Bill C-311 (Historical)

Climate Change Accountability Act

An Act to ensure Canada assumes its responsibilities in preventing dangerous climate change

[The Chair, Conservative, James Bezan]

Before I turn the final questioning over to Mr. Woodworth, I just want to follow up on one comment that Mr. Cullen made and see if you can give clarification. It's the difference in pricing of carbon between us and the United States. In the Waxman-Markey bill they are talking about carbon rising to a cost of $26 a metric tonne by 2019. You guys as economists must be familiar with the recent report that was put together by MK Jaccard, where they are stating that under the Canadian targets the carbon price will be around $100 a tonne, and if we adopt the Bill C-311 targets, carbon will have to go up to $200 a tonne by 2020.

I'm just wondering if you have comments on why there is this discrepancy if we want to have an integrated approach.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

In your presentation you certainly either clearly suggested or implied that the target in Bill C-311, which is to reduce greenhouse gas emissions by 25% over 1990 as a base year, is not credible. Our government's goal is to reduce greenhouse gas emissions by 20% by 2020, using 2006 as the base year. Is that a credible goal?

[Prof. André Plourde]

In 2020 the target in Bill C-311 is more ambitious than in the U.S., but in 2050 the differences are minor.

[Jeff Watson, Conservative, Essex, ON]

You've established credibility both in terms of reachability, first of all, and, second, in terms of alignment with the United States. Those are some of the parameters you've laid down in your testimony today. In that respect the target we're talking about in Bill C-311 is neither credible nor aligned with the United States.

[Jeff Watson, Conservative, Essex, ON]

So this is a bill about a target. It's a target that I think you alluded in your testimony is not credible; it may not necessarily be achievable. It's certainly not one that's aligned with the United States.

The Government of Canada's target roughly translates to about minus 3%, 1990; and the target for Bill C-311 is minus 25%, 1990. As I understand from speaking with some people last night, the U.S.'s 17% to 20% below 2005 translates into something just less than 10%, or minus 10%, 1990.

When we're looking at alignment with the United States and a credible target, this bill doesn't put us in the realm of credibility from the starting point. Is that correct? Is there some agreement on that?

[Jeff Watson, Conservative, Essex, ON]

In other words, to the question that you can't cost C-311 because it doesn't have a specific policy pathway, the answer is yes. Is that correct?

[Jeff Watson, Conservative, Essex, ON]

Thank you very much, Mr. Chair.

Thank you to our witnesses. I'm getting a little chuckle out of your last comment, Mr. Plourde.

I'll ask a consistent question with respect to the bill. What is the cost of implementing C-311? I think the answer is that it can't be costed because there hasn't been a specific policy pathway chosen. Would that be a fair assessment?

So this is a bill about a target. You have said, Mr. Plourde, that settling on the target is the proper starting point--

[Justin Trudeau, Liberal, Papineau, QC]

Thank you very much, Chair.

One of the things that has been an underlying statement and theme running through this testimony is that without being able to quantify it, we are aware that the cost of doing nothing will be extremely high. Now, how high it will be and what it will look like, obviously, is something we need to watch unfold, but there is an awareness that if we don't do anything, the economic impacts will be huge.

This is why I take a little bit of issue with Mr. Calkins' presentation and question around the perils of capital flight versus the perils of not reducing global emissions. That's because the emissions we are going to be seeing as a cause for the melting of Arctic sea ice, the climate extremes we're going to be facing, the various consequences of a two degrees or more increase in global temperatures means that the priority needs not to be keeping business as usual for as long as we possibly can, but addressing this grand issue and this grand challenge in a way that is going to lead to maximal economic prosperity for, in our case, Canada. That's what we're talking about trying to get.

I think balance needs to be brought back in. We have to look at reducing emissions on a global level. The emissions that come from China, the emissions that come from Russia will affect us here, and therefore we have to be open to reducing the emissions in the most efficient way possible.

I like very much one of the things you've said, that targets are all well and good, but it's the intermediate steps and how we get there that we need to start talking about and looking at.

The discussion we're having around Bill C-311 is very much looking at 25% below 1990 levels. We've heard testimony that the 20% reduction from 2006 levels is in line with returning--more or less, give or take 3%--to 1990 levels.

So my question is--even given the modest targets that the Conservative government has put forward for returning to 1990 levels of C0₂ emissions over the past four years--have C0₂ emissions in Canada decreased or increased?

