One pub­lic ser­vant Ford can’t fire

En­vi­ron­men­tal Com­mis­sioner Dianne Saxe says she isn’t go­ing any­where

The Peterborough Examiner - - Opinion - MARTIN REGG COHN Martin Regg Cohn is a colum­nist based in Toronto cov­er­ing On­tario pol­i­tics. Fol­low him on Twit­ter: @reg­gcohn

Doug Ford has fired On­tario’s chief sci­en­tist, sacked the govern­ment’s in­vest­ment czar, ter­mi­nated its top busi­ness ad­viser, and side­lined Hy­dro One’s lead­er­ship in rapid suc­ces­sion.

But there’s one pub­lic ser­vant to whom Ford can’t say, “You’re fired!”

On­tario’s En­vi­ron­men­tal Com­mis­sioner, Dianne Saxe, doesn’t serve at the plea­sure of the pre­mier.

As an in­de­pen­dent of­fi­cer of the leg­is­la­ture, she can only be dis­missed by MPPs with cause. But even if she hasn’t given them any cause to re­move her, the Pro­gres­sive Con­ser­va­tive ma­jor­ity has surely handed her a cause cele­bre — car­bon pric­ing.

As the Earth’s tem­per­a­ture rises, the fight over global warm­ing is heat­ing up in­ex­orably at Queen’s Park. By shut­ting down On­tario’s cap-and­trade sys­tem on the pre­tense of sav­ing peo­ple a few pen­nies at the pump, Ford’s Tories are not only clear­ing the way for un­re­stricted green­house gas emis­sions, they are open­ing the door to po­ten­tial penal­ties.

And long-term pain for short-term gain. With Ford’s govern­ment vow­ing to op­pose any fed­eral car­bon tax, it is now do­ing ev­ery­thing in its power to do noth­ing about global warm­ing.

What next? “I’m very in­ter­ested in what the govern­ment is go­ing to do,” Saxe tells me.

She warns that by sud­denly tear­ing down the ar­chi­tec­ture of a cap-and­trade sys­tem that took years to build up, On­tario is leav­ing it­self ex­posed to un­fore­seen costs and po­ten­tial lit­i­ga­tion on all fronts. On both sides of the bor­der.

That’s be­cause On­tario for­mally linked to car­bon mar­kets in Que­bec and Cal­i­for­nia, where Cana­dian and Amer­i­can com­pa­nies bid at auc­tion for emis­sions per­mits that were trad­able — and valu­able. For pri­vate com­pa­nies that have bid nearly $3 bil­lion at auc­tion since last year for those per­mits, that’s a lot of money to lose by govern­ment fiat.

Dur­ing his win­ning elec­tion cam­paign, Ford made a point of set­ting aside $30 mil­lion to fund a court bat­tle with Ot­tawa over a fed­eral law that man­dates a min­i­mum car­bon tax to back­stop any prov­ince that fails to im­pose a car­bon price of its own.

But be­yond any fed­eral-pro­vin­cial lit­i­ga­tion — le­gal ex­perts be­lieve Ot­tawa has an air­tight case — it is the risk of pri­vate sec­tor court fights that could bleed On­tario fur­ther.

“Con­cep­tu­ally, I think there will be law­suits,” Saxe says in our in­ter­view. On­tario’s Cli­mate Act “was not de­signed for this kind of can­cel­la­tion, but that will be for a judge to de­cide.”

More­over, Cal­i­for­nia may prove to be fer­tile ground for law­suits, be­cause “U.S. courts have a tra­di­tion of im­pos­ing puni­tive dam­ages.” There could also be class-ac­tion suits from com­pa­nies that in­vested heav­ily on the ba­sis of On­tario law.

The PC govern­ment has also lost a rev­enue stream that would have al­lowed On­tario to fund a back­log of school re­pairs — while bankrolling other en­ergy-sav­ing ini­tia­tives in hospi­tals, homes, and pri­vate-sec­tor pi­lot projects.

Cap and trade is a mar­ket mech­a­nism that al­lows com­pa­nies to man­age re­duced emis­sions in the most ef­fi­cient way, while the govern­ment raises rev­enue to in­vest in emis­sions re­duc­tions. A car­bon tax, by con­trast, is a blunt in­stru­ment (no trade) that im­poses a price on pol­lu­tion, with­out nec­es­sar­ily low­er­ing the over­all emis­sions ceil­ing (no cap).

“In terms of emis­sions re­duc­tions, cap and trade out­per­forms the ... car­bon tax,” ac­cord­ing to Saxe’s lat­est an­nual re­port. “Cap and trade has higher to­tal GHG (green­house gas) re­duc­tions due to the de­clin­ing cap, off­sets ... and us­ing rev­enues to fund low-car­bon ini­tia­tives.”

Thanks to Ford — and his self­pro­claimed “Govern­ment for the Peo­ple” — the prov­ince will likely end up with a car­bon tax that is less ef­fi­cient for the pri­vate sec­tor, and more ex­pen­sive for the peo­ple. In ad­di­tion to the le­gal costs, op­por­tu­nity costs, and en­vi­ron­men­tal costs, Ford has also raised the cost of do­ing busi­ness by trad­ing a flex­i­ble ca­pand-trade sys­tem for a rigid car­bon tax back­stop.

As the prov­ince’s en­vi­ron­men­tal watch­dog since 2015, Saxe has tried hard to ex­plain the re­al­i­ties and com­plex­i­ties of cli­mate change. But the po­lit­i­cal en­vi­ron­ment has changed in On­tario since she took on her over­sight role.

Watch­ing Ford’s fir­ing spree at the mid­point of her five-year term, Saxe in­sists she isn’t go­ing any­where. But the prov­ince she serves is slowly go­ing back­wards into the en­vi­ron­men­tal fu­ture.

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