Front Burner - How do anti-carbon tax provinces plan to fight climate change?

Episode Date: April 3, 2019

This week a new federal carbon tax on fossil fuels came into effect in Ontario, Manitoba, Saskatchewan and New Brunswick. These are all provinces that took a hard pass at creating their own version of a carbon pricing plan that would meet the Liberal government's standards. They're being called "The Holdouts". Today on Front Burner, CBC's J.P. Tasker walks us through how each province proposes to fight climate change without a carbon tax.

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Uncover. The Village. Available now wherever you get your podcasts. You don't start killing at 66. You'd start killing when you're in your late teens or early 20s. Uncover. The Village. Available now wherever you get your podcasts. Hello, I'm Jamie Poisson. So this week, depending on who you follow on Twitter, your social media feed may have been full of angry-looking people pumping gas. Today is the last day to fill up your gas tank before the federal carbon tax hits your family budget like a ton of bricks. That's because on Monday, the new federal carbon tax came into effect in Ontario,

Manitoba, Saskatchewan, and New Brunswick. These are all provinces that took a hard pass at creating their own version of a carbon pricing plan federal carbon tax came into effect in Ontario, Manitoba, Saskatchewan and New Brunswick. These are all provinces that took a hard pass at creating their own version of a carbon pricing plan that would meet the Liberal government's standards. They're being called the holdouts. And starting this week, they all have a new federally mandated tax on fossil fuels, one that will make filling up a tank or heating a home a little more expensive, at least up front. I actually didn't realize how much difference there was going to be between yesterday and today. Which is not fair, I think, in my opinion.

We already paid too much. So what's pretty clear to me is that the leaders of these provinces, and by extension, the people who voted for them, do not want a carbon tax. But what's less clear is how they propose to fight climate change without a carbon tax. Like, what is the alternative here? CBC's J.P. Tasker is going to help us sort that all out. Hey, J.P. Hey, Jamie.

Thanks for coming back on the pod. Thanks for having me. Actually, our very first episode was with you, and it was on carbon pricing. So full circle. But I want to start today by setting up the stakes a little bit because earlier this week, this report was released by Environment Canada, and it felt a little bit terrifying to me. Essentially, this report found that Canada is warming at twice the global rate, and that northern Canada is heating up more than twice the global average. Yeah, I mean, it's frankly downright terrifying. We're far from the

world's largest greenhouse gas emitter. I think the last time I checked, we were about 10th overall. We only have about 1.63% of global emissions. So we're not exactly China or the United States on this front, but clearly based on this report, which was conveniently released the same day the carbon tax was taking effect in those four provinces. A convenient leak. Conveniently released. Leaked to CBC, I should add, by someone in government, I presume. Clearly this report is documenting that while we're not the world's largest emitter, it's certainly having much more of an impact on our country than others. The scientists from Environment and Climate Change Canada here with me today, Marjorie Shepard.

The temperature changes over about the past 70 years. Canada's warmed by about 1.7 degrees, which is about twice the global mean of 0.8 degrees over this period. Northern Canada has warmed by 2.3 degrees, nearly three times the global rate. And that really means that we're looking 10, 20, 30, 40 years from now that we could be warming, you know, in some parts of Canada by five, six degrees above other parts of the world, which could be hugely catastrophic, especially for a

country like ours that's surrounded on all three sides by oceans. And we know that that's where the water is being displaced, of course, into the oceans, which is, you know, resulting in huge tides. Right. And we've already seen forest fires in B.C. And of course, this report follows another terrifying report that came out of the United Nations in October that says that we essentially have 12 years to limit climate change catastrophe. Limiting warming to 1.5 degrees is not impossible, but will require unprecedented transitions in all aspects of society. So that's the context in which we are having this big debate right now in this country about carbon taxes. And we've got these four holdout provinces, Ontario, Manitoba, Saskatchewan, New Brunswick, provinces that did not come up with their own plan. And the Liberal federal government is now imposing its carbon tax plan on them. And the whole point of carbon taxes

is so that you and I will change our behavior. Yeah, absolutely. They are slapping a $20 a ton price on greenhouse gas emissions, which probably doesn't mean a whole lot to the average person, but essentially it translates into about four cents a litre for gas, five cents for every litre of home heating fuel. The whole idea is if they make things like gasoline, home heating fuel and natural gas more expensive for us to use by putting this carbon tax on those fossil fuels, the hope is that we'll use less of them and they're going to give us some money back in turn with the Climate Action Initiative rebate,

and that's basically something that we can collect at tax time, and it's designed to make us whole for all the carbon taxes that we might be paying throughout the year. And it's really designed to give us more money up front so that there is an incentive to use less of those fossil fuels throughout the year. So the idea is that at the end of it all, greenhouse gas emissions are going down because there's a cost to them. I'm calling about the new gas tax.

