Pricing carbon: views from Marc Jaccard and Unifor

Energy economist Marc Jaccard has written previously on the need for political reality in the discussion of carbon taxes.  In September, he and colleagues at Simon Fraser University released a new paper  Is Win-Win Possible? Can Canada’s Government Achieve Its Paris Commitment. . . and Get Re-Elected?. As described at his own blog , the report uses a national energy-economy model to simulate climate policy scenarios that explore the effect of current Canadian policies, and contrast the current policies with 1. “must-price-emissions” policies  and 2. Flexible regulations, such as those in California.  The  alternative policy approach in Is Win-Win possible assumes that the federal government would apply flexible regulations in key sectors – transportation, electricity generation, industry, etc. – in conjunction with a modest emissions price, reaching $40 by 2030.

Another carbon market piece, released in iPolitics at the end of August summarizes Unifor’s position on Ontario’s cap and trade regulations.“Could Ontario’s climate strategy trigger an industrial exodus? Not if the province acts now to blunt the effects” by Jordan Brennan  identifies industrial leakage as “an obvious threat” to the  cap-and-trade program underway in Ontario.  Stating that firms operating in emissions-intensive trade-exposed (EITE) industries …(like auto manufacturing for instance …)  might relocate to jurisdictions that do not price carbon,  Brennan summarizes recommendations that his union,  Unifor,  has made : “ First, ‘transition credits’ should be allocated to industries that bear an extraordinary burden of change. Second, the cap-and-trade program should include a ‘carbon price border adjustment’ to ensure that commodities entering Ontario from jurisdictions without a carbon price (or with a lower price) do not gain an unfair cost advantage over Ontario producers. Third, the carbon revenue system should not be revenue-neutral. The Green Fund should be used for ‘just transition’ as well as mitigate the impact on low-income people and to foster the development of low-carbon technologies such as energy efficiency, retrofits and renewable energy.” Unifor’s public reaction to Ontario’s Climate Action Plan in June 2016 is here. 

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