Quebec Cap-And-Trade Plan: Province Set To Become First To Launch Program

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MONTREAL - With global climate-change talks in limbo, Quebec is the first province to push ahead with its own cap-and-trade program.

The province says it's emulating California as it becomes the first Canadian province to start enforcing cap-and-trade regulations for carbon emissions.

Starting on Jan. 1, there will be a one-year transition period to help large emitters adjust to the new system, which will officially kick in at the start of 2013.

Provincial Environment Minister Pierre Arcand made the announcement Thursday as he criticized the federal government for withdrawing from the Kyoto accord.

"I think Canada should absolutely be showing more leadership, be showing more ambition," Arcand said.

"I find it altogether unacceptable that the Canadian position still be tied to the American position."

The federal government has said it won't enter a carbon market without the United States, Canada's main trading partner, and any short-term prospects for that appear to have been snuffed out in the U.S. Congress.

But Arcand expressed his belief there will be a global carbon market eventually, and he said Quebec wanted to be proactive.

The new provincial program applies to large industrial emitters and will require them to reduce their carbon footprint or buy clean-air credits at $10 per tonne of greenhouse gases.

It is being run in conjunction with the Western Climate Initiative, whose stated objective is to reduce emissions 15 per cent below 2005 levels by 2020. Quebec's own target is significantly stricter, with a planned 20 per cent reduction from 1990 levels by the end of this decade.

However, the battle against climate change can be a lonely one these days. The WCI was originally signed by seven U.S. states and four Canadian provinces.

However, every U.S. state except California has pulled out. And it's unclear whether any Canadian province beside Quebec will proceed with enforcing a cap-and-trade system.

British Columbia, Manitoba and Ontario also belong to the WCI. Arcand said he hopes they follow suit with regulations.

Quebec's program will initially include only about 75 companies — the largest emitters that produce more than 25,000 tonnes of greenhouse gases per year, mainly aluminum and mining companies.

In 2015, it will also include petroleum distributors.

Thursday's announcement drew a thumbs up from Quebec environmentalists — and the opposite reaction from business.

Quebec's largest business group, the Conseil du patronat, said it supports, in theory, the idea of an eventual carbon market. But it called it "hasty" and "risky" for Quebec and California to jump in without anyone else, and warned that the go-it-alone approach could put Quebec's businesses at a disadvantage.

Another Quebec business group said companies in the province already face fierce competition and will now be saddled with a new handicap.

Environmentalists were far more pleased.

"It shows that even if the federal government remains apathetic, citizens can look to the provinces, states and municipalities to lead the fight against climate change," said Sidney Ribaux, executive director of the Equiterre group.

"This goal is particularly laudable given that Quebec already has a 50 per cent lower GHG emission rate per capita than the rest of Canada."

It called the target the most ambitious in North America for 2020, comparable to the European target for the same period.

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