Ontario’s cap-and-trade deal a good first step

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At last! Now that Quebec and Ontario signed a cap-and-trade deal, Canadians can begin in earnest to have adultlike conversations about carbon pricing.

Ontario’s announcement is good news because we are actually putting a price on carbon. Glen Murray, Ontario’s minister of the environment, clearly cares about climate change and I appreciate his leadership on this issue. At the same time, I’m concerned that carbon pricing at the provincial level is not as effective as at the national level.

In order to keep the agricultural and manufacturing sectors of the Canadian economy competitive, we need national carbon pricing because under the North American Free Trade Agreement and the World Trade Organization rules, national governments can implement border tax adjustments to prevent industries from going to places with a weak or non-existent carbon pricing policy, while subnational governments cannot.

With provincial carbon pricing, provinces will need to provide exemptions to vulnerable industries or keep carbon prices low, to prevent industries from fleeing. This weakens the effectiveness of the carbon price. We need a meaningful, steadily rising carbon price to transition to the low-carbon economy of the future, and therefore, this needs to be national in scope.

Read full article here.

Caterina Lindman – Waterloo Region Record – Apr 18, 2015.

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