McKenna says no plan to increase carbon tax after 2022, despite PBO saying hike needed to meet Paris targets


Ottawa is offering a tax rebate for provinces where it has employed a federal backstop carbon pricing system. Toronto Star/Rene Johnston

Environment Minister Catherine McKenna said Ottawa does not plan to increase the price on carbon after 2022, despite a report released today by the Parliamentary Budget Officer (PBO) saying the tax would have to double by 2030 on top of existing policies to meet Canada’s Paris targets.

For the first time, McKenna said the Liberals don’t intend to raise the federal carbon tax after it goes up to $50 per tonne in 2022, pointing to the existing climate plan created in 2016.

“The plan is not to increase the price post-2022,” she said. “We are doing exactly what we said we’d do, what we negotiated with provinces and territories in 2016.”

While McKenna said the Liberals remain committed to meeting its 2030 targets, today’s PBO report highlighted that her department’s own figures show Ottawa’s plan would not be enough to reduce emissions to 513 megatonnes of carbon dioxide equivalent (CO2) by that year, as it pledged when signing the Paris climate agreement in 2016.

The fiscal watchdog’s analysis concluded that a carbon price of $102 per tonne — across Canada — could close the gap of 79 megatonnes of CO2 between what Ottawa anticipates Canada will achieve under current policies by 2030, compared to the Paris target.

The PBO found that Canada can close the gap by gradually increasing the federal fuel charge, adding on $6 per tonne in 2023, and an additional $52 per tonne compared to the 2022 $50 price by 2030.

Currently, the federal benchmark carbon pricing system applies to two territories and four provinces, with Alberta to be the fifth province starting next year. The other provinces either have their own pricing systems or have reached an agreement with Ottawa to stave off the imposition of the federal charge.

The federal backstop fuel charge is currently at $20 per tonne but will rise to $50 per tonne in less than four years.

The PBO’s report also found that carbon emissions would be reduced across all applied industries with additional carbon pricing. For example, Canada’s oil and gas sector would see a 16 megatonne reduction between 2016 levels and 2030.

Under current policies, emissions in the oil and gas sector was set to increase by 12 megatonnes by 2030 from 183 megatonnes in 2016. MORE

RELATED:

Ottawa needs to boost carbon tax by $50 a tonne to meet emissions reduction targets: budget officer
John Ivison: By showing how high carbon tax must go to meet Paris targets, PBO report gives Conservatives major ammo
Federal carbon tax will be imposed in Alberta on Jan. 1: environment minister

Corporate America Is Terrified of the Green New Deal

As this article argues, a carbon tax allows polluters to continue to pollute as long as they pay up. It does not guarantee emission reductions. It does not put polluters out of business.

There’s a reason more big businesses are pushing for a carbon tax—and it’s not because they want to fight climate change.


Oli Scarff/Getty Images

There is a “major shift” afoot in corporate America on climate change, according to Axios. On Monday, energy reporter Amy Harder reported that major companies “across virtually all sectors of the economy, including big oil producers, are beginning to lobby Washington, D.C., to put a price on carbon dioxide emissions.” These companies, in other words, are asking the government to make them pay more in taxes in an effort to solve global warming.

It’s not as surprising as it sounds. For several years now, the heads of oil companies like Suncor and ExxonMobil and BP have been publicly calling for a carbon tax, in which the government would charge polluters for every ton of climate-warming gases they emit. They’re doing this because a carbon tax, as a market-based policy rather than a mandated regulation, is the most business-friendly solution being floated in Washington.

So why are corporations so passionate about a carbon? “It’s not really about saving the planet,” Harder noted. Indeed, in the face of growing public support for climate action, these companies increasingly realize they need to throw their weight behind some kind of climate policy. They want a carbon tax because it doesn’t threaten the industry’s very existence and allows them to keep polluting—so long as they pay for it.

