Friday, April 17, 2009 at 2:08PM US, Canada closer to Cap-and-Trade Market
Recent developments in the US and Canada give further indication that a continental-wide Cap-and-Trade system shall be in place across North America.
EPA GHG Declaration
In the United States, the Environmental Protection Agency formally declared that carbon dioxide and the other five "Kyoto" greenhouse gases pose a threat to public health and welfare. This declaration clears the legal path for the agency and the federal government to regulate these global warming gases; the 'cap' part of 'cap and trade'.
NRTEE Report
In Canada, the National Roundtable on the Environment and the Economy recently released their Achieving 2050 report outlining the country's carbon pricing strategy. At its core is an economy-wide cap-and-trade system that should be supplemented with policies on regulation and technology development, participation in international emissions markets as well as a governance and implementation strategy.
Reduction in Canadian Political Rhetoric
The latter is significant for Canada because of what it means in the debates on Carbon Taxes versus Cap-and-Trade systems, two carbon pricing policies that have been at odds with one another due primarily to politics rather than good policy. Amongst the environmental advocates, whichever system a politically-active Canadian preferred had the unfortunate result of automatically labeling that person as a partisan for one or the other of the parties in Canada's crowded left-of-centre spectrum. The same issue is being played out in the provincial election in British Columbia, where the ruling Liberal Party's carbon tax has seen a mix of praise and disdain.
However the inclusion of Mark Jaccard as an author of the NRTEE cap-and-trade recommendation will come as a benefit to the trading system. Often incorrectly portrayed as being in favour of carbon taxes over cap-and-trade systems, the inclusion of the influential BC economist may help simmer down the partisan rhetoric on the effectiveness of cap-and-trade and may help in finally developing a standardized emissions trading system in Canada and across North America.
Reader Comments (1)
Cap-and-trade may not have the support it needs at present, but I believe the US climate change bill will pass into law because putting a price on carbon affords flexibility and serves as a powerful funding tool to support the Presidents over-arching strategy. However, I am not optimistic about a cap-and-trade deal from a Harper government. I welcome your thoughts.
http://thegreenmarket.blogspot.com/2009/04/cap-and-trade-what-and-why.html