It's not going to change my habits at all because I've already changed them. I make a significant effort to combine trips, to walk whenever I can, and to drive a very small vehicle because I don't need a big one. Okay, so we've got this plan that the federal government has come up with. It's one of many tools that they have to fight climate change. And then we've got these holdout provinces. So what's their main gripe with the carbon tax? Yeah, well, if you go back to the last federal election campaign in 2015, the prime minister promised a plan to tackle the rising greenhouse gas emissions in this country. He promised to do more than what the conservative government had done to that point.

We'll work with the provinces in the first 90 days of taking office to establish a framework for reducing Canada's collective carbon footprint. Make no mistake, the Liberal Party will be putting a price on carbon. And he really dropped a bomb on the provinces in October 2016 when he came out in Parliament in a speech to fellow MPs saying that the government was going to slap a carbon tax on provinces whether they liked it or not. If neither price nor cap and trade is in place by 2018, the government of Canada will implement a price in that jurisdiction. So they had to come on side with the federal pricing mechanism. And that really started the debate in earnest in this country, which forced all the premiers and the prime minister to sit down and kind of hash out a plan to really get to that point where they could put that $20 a ton cost on greenhouse

gas emissions. So when they did sit down in Ottawa a couple months later, all the provinces except for Saskatchewan agreed with the Liberal plan, agreed with Justin Trudeau's premise that there had to be a price on carbon, and then it could either take the form of a cap and trade system, like what Kathleen Wynne had pushed ahead with in Ontario, and her counterpart in Quebec as well, or carbon tax, like what we have in British Columbia, and also in Rachel Notley's Alberta. So all were on side except Brad Wall in Saskatchewan, who basically said this was foolish, that we shouldn't move alone on this sort of thing, that with someone like Donald Trump about to take over the U.S. presidency and vowing to push ahead with more coal and oil development, we would be foolish to go ahead with this price on carbon because it would

just make life more expensive and it would kill one of our main extractive industries. We compete with the Americans in our province for drilling rigs. Our farmers compete with their farmers. This matters. Competitiveness for Canadians matters, especially at a time when our energy sector has been is reeling from low commodity prices. Right. And so the main argument here is that it's just it's not going to make a difference and that this is going to create an environment that's hostile to businesses. Yeah. I mean, the idea is that the best way to tackle greenhouse gas emissions is maybe not a tax because they're, you know, the federal liberal government is saying,

look, the tax isn't that onerous. It's really only four cents a litre on gasoline. Their critics say, well, if it's not that onerous and if it's not going to make that much of a difference in your pocketbook, is it really going to make that much of a difference to the environment? You know, is there other things that we can do? And the federal conservative government before, this is kind of the message that these premiers are parroting now, the former federal conservative government said that they should take like a sector by sector approach, which is more of a regulatory approach. So sitting down with some of the larger emitters in this country, like the oil sands, you know, the coal fired power plants, and reaching a deal on how they would cut emissions on their own

without having sort of that pricing pressure. Our government has opted not to apply carbon taxes. The purpose, the central purpose of our plan is to create certainty about emissions reductions, not to raise revenue for the government. Of course, that plan didn't really work out well under the former Harper government because they couldn't reach a deal with any of those big industries. But that's something that Andrew Scheer and these other premiers are now touting.

They're also pushing other things that we know well, like recycling programs, trying to prioritize those as a way to help offset greenhouse gas emissions and the impact of plastics on the environment by pursuing aggressively, even more than we already do, recycling programs, by taking coal power plants offline, by prioritizing hydropower. So these premiers are saying, look, we don't have to rely on a carbon tax alone to help us get to the Paris climate targets that Canada signed on to in the fall of 2015. And so you mentioned Andrew Scheer talking about increased recycling and sector a sector by sector approach. Has he given any details about how he plans to do that?

No very thin on details at this point. He came out very strongly against the carbon tax of course when it was implemented on Monday saying that it's just a tax grab by the federal Liberal government. My message to you today is my first act as Prime Minister will be to scrap Justin Trudeau's carbon tax. But to this point, he hasn't offered any plan at all to help Canada meet its Paris climate target goals. He suggested that there will be a plan in the works when they hit the campaign trail in the fall. But to this point, he's just been mostly critical about the Liberal plan. We

haven't really heard a lot from him. I'm just wondering, how do you plan to reduce the carbon footprint? So we will be unveiling our environmental plan with plenty of time before the next election. And I should point, though, that a lot of Conservative voters, we might have this character of them on this file. But actually, if you look at some of the most recent polling, a lot of conservative voters are actually just as concerned about the environment as other demographic groups. 50%. 50% of all conservative voters think that climate change is a big or very big deal and that there has to be some sort of federal action on this front. So I don't think Andrew Scheer can afford to just sit back and cede this territory to Liberal Party alone. I think he will have to come up with something.