But a carbon tax isn’t just corporate America’s favorite option; it’s the only option. The only serious mainstream alternative to a carbon tax is terrifying to corporations: an aggressive climate plan that doesn’t cooperate with polluters, but seeks to put them out of business.
A carbon tax does not appear in the Green New Deal—at least, not the version popularized by Congresswoman Alexandria Ocasio-Cortez and Senator Ed Markey. It doesn’t appear in Texas Congressman Beto O’Rourke’s $5 trillion plan to fight global warming. Even Washington Governor Jay Inslee—who is running for president explicitly on climate change and who spent his career trying to enact a fee on carbon—doesn’t include a carbon tax in his $9 trillion climate jobs plan.
There are many reasons for the absence of a tax in these plans, but the main one appears to be that it doesn’t guarantee emissions reductions. Democrats are starting to realize that drastic action is necessary to prevent catastrophe, and a carbon tax simply isn’t drastic enough. MORE

Anti-capitalism is entering the mainstream. Are we ready?

Faced with the urgent need to address climate change, the pitch that individual environmentally-friendly consumerist choices is finally falling flat with more and more people. The New Green Deal proposes a blueprint to address climate change that will demand concerted action by all levels of government, national, provincial or state, and municipalities if we are to reach the IPCC’s crucial targets to avoid climate disaster It’s time to ask,  Where is the County’s New Green Deal?

George MonbiotGeorge Monbiot. Image: John Russell/Flickr

For years it seemed that anti-capitalism wasn’t really the stuff of polite conversation.

It may have been okay to talk about corporate power or corporate rule and maybe more recently about the 1% or even neo-liberalism, but in many civil society circles in this country, it felt like it was a step too far to be explicitly anti-capitalist.

With climate breakdown upon us, might that be changing?

 “What we have to do is the big structural, political economic stuff. We have to overthrow this system which is eating the planet with perpetual growth. We’ve got to go straight to the heart of capitalism and overthrow it.” -George Monbiot

Naomi Klein — whose 2014 book This Changes Everything: Capitalism vs the Climate helped move this critique along — tweeted about Monbiot’s TV appearance, “Gotta love it when the live studio audience of a British chat show cheers for overthrowing capitalism to save our habitat.”

Klein has commented, “After years of recycling, carbon offsetting and light bulb changing, it is obvious that individual action will never be an adequate response to the climate crisis. Climate change is a collective problem, and it demands collective action.”

Always ready with a new trick, the Trudeau government is now trying to sell us the spin that the carbon tax is a significant measure to address climate breakdown.

But that argument quickly breaks down when you look at the numbers, says Mark Jaccard, professor in the School of Environment and Resource Management at Simon Fraser University….the federal carbon tax is $20 a tonne and will max out at $50 a tonne in 2022. In other words, it’s an insufficient tax that won’t help us reach an insufficient target. MORE

 

‘Fundamental Incoherence’ in Trudeau’s Climate Policies, Says Campaigner

Ottawa praises BC’s green leadership, while fighting provincial legal case on Trans Mountain expansion.

TrudeauNotleySeated.jpg
Justin Trudeau’s government welcomes BC’s support on carbon tax, but is siding with Alberta’s Rachel Notley in fighting against BC’s right to regulate oil shipments. Photo from Alberta government.

The federal government’s treatment of British Columbia shows the Trudeau Liberals’ “incoherence” on climate change, says an environmental campaigner.

On one hand, Environment Minister Catherine McKenna is calling B.C. an “exemplary climate leader” on Twitter, because the provincial government supports its carbon tax.

582px version of CatherineMcKennaClimateLeaderTweet.jpg

At the same time, the Trudeau government is fighting to force the Trans Mountain pipeline expansion through B.C. over the provincial government’s objections and accusing B.C. of hurting the country’s economy. MORE

Saskatchewan, Ottawa carbon tax case ‘monumental’ for Constitution: expert

REGINA — Legal experts, government officials and industry leaders will all watch this week as Saskatchewan and Ottawa head to court over the constitutionality of a federally imposed carbon tax.

The federal government is set to impose a carbon levy on provinces that do not have one of their own starting in April.

Ottawa’s price on pollution starts at a minimum of $20 a tonne and rises $10 annually until 2022.

The Saskatchewan Party government has always been opposed to the idea. The province says the tax would hurt the economy and feels its own plan for emissions reductions is sufficient. SOURCE

RELATED:

Sask. government carbon plan won’t add up to enough emissions reductions

POLL: Most people disagree with Premier Ford on whether carbon tax will cause a recession

 

When Ontario Premier Doug Ford claimed the federal government’s carbon tax would cause a recession in Ontario, many economists disagreed. And it seems most regular people do as well.

