Don Cayo: In my opinion

Praised: U.S. group likes our approach, but eventually levy will have to rise to fund the things we want

B.C.’s carbon tax is being praised by outside observers, but it will still need to increase to fund what we want.

An influential U.S. advocacy group is holding up B.C.’s carbon tax as a model for Americans and the world.

The analysis on which the praise for the made-in-B. C. policy is based looks in more depth than other studies have at preand post-carbon-tax data on greenhouse gas emissions. It’s the work of the non-partisan Carbon Tax Center — the group that brought together 32 VIPs, including four Nobel laureates, three former U.S. cabinet secretaries who served under four presidents (from both major political parties), and two former vice-chairs of the Federal Reserve’s board of governors — to lobby negotiators at the recent climate change summit in Paris.

While the Carbon Tax Center’s basic message — that B.C.’s carbon tax is working — isn’t new, some of its specific findings are.

These findings compare the province’s emission levels during the seven years preceding the tax with the first seven years after the tax was implemented. Even considering the impact of the 2008 financial collapse, which almost certainly lowered 2009 emission levels, the data shows strong results. For example:

• Average per capita emissions dropped 12.9 per cent from the pre-tax period (excluding fugitive emissions from coal mining and natural gas extraction, which are not subject to the carbon tax and were not included in the study). This is 3½ times better than the performance of the rest of Canada.

• Emissions fell faster than in the rest of Canada, at a rate of about one per cent a year over the whole 2000-2013 period that was studied.

• The decrease of 16 per cent for stationary combustion sources was better than the 10.3 per cent for transportation-related combustion.

• A few sectors — non-renewable resource extraction, heavyduty diesel vehicles and domestic navigation — produced more greenhouse gases after the tax was implemented. But this was balanced by reductions in every other sector, especially manufacturing.

While the averages look good, however, B.C.’s record of progress isn’t unblemished. In both 2012 and 2013, emissions crept back up.

This reversal of an encouraging trend is probably due mainly to economic recovery, the analysts speculate. But it is interesting to note that 2012 was the last year of former premier Gordon Campbell’s plan to raise the tax $5 a tonne every year. Then his successor, Christy Clark, froze it for five years.

The issue isn’t settled, however. It’s back in the news and likely to stay for some time. The province’s climate change leadership team, comprising businesses, First Nations, local governments, academics, and environmental groups, recommended a $10 per tonne carbon tax increase in 2018, balanced by a one-per-cent cut in the provincial sales tax.

As well, Alberta Premier Rachel Notley has introduced a $20 a tonne, steadily escalating carbon tax that will equal B.C.’s by 2018. And B.C. Opposition Leader John Horgan has added another element to the debate by saying that, unlike Clark but like Notley, he favours earmarking carbon tax revenues to fund climate change abatement measures rather than cuts to other taxes.

Charles Komanoff, director of the Carbon Tax Center and lead author of its report, pussyfooted around the Clark-Horgan debate when we talked this week. But he conceded his agency recommends B.C.’s existing revenueneutral approach because it would more politically acceptable to voters in his country.

In this country, too, if you ask me.

I think it’s inevitable that, sooner or later, B. C.’ s carbon tax will rise again. It simply makes sense to shift taxation from things we want more of, like income or commerce, and onto things we want less of, like greenhouse gas emissions. And no government’s emissionreduction goals can succeed as long as they shy away from a price on carbon.

But when B.C.’s next government, no matter who’s in charge, does end Clark’s freeze, I hope it’s her policy ideas that prevail, not Horgan’s.

No government’s emission-reduction goals can succeed as long as they shy away from a price on carbon.