Mr. Speaker, I am pleased to support the motion of the Bloc Québécois which really has two elements in it. It first talks about the importance of fixed targets, a regulated system for Canada's greenhouse gases; and second, that it has to be a precondition for the establishment of a carbon market in Montreal or indeed anywhere else in Canada.
I would like today to focus on the carbon market aspect of this and I think there are 13 important lessons when it comes to carbon markets.
Lesson number one is that a carbon market, in and of itself, does not lower emissions. To be real, somebody somewhere has to be undertaking activity, whether it is industrial or agricultural, that actually demonstrably lowers greenhouse gas emissions. This is why we keep asking the minister and his parliamentary secretary for the government to show its plan, so that we can get on with establishing a carbon market.
Lesson number two for the minister is that we cannot have a carbon market if carbon emissions are treated as free if the atmosphere is treated as a waste receptacle. If emissions are free, there is nothing to trade and that is why the Liberal Party put forward its carbon budget plan to put a value on CO2 emissions. That was further demonstrated in Bill C-30, which was amended to reflect a true climate change plan and a true clean air act.
Lesson number three follows, therefore, that to have a carbon market carbon has to have a precise value or price. It has to be determined by the market and in order for that to happen emissions have to be capped by regulation and, hence, targets. That is why our carbon budget plan said that the price of carbon for those who exceeded their budget would be $20 in 2008, rising to $30 in 2012. That is what it means to put a value on carbon.
Lesson number four, which follows, is that caps on emissions have to be absolute, not intensity based. I am told that it is theoretically possible to have a market with intensity based targets, but it will likely be more complex and not fungible or compatible with systems like that which have been set up in the European Union.
This is why the Bloc motion is so important. This motion puts the emphasis on absolute greenhouse gas reduction targets so as to meet the Kyoto targets.
Targets have to be tough and get tougher to create a sufficient price signal to provide incentive for the formation of a market.
We will see how tough these targets really are next Thursday, if I understood correctly, when the government's intentions will be made known.
Lesson number five is that a carbon trading market needs to be simple, completely transparent and liquid. It cannot be complex. It cannot be an over the counter system where only big players can understand it and participate. It has to be accessible and fair to smaller companies and to individual investors.
Lesson number six deals with quality. Credit certification must be of top quality, of top environmental transparency and integrity.
Lesson number seven is additionality. We cannot give credit for carbon reducing activities that would have happened anyway.
Lesson number eight is that for maximum efficiency a domestic carbon trading market has to be compatible or interconvertible with the North American market, such as the Chicago exchange, and ultimately with Europe and with the United Nations clean development mechanism. That again is why we need absolute targets to establish an absolute price.
Lesson number nine is that, as with any market, we need to give this new derivative market time to work out the bugs, to establish investor confidence and to build credibility. Both the European system and the United Nations clean development mechanism have gone through a pilot period project where mistakes were made and the learning from those mistakes was used to improve the system. Perfection is not automatic or instantaneous.
The Chicago market is essentially a voluntary market for carbon where participation is not mandatory, as it is in the European Union. Chicago, too, is learning a great deal about how to build a successful carbon market. I would note that, because the Chicago market is voluntary, carbon prices in Chicago are lower than they are in Europe. We also need to learn from these types of experiences so that we can avoid their early mistakes, and there were mistakes.
Lesson number 10 is that it is a huge political challenge to explain to the public in simple language what a carbon market actually is and why it helps. As I have said before, an atmospheric tipping fee no longer treats the atmosphere as a free waste receptacle for what we call CO2.
Lesson number 11 is that it is extremely important that we have a carbon trading market located in Canada. Otherwise, it will end up being located in Chicago or elsewhere, which is why we need a clear signal now from the government about the nature of the system it intends to create.
That leads to lesson number 12, which is that it is critical that we get a regulated system in place as soon as possible in Canada for greenhouse gases and the carbon market.
As for lesson number 13—and I see my friends from the Bloc—it is not for me to decide between Montreal or Toronto. It is as if I was asked to choose between the Senators, the Canadiens or the Toronto Maple Leafs. Personally, I always choose the Maple Leafs, because that is where I was elected. Nevertheless, we must let the market decide, as we must let the Stanley Cup decide among these three teams; it is not up to us. Ultimately, quality will win out.
In closing, I can certainly say that the Liberal Party supports the concept of creating a carbon trading market in Canada.
The Liberal Party also supports the development of an integrated climate change plan that deals with all the major sources of emissions in Canada, that is to say, industrial, electricity, upstream oil and gas, big industrial energy consumers, transportation, residential, commercial, agricultural and waste, but we have to be part of the only global system going, the United Nations framework convention on climate change and the Kyoto protocol, which flows from that.
We have to set ambitious fixed targets for ourselves and give it our best effort to reach them.
We have to honour our international obligations and Canada's promise to the world.
We have to save our country and our planet.
Most of all, we have to pass a better world on to our children and to their children.
A Canadian carbon trading market, wherever it is ultimately located, is a small but important part of that effort.