Has Trudeau’s carbon plan poisoned the well?
Let me just get this out of the way first: I am not a climate change denier. And I’m not philosophically opposed to a price on carbon. In fact, in many ways I prefer market-based mechanisms over the heavy hand of government regulatory mechanisms.
But there was something unsettling about the plan to put a price on carbon tax rolled out by the Trudeau government on Monday.
At first I thought maybe the PMO didn’t know that the environment ministers (all of them) were meeting in Montreal — that it was a coincidence that the parliamentary debate on approving the Paris Accord was happening as the provinces and the federal government were negotiating the means to implement that accord. In fact, it seemed odd that Parliament would debate and then vote on approving the Paris Agreement without any indication of how Canada would reduce emissions.
But then it became clear: The federal government knew exactly what it was doing. Growing impatient with the provinces and their inability to agree on cap-and-trade vs. a carbon tax — and growing weary with Saskatchewan Premier Brad Wall’s obdurate opposition to both options — the federal government was going to solve the impasse. The federal government would impose a pan-Canadian floor price on carbon pollution.
By announcing his government’s intention to start putting a price of $10 per tonne on carbon emissions in 2018, growing annually by $10 per tonne until 2022, the PM gave the provinces an ultimatum: Impose a price of your own that meets or exceeds the national floor price or set up a comparable cap-and-trade system. Keep sticking your head in the sand and the feds “will implement a price in that jurisdiction”.
A so-so day for the environment — a terrible day for cooperative federalism. Yukon’s environment minister said it was like the “air was sucked out of the room” at the minsters’ conference in Montreal. (The irony there is that Yukon, as a territory, only has the political jurisdiction the federal government chooses to delegate to it.) Saskatchewan, like other provinces, has constitutional jurisdiction over the development of natural resources — which is why Scott Moe, Saskatchewan’s environment minister, was calling Trudeau’s plan the “National Energy Program 2.0”.
That may be an exaggeration — but the fact that the author of the actual NEP and the current prime minister share a last name is helping to drive opposition on social media to the carbon pricing plan and the Liberals in general.
Environment regulation in Canada is a bit of an enigma. Environmental protection was not top of mind in 1867; the British North America Act makes no mention of it. The provinces have jurisdiction over property and civil rights and natural resource development; the feds have jurisdiction over trade and commerce and the criminal law.
Accordingly, the courts have held that Parliament can legislate against emitting noxious substances — greenhouse gases qualify. So we’re in that murky area of ‘concurrent’ jurisdiction. As long as compliance with more than one regulator is possible, the courts generally will allow either or both levels to legislate.
So Brad Wall’s protests notwithstanding, a successful legal challenge seems unlikely. Wall, however, believes that the feds cannot impose a tax on provincial Crown corporations such as SaskEnergy or SaskPower.
Still, it’s generally not a great thing for federalism to adopt a sledgehammer approach — having three provincial ministers storm out of a meeting to discuss next steps on climate change might amount to the official end of ‘sunny ways’.
Wall predictably called the PM’s level of disrespect “stunning”. I agree that convening a meeting of environment ministers to collaborate on carbon pricing only to turn that meeting into a briefing on a unilateral federal plan — to turn collaboration into a veiled threat, “do something or we’ll do it for you” — is insulting, given concurrent jurisdiction.
Alberta and Saskatchewan will be hardest hit because of their trade-exposed resource industries. This is where you see the wisdom of allowing provinces to come up with individual plans specifically tailored for their situations. It will be much easier for regions which generate hydro electricity to comply than those forced to burn natural gas or coal. And oil producers compete with American producers; I don’t hear Hillary Clinton or Donald Trump promoting a carbon tax.
And if Prime Minister Trudeau was expecting praise from environmentalists, he was disappointed. Elizabeth May said Trudeau’s plan falls far short of what needs to be done, reminding him that he’s adopting the Harper reduction targets he once called “weak and inadequate”.
But perhaps the most curious response came from Alberta Premier Rachel Notley. The NDP premier is bringing in her own much-maligned carbon tax of $20 per tonne on January 1, to be raised to $30 in 2018.
Notley acknowledged that, given the state of her province’s economy, it would be unfair to ask Albertans to pay more than $30 per tonne unless they first see some federal action on energy infrastructure — a pipeline, in other words.
This has got to be the strangest quid pro quo imaginable. Notley believes that her carbon tax provides Alberta with the social licence to get its resources to tidewater. Her logic is counterintuitive. Environmentalists know a new pipeline is unlikely to reduce either production or GHGs. They insist that a safe future climate does not include pipelines — and in that, they’re at least consistent.
What kind of leverage does Notley imagine she has? Having previously announced a carbon tax, how could she now withhold support for the federal carbon pricing scheme if she does not get a pipeline approved?
But maybe leverage isn’t what she’s after. Notley’s carbon tax is deeply unpopular in Alberta. Trudeau’s unilateral plan has given her cover. She can now claim, as all premiers can, that she has no choice: Now she has to bring in a tax on carbon if she doesn’t want the feds doing it for her.
Provincial rights advocates will prefer to see the provinces retain control of this file — no matter how they feel about climate change.
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