Canada racks up climate ambition by imposing a national carbon tax

Seen as an increase in their climate ambitions, Canada to impose a national carbon tax. Photo credit: Reuters / Chris Wattie.
By Anders Lorenzen
As pressure mounts on countries around the world to ratify the Paris Agreement following the US’s and China’s ratification, Canada has upped its climate ambition by committing to impose a national carbon tax.

Canada’s Environment Minister, Catherine McKenna, announced the initiative, which will be put in place by October.

This is just the latest climate-friendly move by Prime Minister, Justin Trudeau’s Liberal government since he was elected last year. Canada is starting to move away from its anti-climate agenda occupied by previous Prime Minister, Stephen Harper. This prompts further speculation ,whether Canada would be about to ratify the Paris Agreement.

Four out of Canada’s ten provinces, British Columbia, Ontario, Alberta and Quebec already have carbon tax schemes in place. But Catherine McKenna has so far provided little detail on how the national carbon scheme would work. She did, however, hint , that the scheme would center around regional schemes which could differ and then later move towards a national scheme. McKenna said that the government requires some uniformity in emissions reductions, but that provinces can have different regulation methods.

But many regional governments have already voiced opposition to a national carbon pricing scheme, saying it should be up to them to decide how carbon emissions should be regulated. However, in March Prime Minister Justin Trudeau persuaded the provinces to accept a compromise deal that acknowledged the concept of putting a price on carbon emissions. But he agreed that specific details which would take into account provinces’ individual circumstances, could be worked out later.

One of the largest regions opposing such a scheme is the western energy-producing province of Saskatchewan, and its right-leaning premier, Brad Wall.  He has long been resistant to federal emissions-limiting plans. But on this occasion McKenna suggested some flexibility, saying that provinces such as Saskatchewan could design a system in which revenues from emissions go back to companies through tax cuts, which would dampen the impact of the extra cost brought by the carbon tax.

However, it is unclear whether the carbon tax scheme would make Canada upgrade its existing emission reductions targets. They are still stuck at the level set by the Harper government, which only requires Canada to cut emissions to 30% by 2030 from 2005 levels. Those targets are not compatible with keeping warming below 2 degrees celsius.

But while McKenna did not commit to increasing the targets, she said they should be seen as a floor and not a ceiling.

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