Strengthening Carbon Pricing
A price on pollution is the cheapest way to reduce harmful air pollution and carbon emissions and is integral to any plan to build a strong economy. The federal price on carbon pollution is revenue neutral, will reduce GHG emissions by 50 to 60 MT by 2022, and help the Canadian economy tap into the USD 26 trillion global cleantech market.
As part of the 2020 mid-term review of the Pan- Canadian Framework on Clean Growth and Climate Change (PCF), the federal government has committed to assess the overall approach to pricing pollution and best practices to address the competitiveness of emissions intensive and trade-exposed (EITE) sectors. The Green Budget Coalition recommends that this process establish clear criteria regarding:
- How the price signal will increase beyond 2022: laying the groundwork for regular, incremental carbon price increases. This will offer much-needed certainty for investors and long-term incentives and flexibility for industry and consumers to move toward low-carbon options. That investment certainty and incentivization of low-carbon options is essential to the future resilience of the Canadian economy as the world strives to decarbonize to limit warming to 1.5 degrees Celsius.
- How the price treatment will convert to full coverage over time for EITE sectors: A properly designed OBPS must be targeted and temporary. In other words, it should only apply to EITE sectors with true competitiveness concerns.
- How to expand the scope of the federal carbon pricing system beyond combustion and industrial emissions to include ecosystem emissions associated with human activity, e.g., land use change and land degradation. See Nature-based Climate Solutions
Isabelle Turcotte – email@example.com