Francis Scarpaleggia

Your member of parliament for


Francis Scarpaleggia

Your member of parliament for



Speech: carbon pricing

Madam Speaker, I will be splitting my time with the member for La Prairie.

The impacts of climate change, such as coastal erosion, thawing permafrost, and increases in heat waves, droughts, and flooding are already being felt throughout Canada. In response to the critical need to take urgent national action on this global issue, Canada’s first ministers adopted the pan-Canadian framework on clean growth and climate change on December 9, 2016. One of the core elements of the framework is to put a price on carbon pollution throughout Canada.

Pricing carbon is widely recognized as an efficient way to reduce emissions at the lowest cost to business and consumers, and to support innovation and clean growth. The aim of putting a price on carbon pollution is to reduce emissions by sending a price signal to the economy as a whole. Businesses, investors, and consumers change their behaviour when they take carbon pricing into account in their daily decision-making.

Carbon pricing has worked all over the world, from British Columbia to California to the United Kingdom. In all of those places, emissions have dropped and the economy has continued to grow. Just recently, Environment and Climate Change Canada released a new analysis confirming that carbon pricing will do the same across Canada, significantly reducing emissions while maintaining strong economic growth.
The new study found that carbon pricing could reduce carbon pollution by up to 90 million tonnes across Canada in 2022, as much as taking 26 million cars off the road for a year or shutting down more than 20 coal plants. The study also found that GDP growth would remain strong with a nationwide price on carbon pollution. Canada’s GDP is expected to grow by approximately 2% a year between now and 2022, with or without carbon pricing.

Almost 85% of Canadians already live in a province or territory that puts a price on carbon pollution, and all governments have committed to some form of carbon pricing.

To extend carbon pricing across Canada, in October 2016, the Prime Minister released the federal carbon pricing standard, a benchmark, that gives provinces and territories the flexibility to implement the type of system that is best for them, while setting certain basic criteria that all systems must meet to ensure that they are fair and effective.

The Government of Canada is also committed to developing and implementing a federal carbon pricing system as a backstop. This backstop will therefore apply to any province or territory that does not have a carbon pricing system that meets the federal standard.

The greenhouse gas pricing act establishes the legal framework for the federal carbon pricing system, which serves as a backstop. The primary objective of the act is to help reduce Canada’s greenhouse gas emissions by ensuring that a price is set on carbon across Canada and that it increases over time.

As part of its commitment to the Canada-wide approach to carbon pricing, the government will apply the federal pricing system only to the provinces and territories that it lists in schedule 1 of the act because they do not have a system that meets the benchmark. It also states that it will assess the provincial and territorial systems annually to ensure that they continue to meet this benchmark.

The federal carbon pricing system introduced by the act has two components: a levy on fossil fuels that is generally payable by fuel producers or distributors, also known as “fuel costs”; and a performance-based system for industrial facilities, also known as “production-based pricing”. These components are intended to complement each other and to ensure that there is no double pricing.

In December, the Minister of Finance and the Minister of the Environment and Climate Change wrote to the provincial and territorial governments to provide them with the carbon pricing timelines. Provinces and territories wishing to establish or maintain their own systems must confirm their intentions by September 1, 2018. The Government of Canada will then determine whether the provincial and territorial systems will meet the federal carbon pricing standard.

In provinces and territories that do not meet the federal standard, the federal carbon pricing system will apply as of January 1, 2019, at an initial price of $20 per tonne of emissions. Provincial and territorial systems will be assessed annually. This timeline provides clarity to everyone involved and will enable consumers, businesses, and investors to make informed decisions.
Businesses already know carbon pricing makes good sense. According to a report from the Carbon Disclosure Project, the number of companies with plans to internally price their own carbon pollution increased between 2014 and 2017, from 150 to almost 1,400. The list includes more than 100 of the world’s largest companies, with total annual revenues of $7 trillion.

In Canada, many energy companies, our top five banks, and major consumer goods companies support a price on pollution. They are all part of the Carbon Pricing Leadership Coalition. They know carbon pricing can make Canadian businesses more innovative and competitive, and that it provides certainty to investors.

A recent study ranked Canada fourth in the world as a clean technology innovator, up from seventh place in 2014. Last year, 11 of Canada’s clean-tech companies ranked in the top 100 worldwide.

Companies such as Winnipeg’s Farmers Edge are developing cutting-edge technologies that help farmers waste less energy and increase their profits. Ecobee in Toronto makes smart thermostats that link up with smart phones to help Canadians save money and make their homes more comfortable. Dartmouth’s CarbonCure has developed a technology to capture carbon pollution from industry and use it to make stronger concrete.

This is the kind of innovation and entrepreneurship carbon pricing is designed to support. These kinds of technologies help protect our environment, create new opportunities and middle-class jobs, and help our industries to compete.

According to the World Bank, jurisdictions representing about half the global economy are putting a price on carbon, and that does not include China’s national system announced late last year. As of 2018, 70 jurisdictions around the world at the national and subnational levels are putting a price on carbon.

The approach to carbon pricing is going to ensure that Canadians are well placed to benefit from the opportunities created by the global transition that is now under way. Carbon pricing is the most effective way to reduce emissions. It creates incentives for businesses and households to innovate and pollute less. Innovation is key to keeping Canada’s economy competitive. Carbon pricing brings down emissions while driving investment in energy efficiency and in cleaner, less polluting energy sources.