Carbon-reduction plan nears

Hey there, time traveller!
This article was published 16/10/2017 (2971 days ago), so information in it may no longer be current.

After nearly two years of teasing, Manitobans are perilously close to hearing Premier Brian Pallister’s carbon-reduction plan.

On Oct. 11, Pallister promised he would reveal his plan in two weeks. Applying a wide berth of interpretation to that statement, that would mean a formal announcement sometime during the final full week of October — the 23rd through the 27th.

What will Pallister say when he finally shows his cards? At first blush, that would be hard to predict. The premier has said a lot without giving away too many specific details. Some of his thinking-out-loud statements have been more confusing than illuminating.

Still, a close examination of everything he has said since coming to power in April 2016, along with some informed scuttlebutt, gives us the ground upon which to make a fairly solid prediction.

The premier appears poised to reveal an initial carbon tax of between $20 and $30 per tonne, with the really smart money picking the middle ground of $25 per tonne. That was the magic number in a leaked discussion paper that was notable largely because no one from the Pallister government tried to deny it.

More importantly, it appears quite likely the premier has no intention of moving the carbon tax in Manitoba to the maximum $50-per-tonne level, one of the stipulations in the federal government’s climate change plan.

How can we make these predictions? First, let’s look back on Pallister’s record on the subject.

Since winning the 2016 election, Pallister has repeatedly promised Manitobans a carbon-reduction plan that is the political equivalent of having your cake and eating it too. Pallister said his plan would “foster emissions reduction, retain investment capital and stimulate new investment in clean energy, business and jobs.”

However, to date, Pallister has offered precious little detail on how he plans to accomplish all of those goals.

The federal Liberal government has imposed a 2018 deadline for all provinces to introduce a regime that charges the equivalent of $10 per tonne on carbon emissions. If that deadline is missed, Ottawa has promised to impose that minimum carbon tax and remit all of the taxes back to offending province.

That has presented a huge problem for Pallister, a staunch fiscal conservative with a severe allergy to taxes. Perhaps as a result of the stress of that deadline, Pallister has made a series of confusing, but intriguing, statements.

Pallister suggested $10 per tonne was “negotiable” in May, but wouldn’t explain how. A few months later, he said a carbon tax “wasn’t the only way” to accomplish Ottawa’s carbon-reduction goals. That caused some head-scratching — he had ruled out the main alternative, cap and trade, months earlier.

Then, Pallister suggested that Ottawa ought to give Manitoba some sort of credit for the billions of dollars invested in Manitoba Hydro’s renewable electricity generating system. He could not, however, explain how to calculate the per-tonne value of that investment.

Finally, Pallister said if he does levy a carbon tax, it would not be applied to farmers. That certainly raised eyebrows in other industries, such as construction trades and trucking, about why they might have to pay while the agricultural sector gets a free pass.

Reading the tea leaves that Pallister has scattered over the past 18 months, we can conclude that it will be a carbon tax and that it will likely start at a level higher than what Ottawa recommended, but fall far short of the upper end described in the federal climate change framework.

This strategy became much more clear with the recently released legal opinion provided by law professor Bryan Schwartz, who asked if Ottawa had the constitutional right to impose a carbon tax on an unwilling province.

To no one’s surprise, Schwartz said Ottawa does indeed have the legal authority. However, Schwartz went much further, claiming that if a province did introduce its own carbon-reduction measures, the federal government may not be able to dictate the type and magnitude.

This aspect of Schwartz’s opinion is based less on legal analysis and more on a political agenda. Pallister has fought the notion that Manitoba would ever need a $50-per-tonne tax. Instead, sources confirmed that Pallister will attempt to bombard Ottawa — and a court if necessary — with evidence of other carbon-mitigation measures.

These will include a calculation on the combined sequestration impact of Manitoba’s expansive boreal forests, along with investments in renewable electricity.

Although Pallister clearly resents the former NDP government’s decision to advance the Bipole III transmission line and the Keeyask generating station, he will argue Manitoba should get some sort of credit for its multi-billion-dollar investments in renewable hydroelectricity.

Pallister is not alone in the opinion that “other measures” should be considered when setting the upper limit of any carbon tax.

Former British Columbia premier Christy Clark agreed to Ottawa’s carbon-reduction plan with two caveats: first, that the federal government ensure that all provinces achieved the equivalent of a $30-per-tonne tax, the current tax burden in B.C.; and second, that her province be allowed to argue that measures other than taxes could be used to accomplish carbon-reduction goals.

Schwartz was clearly speculating when he suggested that a made-in-Manitoba carbon-mitigation plan could be immune to future legal action. If Ottawa has the constitutional right to impose a carbon tax on provinces, it arguably has the authority to determine how much tax should be imposed. And there will be pressure from B.C. and other provinces to ensure that Manitoba is not allowed to remain under $30 per tonne.

However, for a province like Manitoba that does not contribute much to the nation’s carbon footprint, that still may be a fruitful avenue to pursue. Particularly if you can confound and confuse the issue with calculations on the impact of the boreal forest and investments in hydroelectricity.

The best part of Pallister’s carbon-reduction plan is that sometime before the 27th of this month, we’re finally going to get to see it. And that means we can stop complaining about a lack of a plan — we can finally start assessing it on its own merits.

dan.lett@freepress.mb.ca