How Successful is Canada's Carbon Tax?

And what could we be doing instead?

The Climate Change Performance Index (CCPI) has been measuring the world's commitment to “climate protection efforts and progress” for the last twenty years or so. It's the perfect tool to keep up to date on how well your favorite country is doing in regard to its commitments and actual track record in all things climate (assuming you actually care about such things).

As with most things climate change, when it comes to “protecting the climate,” what we’re really talking about is not so much protecting the environment (which we've been actively doing for decades), but a bunch of nebulous rules that allow leaders to virtue-signal to other leaders about how they're keeping their people accountable for the greater good.

A perfect example of this is the king of virtue-signaling himself, none other than Canadian Prime Minister Justin Trudeau.

On Earth Day this year, Trudeau got up and said this:

Through our 2030 Emissions Reduction Plan, we are on a solid path toward meeting our emissions reduction targets, including our 2026 target. This marks the first time that Canada is expected to achieve a climate target, ensuring clean air and safe communities for all Canadians.

When he says this is “the first time we're expected to meet a climate target,” one might wonder why we would even bother to set these targets which we don't really expect to meet. The data the CCPI uses is always a little out of date, but still provides a bit of historical context:

So, while the practical usefulness of the CCPI is a little hard to pin down, it is still an easy way to compare the progress of countries who like to brag about what they've accomplished in this arena.

One would think that for a country like Canada with a Prime Minister so utterly consumed with climate change, (and of course his global image) we'd have a pretty good showing in the Climate Change Performance Index.

As of the latest iteration of this chart, out of 67 spots, Canada comes in at #62. One interesting aspect of this chart is that the top three spots are blank, presumably because even the best performing countries aren't good enough to warrant placement in that top tier. According to their ranking criteria:

The results show that, even if all countries were as committed as the current frontrunners, efforts would still be insufficient to prevent hazardous climate change.

So, here we are again with the expectation that regardless of how many targets are set, and regardless of the current efforts, even the best and brightest among us are simply not committed enough to “prevent hazardous climate change.”

Sounds pretty bleak.

So, though no one is apparently worthy of those top spots, it appears that Canada's real battle for placement is for the bottom spots, and there are still a few countries that are worse performers than Canada on this index. They are:

• #63 - Russian Federation

• #64 - Korea

• #65 - United Arab Emirates

• #66 - Islamic Republic of Iran

• #67 - Saudi Arabia

Yes, even that rapscallion, China who is currently building about two new coal plants every week ranked a fair bit higher on this list than Canada did.

One would almost think that with the taxes we pay, all the shaming and the blaming, and the amount of airtime given to discussing the impending climate disaster, we'd be a little further up the pole.

For those who are convinced that Justin Trudeau's carbon tax system is saving the planet, take a look at the following chart and see if you can tell which year that plan came into effect:

If you guessed 2019, congratulations - you win absolutely nothing. But you're still correct.

If however, you thought that the implementation of the carbon tax regime was in any way responsible for that precipitous drop (as is often implied), you'd better think again. In case you've already forgotten, the real reason for that huge decrease in GHGs in 2020 was the decimation of our economy by our own government in response to the Covid panic. It's amazing what can be accomplished when you lock everyone in their homes and shutter thousands of small businesses. But as you can see, it's begun to inch back up again and is likely well on its way to being what it was before the carbon tax was initiated.

In order to explain this, our Environment Minister, Steven Guilbeault assured us that the main reason for this increase is because of a "rebound" from the pandemic. This makes sense. Since we're all about comparing ourselves to other countries in the race against climate destruction, here's what our “rebound” looks like beside everyone else:

Even with this pathetic showing, our emissions have increased. Imagine what our GHG emissions would be like if we'd have had the kind of rebound the United States had. Hardly seems like something to crow about. The US border, by the way, is literally 13 miles from my house, and as porous as it is, we now know at least one thing that can’t get through. That would be our post-pandemic recovery.

In attempting to find an answer to the question in the title of this piece (Is the Carbon Tax really working?” I was frustrated because it’s almost impossible to get a straight answer on that, and of course it always depends on whom you ask. The best clue I could find was a study done in April of 2022 on British Columbia’s provincial carbon tax.

In Does a Carbon Tax Reduce CO2 Emissions? Evidence from British Columbia, the authors conclude that though “there is evidence for a significant reduction in emissions from transportation, . . . there is no statistically significant effect of the introduction of the carbon tax on the aggregate level of CO₂ emissions.”

