Press Release: Carbon taxation important source of revenue for innovation

Press Release
Saskatchewan Environmental Society
Wednesday, October 19, 2016
For immediate release

Carbon taxation important source of revenue for innovation

The Saskatchewan Plan for Climate Change released yesterday outlines an approach to climate change that stresses innovation. The Saskatchewan Environmental Society is pleased to hear the Province intends to take the threat posed by climate change seriously, and supports innovation as one of the avenues through which Saskatchewan can work to achieve our fair share of the global emission targets. Robust policy planning around climate change must capitalize on all three approaches – namely adaptation, innovation, and incentives to use energy more efficiently – which will include carbon pricing among other tools.

Investments in innovation will ultimately be subsidized by public funds, and putting a price on carbon offers an important way to link investment in climate change solutions to the source of greenhouse gas emissions. Pricing carbon is the best way to represent the true environmental and social costs that result from the burning of fossil fuels. Carbon taxation is widely favoured by economists as the most cost-effective method to reduce greenhouse gas emissions and many oil, gas and mining companies in the Carbon Pricing Leadership Coalition are supportive of the approach. Carbon taxation, and the flexibility around revenue recycling options it provides, represent an important revenue stream the provincial government should pursue to support innovation.

“Given the urgency of the issue, the Saskatchewan Environmental Society believes we only stand to benefit from a diverse portfolio of policy approaches to climate change,” said Hayley Carlson, SES Policy Coordinator. “Carbon taxation represents an important revenue stream through which to fund investment in innovation.”

Modelling by the Intergovernmental Panel on Climate Change indicates the world must collectively achieve net zero carbon emissions by mid-century. This means that regardless of the size of Saskatchewan’s overall contribution to the problem, we also must reduce greenhouse gas emissions within our borders. Given the costliness and capacity to sequester only a small fraction of total emissions, carbon capture and storage technology cannot be the only strategy pursued at home or around the world. Fortunately, the Government of Canada has indicated it intends to introduce several additional policy initiatives to reduce emissions in a coordinated fashion across Canada, including regulations to reduce methane emissions associated with oil and gas extraction and a coal phase out.

Some of our significant trading partners, including the United States, have indicated they will be pursuing similar approaches.

Climate change is a systemic issue; all people who contribute to the problem must also be part of the solution. Saskatchewan is the highest greenhouse gas emitter in Canada per capita and per unit of GDP, and the fourth largest emitter in Canada in terms of absolute emissions. In the spirit of ‘common, but differentiated responsibility’, a principle underlying international climate negotiations since the early 1990’s, developed regions like Saskatchewan have a leading role to play in taking action on climate change. As a region with financial capacity and flexibility, it is our role to model growth and quality of life that can be achieved at the same time as decarbonisation, providing incentive for other regions to do the same. It is also our role to support the world’s most vulnerable nations in their efforts to decarbonize and prepare for the worst impacts of climate change. Fortunately, Saskatchewan has a diversity of ways to achieve these goals.

“Saskatchewan has tremendous potential to expand innovation around wind and solar production in the province,” said Ann Coxworth, SES researcher and board member. “Alongside investments in energy efficiency, the renewable energy sector could be an important source of economic development and employment in the province while meeting our goals under the Paris Climate Agreement.”