…environmental economics and the implications of environmental policy

More Target Trash Talk — Quebec Steps Up to the Mic

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The need to poke your finger in your neighbors eye runs deep in politics. How else does one explain another jurisdiction making target trash talk? Yesterday, Quebec stood up, and was counted — as another jurisdiction that has made a promises that it can’t keep.

Quebec breaks from Ottawa in plan to cut greenhouse gases

Quebec is taking the final step in its break from Ottawa on climate change, unveiling an ambitious plan to reduce greenhouse gases and blasting the federal government for inaction only a few weeks before a major international environmental conference.

Premier Jean Charest announced yesterday that, by 2020, the province will reduce greenhouse-gas emissions by 20 per cent below 1990 levels, a goal similar to the target the European Union has adopted.

The ambitious target-setting is the latest in a series of policy moves on the environment from the provinces, with Quebec and B.C. leading a surge ahead of the cautious position of the Harper government.

Quebec premier says Ottawa needs to do more to cut greenhouse gas emissions

Quebec Premier Jean Charest says Ottawa needs to do more to reduce Canada’s greenhouse emissions, as he committed Quebec to take a leadership role by accelerating its own efforts.
Charest said Monday the province will cut its emissions by at least 20 per cent from 1990 levels by 2020 and urged the federal Conservative government to raise its target above the three per cent it has set.
“It is in the interests of Canada, whose prosperity rests in large part on exportation, to give as much effort as its partners in this global fight,” he said in a speech attended by the who’s who of Quebec business leaders.

Or won’t keep once it sees what it will cost.

The announced target at 20% below 1990 levels seems to be much bolder than what others are saying, and notably the feds. It sounds deep, but it is not really since Quebec’s emissions have been more or less flat since 1990, growing only 5% in fifteen years. (see here).

But still it is bold, and to achieve reductions of this magnitude will require credible policy. I did some simple modeling of what it will take to hit the target. Assuming an economy-wide cap and trade system ala WCI (full coverage that includes vehicles and buildings), the following emerges,

Compliance Target. The target is 68Mt (-20 %/1990). This means that 28 Mt will need to be found in 2002, or a reduction of about 30% below BAU.

Permit Price. The permit price assuming action is taken in 2012 will need to be in the order of $135 tonne, with some pretty supped-up vehicle regulations, vroom vroom.

Total Cost. About $2 billion in capital, energy and operating costs in 2020 or about 0.5% of forecast GDP in 2020.

Distribution. Vehicles costs will rise 25% and electricity costs 10% (above forecast norms).

This is transformative stuff that requires real policies and real pain for some. Modeling has shown that these costs are doable, and actually not all that bad relative to the total economy. Indeed, the targets are technically and economically feasible, and policy can do it. But all too often we trip or rather choke on the types of costs outlined above.

So, why these jurisdictions continue to climate trash talk I will never ever understand. Once they start to look closely at what it will take to achieve what they have promised, they balk. Setting bold targets has proven time and again to result in non-polices and bold inaction.

Written by Dave Sawyer

November 24th, 2009 at 9:51 am

21 Responses to 'More Target Trash Talk — Quebec Steps Up to the Mic'

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    27 Jul 14 at 7:40 am

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    9 Dec 14 at 7:40 am

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