By Brendan Boyd
and Barry Rabe
University of Michigan
Things look bleak these days for the federal government’s Pan-Canadian Framework on Clean Growth and Climate Change. But Canada should stay the course.
The framework represents Canada’s primary compliance path with the Paris climate accord, requiring provinces to establish a price on carbon or have one imposed by Ottawa.
Opposition Conservatives have railed against the plan in the House of Commons. Newly-elected Ontario Premier Doug Ford is scrapping his province’s cap-and-trade system and Alberta’s United Conservative party leader, Jason Kenney, proposes to ditch his province’s carbon tax, as he seeks the premiership in 2019. Recent polling suggests that Canadians’ opposition to carbon pricing has grown since policy details have been finalized.
Perhaps most troubling for the federal government are the ongoing actions of U.S. President Donald Trump, who has withdrawn from the Paris accord and begun to dismantle emission reduction policies enacted under Barack Obama, while dismissing the dangers of climate change as a hoax.
These actions, across multiple policy fronts, raise innumerable questions about just how far Canada should stray from the path of its dominant bilateral partner and stir the North American policy pot. Foremost among these is whether carbon pricing will render Canadian businesses uncompetitive with the U.S.
At first blush, American climate policy retrenchment would seem to bolster the arguments of the framework’s opponents, creating a compelling reason for Canada to delay, scale back or even terminate its plan, which would almost certainly place the country’s Paris targets in jeopardy. But while Ford, Kenney and other critics hone their attack lines, none have offered a credible alternative plan.
Canada has backtracked from international climate agreements in the past. Its history closely parallels the United States in this regard, with both nations commonly derided globally as climate laggards that talk a good game but fail to deliver.
Here’s why Canada shouldn’t abandon its international commitments this time:
First, the lack of an American federal carbon pricing program doesn’t mean it lacks a carbon price. Twelve states continue implementing their own versions of cap-and-trade, and this number will likely expand after mid-term November elections. In addition, numerous regulatory measures to reduce carbon emissions at both state and federal levels remain and impose costs. This effectively puts a price on carbon, although that price is implicit and likely much higher than under a more efficient carbon tax or cap-and-trade system.
Second, there’s no evidence to suggest that the U.S. is on a path toward aggressive re-carbonization. In fact, American emissions declined 12 per cent between 2005-2015, a reduction pace that outperforms Canada. American electricity sector emissions have dropped even more rapidly. While federal and state policies have played a role, this transition is also fuelled by ever-expanding use of natural gas as an alternative to coal in the shale era, and enormous growth in wind energy in states like Texas and Oklahoma. Despite Trump’s rhetoric about restoring coal production, more than 25 plants closed in 2017, with more to come this year.
Third, there remain considerable limits on what any president can accomplish on climate, as Obama learned and Trump is learning. America’s Paris reversal doesn’t go into effect until the last months of Trump’s current term and could be altered again by his successor.
Each sector of the economy presents a different story. In electricity, the demise of the U.S. Clean Power Plan will only have limited effects on continued expansion of renewables and gas. In transportation, Trump has overplayed his hand and faces industry and state resistance to threats to curtail California’s power to set higher standards. In methane, however, American federal reversals are consequential, threatening North America’s 2016 reduction agreement.
Finally, Canada needs to remember that climate change is a multilateral issue, not just a bilateral one. The U.S. stands alone globally in the Paris process, isolated from its increasingly distrustful Asian and European allies.
Canada has some history of standing tall on international issues rather than simply falling in line with American foreign policy. Think Lester Pearson challenging Lyndon Johnson during the Vietnam War, or Jean Chrétien opting not to join George W. Bush in the second Iraq War. Pursuing a credible national carbon pricing policy will be the latest test.
Brendan Boyd is an assistant professor at MacEwan University in Edmonton. Barry Rabe is a professor at the Ford School of Public Policy at the University of Michigan.