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| 11/01/17

Manitoba climate plan emphasizes regulation over feds’ carbon tax

TCE

Manitoba unveiled a climate plan last week that proposes a carbon tax half that demanded by the federal government, while promising a raft of regulations to deliver “more than twice” the greenhouse gas emissions reduction that Ottawa’s carbon price would achieve.

The centre-right government of Brian Pallister’s Progressive Conservatives will impose a carbon levy of $25 per tonne beginning next year through to 2022. The federal government has told provinces and territories that they must achieve a $50 per tonne carbon price by the same date, either through a tax or via an emissions-trading system. In the absence of such a price, Ottawa has said it will impose one unilaterally.

Manitoba’s gambit is being closely watched because the province, along with neighbouring Saskatchewan, had refused to sign on to the federal-provincial-territorial climate pact negotiated between the three levels of government in 2016 that embraced the $50-a-tonne price. Climate policy wonks will be poring over the details to see whether a primarily regulatory path rather than one that emphasizes carbon pricing can achieve the same or better results.

Premier Pallister sought legal advice that concluded Ottawa has the constitutional power to impose a carbon tax, but only if Manitoba’s emissions mitigation plan was not as effective. So the province’s plan supplements the $25 tax with regulatory and incentive measures that it projects will result in a reduction of 2,460 kilo-tonnes of greenhouse gases over the 2018-2022 lifetime of the plan, compared to a projected 990 kilo-tonnes that would be achieved by the federal carbon tax alone.

Efforts that are projected to achieve the biggest emissions reductions include a requirement that diesel contain at least five percent biodiesel and new energy efficiency programs to reduce natural gas use for heating. Diversion of organics from landfills, a rebate program to encourage heavy-duty truck diesel retrofits, and closure of Manitoba’s last coal-fired power plant round out the other major measures.

Federal environment minister Catherine McKenna told reporters on Monday: “Manitoba’s approach is good for the first two years. After that, they [carbon tax] will have to go up.”

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