According to the first in a series of Clean Energy Canada / Abacus Data nationwide polls:

  • Few Canadians (19%) expect a recession next year. If there were to be one, most (63%) say it would likely have more to do with global economic trends than domestic policies.
  • When told Premier Ford warned the federal carbon tax would cause a recession in Ontario, almost two out of three across the country (64%), and in Ontario (63%), disagreed, believing he was overstating the impact.
  • When respondents were presented with a question which noted that many economists had offered a contrary view, namely that the impact of the tax would be too small to cause a recession, even more people (73% in Ontario, 74% across Canada) rejected Mr. Ford’s contention.

SOURCE

The False Choice Between Economic Growth and Combatting Climate Change

Last year, the U.S.’s carbon-dioxide emissions increased by an estimated 3.4 per cent, the second-largest gain in the past two decades.  Photograph by Fernando Moleres / Panos Pictures / Redux
In 1974, the economist William Nordhaus described the transition from a “cowboy economy” to a “spaceship economy.” In the former, he wrote, “we could afford to use our resources profligately,” and “the environment could be used as a sink without becoming fouled.” But, in the spaceship economy, “great attention must be paid to the sources of life and to the dumps where our refuse is piled.” He added, “Things which have traditionally been treated as free goods—air, water, quiet, natural beauty—must now be treated with the same care as other scarce goods.”
 “It’s absolutely the case that emissions and growth can be decoupled,” Marshall Burke, an assistant professor in Stanford University’s Department of Earth System Science, told me.
“But the switch to nuclear and renewables needs to happen more rapidly. “It takes policy. It won’t happen through markets alone.”
As a small but growing coalition of congressional Democrats, led by Representative Alexandria Ocasio-Cortez, have outlined as part of their Green New Deal, transforming the energy sector—and, really, the entire economy, in a just and more equitable way—will require some sort of carbon tax (preferably a “fee and dividend” approach, which distributes tax revenues as rebates directly to citizens), and also new regulations and huge investments. “We can decarbonize the electric sector at a fairly low cost….That’s where some of the cheapest emissions reductions are to be found. Extensive government subsidies could hasten the spread of renewables—specifically, solar, wind, and batteries—and offset any rise in emissions elsewhere….There are ways to reduce the use of fossil fuels in heating; utilities, for instance, can create incentive programs so that homeowners have a motivation to replace their boilers with electric heat pumps. MORE

As the carbon tax debate heats up in Ottawa, Canada should look to B.C.

‘At partisan times like these that we must remind ourselves that when it comes to climate policy—like climate science—we can choose what we listen to and broadcast: evidence and expertise or political soundbites.’

Prime Minister Justin Trudeau meets with B.C. Premier John Horgan in Vancouver in 2017. PMO Photo by Adam Scotti.

As one factually dubious claim after the other continues to make headlines, an entire decade of real-world evidence from B.C. is sitting on the shelf collecting dust.

And so it is at partisan times like these that we must remind ourselves that when it comes to climate policy — like climate science — we can choose what we listen to and broadcast: evidence and expertise or political sound bites.

Because there is independent research, and plenty of it. There’s the research that found that B.C.’s revenue-neutral carbon tax has cut emissions by 5 to 15 per cent from what they would be otherwise. There’s also the research that says B.C.’s tax demonstrably reduced gasoline demand as well as natural gas use — and actually increased employment. MORE

Economists cool to Doug Ford’s warning of ‘carbon tax recession’

Latest Bank of Canada statement on major risks to the economy in 2019 doesn’t mention carbon tax

In a speech to the Economic Club of Canada, Ontario Premier Doug Ford warned of a ‘very, very real’ risk that the federal government’s carbon tax will trigger a recession. (Radio-Canada)

“A carbon tax will be a total economic disaster,” Ford told the estimated 1,000 paying guests at the lunchtime event in downtown Toronto on Monday.

Asked by CBC News for clarification, Ford’s press secretary pointed to a study by the Conference Board of Canada that suggests a federally imposed carbon tax would shrink the nation’s economy by $3 billion. While that sounds like a big number, it is only a fraction of a per cent of the country’s $2.1 trillion GDP.

“Our analysis suggests the economy will shrink marginally in response to the carbon tax,” the authors said. “While the overall economic impact is small, the distribution is not equal across sectors, with some industries bearing notable costs.” The report does not say that the carbon tax will cause a recession. Nor do other economists.  MORE