As reported in our earlier blog, British Columbia (BC) Premier Christy Clark appointed a Climate Leadership Team in May 2015 to provide advice and recommendations to government for its new Climate Leadership Plan. The Climate Leadership Team’s mandate was based on four cornerstone objectives: (i) achieving BC’s legislated GHG emission reduction targets; (ii) maintaining a strong economy; (iii) mitigating negative impacts on vulnerable populations; and (iv) maintaining BC’s reputation for world-leading climate policies.
Following extensive stakeholder consultations throughout the summer, the Climate Leadership Team prepared a report that was released by the BC government on November 27, 2015, in advance of the upcoming international climate negotiations in Paris. The team’s report consists of 32 recommendations addressing a number of areas including GHG reduction targets, carbon tax design, transportation, buildings, communities, offsets, and First Nations. Based on extensive modelling of different pathways to meet the objectives of their mandate, the Climate Leadership Team concluded that any pathway that achieves these objectives will require the following four elements:
- an increasing and expanded carbon tax;
- adjustment mechanisms within the carbon pricing framework to address both competitiveness impacts on emissions-intensive, trade-exposed industries (with such adjustments being designed in a manner that does not undermine the incentive to reduce emissions) and vulnerable populations;
- complementary polices that either enhance the effect of the carbon pricing regime and/or target emissions not effectively reached through carbon pricing; and
- periodic review of the foregoing three elements over time.
The recommendations are intended to be strategic in nature, meaning that detailed specifics will be set out at the policy and program level. In addition to broad strategies, the Climate Leadership Team has proposed a number of economically progressive recommendations, among them:
- Lowering the provincial sales tax (PST) from 7% to 6%, supported by incremental carbon tax.
- Increasing the carbon tax by $10 per year commencing in July 2018 while (a) maintaining the current tax reductions achieved through the existing carbon tax that are broad based, provide support to vulnerable populations, or promote GHG reductions; (b) adjusting the current low income and rural and northern tax credits; and (c) establishing targeted and transparent mechanisms for emission-intensive, trade-exposed sectors until such time that carbon pricing and regulatory policy equivalency with other jurisdictions is achieved.
- Expanding the coverage of the current carbon tax to apply to all GHG emission sources in BC after five years, starting with measurable GHG emissions covered by the current reporting regulation.
- Using incremental revenues generated from the increase in the carbon tax to (a) eliminate PST on all electricity rates; (b) establish mechanisms to facilitate investments in technology and innovation that reduce GHG emissions; and (c) establish mechanisms to provide local governments with funding for projects that will result in demonstrable GHG emission reductions.
The Climate Leadership Team also made the following key recommendations:
- Setting a legislated target for 2030 of 40% GHG reduction from 2007 levels, and reaffirming BC’s commitment to the 2050 target of an 80% GHG reduction from 2007 levels.
- Establishing sector-specific GHG reduction goals (below 2015) for 2030, in particular: (a) 30% for the transportation sector totalling 6.3 megatonnes (Mt) of carbon dioxide (CO2); (b) 30% for the industrial sector totalling 8.4 Mt of CO2; and (c) 50% for the built environment totalling 3.4 Mt of CO2.
- Amending the Environmental Assessment Act to include the social cost of carbon in the environmental assessment process and ensure consistency with the climate action plan and carbon pricing signals.
- Amending the Clean Energy Act to increase the target for clean energy on the integrated grid from 93% to 100% by 2025.
- Establishing a strategy and funding to phase out diesel generation in remote communities and replace it with low-GHG electricity service by 2025.
- Instructing BC Hydro to develop a strategy to supply clean electricity to facilitate electrification of upstream natural gas, LNG and associated infrastructure.
- Reducing fugitive and vented methane emissions through reduction targets and the development of best practices.
- Developing a low-carbon transportation strategy to enable the transportation sector to emit 30% fewer GHG emissions by 2030, which strategy will include Zero Emission Vehicle targets, increases to the scope and coverage of the Low Carbon Fuel Standard, and the establishment of a revenue neutral PST for all vehicles based on grams of CO2 per kilometre.
- Creating a waste-to-resource strategy that reduces GHG emissions associated with food waste, organic waste, and landfills.
- Working with First Nation communities to transition communities that are currently dependent on diesel generation to low-GHG electricity service.
- Undertaking a review of the current offset policy in BC.
The BC government is now reviewing the Climate Leadership Team’s recommendations and will commence the next series of public consultations in January 2016. A final Climate Leadership Plan is expected in March 2016.