It sure looked like an effective display of brinksmanship. Late in the Dec. 9 meeting between Prime Minister Justin Trudeau and the premiers on climate change, B.C.’s Christy Clark walked out and told reporters she wouldn’t be signing Trudeau’s vaunted Pan-Canadian Framework on Clean Growth and Climate Change.
Clark explained it to the cameras as a matter of fairness. The essentials: B.C. has taxed carbon emissions since 2008, a levy that now stands at $30 per tonne, and doubts the measures some other provinces are adopting will amount to the same thing. Clark wanted assurances that a fair comparison would be made before B.C. had to hike its tax, as dictated by the new framework.
Minutes later, B.C. officials hurried out to to tell reporters they’d got what they wanted, strongly suggesting that Clark’s gambit had applied the necessary pressure to gain concessions. But federal officials later countered that nothing of the sort had happened. They said the key B.C. ask—a comparative review of what provinces are doing to cut carbon in 2020—was already agreed to before Clark’s public performance.
It’s difficult to report with confidence on what went on behind the scenes. However, based on interviews conducted a few hours after the meetings ended—and the Pan-Canadian Framework was announced, with only Manitoba and Saskatchewan refusing to sign—this is what federal and B.C. officials largely agree happened.
In fact, before Clark walked out to tell reporters she wouldn’t be signing, there was already agreement to include a key clause into the framework, promising an interim report to be completed in 2020, assessing the different approaches the provinces are taking to meet the emissions-reduction objectives of the agreement. The Prime Minister and premiers will review those findings.
That sounds a lot like what B.C. officials had been telling reporters all day Clark was seeking. So what, if anything, did her threat not to sign change? Federal and B.C. officials said a single line was added to the “annex” on the province at the back of the framework document. It reads: “B.C. will assess the interim study in 2020 and determine a path forward to meet climate change objectives.”
A lot depends on how much weight is put on those words. From Clark’s perspective, they imply that if the 2020 assessment finds that other provinces—notably Ontario and Quebec—haven’t done enough, B.C. won’t be increasing its carbon tax. But a federal official flatly called the sentence “redundant,” suggesting it doesn’t really alter the 2020 interim review’s importance.
Beyond the squabbling over how much Clark won for B.C., if anything, serious questions now arise about how that 2020 review will be conducted. University of Alberta business economics professor Andrew Leach, a key architect of Alberta’s climate change policy, suggests it will be tricky to compare carbon pricing, like B.C.’s, against the so-called cap and trade systems adopted by Quebec, Ontario, and, most recently, Nova Scotia. Under those systems, companies buy and sell credits to pump out greenhouse gas emissions, effectively putting a price on burning fossil fuels.
At root, B.C. is demanding a comparison of how heavy a price provinces impose on fossil fuel burning, while Ontario and Quebec insist the emphasis should be on how much emissions are cut. It turns into a highly technical argument. Leach doesn’t claim to be neutral—he’s heavily invested in Alberta’s approach, which is closer to the B.C. model—but his observations about the battle to come seem about right.
He worries that Canada is heading to a fork in the national policy road, a split between provinces that emphasize the quantity of emissions, and those that stress the level of carbon pricing. “It seems we’re heading to a hybrid, where the worry would be moral hazard,” Leach said in an email. “So provinces who can meet deep reductions with low prices choose the quantity ‘lane,’ and provinces that can’t meet big reductions without high prices choose the ‘price’ lane, and overall we end up well short of our target.”
What shouldn’t be lost in all this is that the framework hammered out on Dec. 9 is a substantial feat of federal-provincial diplomacy. But, if Leach is right, the battle over the right way to implement that landmark agreement has only just begun.