Why a price on carbon pollution is good for Canadians

Photo: Benjamin Thibault

Every so often, a commitment is made that sets a new course and drives Canada forward.

This is the kind of commitment we saw last week when the federal government announced that Canada will put a price on pollution as of Jan. 1, 2019 — a milestone worth celebrating toward the implementation of Canada’s comprehensive plan to tackle climate change.

The announcement came against a backdrop of rapidly polarizing rhetoric that has made pricing pollution the boogeyman of Canadian politics. And while it can be easy to be spooked by boogeymen, true leadership means having a vision and seeing through the smoke and mirrors that confuse the debate.

Let’s be clear: A price on pollution will benefit Canadians.

Pricing pollution increases demand for more fuel-efficient technologies, which, in turn, stimulates innovation in Canadian firms to produce more fuel-efficient technologies. Canadians will thus have more options to buy low-cost, fuel-efficient and energy-saving products. This trend is already evident in the electric-vehicle sector: once only an option for the rich, electric vehicles have begun falling in price as demand increases, making them increasingly affordable.

Sending a clear signal to the market makes it easier for individuals and firms to plan. A family may not be ready to buy a new car this year, but the certainty of the price on carbon pollution means they can plan for their next car to be electric in a few years.

Further, this certainty will drive investment in clean tech, since investors now know a price on carbon will be in place in Canada, and that this price will increase over time. Investors know this will drive demand for their investments in technologies that lower carbon pollution.

Nearly 274,000 Canadians had clean-tech jobs in 2016, according to estimates released by the federal government’s statistical agency. These well-paying jobs include building contractors, solar-energy installers and roles with clean-tech manufacturers. These are great jobs, with an average annual salary of between $80,000 and $90,000, including benefits. These jobs pay about 50 per cent more than the average job in Canada. We want more of them, and a price on pollution is a key driver to get there. Through these actions, we’re changing our economy to ensure we are not left behind as the world moves to a low-carbon economy.

Through the federal government’s Climate Action Incentive payments, most households will receive more money than they pay for carbon pollution. Households can come out even further ahead if they reduce their energy use and the embedded cost of carbon pollution. Despite the spectre raised by some critics, Canadians can feel good about doing the right thing — taking concrete action to tackle the most pressing threat to their health and well-being — while knowing it won’t hurt their pocketbooks.

A price on carbon brings investment certainty to the Canadian economy that is fair and balanced. It holds polluters to account, while distributing revenue back to Canadians and their communities, thus protecting lower-income and vulnerable households, and continuing to encourage behaviour change.

The national price on carbon pollution will not only bring economic benefits to Canadians; it will bring health benefits, as well. Less carbon pollution and fewer air contaminants means cleaner air. Cleaner air will lead to less lung cancer, dementia and adverse birth outcomes. The Canadian Medical Association has found that air pollution causes 21,000 premature deaths in Canada each year, and predicts that number will rise by 83 per cent by 2031. The price on pollution will help avert this.

As shown by recent Nobel Prize-winning economist William Nordhaus, putting a price on carbon pollution is the best tool we have to lower carbon pollution. Carbon pricing is also a fair way to share responsibility for the carbon pollution that causes climate change and to reward the companies that are most efficient and pollute the least. 

That is why more than 70 jurisdictions have implemented carbon pricing, including the European Union, New Zealand, California, India and China.

The problem of climate change is no longer mainly a scientific problem. We already know the scale and scope of the problem. We know its urgency and we know the solutions.

The federal government has taken a significant step toward showing it has the courage to tackle this issue, and Canadians will be better off for this leadership. The health of our planet — and of our children — requires nothing less of us.