Saturday, August 20, 2016

B.C.'s climate plan: What you need to know

B.C.'s climate plan: What you need to know
The Globe and Mail, 19 August 2016, by James Keller

This article details the latest developments in British Columbia (Canada) regarding the government's efforts to combat climate change.  BC adopted a revenue-neutral carbon tax in 2008, and that tax was scheduled to rise annually in order to create increasing pressure for greenhouse gas emissions reductions.  In 2012, however, the price was frozen at CAD $30/ton (about US $23/ton), and there it has stood ever since.  Perhaps as a result of that, emissions in BC are climbing, and it is now acknowledged that BC will miss its previously set emissions target for 2020.  An expert panel formed by the BC government recommended last year that the carbon price be unfrozen again, and that specific greenhouse gas reduction targets be set for 2030 and 2050, so as to make progress on climate change goals.  The BC government has just announced their new climate plan, and it implements neither of those suggestions; it calls for the carbon price to remain frozen, and for a weaker emissions target than recommended by the panel (no target at all for 2030, in fact).  The new climate plan does include plans to decrease methane leaks, similar to what the U.S. is presently planning, and a number of other measures intended to reduce emissions.  Nevertheless, the reaction to the plan in the environmental community has been uniformly negative, with the Sierra Club calling the plan "fraud".

My take: This is deeply, deeply disappointing.  The whole world has been watching British Columbia's experiment in carbon pricing, because they are one of a handful of places to institute a broad-based carbon tax rather than a cap-and-trade scheme or taxes only on specific products or activities (such as a gasoline tax).  Indeed, the Carbon Tax Center ( calls BC's tax "the most comprehensive and transparent carbon tax in the Western Hemisphere, if not the world".  BC has thus been a leading light for the movement.  And initially BC's experiment seemed successful; emissions went down, and economic activity did not seem to be harmed – perhaps it even benefited.  Nevertheless, their carbon price was frozen for political reasons, and now their emissions are climbing again as the market responds to the shift in incentives.  I had hoped that the recent political turnover in Canada, from Harper to Trudeau, would facilitate a renewal of BC's commitment to their carbon tax; but apparently not.  Those of us pushing for a meaningful carbon tax in the U.S. and around the world should look closely at BC as an example of how politics can interfere even after a tax is passed; we should devote more thought to the problem of how to safeguard a carbon tax from political interference after passage, I suspect.  I've written before about the political difficulties of implementing a carbon tax; see here and here.  This article provides a clear case study in these difficulties.

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