carbon pricing: Ontario’s set the table | Ecofiscal

Carbon Pricing: Ontario’s set the table. Are we ready to tuck in?

Climate and Energy

From the downtown Toronto Y to the Sudbury Steelworkers Hall to the Kitchener Library – Ontarians are now going to be talking about carbon pricing. True, the Ontario Government’s Climate Change Discussion Paper offers a broad menu of food for thought on the direction of climate policy in the province. However, pricing carbon is an explicit and—seemingly—permanent dish. What the province is asking is not: do you want it on the table, but rather: how should it be served?

Framing the conversation this way is a fascinating and, in my view, very positive development. It implicitly accepts the principle that if you’re a government with a goal to reduce greenhouse gas emissions in the most cost-effective way, then pricing carbon simply has to be baked into your plan.

It also implicitly accepts the idea that how you choose to price carbon matters a whole lot. And there’s much inside the word “how”, including the broad outlines you adopt (how you set the price, how much it should cover) and the details you design (how revenue gets used, how you manage impacts on vulnerable businesses and households). These are the decisions that are going to shape your economy and determine how the policy affects your diverse constituents. So asking them to weigh in on the plan makes very good sense.

One can sensibly ask: are people really ready to have this conversation? I think the answer is yes.

Canadians are a pretty pragmatic lot. The polarized “economy vs. environment” discussion around climate change was always unproductive, and it has now become wearisome. As seasoned pollster Bruce Anderson has recently pointed out, though there are still some people on either fringe of the discussion—those who think we should “do nothing” about greenhouse gas emissions and those who think we should “change everything”—the vast majority of us are somewhere in the middle. Yes, we need to do something to reduce greenhouse gas emissions, but that something should be practical and economically sound. This is exactly the mindset needed for a good “how” discussion on pricing carbon.

Different people from different walks of life, different backgrounds, different priorities coming together to talk through what needs to be considered in a really good carbon pricing policy—now, that’s my idea of a party! I understand it may not be yours (or even most people’s). Some may feel like they don’t know the issues or technical details well enough to contribute. But you don’t need to be an economist or a policy wonk to know what matters to you and to ask good questions.

The fact is, if the pragmatic majority doesn’t show up for this conversation, it’ll get left to the fringes. And we all know what that conversation sounds like (cue the “head banging against wall” sound-effect).

The Government of Ontario has set the table for a rational conversation about carbon pricing. If we’re ready to move from a polarized position on climate policy to a practical one, then we’ve got to show up with our appetites. (For a list of public consultations, check here). As for the Ecofiscal Commission’s contribution to the meal, stay tuned—we’ve got something cooking, and it’s going to be good.

 

 

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