Revenue- neutral carbon fee will work for Alberta

We need courage to follow B. C.’ s example, writes Kaitlin Szacki.

Within a year, more than 80 per cent of Canada’s economy is expected to be covered by carbon pricing. This may come as a surprise, given that some environmental groups will have you believe that we here in Canada are carbon policy laggards.

Even more surprising, Alberta was the first mover on carbon pricing in Canada nearly a decade ago. But that aside, the current regulatory system hasn’t resulted in significant emission reductions, and emissions have continued to climb. This is a problem that Alberta’s climate change advisory panel must address.

With carbon taxes, fees and cap- and- trade regimes expanding across the provinces and other sub- national and national jurisdictions around the world, it is clear that carbon will be priced. But Albertans must ensure this isn’t done at the expense of the economy.

Even as we transition to a low- carbon economy, oil and gas will be significant economic drivers for many years to come, and Alberta should have the opportunity to benefit from our resources. Rather than “leaving it in the ground,” as some politicians would have us do, Canadians for Clean Prosperity believes that, with a balanced carbon policy in place, Alberta can have both a strong economy, including a vibrant energy industry, and a clean environment.

It all comes down to good policy. Striking the appropriate balance, particularly during difficult economic times in the province, is something Alberta’s climate change advisory panel will have to consider over the coming months. Last Friday, the panel announced its membership and released a discussion document for public sessions, which are expected to begin the week of Aug. 24.

The panel, chaired by respected University of Alberta economist Andrew Leach, is tasked with delivering policy recommendations to Premier Rachel Notley before the United Nation’s climate change conference in Paris. It’s a steep order, given that the conference commences on Nov. 30. The panel is balanced and experienced, and brings together collective expertise from the energy sector, environmental groups and the aboriginal community. Notley should be commended for making climate change policy a priority for her government, and for the open and transparent consultation process she’s initiated.

This policy review gives Alberta a historic opportunity to bring in the most effective and economically sound approach to emissions reduction: a revenue- neutral carbon fee. It’s administratively simple and boasts results: a fee is charged based on carbon emissions and every dollar raised is returned to Albertans in the form of tax cuts. This type of fully refunded carbon fee is about reducing emissions, not increasing government spending, and focuses the revenue generated on easing the tax burden on Albertan families and job creators.

And the results? Corporate and consumer behaviours change, real emission reductions are seen, costs to the taxpayer are lowered and money is reinvested in the economy. Both the environment and the economy are safeguarded. This proven economic policy has been working for years in British Columbia, one of Alberta’s closest trading partners. Under its revenueneutral carbon fee, B. C. has seen its greenhouse gas emissions drop even as the province has enjoyed Canada’s strongest GDP growth.

If Alberta has the courage to follow B. C.’ s example through a revenue- neutral carbon fee, Alberta can reduce emissions, while also bringing in significant tax cuts to restore the Alberta Advantage and boost our economic growth. As a global leader in energy production, we have pride in the resources that afford us key economic and social benefits.

We’re justly proud of our technological innovations that have made a major contribution to fighting climate change. Now, with this policy, we can also be proud to be the first major energy producer in North America to implement proven solutions to reconcile our economy and the environment.

Alberta can have both a strong economy, including a vibrant energy industry, and a clean environment.

Kaitlin Szacki is the Western Canada director of Canadians for Clean Prosperity, an advocacy group building public and political support for marketbased solutions to environmental challenges.