Nov 29, 2015

BC’s climate action masquerade

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When BC Premier Christy Clark arrives at the Paris climate conference, as part of a reinvigorated Canadian delegation under PM Trudeau, the world will hear bold statements about BC’s climate leadership. BC has received much praise since its 2008 introduction of a carbon tax (under previous Premier Gordon Campbell), and for its legislated greenhouse gas targets, which call for a one-third reduction in emissions by 2020 relative to 2007 levels.

The trouble is BC has done essentially nothing on the climate file since that time, and the current Clark government has actively been moving the yardsticks backwards by aggressively pursuing an LNG export industry. In truth, Campbell’s Climate Action Plan never contained measures sufficient to meet that 2020 target. A 2008 Climate Action Team was tasked to make recommendations about how the province could achieve the 2020 target, but the government largely ignored them.

Fast forward to 2015, and statistics show that after a recession-induced drop in emissions in 2009 and 2010, BC’s greenhouse gas emissions grew every year up to 2013, the last year for which we have data. BC government claims to have met an interim 2012 target of 6 percent below 2007 levels were on the basis of dubious offset purchases.

This is the context for the report of the new Climate Leadership Team (CLT), recruited last summer to make recommendations for a next phase of climate action in BC. Viewed cynically, this was a last-minute attempt to save face before the spotlight of the Paris climate negotiations.

The government instructed the CLT to make recommendations that would not thwart its LNG ambitions or undermine economic “competitiveness” (narrowly understood). It is likely this mandate could not be squared with the scientific and ecological imperative, thereby making it a challenging experience for environmentalists appointed to serve on the CLT alongside industry (including the LNG Alliance).

The end result, sadly, is a set of recommendations that disappoints relative to the ambition the world needs, and the leadership BC really could provide. (If you want to compare, my submission to the CLT, summarizing the work of the Climate Justice Project, is here.)

The CLT states that BC will not meet its 2020 targets, nor are its own recommendations sufficient to get there. This aligns BC with a dubious Canadian tradition: setting targets and then failing to meet them. It is unfortunate that the CLT chose not to put up more of a fight on this front, given that the first item in the CLT’s mandate was to advise the government on “achieving BC’s legislated GHG emission reduction targets.”

The CLT report instead shifts the yardsticks, calling for a reduction of 40% below 2007 levels by 2030, which gives the government cover for making the same shift. Whether a new target for 2030 has any credibility depends on how the government responds. After releasing the CLT report – on a Friday afternoon, after media stories for the day had already been filed – the government has promised only consultations in January 2016 “with industry and the public” (in that order).

The CLT has some interesting things to say about GHG reduction in BC. There are many positive recommendations to reduce emissions in buildings, transportation and communities. These are all areas of domestic consumption, and the low-hanging fruit of GHG reductions. The real challenge, however, is how BC addresses its fossil fuel production sector, and plans for a massive escalation via LNG.

The CLT was forced to work around LNG as part of the status quo path forward, so its recommendations deal with reducing the damage, at least in terms of emissions from extraction and processing in BC. The lion’s share of emissions would occur when gas is combusted in the importing country – all told we are looking at the equivalent of adding 24 million cars to the roads of the world for a middle scenario of LNG. On the plus side, the CLT recommends that GHG emissions be included in BC’s environmental assessment process.

A major part of reducing the domestic emissions associated with LNG is a call for clean electricity to be supplied by BC Hydro. Interestingly, the planned construction of the controversial Site C dam is not explicitly mentioned, nor the local and First Nations opposition to it (court cases are still pending). This is a significant oversight given that the real purpose of the dam is to provide low-cost power to the mining and gas sectors. This also reflects a broader theme – the report fails to mention First Nations rights and title in the context of industrial development.

The economics of LNG are currently awful. Even if BC had a plant built and ready to go, an LNG exporter would be losing money on every tanker load sent to Asia. This is the main reason why LNG has been so often promised, but no final investment decision has occurred. So it may be economics, not climate policy, that has the most impact on BC’s future GHG emissions.

In the government’s discussion paper for the CLT process, they repeat a claim that LNG would reduce global GHG emissions by displacing coal in China. Sadly, the CLT report does not counter this assertion (for critiques see herehere, and here).

The central recommendation of the CLT is for BC to start increasing its carbon tax, frozen since 2012. The CLT proposes that BC’s carbon tax increase by $10 per year, but not starting until 2018. Emissions not already covered by the carbon tax are given until 2021 before being subject to it. It notes that this will affect the gas and other industrial sectors, and proposes subsidies to industry out of carbon tax revenues to deal with those “competitiveness” issues. Yet, unlike the recent Alberta report from the Leach commission, the CLT is silent on supports for workers in carbon-intensive industries, and the need for just transition policies.

While increasing the carbon tax by $10 a year is worth supporting, the CLT places too much faith in the emission reduction incentives of the tax itself, and not enough on its potential to fund green infrastructure, like public transit, needed for BC to really get off of fossil fuels.

The team calls for a 1 percentage point reduction in the PST, from 7 to 6 percent, funded by the carbon tax increase. The CLT ultimately rejects the BC government policy of revenue neutrality (without explicitly saying so), arguing that incremental carbon tax revenues support complementary climate action measures, including new technology development and funding for local governments, although the CLT only allocates a very small share of new carbon tax revenues for these purposes. In another part of the report, the CLT supports increased public transit, but does not tie carbon tax revenues to supporting it, as has been recommended by Metro Vancouver mayors, among others. The CLT also acknowledges that low-income households and rural communities may be adversely affected, so deserve a portion of increased carbon tax revenues.

Strangely, in the appendices (p. 26) we find that the CLT recommendations as modeled are not sufficient to meet their stated targets of a 40% reduction by 2030 (over 2007 levels) and 80% by 2050. Needing to work around LNG is the likely culprit here, although the information provided is not sufficient for the reader to gauge the impact.

All told, the CLT has some important recommendations for further action, but will require the BC government to actually implement them and then some. Whether the CLT or the government can claim this represents leadership is disputable, however, given BC’s dogged pursuit of LNG.

Back in 2008, some claim of climate leadership was fair, but no longer. BC’s limited climate actions have fizzled, replaced with claims of leadership unmatched by deeds. In that context, it’s hard to see this as anything other than a cynical exercise, a masquerade for the Paris spotlight, to allow an LNG-pushing Premier to pretend to be a climate hero.

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