What about these other holdout provinces? Let's start with Saskatchewan. Does Premier Scott Moe have a different plan? Well, as I mentioned earlier, Brad Wall has been aggressively campaigning against a carbon tax for some time because he felt that it was best placed for the provinces to deal with climate change. And he's been pursuing, and his successor Scott Moe, has been pursuing a technology called carbon capture and sequestration technology. And that's CCS in Saskatchewan. It's quite popular.

Basically, it's retrofitting coal-fired power plants to capture more of the GHGs, the greenhouse gas emissions that are coming from those plants. And that would make them more efficient, more akin to natural gas or other cleaner fossil fuels that we use in the electric grid. And he's believed that investments that the province has made in that technology should count towards, you know, action on climate change, because it will drive down some of the greenhouse gas emissions that are coming from that sector of the economy. Taking action on climate change and taxing Saskatchewan residents are two very separate conversations.

We have the largest investment in our fossil fuel plant in climate change mitigation at Boundary Dam 3. But the federal Liberal government said that's simply not enough, that it's not equivalent to putting a carbon tax in place or a cap-and-trade system, and that they actually had to follow the federal plan despite some of these investments in the coal power plants. Well, Scott Moe decided, you know, if you're not going to take our investments seriously, we're not going to take your tax seriously, and we're going to actually take you to court. And earlier this year, that court action finally made it in front of a judge, and essentially they argued that the federal government was not within its jurisdiction

to impose this sort of carbon tax on the people of Saskatchewan, saying that it was beyond the powers within the constitution, the taxation powers. What we see is Saskatchewan saying to the federal government that you are intruding in our provincial area of regulation and you shouldn't be doing it. Federal Liberal government arguing otherwise, saying of course they have the regulatory power to do this sort of thing. So that's still up in the air. But they've decided to pursue court action rather than comply with the federal Liberal plan.

And what about Manitoba? Yeah, Manitoba is an interesting case because Brian Pallister, a former federal MP who rose to power a couple years ago now, and he actually came up with what he was touting. He's calling it the made in Manitoba approach, which did put a price on carbon about $25 a ton. So actually more than what Ottawa had proposed for this year. It's exciting. It's ambitious. It's made for Manitobans by Manitobans.

But he wanted to keep the money locally. He wanted to keep it within the province. And that all sounded well and good. But then he started to face a backlash from people within his own party when they saw the likes of Doug Ford, when they saw the likes of Scott Moe in the other provinces really championing an anti-carbon tax perspective. He started to get a bit jittery about his plan. And he said that things went awry in his negotiations with Ottawa and his negotiations with Catherine McKenna, the Environment Minister in particular. We fought hard to try to get certainty with our plan.

We haven't been able to get it. And now we have no choice, in my estimation, but to stand up and say no. So he actually pulled his plan entirely and said that what they were going to do instead was just continue to develop hydroelectric power within the province, you know, continue to phase out coal. There's actually only one coal-fired power plant in that province, but he said that that was, you know, headed for the dustbin of history. And he also said they would learn how to recycle more and better.

So that was his green plan after getting rid of the carbon tax. Okay, let's talk about Ontario and Doug Ford. Yeah, absolutely. So Kathleen Wynne had an advanced plan in place. They had already started the cap and trade system. You know, the cap and trade system is far more complicated than the carbon tax. And most economists will tell you that cap and trade is pretty difficult to understand. But essentially, it's large industries. They have a cap on how many emissions they can let out each year, and they have to trade certificates amongst each other to give more leeway. Yeah, it's sort of like an auction.

So if they use less carbon each year, they can pass on those certificates to others for a price. So he came to power, you know, championing an anti-carbon tax agenda. Doug Ford made it clear if he were elected, he would rip up those contracts that Kathleen Wynne had signed, that he would relieve Ontarians of all the costs that came about because of that cap-and-trade system. We're going to scrap the carbon tax, we're going to cap taxes, and we're going to trade Kathleen Wynne. And that was a very successful message, of course. As you'll remember, he has a huge majority government in Ontario. He won a number of seats in both the 905 and the 416.

