Trudeau’s carbon pricing plan


in Canada, Economics, Law, Politics, The environment

Today Prime Minister Trudeau announced that the federal government will require all provinces to have a carbon price of at least $10 per tonne by 2018, rising in $10 increments to $50 per tonne in 2022. There’s a lot of politics at work here. The Alberta government says they will only accept the plan in exchange for an export pipeline, while climate activists emphasize that the whole point of a carbon price is to prevent such projects. Trudeau seems to think he has split the opposition in Parliament, and set up an approach that most Canadians will support:

Polls suggest there is overwhelming support for the idea of carbon pricing, and that many Canadians back the imposition of a national climate change target. Trudeau alluded to that generosity of spirit when he said Canadians are prepared to work together and follow through on the commitments to fighting climate change made in the Paris Agreement on climate change. But such good will has its limits.

Environmental groups rushed Monday to condemn the planned price as being too low to take a bite out of Canada’s emissions. Dale Marshall of Environmental Defence said the carbon price needs to rise at the same rate beyond 2022 — a point on which Trudeau was mute.

It’s a perfectly sound strategy, provided he forsakes his environmentalist allies. It is becoming clearer by the day, they are not going in the same direction as he is.

Trudeau needs to have the courage to tell Canadians that fossil fuels are on the way out as a source of jobs, tax revenue, and economic prosperity. Building new extraction and export projects is wholly at odds with the direction Canada and the world need to go. A price on carbon is a mechanism for discouraging fossil fuel projects, not an excuse for letting them proceed.

{ 8 comments… read them below or add one }

. October 7, 2016 at 2:46 pm

Trudeau’s carbon price is too low to do the job: Walkom

The Liberal climate-change scheme is sly politics but on its own, won’t do much.

By Thomas WalkomNational Affairs Columnist
Wed., Oct. 5, 2016

And there’s the problem: The carbon-price minimums Trudeau announced are just too low to work on their own.

“Not even close,” York University environment professor Mark Winfield said in an email.

Winfield and other climate-change experts calculate if Canada is to meet its promised emission target through carbon prices, it would have to impose one of $30 a tonne now, rising to $200 a tonne by 2030.

As well, there is the question of the target itself. First enunciated last year by Stephen Harper’s Conservative government, it would have Canadian emissions reduced to 30 per cent below 2005 levels by the year 2030.

The Liberals used to say this target was insufficient. Now they have adopted it.

. October 7, 2016 at 2:48 pm

“The proposed federal carbon price of $10 a tonne may be too low to do much good. But it is politically acceptable to B.C., Ontario and Quebec, all of which have instituted, or are about to institute, carbon prices that are higher than this.

Alberta Premier Rachel Notley says her province won’t co-operate unless Ottawa approves a pipeline that can bring tarsands bitumen to the sea.

But given that Alberta is already committed to instituting a $30 per tonne carbon tax within two years, Notley’s conditional opposition won’t have any practical effect until 2020, when the proposed federal levy hits that level.

That’s well after the next federal election.

In short, the politics of Trudeau’s move are rather clever. He can legitimately claim his government is playing a leading role in the fight against climate change. But at the same time, he’s not doing enough to offend too many voters.”

. January 9, 2017 at 8:18 pm

Walking the walk
Canada’s prime minister secures a deal for a national carbon price
He may need more carrots to keep the provinces on his side

. July 5, 2017 at 5:11 pm

The Liberal government has invested great political capital in efforts to build a pan-Canadian consensus when it comes to carbon taxes and pipelines.

Polling from fall last year suggested it might be possible to carry a majority of support in every region of the country, if a national carbon pricing plan that encouraged a shift toward greater use of clean energy were accompanied by a pipeline to get oil and gas to new markets.

The plan linking the introduction of carbon taxes with pipeline approval was a winner, gaining the support of three out of four Canadians, with majorities in every region, according to the survey by Abacus Data.

Since then, just about everything that could have gone wrong with Trudeau’s grand bargain has done so — carbon enthusiast Donald Trump was elected U.S. president; an anti-pipeline coalition of New Democrats and Greens is set to take power in B.C. and oppose Ottawa’s approval of the Trans Mountain pipeline; and now, a new poll suggests support for federal carbon-pricing has cooled as the Liberals’ plan moves from rhetoric to reality.

The new study by the Angus Reid Institute suggests support for a national carbon tax has fallen to 44 per cent from 52 per cent last November, and 56 per cent two years ago.

Canadians are concerned their industries may be hindered after Trump pulled out the Paris Agreement: 55 per cent believe Canada should hold off on carbon pricing to avoid being placed at a competitive disadvantage.

. July 26, 2021 at 6:58 pm

Saskatchewan’s carbon pricing plan has been rejected by federal government, premier says

Scott Moe called it an ‘arbitrary and political decision from Ottawa.’ He said Saskatchewan’s plan is similar to ‘other provincial programs previously accepted’

. July 26, 2021 at 6:59 pm

Ottawa submits new greenhouse gas targets to UN, plans changes to carbon-pricing ‘benchmark’

Environment minister says he wants to even out differences and exemptions in carbon pricing among provinces

. April 4, 2022 at 6:44 pm

Liberal climate plan looks to guarantee a carbon price, no matter who is in power

The federal government is now moving toward providing a guarantee of sorts, for firms that want to see the carbon tax climb to the levels the government has forecast. But with few specifics, it’s still unclear how well the approach would survive a change of government.

The proposal was included in the new emissions reductions plan unveiled on Tuesday, although details are scarce.

It would provide a fixed carbon price over a time period, known as carbon contracts for differences (CCFD). The federal emission plan notes CCFD “enshrine future price levels in contracts between the government and low-carbon project investors, thereby de-risking private sector low-carbon investments.”

. April 4, 2022 at 6:45 pm

Federal Liberals look to protect carbon price from any future attempts to cancel or lower it

It could include legislation to enshrine the carbon price and its upward trajectory into law. Or signing contracts with investors guaranteeing compensation if the carbon price doesn’t go up

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