OTTAWA—Dale Beugin, Executive Vice President with the Canadian Climate Institute, made the following statement on the Government of Alberta’s decision to freeze industrial carbon pricing:
“Today’s decision from the Government of Alberta is a step backwards. Freezing industrial carbon pricing will undermine investor certainty, hurt provincial competitiveness in the long run, and kneecap Alberta’s ability to reduce emissions.
“Industrial carbon pricing works. According to research from the Canadian Climate Institute’s 440 Megatonnes project, these carbon pricing systems can do more to cut climate pollution between now and 2030 than any other policy. They create credit markets that can drive investment in low-carbon projects, such as carbon capture and storage and renewable electricity projects, while also creating incentives for big emitters to improve their emissions performance to avoid carbon costs.
“But industrial carbon pricing systems are only effective when investors and markets have certainty. Alberta is home to billions of dollars of decarbonization projects that are banking on the existing system, and up to another $5 billion in carbon credits. A frozen price undermines the assumptions on which all these investments were made. That’s costly for existing projects and also undermines confidence and investment in future low-carbon projects.
“Crucially, systems like Alberta’s are already designed to minimize costs and competitiveness impacts. Our research shows these costs, at most, amount to the price of just 30 cents per barrel of oil. These systems create incentives to reduce emissions by improving performance, not by reducing investment or production.
“There are other, better options, for protecting competitiveness, like returning more revenue generated from the policy to industry. Freezing Alberta’s industrial carbon price is a mistake and the government should reconsider.”
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Claudine Brulé (Eastern Time)
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cbrule@climateinstitute.ca
Krystal Northey (Mountain Time)
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knorthey@climateinstitute.ca
The Canadian Climate Institute is Canada’s leading climate change policy research organization. We produce rigorous analysis, economic modelling, and in-depth research, and have experts available to comment on topics including: carbon pricing, the costs of climate-related disasters in Canada, and Canada’s progress in reducing emissions, and policy priorities for the incoming federal government.
