This week, the Ecofiscal Commission released results from a new survey by Abacus Data that interviewed 2,250 Canadians on their perceptions of carbon pricing and climate change.
Unsurprisingly, the majority of Canadians agree that climate change is real and caused by human behaviour. The results also showed that Albertans recognize the need to reduce greenhouse gases and associated emissions and in fact, only 27 per cent want the government to place less emphasis in their policies on emission reductions. So what to make of the vocal opposition to carbon pricing and how to move forward?
The opposition to the policy is interesting, considering a price on pollution is nothing new for Albertans. Alberta actually was the first jurisdiction in North America to put a price on carbon with the Specified Gas Emitters Regulation as early as 2007.
However, the survey points out that to the average Canadian, government hasn’t done a good enough job in explaining why carbon pricing is at the core of meaningful climate action. This gap makes the policy a convenient target for opposition.
No policy is a silver bullet and successful policy packages will include a mix of pricing carbon, along with regulations and support for low-emission technology, but carbon pricing remains a core component of any credible plan to reduce emissions.
A price will result in lower emissions than would have happened without a price, while being compatible with economic growth. This is backed up by both theory and practice. The reasoning for this is simple: you put a price on something that you don’t want (pollution) and use the money for something that you do want (such as investments in productive and efficient infrastructure or lowering other distortionary taxes).
Businesses recognize this, and are speaking out in support of a price on carbon. Last month, Canadian businesses that are members of the Carbon Pricing Leadership Coalition released a report sharing their recommendations on carbon pricing and complementary regulations to transition to a low-carbon future. The report reflects input from usual suspects like Cenovus, Enbridge and Suncor, but also Air Canada, Bank of Montreal, Lafarge, Holcim, Unilever and 20 more Canadian businesses.
These leading businesses are in step with the global movement towards pricing carbon; as of 2017, over 40 national and 25 subnational jurisdictions are putting a price on carbon. According to countries’ Nationally Determined Contributions (NDCs), submitted to the United Nations, carbon pricing is currently used to cover 58 per cent of global greenhouse gas emissions.
As the recently released Auditors General report shows, historically provincial governments have made big climate promises but failed to deliver the real polices that are required to deliver on these promises. In the spirit of moving away from this trend, Alberta’s party platforms all need to show how they would address pollution, so Albertans can sufficiently compare what emissions reductions they are promising to achieve, and how.
Albertans can then judge the proposed policies and how they measure up on some key dimensions including: how can this contribute effectively to Canada’s international commitments; is it business friendly for the province — does it give investors a signal of regulatory certainty and; are the revenues used in a way that contributes to a diversified economy transitioning to a lower-carbon future?
As a province, we should stop wasting time with the discussion of simply getting rid of a price on carbon. That path is doomed to failure given the inevitability of the federal backstop (already proven airtight, as tested by the Manitoban government), and is against the global trend.
Instead, we need to have a real conversation on the different options for a mix of approaches to reduce emissions that includes a price on carbon. This kind of climate action is what Albertans want, and will provide businesses the kind of the regulatory certainty for economic growth.
