The federal government released Thursday the specifics of its much-anticipated emissions plan, which requires most industries in Canada to become 18 per cent more energy efficient by 2010.

The new plan means Canada will be at least a decade behind meeting its requirements under the Kyoto Protocol.

Environment Minister John Baird, who released his government's new emissions plan Thursday in Toronto, said the plan will deliver on the Kyoto targets late but sets realistic goals.
(Adrian Wyld/Canadian Press)

The Conservative plan sets a new made-in-Canada goal of reducing overall emissions by 20 per cent of 2006 levels by 2020. Given the expected levels for 2006, that would still be well above the Kyoto target that Canada was to achieve by 2012.

Environment Minister John Baird acknowledged his government's plan will deliver on Kyoto late, but he said it promises what is realistic.

"This is a real plan, a plan we can reach," he told reporters at a news conference in downtown Toronto on Thursday. "I'm not ready to make promises I can't fulfil." 

The plan will cost the Canadian economy between $7 billion and $8 billion a year at most, but not many jobs will be lost, the Conservative government predicts.

"Our plan strikes a balance between the perfection some environmentalists may be seeking and the status quo that some in industry seek to protect," Baird said.

The plan, entitled Turning the Corner, calls on Canada to reduce its current amount of greenhouse gas emissions by 150 million tonnes by 2020.

Fleshes out plan

Baird released some aspects of the plan Wednesday, after some details were mistakenly given to the Liberal Party of Canada on Tuesday. He fleshed out the plan Thursday.

It touches on emissions from cars, trucks and household appliances, but primarily the plan takes aim at industry, which accounts for nearly 50 per cent of Canada's total emissions.

Canada's industrial sector will be responsible for 40 per cent — or 60 million tonnes — of Canada's total 150-million-tonne greenhouse gas reduction.

The industries affected by the new rules are:

• Oil and gas.
• Electricity generated by combustion.
• Forestry products.
• Smelting and refineries.
• Iron and steel.
• Cement, lime and chemicals.
• Some mining.

Companies that were set up before 2004 will be required to become 18 per cent more energy efficient by 2010, compared to their 2006 standards. New facilities, defined as those that begin production in 2004 or later, receive a three year grace period and will be expected to show a two per cent annual improvement in their energy use after that.

Some companies given breaks

Companies will get a break on emissions produced by technology that has no green alternative, the government said. Those emissions will not be included in the reduction requirements.

New companies, which opened 2004 or later, will have a three-year grace period before they have to start meeting targets.

The greenhouse emissions requirements aren't hard caps, as environmentalists have been demanding, but are dubbed "intensity-based" targets, meaning they are based on units of production.

Intensity targets mean companies must reduce the amount of emissions used to produce their individual products, but they don't have to reduce emissions overall. If a company ramps up its production, its total emissions can rise.

There will be a hard cap on specific pollutants industries can emit. For example, companies will have to reduce their output of particulate matter by 20 per cent and sulphur oxides by 55 per cent.

Emissions trading allowed

Companies will have options when it comes to reducing their emissions.

They can update their factories and plants to make them more environmentally friendly, or they can take part in environmental programs that will reduce the amount of emissions they are required to cut.

The programs include:

• The Technology Fund. Companies can invest in a new federal fund that will be used to finance research and development into energy-efficient technologies.
• Emissions trading. Companies that over-pollute can pay companies that under-pollute for emissions credits. Emissions trading will first be done between companies in Canada, but could eventually include companies in the United States and Mexico.
• Early action credits. Companies will be credited if they made verified emissions reductions between 1992 and 2006.
• Kyoto credits. Companies can get involved in the international emissions trading and credit programs set up under the Kyoto Protocol.

But, Canada could be denied access to the Kyoto emissions trading program since it will not meet the Kyoto targets on time. It could also face other penalties for missing the 2012 Kyoto deadline.

'Doing nothing was no longer an option.' — Environment Minister John Baird

Baird said he will try to negotiate on penalties when countries next meet to discuss the Kyoto Protocol. More than 140 countries ratified the protocol, with Canada signing on in 1998 under then Liberal Prime Minister Jean Chrétien.

Baird said countries committed to Kyoto should understand that Canada is finally taking concrete action after what he called 10 years of "inaction" under the previous Liberal government.

"This [new emissions] plan does meet Kyoto, if today was 1997," Baird said. "I didn't decide to do nothing in 1997. I can't take responsibilty for 10 lost years."

Plan will reduce health-care costs: Baird

Baird said the new plan will have an impact on the economy. At its worst, it will cost as much as 0.5 per cent of Canada's gross domestic product.

"No doubt about it, it's significant. It's real," he said. "But doing nothing was no longer an option."

The government says there will be benefits to implementing the plan. By 2015, it expects to save $6.4 billion in health-care costs because fewer people will be suffering from pollution-related illnesses.

The government also expects to see some industries that rely on the environment, like agriculture and forestry, flourish with less emissions in the atmosphere.

The federal government will work to co-ordinate its emissions plan with provincial governments. If a province has stricter rules, the province's rules will apply, but if the federal government's rules are tougher, they will be the ones enforced.