Prime Minister Justin Trudeau achieved a historic climate-change accord Friday but could not win support for his national carbon pricing plan from key Western provinces.
Saskatchewan Premier Brad Wall and Manitoba's Brian Pallister would not sign the pan-Canadian framework on clean growth and climate change, while British Columbia Premier Christy Clark postponed any commitment to increase her province's carbon tax in line with the federal schedule.
Ms. Clark created some drama late in the afternoon when she emerged from the meeting to say she would not sign a deal unless the Prime Minister agreed on a mechanism to ensure carbon pricing was being done fairly across the country. B.C. already has a $30 carbon tax and the Premier demanded assurances that all the provinces will meet an equivalent price before she commits her province to hiking it to $50 a tonne by 2022, in line with the target set by Ottawa.
Minutes after she returned to the meeting, provincial officials signalled she had won the concession she was demanding and would sign the deal. Federal officials insist Mr. Trudeau was willing all along to meet her demands and dismissed her public statement as a "stunt."
A few hours after she spoke, the Prime Minister and the premiers emerged to announce a wide-ranging agreement that includes not only carbon pricing but efforts to eliminate coal-fired power, reduce the carbon content of motor fuels, invest in renewable energy and electricity infrastructure, and support clean-technology and energy efficiency.
Mr. Trudeau came to power 13 months ago, promising to forge a national climate strategy that would respect the province's role in energy and climate policy, but also meet Canada's international commitment to reduce greenhouse gas emissions by 30 per cent from 2005 levels by 2030.
"I am very happy to share with you the results of many months of hard work, the pan-Canadian framework on clean growth and climate change," Mr. Trudeau announced. "An ambitious and achievable framework to address climate change and grow the clean economy for our children and our grandchildren."
Critics, including Mr. Wall, argue Mr. Trudeau will undermine Canada's economic competitiveness by proceeding with an aggressive carbon-pricing plan when president-elect Donald Trump is reversing the direction that Barack Obama has taken.
"I think all Canadians know that Canadian climate policy will be set by Canadians, not by whomever happens to the president of the United States," the Prime Minister said. He added that Canada will benefit from an ambitious climate policy that provides incentives for investment and job growth in clean-tech industries that will dominate the global economy.
Despite her apparent misgivings, the B.C. Premier hailed the agreement and applauded Mr. Trudeau for acceding to her demands for a mechanism to assess equivalency of carbon pricing across the country.
At issue are the two types of carbon pricing that exist in Canada: B.C. and Alberta imposes a tax, while Ontario and Quebec employ a cap-and-trade approach that requires companies to buy permits, including GHG allowances from California. The Ontario and Quebec approach results in lower compliance costs – or prices – but is criticized because companies are expected to invest millions of dollars outside of Canada to reduce emissions.
Ms. Clark said that, under the federal plan, consumers and companies would be paying a $50 carbon tax in 2022 in B.C. and Alberta, while prices in Ontario and Quebec are forecast to be about $27 that year.
"There was an issue of fundamental fairness that we needed to see resolved," said the Premier, who faces an election next spring. "We wanted to make sure everybody else has caught up before we agreed that our carbon tax would go up. So that changed."
She also said that the agreement allows B.C. to resort to other climate-change measures by 2022 to avoid paying the $50 tax.
While her neighbouring premiers in British Columbia and Saskatchewan expressed reservations about Mr. Trudeau's carbon pricing plan, Alberta Premier Rachel Notley endorsed it, saying it is in line with what her government has determined is best for that province.
"Listen, climate change is real and in Alberta, we need to take action. We cannot delay on it," she said. "But there is a lot of work to be done on how we measure comparability between various jurisdictions. It's highly complex."
The Alberta Premier added her government's commitment to climate action is part of an overall energy strategy that includes the recent federal approval of two oil pipelines that will boost export capacity and open Asian markets for the struggling oil industry.
Mr. Pallister – who backed Ms. Clark's demand – did not sign on to the deal, though some officials said he indicated in the meeting that Manitoba may sign the climate accord if Ottawa meets provincial demands for more money for health care. The Manitoba Premier has pledged to introduce carbon pricing in the province, but has made no commitment to meet the federal $50 floor price by 2022.
"We are in the midst of developing a made-in-Manitoba green plan that we believe is ambitious and achieves the goals that we agreed upon," Mr. Pallister said. "At the same time, we also have some monumental challenges in the areas of health care."
Mr. Wall was the lone holdout, refusing to adopt any broad-based carbon price, arguing it will harm his province's energy-intensive industries such as oil and gas, agriculture and mining.
Federal Conservative Party environment critic Ed Fast said the federal-provincial plan makes no attempt to calculate the cost of the carbon tax and the various other measures. "Developing a credible plan to fight climate change involves having a frank discussion about how much Canadians are willing to pay for it," he said in a statement.
Mr. Trudeau said the plan will allow Canada to meet 2030 international targets.