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Businesses ask Ottawa to price, not regulate emissions

Aerial view of the Suncor oil sands extraction facility on the banks of the Athabasca River near Fort McMurray, Alta.

MARK RALSTON/AFP/Getty Images

An overwhelming majority of Canadian industrial companies want the Harper government to put a price on greenhouse gas emissions rather than impose strict regulations that limit them, a new survey finds.

Individual business groups - from the Canadian Council of Chief Executives to the Canadian Association of Petroleum Producers - have urged Ottawa to move forward with a market-based system that would create certainty for companies that have to make long-term investment decisions.

In a report to be released Wednesday, Sustainable Prosperity, an Ottawa-based research network, said virtually all major business associations support some form of "carbon price" - whether a cap-and-trade system or carbon tax - rather than a regulatory approach.

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"It is a rejection of the command and control stuff which is what our government is trying to push," said Alex Wood, director of research for the group.

Researcher Kaija Belfry Munroe surveyed companies such as Suncor Energy Inc. and EnCana Corp., and trade groups such as CAPP, the Cement Association of Canada and the Mining Association of Canada. Virtually all of them said they would favour some form of market-based carbon pricing rather than a regulatory approach.

Environment Minister Peter Kent has rejected calls for a cap-and-trade system or carbon tax, saying the government will instead follow the U.S. lead and impose regulated limits on emissions from major industries.

Mr. Wood said Canadian companies worry a regulated approach will be inflexible and have more compliance costs. He said business leaders are eager to see clear rules of the road, with a predictable cost associated with carbon emissions as they make long-term investment decisions.

Still, he said, industries and companies differed widely in what type of system they would support.

The Canadian Electricity Association - which includes coal-dependent utilities from Alberta, Saskatchewan and Nova Scotia - did not endorse a carbon price, while CAPP favours the Alberta approach, which sets emission limits for individual facilities but allows companies to purchase credits and to pay into a technology fund if they exceed.

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About the Author
Global Energy Reporter

Shawn McCarthy is an Ottawa-based, national business correspondent for The Globe and Mail, covering a global energy beat. He writes on various aspects of the international energy industry, from oil and gas production and refining, to the development of new technologies, to the business implications of climate-change regulations. More

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