Evidence of meeting #11 for Environment and Sustainable Development in the 39th Parliament, 2nd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was targets.
A recording is available from Parliament.
Director, Global Threats, Conservation, World Wildlife Fund Canada
In principle, we absolutely should have regulated requirements.
Analyst, Climate Change Policy, David Suzuki Foundation
Sorry, section 71? I didn't catch what you're talking about.
Conservative
Maurice Vellacott Conservative Saskatoon—Wanuskewin, SK
In terms of actual regulations, not just voluntary compliance, we should have tough regulations with respect to the big polluters, as under section 71.
Analyst, Climate Change Policy, David Suzuki Foundation
An absolute emission reduction would be preferred in terms of the regulations, but we do favour regulations.
In fact, I didn't get a chance to answer your question from before, which is that one way of designing a system is to have an upstream cap and trade system, which of course involves regulations for large final emitters, have a downstream carbon tax that is felt by the consumer, and have regulations for things I've mentioned already that aren't really well captured by a carbon price.
Liberal
Geoff Regan Liberal Halifax West, NS
Thank you very much, Mr. Chairman.
Let me ask you about this question of what we've just been hearing about in terms of a carbon tax, which of course is different from a carbon budget or cap and trade system, although my colleagues in the Conservative Party don't seem to be able to grasp those differences, I gather, from what they're saying.
Let me ask you this question. In view of the rise we've seen in oil prices over the past year or so particularly, how much behavioural change has that created? How much of a tax in terms of this proposal--which we don't support, that is, the tax itself--are you talking about in order to have the impact on behavioural change that would be required?
Analyst, Climate Change Policy, David Suzuki Foundation
I think there has been behavioural change with respect to higher gas prices, for example, with the kinds of vehicles people are buying, but this is why I argue that the best way to actually address emissions from transportation from personal vehicles is to put in place regulations that mandate that we ramp up quite quickly the efficiency of vehicles that we're allowed to buy. The California standards may be the best proposal from a North American standard, but the California standards compared to those of Europe, China, and Japan--compared to anywhere else--are incredibly weak from a vehicle fuel efficiency standpoint.
So that's how you best capture those emissions. You put into place vehicle fuel efficiency standards that improve--
Liberal
Geoff Regan Liberal Halifax West, NS
That's a very different answer than the question of a carbon tax. You're not addressing the question. I mean, I accept what you're saying, that in fact there's no question, or the idea that having strong regulations on manufacturers of vehicles and so forth and limiting emissions that way is important. But if you're proposing that we also have a tax on oil, my question is, how much, and what impact do you see it having? I think we've seen some modification. It's one of the reasons I bought a Prius, along with the fact that it's better for the environment, and we all care about that, hopefully more and more these days, but not enough yet. Lots of folks are still buying SUVs and trucks and everything else.
Executive Director, Pollution Probe
As was pointed out earlier, we're not economists, so we look to other people's analyses for this sort of thing. William Nordhaus, who is a very well-respected Yale University economist, has calculated that an economically optimal carbon price or tax would be about $27 U.S. per metric tonne in 2005, rising to $90 U.S. in 2050. So we're talking carbon tax one way or the other of anywhere from $30 to $90 a tonne, according to some economic analysis. I don't know how the numbers shake out in Canada, but that seems like a reasonable level that starts to get some action. Of course, prices could go much higher after that, depending on how tight we have to push to get further reductions, but those are the kinds of numbers people are throwing around. I don't know what my colleagues are going to come up with shortly on this.
Director, Global Threats, Conservation, World Wildlife Fund Canada
Part of your question has to do with what's called elasticity. You don't have very much choice in how much energy you use to heat your home; it depends on how cold it is. You don't have that much choice if you have to commute to work and there isn't a public transit system. This is what I'm concerned about, in terms of Canada and Canadians being exposed to higher energy prices.
These kinds of uses do not respond well to price signals, which is why you need a two-approach system. Price will drive those kinds of uses when they can avoid it: when there are efficiencies to be made within industrial plants or where the user actually has some control. It will not affect behaviour and use where you don't, which is why you need the complementary regulations. If we don't actually set some targets and deploy the measures that are appropriate for each of those uses, we will not reach them.
Liberal
Geoff Regan Liberal Halifax West, NS
Let me ask if you saw a column in the Globe and Mail today by Gwyn Morgan. He's a good friend of the Prime Minister, I gather, and president of EnCana. He basically argues in support of what the government is doing, saying our focus should be on the developing countries and getting them onboard to make reductions, rather than making reductions ourselves.
If you saw that, could you address it? I'm also interested in your comments on that generally.
