Canada agrees to first national carbon price : PM Trudeau

Canada's Prime Minister Justin Trudeau said the move to introduce a national carbon price will help Canada meet its international climate change obligations.
Canada's Prime Minister Justin Trudeau said the move to introduce a national carbon price will help Canada meet its international climate change obligations.PHOTO: REUTERS

OTTAWA (REUTERS) - The government on Friday (Dec 9) agreed a deal with eight of Canada's 10 provinces to introduce its first national carbon price, Prime Minister Justin Trudeau told reporters.

Trudeau has said the move will help Canada meet its international climate change obligations.

The agreement was struck only after heated talks. The energy-producing province of Saskatchewan did not sign up, saying the cost would be too great. Manitoba also declined to sign but officials said it might do so later.

Under his plan, carbon pollution would cost C$10 (S$10.85) a tonne in 2018, rising by C$10 a year until it reaches C$50 in 2022. The provinces can either implement a carbon tax or a cap-and-trade market.

Trudeau is broadly aligned politically with President Barack Obama, who has pushed hard to cut emissions of greenhouse gases.

US Vice-President Joe Biden told the meeting he doubted President-elect Donald Trump could undo much of the administration's policies since many of them had taken firm hold.

Saskatchewan premier Brad Wall said the carbon price would make Canadian firms less competitive at a time when Trump looks set to adopt policies cutting energy costs.

In a sign of the tension that remained after the negotiations, Trudeau and Wall exchanged barbed comments at the closing news conference.

Wall noted Trump’s decision to put a climate skeptic in charge of the U.S. Environmental Protection Agency, which Obama used to push through many green measures.

“Let’s not be naive as Canadians. This is our No. 1, not just trading partner, but competitor ... we need to be competitive with them,” he said.

“Canadian climate policy will be set by Canadians, not by whoever happens to be president of the United States,” Trudeau immediately replied.

Environmental groups largely welcomed the announcement, but some said Trudeau’s recent approval of two crude oil pipelines would make it harder for Canada to meet its Paris targets.  

Trudeau, who vows to impose a carbon price on any province that refuses to sign the deal, did not answer directly when asked when he would move against Saskatchewan.  

Manitoba also declined to sign, saying it wanted Ottawa to hand over more money for health care first, but officials said it might join later.