The Kyoto Protocol in Canada: Legacy or lunacy?

By Hank Reardon

Prime Minister Jean Chrétien says he will put the Kyoto Protocol on climate change before Parliament for a ratification vote before year-end 2002. The announcement of the Kyoto Protocol ratification vote comes before an implementation plan to reduce greenhouse gas emissions (GHGs) has been finalized and before details on the full impact on provincial economies are available. Paul Martin, the former Finance Minister and lead contender to replace Chretien, said in November that: "Moving ahead without provincial consent is irresponsible." Most of Canada's provinces and the majority of Canadian businesses and think tanks agree with him.

Background on the Kyoto Protocol

• The Kyoto Protocol is an international agreement reached in 1997 in Kyoto, Japan, to address the problems of climate change and reduce GHGs.

• The Kyoto Protocol involves moving away from fossil fuel energy sources—oil, gas, and coal—to renewable sources of energy — hydro, wind and solar power — and to less environmentally harmful ways of burning fossil fuels.

• Burning fossil fuels mainly generates greenhouse gases, such as carbon dioxide, methane and nitrous oxide. Higher levels of GHGs cause global warming and climate change.

• The Kyoto Protocol commits 38 industrialized countries to cut GHGs by 2008-2012 to overall levels that are 5.2 % below 1990 levels. Individual targets for reductions in GHGs were established for each industrialized country. Developing countries, including China and India, were asked to set voluntary targets for GHGs.

• The Canadian target for the Kyoto Protocol is to reduce GHGs by 6% below 1990 levels by 2012.

• The United States has said it will not ratify the Kyoto Protocol, and in February 2002 introduced the Clean Skies and Global Climate Change initiatives, in which targets for reductions in GHGs are linked directly to GDP and the size of the U.S. economy.

• The federal government presented an implementation plan to achieve the objectives of the Kyoto Protocol on November 20, 2002. A provincial minister likened the plan to "putting lipstick on a pig.”

Parliament will be asked to vote on whether or not to ratify the Kyoto Protocol by the end of 2002. With the Liberals, Bloc Quebecois and NDP supporting Kyoto, it will likely pass. Chretien has suggested he would make this a vote of confidence in the government, adding: "The accord will be passed — period." Alberta Premier Ralph Klein said he still plans to push other politicians and business groups to oppose Kyoto.

Canadian Opposition to the Kyoto Protocol

The Alberta government leads the opposition to the Kyoto Protocol, although an Ipsos Reid Research poll conducted in October 2002 showed an almost even split across Canada between those in favour and those opposed to ratification. Understandably, most large oil companies are against the Kyoto Protocol. Large industry groups like the Canadian Chamber of Commerce also oppose the accord.

Coal contributes an estimated $8.1 billion to Canada's economy — enough to sustain 116,000 average Canadian families for 12 months. The industry directly and indirectly employs over 56,000 men and women from coast to coast. As a result, coal is now Canada's single largest export to Japan, and the growth of the industry has helped create major infrastructure improvements to Canada's railroads and ports. The Coal Association of Canada (CAC) argues that the industry has changed significantly in the past 15 years, with new sustainable mining practices and site reclamation projects that limit the impact on the environment. The petroleum industry and other resource-based industries have made similar cases.

Other arguments against Canada ratifying the Kyoto Protocol include the concession in mid-November by the federal government that the costs for Kyoto will be at least 30% higher than first anticipated. Independent estimates suggest Canadians could be looking at up to 50% increases in the cost of electricity, gasoline and heating, the loss of closeto 500,000 jobs (the federal government says 200,000) and economic costs of up to $40 billion (the federal government says there will adjustments of several billion dollars with compliance).

• The Kyoto Protocol would add a financial burden to Canadian companies that their US counterparts do not have. The United States and Mexico, Canada's North American trading partners, both refuse to ratify Kyoto. They will not have to incur the huge implementation costs and adjustments, which Canadian industry will have to bear. Canadian business argues that this will negatively affect its competitiveness.

• The provinces argue that they have not been consulted in any meaningful way on details of the implementation plan (if there is one).

• The Alberta government says Ottawa cannot force an implementation plan for the Kyoto Protocol on the provinces, since natural resources are owned by the provinces. Klein has threatened to bring the Kyoto matter to the Supreme Court. Alberta has proposed a "made-in-Canada" policy with similar targets to the Kyoto Protocol, but with deadlines extending to 2020.

• If the Alberta government argues the case before the Supreme Court as a Charter Case and loses, it can still exercise the notwithstanding clause in the Constitution. While some say this is a long shot, others agree that it could effectively kill Kyoto in Canada for good.

• Canadian Alliance leader Stephen Harper and many renowned scientists and researchers have argued that global warming, as "a scientific hypothesis," is still unproven. Harper states that: "Kyoto does not target air quality. The accord focuses only on carbon dioxide, a naturally occurring gas that is part of the life cycles of the planet. Kyoto targets only man-made CO2, a small percentage of the

earth's total. Of this, it only deals with the one-third that is produced in countries that are ratifying the protocol."

• The Conservative Party has suggested abandoning the Kyoto Protocol and working towards a North American gas emissions strategy with the United States and Mexico.

Canadian Support for the Kyoto Protocol

Manitoba, Quebec, Nunavut and the Northwest Territories support the Kyoto Protocol. It is also likely that British Columbia will bean side, because it will benefit from its large hydroelectric resources. Environmental groups such as Greenpeace Canada support ratification of Kyoto. Many insurance companies also support Kyoto, since extreme weather events cost them money, and some banks are pro-Kyoto because of possible business from the global emissions trading market.

Arguments supporting Canada ratifying the Kyoto Protocol include:

• Canada can reduce greenhouse gases more cheaply if it works within the context of an international system.

• It would give the Kyoto Protocol a presence in North America.

• The benefits will outweigh the costs.

• The costs of not acting include droughts, floods and poor health.

• Ratification of the Kyoto Protocol does not need provincial consensus since international agreements are within the scope of Canadian federal government powers.