work with the federal government to adopt strengthened building codes, to implement an effective clean fuels standard and to increase the carbon price after 2022.”
Merran Smith, executive director for Clean Energy Canada, said the national framework adds “new tools to the toolbox to reduce carbon pollution.”
“This will create new economic opportunities, opening doors for Canadian businesses and workers in the growing global market for clean energy solutions," Smith said.
“It’s unfortunate Saskatchewan decided not to sign onto this national effort, and that Manitoba opted out for now—but it’s good news that the rest of Canada is moving ahead regardless.”
Jock Finlayson, executive vice president of the BC Business Council, said a pan-Canadian framework for carbon pricing and climate action policies “makes sense to work toward a common platform for carbon pricing to ensure that all regions and sectors of the economy are contributing and are treated equitably.”
However, he shared Clark’s concerns that British Columbians could end up paying a much higher carbon price than residents and businesses of Ontario and Quebec.
“I am worried that businesses and industries in B.C. could end up paying more for fossil fuels than those in central Canada, given that B.C. is using a broadly-carbon tax while Ontario and Quebec are relying on complex ‘cap and trade’ programs to meet the federal government’s $50 target,” he said.
“Second, I am troubled by the thought that tax-inclusive fossil fuel costs will be escalating steadily in Canada at a time when the United States will be doing nothing on carbon pricing under incoming President Trump.
“If Canada moves to a $50 carbon price by 2022 while the U.S. sticks with a zero national carbon price, investment in the oil and gas sector and also across swathes of manufacturing will bleed out of Canada into the U.S. to take advantage of lower energy costs there. That will further disadvantage the Canadian economy, which is already suffering from a loss of industrial competitiveness in the North American context.”