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No Consensus on Climate Action

Posted by mhudema on July 16, 2008

Climate policy divide expected at Canada premiers’ meeting

Published by Point Carbon: 15 Jul 08 17:03 Last updated: 15 Jul 08 17:14

Carbon trading backers are expected to come head to head with those advocating carbon capture and storage technology to fight climate change when Canada’s premiers attend their annual meeting this week, market observers said.

Premiers from all 13 Canadian provinces and territories will come together 16-18 July for the premiers’ summer meeting organised by the Council of the Federation, an association formed in 2003 to foster a constructive relationship between the provinces and territories and with the federal government.

Climate change will be one of the main topics of discussion, said the federation.

“There are two camps emerging in Canada: Those provinces that support cap-and-trade, such as British Columbia and Quebec, and those provinces that support carbon capture and storage, such as Saskatchewan and Alberta,” said Matt Price, project manager for Environmental Defence Canada.

At last year’s meeting in Moncton, New Brunswick, premiers agreed to implement energy conservation strategies and to reduce greenhouse gases within their own provinces. Over the past year, several provinces have taken steps towards those goals. But many of these actions differ from province to province.

In the cap-and-trade camp are provinces such as British Columbia, Ontario and Quebec. But even among these jurisdictions there are differences of opinion on what kind of system should be implemented.

In June, Quebec and Ontario agreed to form their own interprovincial cap-and-trade system, which they encouraged other provinces to join.

In addition, British Columbia, Quebec and Manitoba are members of the Western Climate Initiative (WCI), which includes seven US states. This initiative is working toward its own cap-and-trade programme.

Several Canadian provinces and territories have so far not signed up to either initiative. It is possible these jurisdictions could show their willingness at the meeting to join either of the programmes, said Dale Marshall, policy analyst at the David Suzuki Foundation, a Canadian environmental group.

“A lot of the discussion will be on which other provinces will choose the regional system linked to the US states or the Ontario and Quebec initiative,” said Marshall.

Marshall said some of the provinces, such as Manitoba, Nova Scotia and Newfoundland, may choose the Ontario and Quebec cap-and-trade initiative because it is a more natural geographical fit for them than the WCI.

“Maybe it is easier for them to look to Ontario’s and Quebec’s system because of their natural affiliation,” said Marshall.

Alberta’s role

Alberta’s weak targets for cutting greenhouse gas emissions relative to the other provinces’ goals could also come under discussion, said market observers. Like the federal government, Alberta’s government has committed to intensity-based targets to reduce greenhouse gases. This is in contrast to other provinces that have set absolute targets.

Alberta, which is a heavy emitter of greenhouse gases because of the development of the tar sands in the province, has set initial intensity-based reduction in greenhouse gases of 12 per cent below 2005 levels by 2007.

The federal government has also set intensity-based targets for cutting greenhouse gases, but they are higher than Alberta’s. The federal government has committed to an intensity-based reduction of 18 per cent below 2006 levels by 2010.

“There will be discussion on how Alberta can do its fair share to cut emissions,” said Graham Saul, executive director of Climate Action Network Canada. “Alberta is one of the obvious flanks of the divide in the country,” said Saul.

Alberta’s low intensity-based targets are unpopular with other provinces, said market observers.

“You can’t look at Alberta’s greenhouse gas reduction plan and not be critical of what they are doing. They will have critics from environmental groups and other provinces,” said Marshall.

Alberta’s support of carbon capture and storage technology is also different to most other provinces’ stance on reducing greenhouse gases. The province’s government says the technology is an important part of its greenhouse reduction plan. It recently announced the creation of a $2 billion fund to invest in carbon capture and storage technology.

Price said Alberta’s government announced the creation of the fund deliberately before the meeting to offset criticism it is not doing enough to reduce emissions in the province.

Carbon tax

Carbon tax is another topic that could be discussed at the meeting, said market observers. Canada’s liberal party propelled discussion of a carbon tax to the forefront of political debate in Canada with its proposal in June to introduce a carbon tax that would start at C$10 a tonne in the first year and increase to C$40 in the fourth year.

Carbon tax has also gained momentum on the provincial level with provinces such as British Columbia implementing a carbon tax on 1 July and provinces such as New Brunswick considering such legislation. Alberta, on the other hand, has criticised the carbon tax. Premier Ed Stelmach said Canada would take a big hit if taxes were levied on carbon.

With such differing views among the provinces on how to address climate change, there is a real need for the jurisdictions to reconcile their different approaches, said Price.

“Everybody agrees it is not tenable for provinces to go in separate directions. It will create policy chaos to have separate policies and 10 different sets of regulations,” he said.

Washington DC

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