More than pricing carbon
March 9, 2016
Some of the proponents of the BC carbon tax are only telling part of the story.
I am not weighing in on the right mechanism to price carbon. Whether it is a tax, cap and trade, or fee and dividend, we need to price carbon in Canada. There are pros and cons with each approach along with regional differences in application that must be considered. So let the provinces and territories choose their own way with the federal government leveling the playing field by legislating a baseline price that increases each year.
What I do know about the BC carbon tax is that it did not single-handedly lower greenhouse gas emissions in that province as some would suggest.
Proponents of the BC carbon tax usually like to extol the fact that it is revenue neutral. What they fail to mention is that the BC government has brought in a suite of complementary enabling, regulatory and funding tools to support local governments take action on climate change. Local governments in BC have control over or influence about 45 percent of greenhouse gas emissions in the province. The tools that have been provided range from requiring local governments to include greenhouse gas reduction targets, policies and plans in their Official Community Plans (regulatory tool), providing all local governments with energy and emission inventories (enabling tool) to rebating a local government’s carbon tax when they sign the Climate Action Charter (funding tool).
BC also funds numerous programs to support the uptake of renewable energy and energy efficiency projects, rebates for clean energy vehicles and electric charging stations (just like Ontario) and grants for alternative energy systems and more. Whether these programs are funded directly from revenues generated from carbon or general revenues is a political decision and might have more to do with elections than policy.
We need other tools in addition to a price on carbon to accelerate greenhouse gas reductions. I suppose any one tool – like a carbon tax – might just work given enough time. I am not convinced but the point is we don’t have time.
For a great summary of BC’s programs see: Provincial Climate Action Plans and Local Governments: Lessons from BC