Saturday, June 11, 2016

in Ontario, a climate circle

My province has been very active with the introduction of a cap-and-trade plan, both in creating revenue tools and planning the dispensation of the revenues.

A chronology of some events that brought about the current status - according to heresay I've encountered on social media, and subsequent research:
  • 2008, October - Dave Sawyer (of Enviroeconomics) and Nic Rivers (for M.K. Jaccard and Associates) prepare pricing carbon: saving green written for the David Suzuki foundation. A main finding of the report is "A substantial portion of the government revenue from a carbon price should be invested in a large-scale increase in renewable energy, home energy efficiency improvements, and public transportation."
  • 2009 - The National Round Table on the Environment and the Economy (NRTEE) releases ACHIIEVING 2050: A CARBON PRICING POLICY FOR CANADA. The work's "three principal policy elements" are cap-and-trade, regulations in various sectors including buildings and transportation, and using international carbon abatement trading (partially to mitigate costs). Like the earlier report for the David Suzuki foundation, the recommendations for disbursing revenues from cap-and trade include, "to invest in the required technologies and innovation needed to meet the Canadian environmental goal of reduced GHG emissions."
  • 2015, March - The government  appoints a Climate Action Group. David McLaughlin, NRTEE President and CEO in 2009, tweets, "More evidence ON moving to cap-and-trade carbon pricing regime...Climate change advisors experts in field"
  • 2015, November The government's draft Cap and Trade Program Design Options included, "From 2008 to 2010, Ontario collaborated on and co-authored Western Climate Initiative (WCI) design recommendations..." Ontario decides to join that.
  • 2016, May 13The Wall Street Journal carried an article, When All Economics is Political (subscription), on Russ Roberts of  EconTalk, which is a favourite podcast I found since being gifted, pointedly, a treadmill. Roberts jokes in the article,“How do you know macroeconomists have a sense of humor? They use decimal points.”
  • 2016, May 17 - following a Globe and Mail story based on a leaked draft of the climate change plan, the government spreads the message"The average energy costs to households for building energy and transport could rise in the order (of) $13 per month in 2017." The message originates from Dave Sawyer of Enviroeconomics, in a presentation that begins, "Our analysis indicates that the provincial GDP impact in 2020 would be equivalent to a drop in growth of 0.03%". Decimal pointsEconomists chuckle.
  • 2016, May 18government passes Landmark Climate Change Legislation facilitating actions by the government
  • 2106, June 8 - government has media launch of the Climate Change Action Plan. The media includes a commercial with an audience of children listening to David Suzuki.
Suzuki's re-appearance closes that circle.

Other government videos includes a girl's "idea for solving climate change" which is "the farting car" - which would sound funny ridiculous if automotive expert Dennis DeRosiers, a Climate Action Group member, hadn't told us"in 100 hours of meetings less than half an hour was devoted to the auto sector." 
Wherever did the ideas for all the incentives the government announced originate?
Perhaps the same place as the farting car.

Actual economist Donald Dewees wrote a terrific letter on the topic, Don't Rush to Electric Avenue:
Governments have shown no expertise in choosing cost-effective technologies. A better policy would be a feebate system whereby high-emission vehicles pay a fee and low-emission vehicles receive a rebate based on estimated lifetime greenhouse gases emissions. This lets consumers choose vehicle size, performance and power source to get the best combination of user satisfaction and low emissions with low fees or high rebates. Studies have shown that Ontario’s past feebate program worked and that better design could achieve more. A good feebate scheme will get better environmental results at lower costs to Ontarians than subsidizing specific technologies.
A suggestion worthy of exploring.

Dewees isn't alone in being skeptical of any government's, but particular Ontario's, ability to pick technologies for subsidizing. Again today the Globe and  Mail has an editorial against the micromanagement policies of Ontario's climate change plan, but supportive of pricing emissions to encourage the discovery of lower, or emissions free, technologies.

There are great reasons to believe this is necessary, the greatest of which being expensive local solutions have no utility globally. Question Period in Ontario's legislature included this low point:
Mr. Patrick Brown: Obviously, the government doesn’t like it when facts get in the way of their spin. Natural Resources Canada says that a net-zero-energy home can cost $150,000 more.
My question to the Premier is, where does she expect home buyers to find another $150,000?
Hon. Kathleen O. Wynne: I would say this to the Leader of the Opposition: Where does he expect any of us to find another planet to live on?
If that's the Premier's point perhaps we should simply be looking for a planet to die on.
Ontario will not provide an example to the world at $150,000 more for a house; the impact on global emissions of figuring out more expensive ways is unlikely to be significant, and may be either negative or positive.

Engineers might have something to contribute in lowering emissions in building construction, and elsewhere. They too have been left out of the little circle the planned Ontario's cap-and-trade command-and-control system. The Ontario Society of Professional Engineers (OSPE) wrote an open letter to Ontario's Premier regarding climate change actions. The OSPE site introduces the letter by quoting its CEO:
"Ontario’s engineers are tired of being ignored. Areas of complex science, functionality and design demand the expertise of Ontario’s highly trained engineers, yet we don’t have a seat at the policy table...We’ve met with government officials, we’ve analyzed the data and provided reports, we’ve repeatedly asked to be included – and now we’re fed up. The province continues to put all Ontarians at risk and diminishes its ability to deliver best-possible solutions for the problems we are facing – like climate change – by not engaging engineers.”
I doubt many ignored engineers feel better about the nature of things now that David Suzuki is advertising to their kids.


I may have skewed the presentation to what I'll call the "small tent" aspect of the Wynne government's planning. A new post from Mark Cameron at Canadians for Clean Prosperity concentrates on what I've called a tool to steal aspect.

"Ontario’s strategy seems not to rely on carbon pricing to incent businesses and individuals to reduce their emissions, but to use cap and trade revenues as a way of raising money to purchase much more expensive reductions.
...the Ontario plan treats carbon pricing as a kind of “sin tax” that is used to raise money for a highly expensive subsidy program – a program that is excessively costly in the short run, and in the long run completely unsustainable."

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