Environment ministers meet while Ottawa issues ultimatum on carbon pricing

Canada’s environment ministers will meet today to hash out a plan on carbon pricing, only weeks before the prime minister convenes a meeting with the premiers to finalize a national climate strategy.

Catherine McKenna says provinces must adopt one of two carbon pricing systems

Minister of Environment and Climate Change Catherine McKenna has made it clear that all provinces and territories must adopt some form of carbon pricing. (Darryl Dyck/Canadian Press)

Canada's environment ministers will meet today to hash out a plan on carbon pricing, only weeks before the prime minister convenes a meeting with the premiers to finalize a national climate strategy.

The federal, provincial and territorial ministers will strive toward a consensus on a new framework on climate change, even while some provinces are pushing back against Ottawa's intervention.

There has been some resistance to any further levy on emissions, particularly from Nova Scotia and Saskatchewan, but Environment Minister Catherine McKenna will make it clear today that they will have no choice but to accept some sort of pricing mechanism.

"I've listened to all the provinces and territories … everyone understands we need to move forward. Everyone understands, and through the Vancouver declaration, this was part of it, that putting a price on what we don't want, pollution, is something that's important," she said Friday.

Canada pledged to cut emissions by 30 per cent, over the next 14 years, at the Paris climate summit last fall. Prime Minister Justin Trudeau has vowed to meet those ambitious targets, and a price on carbon is at the heart of his strategy.

The federal government wants each jurisdiction to adopt one of two possible pricing schemes.

"There are two ways you can price carbon," McKenna told reporters in New York earlier this month, where she was attending UN environmental events.

"There's a cap-and-trade and there is a carbon tax. Eighty per cent of Canadians live in jurisdictions [with one or the other]."

Saskatchewan emissions climb

Saskatchewan's industrial carbon-capture system won't be considered an acceptable option without additional carbon pricing to go along with it, a position that will rankle leaders in the Prairie province.

Carbon dioxide is captured from a coal-fired generation unit at Boundary Dam in Estevan, Sask. The province's emissions per capita are still the highest in the country. (Michael Bell/Canadian Press)

"What we are trying to do here is see if we can better collaborate as a country," said David Heurtel, Quebec's environment minister, who is hosting the meeting in Montreal.

"Each province has the right to set up a system that is best adapted to its needs. But what we need to be able to do is make sure that our jurisdictions are respected and yet we can achieve the Paris goals." he said.

A report released last week by the Pembina Institute, an environmental think-tank, shows Saskatchewan has become the country's largest carbon polluter per capita. Emissions rose eight per cent between 2005 and 2014 without new provincial policies to balance it off, according to the report.

"Saskatchewan has not made a commitment to phase out coal-fired power. Saskatchewan has also not moved forward on proactive methane regulations for its oil and gas sector," said Erin Flanagan, the lead author of the report.

Alberta's emissions rose 18 per cent in the same time period, but it is introducing a carbon tax in 2017 and will phase out its coal-fired powered plants by 2030.

But Flanagan said environment ministers should not engage in finger-pointing as they try to craft options for a national plan.

"I think that's one of the key messages. Some provinces have brought in policies that are effective at reducing emissions; we are not seeing, at this point, those policies being scaled nationally, she said.

"All provinces need to bring more to the table."

China pressing ahead with cap and trade

Glen Murray, Ontario's environment minister, said Canada cannot sit on the sidelines while other jurisdictions —countries traditionally seen as laggards — act. Next year, China will launch the world's largest carbon trading system.

"When China comes on, 60 per cent of the global economy will have a price on carbon," Murray said. "The vast majority will be a cap-and-trade system, so border issues will emerge, so there will be trade issues there, so we have to sort out what we have got."

At the first ministers meeting in March, the leaders agreed to form four working groups to study key areas that have to be tackled before putting the finishing touches on a climate strategy.

Those groups — mitigation (reducing emissions), carbon pricing, adaptation and innovation — will deliver reports today.

They are also expected to hammer out agreements to improve air quality by reducing levels of sulphur dioxide produced by coal-fired power plants and oil and gas facilities.

"I don't think we will come out with everything nailed down on Monday, but I think there will be a lot of progress," Murray said.