British Columbia a Leader in Tackling Global Warming with Carbon Tax

Just as British Columbia passes the first carbon tax in Canada into law, a new poll by McAllister Opinion Research has revealed that more than 70 per cent of Canadians support British Columbia's carbon tax as a "positive step" towards reducing greenhouse gas emissions.

A separate poll by Harris/Decima published in the Vancouver Sun last week found that 75 per cent of British Columbians are prepared to significantly alter their behaviour to fight global warming, and 73 per cent believe more government regulation will be necessary to help them do that.

It's not often a province receives praise for introducing new taxes, but these recent polls confirm that Canadians, and British Columbians in particular, understand the global importance of the climate change issue and want governments to take action.

British Columbia's government has become a leader on global warming with a carbon tax that is one of the most comprehensive in the world (covering virtually all fossil fuels), and the first in North America to focus directly on reducing greenhouse gas pollution by changing the decisions made by businesses and consumers. The ground-breaking tax is changing the level of debate on carbon taxes in the rest of the country.

As the carbon tax receives its final stamp of approval this week, the government's next challenge is to ensure the tax improves over time to significantly reduce future emissions.

The price on greenhouse gases needs to reach at least $75 per tonne by 2020 in order to reduce national greenhouse gas pollution to 1990 levels, according to the National Round Table on the Environment and Economy. British Columbia is committed to reducing its greenhouse gases to 10 per cent below 1990 levels.

The British Columbia government has said the carbon tax will start at $10 per tonne and rise to $30 per tonne by 2012, but has yet to commit to future increases in the tax that will be needed to reach its emission targets.

To ensure the province is on a path to meeting its emissions targets, the government needs to provide a schedule for incremental increases in the carbon tax beyond 2012 . This schedule should be laid out clearly for British Columbians as soon as possible to help people make good decisions on purchases that will be affected by the carbon tax, such as cars or homes.

For the tax to be effective, the government also needs to make sufficient investments to ensure that there are solutions available to help all British Columbians decrease energy consumption and emissions. The government has already taken steps in this direction with announced increases in public transit investment and new funding for home energy retrofits.

Low income families will need additional support. While the proposed low income tax credit is a good start and should continue, the focus must be on helping low income households reduce their energy bills. Examples include creative programs like Warm Front in the U.K., which will spend $1.5 billion to retrofit the homes of 400,000 low income families between 2008 and 2011.

And finally, the government must aim to include all sources of emissions under a carbon pricing system. The one-third of industrial emissions not currently covered by the carbon tax could be included in British Columbia's cap and trade system, which is currently being designed. However, if the province's future cap and trade system does not include these sources, they must be included under the carbon tax -- or industry will be given a free ride.

British Columbia's carbon tax is an important and welcome step toward addressing global warming and reducing emissions. As it improves over time, it could significantly reduce energy use and greenhouse gas pollution while also generating revenue to support a transition to clean and renewable energy sources.

Matt Horne is a Senior Policy Analyst with the Pembina Institute and the author of Cap and Trade: Reducing Pollution, Inspiring Innovation and is a co-author of Mind the Gap: A Blueprint for Climate Action in British Columbia. The reports, plus the results of the McAllister Opinion Research poll can be downloaded from www.pembina.org.