On 27 October, the Manitoba government released its proposed climate change strategy, A Made-in-Manitoba Climate and Green Plan (the Plan). The Plan, which is currently open to public input, is based on four strategic pillars – climate, jobs, water and nature – and includes 16 keystones for priority action. These keystones are associated with each pillar and include clean energy, carbon pricing, green infrastructure, agricultural and land use, water quality, forests and conservation, among others. The Plan also sets out a made-in-Manitoba approach to carbon pricing with a price of $25 per tonne beginning during 2018 – this amount will not increase over time and is half the amount mandated by the federal government (under the Pan-Canadian Framework on Clean Growth and Climate Change, the federal government established a carbon price benchmark of $10 per tonne of carbon dioxide equivalent starting in 2018, which will increase by $10 per tonne annually until it reaches $50 per tonne in 2022).
It should be noted that the Manitoba has erroneously stated that the federal government’s carbon pricing plan “lets Ottawa decide where to spend new carbon price revenue in Manitoba”. However, as committed by the federal government in its October 3, 2016 document Pan-Canadian Approach to Pricing Carbon Pollution, carbon price revenues will remain in the jurisdiction of origin and each jurisdiction can use carbon pricing revenues according to their needs (including to address impacts on vulnerable populations and sectors, and to support climate change and clean growth goals).
The provincial government posits that a Made-in-Manitoba plan with a lower carbon price is justified because historically, Manitoba has invested billions of dollars in clean, renewable hydroelectricity. The Plan credits early investments in Manitoba Hydro that have kept the province’s GHG emissions low. The Plan states specifically that the “federal backstop is wrong for Manitoba” and it “does not respect Manitoba’s green record”. Also, the provincial government argues that the Plan will produce more emission reductions than the federal carbon levy over the next five years. In particular, the Plan states that the federal $50 per tonne carbon pricing plan would actually result in 80,000 tonnes fewer emissions reduced by 2022, compared to the Made-in-Manitoba carbon pricing plan. Manitoba will be relying on sector-specific reductions to achieve what it considers to be greater results. Specifically, the provincial government anticipates that the sector emissions reductions (based on output-based pricing for large emitters) set out in the Plan will generate over 1 million more tonnes of cumulative carbon emissions reductions over the next five years, compared to the federal carbon tax. The provincial government expects that together, these initiatives will reduce carbon emissions by 2,460 kilotonnes, more than twice as much as the federal carbon tax. A full review of Manitoba’s carbon pricing plan will take place in 2022. An independent expert advisory commission of Manitobans will also be established to help develop five-year Carbon Savings Accounts to achieve meaningful emission reductions across sectors of the economy.
The Plan confirms exemptions for agricultural emissions. The carbon levy will also not be applied to marked fuels used by farmers for their farming operations. Agricultural operations will also be able to contribute to carbon sequestration and offset trading systems to be established in Manitoba and other provinces. The Plan also sets out a range of new initiatives to protect wetlands and watersheds, water quality, and wild species and habitats. In addition, the provincial government looks to support the creation of low carbon economy jobs through green infrastructure, clean technology, innovation financing, and skills and training.
While the Manitoba government’s commitment to take meaningful action on climate change is laudable and the Plan represents a step in the right direction, pitting the provincial carbon pricing plan against the federal carbon pricing backstop risks undermining efforts across the country to help Canada achieve its commitment under the Paris Agreement.