In internal briefing notes, officials from Environment Canada said that aggressive policies from the state of California are in fact consistent with Canada’s existing global-warming pollution goals.
The documents, released through access-to-information legislation, were based on an analysis of the Low Carbon Fuel Standard, which was announced by California Gov. Arnold Schwarzenegger on Jan. 9, 2007.
It set a goal of reducing the carbon intensity of fuels in the state’s passenger-vehicle fleet by at least 10 per cent by 2020. Although the Canadian government actively and secretly lobbied against this and other international climate policies, arguing they could harm companies in Alberta’s oilsands sector, Baird was told the California plan would not have a significant impact on the Canadian petroleum industry.
“The LCFS is expected to have a negligible impact on the Canadian oil industry, as Canadian crude oil imports account for less than 2 percent of California’s crude oil imports,” wrote Michael Horgan, at the time a deputy minister, in a secret memorandum to Baird’s office dated April 12, 2007.
The memo, which coincided in the spring of 2007 with the release of Baird’s “Turning the Corner” plan to address climate change, noted the federal government had already set similar targets to the California plan in Canada.
“Implementing a LCFS in Canada would largely duplicate the federal government’s recent and planned actions, which together will address the majority of the lifecycle (greenhouse gas) emissions associated with Canadian passenger vehicle fuels,” wrote Horgan in the memorandum, which was obtained by the Pembina Institute, an Alberta-based environmental research group.
“Given the advice his own officials provided, Minister Baird should explain why the government of Canada decided to fight California’s policy instead of supporting it,” said Clare Demerse, associate director of climate change at the Pembina Institute.
The Canadian Association of Petroleum Producers, an industry association, had written to the government in December 2007, warning members of cabinet that it believed the emerging standards were “discriminatory” and would “detrimentally affect international trade and Canada’s prosperity agenda.”
But the memo from Horgan noted that in the long-term, the oilsands could continue to export to markets with stringent climate standards by investing in new technologies, such as carbon capture and storage to bury emissions in underground deposits.
“In the end, the government sided with the industry representatives and worked to undermine California’s policy,” said Demerse. “I don’t think that’s what Canadians want their government to do, and it’s not the right decision for the environment.”
California’s Low Carbon Fuel Standard will see reductions in the state, beginning next year.
Baird, who will arrive in Mexico this week to participate in high-level discussions at the United Nations annual climate summit, has said that Canada is pushing for an international climate treaty that sets binding targets to reduce greenhouse gas pollution from all major emitting countries. He has also said Canada is trying to harmonize its actions with the U.S.
The recommendations from Horgan clashed with efforts of bureaucrats from Natural Resources Canada and diplomats at Canadian embassies who would later coordinate a communications strategy to “kill” foreign climate-change policies that they said could harm the oilsands sector.
Canadian diplomats from Washington also quietly sought out oil industry officials from companies such as Exxon Mobil and BP, encouraging them to speak out about environmental policies to ensure that Canada’s oil would continue “a-flowing” into the American marketplace, Postmedia News reported last week.
“The LCFS is expected to create a substantial certain market for low GHG fuels and a stable investment environment which, in combination with the state-wide cap and trade system, is expected to create a large enough price signal to induce sufficient, timely investments in new fuel and vehicle technologies,” Horgan said in the memo.
Horgan made headlines last spring after a memo he signed in his new role as deputy minister in the Finance Department urged the government to honour a G20 clean-energy commitment by eliminating subsidies to fossil-fuel companies, including those in the oil and gas industry.
Finance Minister Jim Flaherty dismissed the recommendations, and instead asked the department to come up with a plan to “minimize” its commitment leading up to the global economic meetings hosted in Toronto.
Canada has followed the U.S. in introducing new regulations to control tailpipe emissions from new passenger vehicles, but it has not introduced any regulations to slash pollution from Canadian industries that now produce about half of the country’s greenhouse gas pollution. Greenhouse gas emissions from the oilsands industry have tripled since 1990, according to Environment Canada estimates.
The U.S. has not been able to introduce a cap-and-trade system, which would set caps on pollution and allow companies to trade for permits to pollute on a price set by the open market. However, the Obama administration is introducing new regulations, coming into force next month, to limit pollution from new industrial facilities and existing ones that do major renovations.
mdesouza@postmedia.com
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