Report says diverse plan needed on GHG cuts
As Saskatchewan focuses on carbon capture technology and resists a carbon tax, a new climate change policy report is calling on the provincial government to consider a more multi-dimensional approach to combating greenhouse gas (GHG) emissions.
The report — titled Climate Change: The policy options and implications for Saskatchewan — was released this month by the Johnson Shoyama Graduate School of Public Policy.
It outlines the challenges, legal arguments and some of the policy options surrounding climate change, as well as the impacts those policies would have on the province.
“If we’re going to be serious about addressing climate change in the way that the federal government has set out ... then there is no one policy solution to this,” said Dale Eisler, co-author and senior policy fellow. “It’s going to take a number of different approaches.”
The federal government has committed to a 30 per cent reduction in GHG emissions from 2005 levels by 2020. In October 2016, Prime Minister Justin Trudeau announced provinces and territories must implement a direct tax on carbon emissions or adopt a cap-and-trade system by 2018.
The Saskatchewan government has maintained that a provincial carbon tax will never happen, stating that their export-based economy could not withstand it, despite provinces and territories having the ability to exempt or reduce taxes on certain sectors.
Eisler said the report aims to broaden the discussion “beyond simply what often gets reduced to an issue over the carbon tax, yes or no” and exploring a combination of a carbon tax, cap-and-trade system and clean technology instead.
CARBON TAX
The province estimates a carbon tax, which directly taxes GHG emissions, would produce $2.5 billion in revenue. The report says the revenue would allow the government to lower taxes and spend money to stimulate the economy and increase employment — effectively offsetting the negative impacts of the carbon tax.
But it points out products made in places without a carbon tax would be less costly and could “displace those produced in Saskatchewan.”
CAP AND TRADE
A regulatory system like capand-trade would place a levy on entities with annual GHG emissions over 50,000 tonnes. According to the report, it is likely only the electricity sector and coal production would come under the restriction.
The advantage of this system is it would monitor and measure progress in reducing emissions, says the report, but does not directly affect the behaviour of “individuals or households who may choose to absorb the additional costs and continue carbon intensive activities.”
“This is about changing people’s behaviour. That’s the core of the issue,” said Eisler. “We need to effectively change our lifestyles if we are going to achieve the reductions we need.”
CLEAN TECHNOLOGY
To assess the economic impact of spending on the development of alternative technologies — such as nuclear, solar, wind, carbon capture and storage (CCS) — was beyond the scope of the analysis, says the report.
However, it does say the fact it has no direct impact on individual behaviour could “greatly restrict the potential for this option to affect other GHG emissions within the province.”
It also states in order for CCS to work, the province would need to commit to a planned transition to a low-carbon future. Without that plan, the technology is simply “an expensive demonstration” of “engineering prowess” and a bargaining chip in federal-provincial climate policy negotiations.
Each option has its pros and cons, but a “well-designed mix in which the weaknesses of one policy instrument is counterbalanced by the strength of another” is urgently needed, concludes the report.
Eisler said the crux of the issue is trying to create long-term change when governments operate in four- to five-year political cycles.
“That is the real challenge here,” said Eisler.
The full report can be found at schoolofpublicpolicy.sk.ca.