So he certainly hit a nerve with a lot of voters. And to this point, they have championed some minor tinkering around the edges, if you will, that they're going to make some environmental changes here and there. Again, pursuing hydroelectric power, pursuing greener technology in the energy sector, more recycling, continue to develop nuclear, which burns clean. But he has not and vehemently opposed any sort of pricing mechanism imposed by the federal government. I'm here today to ring the warning bell that the risk of a carbon tax recession is very, very real. And you just mentioned Saskatchewan's core challenge. Ontario is also taking the federal government to court over this.

Yeah, both of those provinces. Saskatchewan, of course, was the original holdout, but then under the leadership of Doug Ford and Ontario's Progressive Conservative Party, they also felt that legal action was the best way to move ahead to avoid having to have that federal liberal carbon tax slapped on the people of their provinces. And lastly, New Brunswick, final holdout. Yeah, so even under the former liberal government, there was a plan in place that

most observers found lacking, frankly, because essentially what they wanted to do was increase the gas tax, the existing gas tax, and call it a carbon tax. While the federal Liberal government, while supportive generally of New Brunswick and close allies, found that that plan was just, you know, left a lot to be desired. And Blaine Higgs, the replacement, the progressive conservative premier who took over for that Liberal government, has really had nothing to say about the environment, other than to say he's vehemently opposed to the carbon tax as well.

And we are fighting that carbon tax because one of the things we don't need here in New Brunswick is more taxes. So he has campaigned very strongly against any sort of carbon tax, but hasn't really given voters a lot of options as to what he would do to help tackle, you know, the growing climate crisis. So all together, taken all together, Andrew Scheer, all of these premiers in these four holdout provinces, is what they're doing equal to what the carbon tax could do? Well, it's hard to say because there really isn't a coherent conservative plan right now on the climate agenda. They don't believe in carbon taxing and carbon taxing is really the main mechanism that most of the environmentalists that we speak to and even people in industry, a lot of market observers, believe this is the best way to go. So we don't yet know how they are going to actually tackle these issues because it really does seem like minor tinkering around the edges. There's not a big, bold plan as of yet. And frankly, I think they're thinking that their voters are OK with it.

So that's why they're touting some of these other initiatives as a possible solution to a climate agenda that doesn't include a taxing mechanism. Right. So, you know, this idea that they're saying that carbon taxing isn't the way to go. In the provinces where carbon taxes have been implemented, BC has had one since 2008. What do we know about how they're working? Yeah, BC was really the first jurisdiction in all of North America to ever pursue anything like a carbon tax. And they've had some success to this point, frankly. If you look back on the data that's been provided by the government, but also some outside independent observers, they've been able to cut their greenhouse gas emissions in that province by 10%.

And that really is an impressive number if you look at just how much the economy has grown in turn in that time. The economy has grown by 20% in the last 11 years. And usually when the economy is growing, so are greenhouse gas emissions. So to see that number come down substantially, about 10%, as I said, to see the economy growing by about 20%, and to also see a population growing by 10%,

you know they're making progress in that province, at least in part because of the carbon tax. Right. And the idea here being 10% is impressive also because, you know, maybe if there wasn't a carbon tax, emissions would have been going up. So it's not just that there was a 10% decrease. It's that without a carbon tax, it's possible that we could have seen a 20% increase in emissions in the province. Okay. JP, thank you so much. Thank you. So that's the carbon tax, and we'll be watching to see how it all plays out in the courts.

In other big news, you've likely already heard that former cabinet ministers Jody Wilson-Raybould and Jane Philpott were kicked out of the Liberal caucus on Tuesday evening. We're working on an episode on this, trying to tap into some of the emotion around this whole scandal. We wanted to take an extra day on it, and you can catch it tomorrow. I think it's going to be worth it. In a tweet Tuesday night, Jody Wilson-Raybould said the prime minister delivered the news to her himself. Maybe the most important three words in that tweet, though, more to come.

The Prime Minister spoke at a caucus meeting shortly after. Here's some of what he had to say. Whether it's taping conversations without consent or repeatedly expressing a lack of confidence in our government and in me personally as leader, it's become clear that Ms. Wilson-Raybould and Dr. Philpott can no longer remain part of our Liberal team. So that's it for today.

I'm Jamie Poisson. Thanks for listening to FrontBurner. For more CBC Podcasts, go to cbc.ca slash podcasts. It's 2011 and the Arab Spring is raging. A lesbian activist in Syria starts a blog. She names it Gay Girl in Damascus. Am I crazy? Maybe. As her profile grows, so does the danger.

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