[Mark Warawa, Conservative, Langley, BC]

Both of you touched on the cost to Canadians of moving ahead on Bill C-311.

Professor Dissou, you said the choices would be painful.

Professor Plourde, you asked, are Canadians ready? Do they “appreciate the magnitude of the task underlying the emissions reductions commitments?”

Could you, starting with Professor Plourde, be a little more specific? What kinds of costs would Canada be looking at?

[Blaine Calkins, Conservative, Wetaskiwin, AB]

I appreciate that. That's a very good, interesting, and honest answer.

I want to get to the issue of dealing with the costs that are associated with this plan. We heard testimony from the Pembina Institute, which came with a plan that said the assumptions were that there was no capital flight leaving Canada and that if we implemented the plan with Bill C-311 in an environment in which there wasn't any capital flight leaving Canada and there wasn't any wealth transfer, the economic impact upon the province of Alberta would be about a 12% lower GDP. Were you aware of that report?

[Christian Ouellet, Bloc, Brome—Missisquoi, QC]

Thank you, Mr. Chairman.

I would like to thank both of you for being here today. You have put a smile back on the faces of our friends opposite, especially Mr. Woodworth. I had not seen him smile for two or three weeks. Now he is smiling and he seems happy thanks to you. So I thank you for coming.

I would like to reiterate something Mr. Woodworth said. You see, he is smiling. So I will continue. What is at the heart of the problem? Why is Bill C-311 being proposed? Is it to determine targets or to reduce greenhouse gas emissions so as to not increase the earth's temperature by more than two degrees?

It seems to me that what is essential is not the question of targets or savings. Perhaps I am wrong. Perhaps it is to maintain the standard of living in Canada, as we have often heard. Perhaps it is to maintain the economy—you are an economist—in its current state as long as possible. Your extraordinary presentation seems to be made for our generation and not for future generations.

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

I understand that the targets are comparable. But Canada is behind the eight ball in having to achieve as much as a 40% reduction. I'm only asking you about the 2020 level. Has there been anywhere else in the world, to your knowledge, that has set out to achieve the same rate of reduction that Bill C-311 would require Canada to make by 2020?

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

Professor Green said that if there were a 2.2% per annum growth, the decarbonization rate would need to be increased to 7.7% per annum. One of his comments was that these are rates of decarbonization with no parallels, even in collapsing economies. That seemed to be a reasonable statement. I wonder if you are aware of any collapsing economies with decarbonization rates similar to what is being proposed in our economic analysis of Bill C-311.

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

He was working on a 38% cut from current levels rather than the 40% you referred to. He said that even if there were zero growth between now and 2020, Bill C-311 would require a 4.8% carbon intensity decline per annum. Does that figure equate with yours?

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

Thank you, Mr. Chair, and my thanks to both of our witnesses for coming today. Your credentials are impressive, and what you've had to say has been helpful.

Professor Plourde, you've touched on some things that I think are particularly germane, so I'd like to go through a few of them with you. I will join Mr. McGuinty in saying that I thought your presentation was particularly exceptional and a breath of fresh air, if I might say, compared with some of the evidence I have listened to over the last several months.

I will begin with a comment you made about the Kyoto accord, which sets the stage for us. You said that the Kyoto targets would have meant a cut of about 36 megatonnes in greenhouse gas emissions over a period of 11 years. As we know, we won't get there. By 2007, Canada's emissions had risen by about 155 megatonnes and thus stood at about 125% of 1990 levels. In that statement you set up the crux of the problem.

You also said that the proposed legislation, Bill C-311, would require a 40% reduction in annual emissions to be attained over a period of about 11 years. In other words, in every single year between 2010 and 2020, Canada would need, on average, to reduce emissions by 75% of the total amount of reductions we agreed to deliver under the Kyoto Protocol. We will fail to deliver on this by a wide margin. Again, that sets out the crux of the problem. You end by asking whether the commitments identified in clause 5 are credible in the sense of being likely to be achieved.

I have received some information from Professor Chris Green at McGill University. No doubt there is a collegial atmosphere among economists across the country. He answered that very question for me. He began by pointing out that from 1990 to 2006 there was about a 1.1% per annum average rate of carbon intensity decline. Does that sound accurate to you?