My Latest on the Globe and Mail’s Economy Lab

Here’s how my latest post on Economy Lab at the Globe and Mail ends: “If you are going to let GHG policy influence your vote, you owe it to yourself to get engaged in the discussion and get beyond the easy sound bites.”  If you want to read the beginning, click here.

10 responses to “My Latest on the Globe and Mail’s Economy Lab”

  1. Rick Hoff

    Gotta say, I’ve read and re-read your article and I am left scratching my head. You’re way ahead of the debate and way ahead of the available information for 99% of us plebs. What matters about the cap and trade debate, or a carbon tax, to me? Obviously that answer is – what is it going to cost me?

    You are making a huge leap of faith with your post, and that is the workability of any proposal. What we need before any debate about the merits of Plan A or Plan B is a framework under which political interference won’t influence how any GHG rollout is implemented. Intuitively, as an Albertan, I think I understand that there is very good chance that a centrist government would find a way to exempt industry in a region that has the highest number of ridings from any potentially punitive legislation. (HINT – think auto industry and Kyoto.)

    GHG legislation will NEVER work without equitable distribution. Screw over one part of a skeptical populace and it degrades into an us against them cat fight, with opportunistic politicians taking sides in an effort to garner support from wherever they can get it.

  2. Mark

    So after reading Rick’s comment I got interested to see what the Liberal and Conservative GHG plans where and this is what I found.

    LIBERAL

    TARGET:
    Liberals have committed to a long-term greenhouse gas reduction target of 80 percent below 1990 levels by 2050. (Page 48 of liberal platform)
    METHOD:
    -“A Liberal government will establish a cap-and-trade system – a mechanism that sets a ceiling on the total amount of permissible greenhouse gas emissions by large industrial facilities, and then auctions off emission permits to companies who can trade them amongst themselves to remain compliant under the law.”(Page 49 of liberal platform)
    Green Renovation Tax Credit means that you can qualify for a tax credit of up to $13,500 for renovations to green your home. (p.46)
    -Renewable Power Production Incentive (RPPI) (p.47)…..an investment of $1 billion in RPPI over the coming years will increase Canada’s renewable energy mix to 10 percent of our total electricity output by 2017
    -Oil sands development must become more sustainable as this major resource continues to con- tribute to Canada’s prosperity. Increase the rigour with which the federal government exercises its regulatory responsibilities relevant to oil sands development;(p47)

    CONSERVATIVE

    TARGET:
    aligned our climate-change targets with those of the Obama Administration – our goal is a 17-percent reduction in domestic greenhouse gas emissions from 2005 levels by 2020;…..established the Clean Energy Dialogue between Canada and the United States, to enhance collaboration on reducing greenhouse gases and combating climate change; (page 41 of conservative platform)
    METHOD:
    -We will support economically viable clean energy projects that will assist regions and provinces in the replacement of fossil fuel with renewable fuel sources. (p.42)
    -ecoENERGY RETROFIT-HOMES PROGRAM ($5000)

    I am going into this election concerned about environmental policy and GHG targets. I am not so concerned about the targets as the Liberals have picked a Kyoto accord target and the Conservatives have published a US target. Either way it’s a target in the not so near future and a lot can change between now and then. So….they both have a target, Great.

    Next question…how are we going to get from the here and now to that target. Conservatives method is to align with US on whatever they do, and offer subsidies to clean energy projects along with home retrofit programs. In my opinion, a little weak to say we will just follow the US, especially if any thought of GHG policy in the states has been scrapped till after elections and their economy pulls itself back together. In my mind, that pulls a conservative GHG policy off the table.

    Liberals plan is seemingly a lot more detailed with specifics. So I think they have a better method for achieving a target then the conservatives. The liberals differ as they are not waiting for Obama admin to put forward a GHG policy.

    I would like to make clear that you can have a cap & trade like liberals propose without it affecting the economy, just give all the permits away every year….free. So when I hear the argument that we will effectively kill our manufacturing economy at the start of a C&T program I have a little chuckle. Obviously it will do nothing for ghg reductions….(will it? i.e. signaling?), but it’s a start.

    Overall, a federal GHG policy is going to be messy when considering provincial vs. federal powers.

  3. Rick Hoff

    No doubt you’ve seen the NDP platform released today. I won’t go into the billions of dollars Jack Layton wants to spend, but I will point out that by all accounts he plans to skim off the top of (drumroll please) a cap and trade agreement he would levy against “Canada’s biggest polluters” to cover what otherwise would be massive shortfalls in the NDP revenue projections. This is after he would raise the corporate tax rate to pay for just about everything else that apparently needs money spent on it.

    It’s just all so nuts. At some point, the lunatics are going to get a chance to put their policies in place. I can guarantee you then GHG emissions will begin to fall, but we’re not going to like it much.

  4. Rick Hoff

    Andrew – as you develop your ideas, I hope you don’t look too far ahead and make too many assumptions about getting from “here to there”. Part of any GHG policy needs to include reality checks, and one I consider to be missing from most discussions is exactly how green energy is going to meet our needs. I think we have an excellent case study developing in Ontario, where we undoubtedly are going to get a first hand look at whether renewables can indeed fuel a modern economy.

    We don’t need to go there yet, but if you get a few moments have a look at this article discussing the environmental impact of rare earth mining in China and specifically the production of neodymium, used in large quantities in the latest generation of wind turbines. Dirty wind, anyone?

    http://www.dailymail.co.uk/home/moslive/article-1350811/In-China-true-cost-Britains-clean-green-wind-power-experiment-Pollution-disastrous-scale.html

  5. Mark

    Rick & Andrew,

    I got to take a look at the NDP platform this morning. It made me feel so warm and fuzzy inside. With the lack of budgeting numbers it does all sound like a big spend I agree. Back to the Climate change policy though, Im a big fan of this section:

    4.3 Establishing green bonds to fund research and development
    A guy named Tom Rand is heading up a push for these and if you google “green bonds” you will see his website.

    Basically, gov’t subsidizes ‘cost’ of borrowing by ‘backing’ bondholders. Allows the public to determine level of investment in renewables via green bond purchases. Gov’t expenditure basically amounts to the cost of securing the bonds against default. With some savvy administrators this could be minimized.

    This seems like a cheap way to put green energy on the grid, as from some discussions cost of borrowing is often high for these guys and ROI is lower than traditional energy investments making their projects a hard sell.

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