Also:

Detected significant reductions in aggregate CO₂ emissions across Canadian provinces, in turn, do not coincide with the implementation of the BC carbon tax, nor the carbon pricing schemes in Alberta and Quebec. Instead, the detected interventions in aggregate emissions reflect the closures of emission-intense industries (pulp and paper with accompanying power-generating facilities) and reforms in electricity generation in untaxed provinces such as New Brunswick and Nova Scotia transitioning away from fossil-fuel driven electricity generation.

As I mentioned, shutting down the economy was the main driver of our GHG reductions in 2020.

The authors of the study also found that B.C. is a bit of a “special case” since the province gets much of its electricity from hydro power, and so it is “not surprising to see little impact of the carbon tax on emissions related to electricity production.” Extend this implication to the rest of the country, where hydro power is responsible for approximately 60% of electricity generation, and you’ve got a logical reason why we likely won’t see much benefit to a carbon tax at the federal level either.

Not to be all doom and gloom, the authors also surmised that another reason the carbon tax may be ineffective at curtailing aggregate emissions is simply because it’s not high enough. Well, if that isn’t a perfect reason to raise taxes, I don’t know what is…

The biggest barrier to that right now (raising the carbon tax) is that people are becoming less convinced that there is an existential crisis afoot and are therefore a lot less tolerant of extra taxation with nothing to show for it. The provincial premiers’ near mutiny at April's tax hike is a perfect example.

One reason the study found that the carbon tax is “working” in BC is that it “enjoys a high degree of public acceptance” (despite the fact that it isn’t really accomplishing much). B.C. is just kind of like that though and this is no longer the case in the rest of the country (if it ever was), and so I’m pretty sure jacking it up every year isn’t going to fix that problem.

And then of course there's that other little issue, which I'm only going to touch on here, which is that if the stated purpose of the carbon tax is as a disincentive for using fossil fuels, and if the Liberal government is to be believed when they say that “most people are further ahead with this tax,” then where’s the frickin’ incentive?

To summarize:

• Canada has never once met any of its climate targets and regardless of how optimistic our Prime Minister is, we’re still every bit as unlikely to meet the next one as well.

• So far, any gains realized from the carbon tax are impossible to see, if they exist at all, but negative effects are being felt by everyone all year long.

• The biggest impacts on reducing greenhouse gas emissions appear to be:

1. Shutting down the economy and,

2. Transitioning away from fossil-fueled electricity generation to hydro (in that order).

Since Canada's main source of electricity is already hydro power, maybe we should concentrate on expanding that and making that more affordable so we could use less natural gas and heating oil to keep from freezing in the winter. Then we could take all that natural gas that we don’t need and convert it to LNG so we could ship it all over the world. This would do at least four things:

1. It would revitalize our economy more than anything in decades, and allow for a real post-pandemic recovery,

2. It would allow other countries to use a reliable, efficient form of fuel to heat their homes, cook their food, and provide electricity generation without the emissions that oil and coal have,

3. It would mean that other countries would no longer have to rely on authoritarian dictatorships for their energy, and

4. It would reduce greenhouse gasses on a global level.

According to a recent study by the Canadian Chamber of Commerce:

Of all the established energy options, natural gas is by far the cleanest, emitting half the carbon into the atmosphere as coal. If just 20% of Asia’s coal-fired power plants were converted to natural gas, global emissions would be reduced by more than Canada’s total annual emissions. In other words, converting a relatively small share of Asia’s power infrastructure would “save a Canada” in emissions.

So, by selling our natural resources to Asia, not only would we have billions of dollars flowing into our country to build infrastructure, revitalize heath care, (even develop green tech!) we could also potentially eliminate the equivalent of all our annual emissions. and all without any mention of a carbon tax. Yes, we'd actually be richer as a result.

Alas, Justin Trudeau still seems to believe there’s “no business case for LNG,” but has every reason in the world to keep raising taxes, even when they’ve proven to be as ineffective as his government.

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More from BlogOfKen:

The Real Deal with the Canada Carbon Rebate

Death By a Thousand Degrees

The Suffering of the World's Poor and Oppressed Continues Under Climate Change Colonialism

Our Questionable Climate "Catastrophe" - Part 1

The Coziness of Glaciers and Other Awakenings