Executive Director, Pollution Probe
He talked about setting standards and that sort of thing, which is really essential here--setting intensity-based standards for industry and then pushing them on developing countries. That won't get us to the kinds of numbers we're talking about, and I don't think he's claiming it will. The question is whether we'll go with the science and try to avoid the worst impacts of climate change or not. If so, we will have to deal with the science, the timing, and the numbers there.
It's a mission of getting there with the least cost and in the most economically optimal and favourable way, as opposed to saying, “Let's do intensity”, or “Let's set a few standards and let things fall out where they will until the developing countries come along”. We have to work backwards from the science and find the optimum way to get there, in our interests, as well as cost-effectively.
I think he's looking at a different scenario altogether, where he's not taking the science and factoring that in. He's looking at the economics from the point of view of industry and what it can cope with. I understand that, but it's not going to solve the problem.
Conservative
Luc Harvey Conservative Louis-Hébert, QC
Good day and thank you for joining us. Since I have only five minutes to spare before I have to leave, I would ask that you answer my question with a simple yes or no.
My riding is home to the Mining Association of Canada. As we know, aluminum is undoubtedly one of the most widely used metals because of its light weight. Producing a ton of aluminum in Canada generates four tons of CO2 in the process. In China, a plant that produces the same ton of aluminum emits seven tons of CO2.
You propose a carbon tax. If we apply a tax of $30 per ton, that would mean $30 times four. You didn't have time to get into this, but the figure could be slightly higher. Add to that the cost per ton of Canadian aluminum, namely $120. Everyone knows that buyers will look elsewhere in the market and buy their aluminum from China rather than in Canada.
Do you think it is better for the environment for people to buy a ton of aluminum from China, where seven tons of CO2 have been produced in the process, instead of in Canada, where the smelting process generates four tons of CO2?
Mr. Marshall.
Analyst, Climate Change Policy, David Suzuki Foundation
I'm sorry, but I would be more comfortable answering that question in English.
The way you deal with rapidly industrializing countries like China is to ensure that they are part of the global regime and their industries are being affected in the same way with respect to a global regime on carbon. Developing countries—
Conservative
Luc Harvey Conservative Louis-Hébert, QC
I would just like to point out that I asked you to keep your answers brief, because I have only five minutes to spare. You haven't even begun to...
Analyst, Climate Change Policy, David Suzuki Foundation
This is a highly complex question, sir.
Conservative
Luc Harvey Conservative Louis-Hébert, QC
I understand that, but I asked you if the current way of doing things was better for the environment. Bill C-377 makes no mention of China. It talks about fluctuations, movements and so forth. That is the issue here. I am not interested in knowing what the Chinese must do. I want to know if our current approach is better for the environment. According to Bill C-377, ...You talk about imposing a tax, for instance a tax of $30 per ton of CO2 produced, which works out to a cost of $120 per ton of aluminum. What's going to happen then?
Analyst, Climate Change Policy, David Suzuki Foundation
I'm saying that every country must assume responsibility for its emissions. The Chinese must be part of the international approach to control climate change.
Executive Director, Pollution Probe
We need equitable treatment with our own domestic production and imports. China should be paying an equivalent tax on its production, and it will pay more if it's less efficient. If we produce aluminum more efficiently in Canada--and it's very energy intensive--and there's a price on carbon, if the Chinese face the same price signal, then they will be paying more and we'll increase our competiveness.
Director, Global Threats, Conservation, World Wildlife Fund Canada
From an environmental perspective, all greenhouse gas emissions reduced are good greenhouse gas emissions reduced. We should be doing the best to reduce our own, and we should be doing the best possible to make sure that other countries do as well.
Conservative
Luc Harvey Conservative Louis-Hébert, QC
I see. We've heard how the European model has been a success. Mention was made of France, England and Germany. It is a well known fact that these countries use nuclear technology. Do you think that Canada should turn to nuclear energy to reduce its greenhouse gas emission levels, yes or no?
Analyst, Climate Change Policy, David Suzuki Foundation
The answer to that question is no. Germany is in the process of scaling back its nuclear energy production.
Conservative
Luc Harvey Conservative Louis-Hébert, QC
Yes, and currently the Germans are buying their energy from France.
Mr. Ogilvie.
Executive Director, Pollution Probe
Nuclear has unresolved questions around it: waste disposal and hidden subsidies that are not well understood. I think all of this should be on the table. Prices should be adjusted to reflect a fair number for nuclear as opposed to the numbers we're told. I don't think they're appropriate, and in fact there are better options. Until we come up with solutions, we should be going in other directions first, as a priority.
