If you’re serious about wanting to take real, effective
action on climate change, you’ve got to put a rapidly escalating price on
carbon pollution. That was the message
speakers gave to Sudbury MP Paul Lefebvre earlier this month at his climate
policy town hall. With Catherine
McKenna, the Federal Minister of Environment and Climate Change, expected to
release a draft national climate change strategy later this fall, Members of
Parliament across the nation have been engaged in public consultation all
summer long (see: “Yellowknifers join Catherine McKenna to talk climate change,” CBC, July 12, 2016).
If Minister McKenna wants her Liberal government to be taken
seriously by Canadians clamouring for action on climate change, she’ll have to
ignore some provincial leaders like Saskatchewan Premier Brad Wall, and put a
national price on carbon pollution. But
pricing carbon is the easy part. Determining how the carbon fee will be
collected, and how the revenues used are the more difficult decisions the
Liberals will need to make.
“To work, the price on carbon has to be high enough to
change behaviour,” says Laurentian University Professor of Economics Dr. David
Robinson, who gave a presentation to MP Lefebvre about the need to send clear
and strong signals to consumers (see: “Why Ontario’s Climate Plan Has Already Failed,” Dr. David Robinson, Economics for Northern Ontario, June 19, 2016). “That means the [carbon] price is high enough
to convince most people to stop using gasoline cars and stop using natural gas
for heating.”
Robinson and others have suggested that an initial carbon
price somewhere between $30 and $50 per tonne is an appropriate place to
start. To be effective, the price will
need to rise to $100 to $150 per tonne by 2030. Right now, British Columbia has
the highest carbon fee in the nation, at $30 per tonne, where it’s been stalled
since 2012. Alberta and Ontario’s
climate plans call for an initial price of less than $20 per tonne, starting in
2017.
An effective climate change plan will require our government
to convince the public that it’s serious about following through on escalating
the price. That means talking about how
much more everything is going to cost consumers – and convincing voters that rising
prices on goods and services are beneficial.
That hardly sounds like a winning political strategy.
Certainly, Ontario’s Liberal government was reluctant to go
down that road. After hearing from the public about the need to put a
transparent price on carbon, Premier Wynne and provincial Minister of
Environment and Climate Change Glen Murray decided to use the most opaque
method available for pricing carbon – a cap and trade scheme that exempts many
of Ontario’s biggest emitters for several years. Ontario’s plan hardly provides the right
signals that the government is serious about the need to change consumer
habits (see: "A Failure of Ambition: Ontario's Climate Change Plan," Sudbury Steve May, July 10, 2016).
Ontario and Alberta are going about carbon pricing the wrong
way, treating it as a cash cow to fill government coffers. Yes, the money collected from carbon fees is earmarked
for new green infrastructure projects, like improving our public transit systems
– but these are the sorts of investments that our governments should be making
anyway, in the interests of our collective future economic prosperity, with
existing tax dollars.
If elected officials like Lefebvre and McKenna are serious
about climate change and want to champion the rapidly rising price on carbon needed
to reduce emissions and incent alternative energy development, there is only
one way to do it: give the lion’s share of revenue collected back to taxpayers
in the form of a dividend cheque or an income tax reduction. The extra money in
people’s pockets will help offset rising prices, and smart consumers will save
money by selecting low-carbon options.
(opinions expressed in this blogpost are my own and should not be considered consistent with the policies and/or positions of the Green Parties of Canada and Ontario)
Originally published in the Sudbury Star as, "Will feds be champions or chumps on carbon pricing?" in print and online as "Sudbury column: champions or chumps on carbon pricing?" August 27, 2016.
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