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Notley predicts Ottawa will struggle without provincial buy-in on carbon pricing

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The federal government will struggle to push through its new carbon pricing scheme without the support of the provinces, even if Canada’s premiers don’t have legal recourse to stop it, says Premier Rachel Notley.

Prime Minister Justin Trudeau announced Monday that Ottawa expects provinces to establish a minimum carbon price of $10 per tonne by 2018, rising to $50 by 2022 — or the government will do it for them.

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While Alberta has its own incoming carbon tax, Notley fired back that Alberta would not back the federal plan without action on a much-needed new oilsands pipeline.

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Speaking to reporters at McDougall Centre in Calgary on Tuesday, Notley acknowledged the provinces can’t legally stop Ottawa from implementing a mandatory carbon price, but she cautioned Trudeau to heed provincial concerns.

“The fact of the matter is, the federal government will be successful on implementing this plan if they are able to work with the provinces to make the allowances that are necessary,” she said.

“The federal government will struggle if they don’t have a willing partner with the provinces. The view that we are taking is that we are happy to be that willing partner if they do what Alberta has done for all of Canada for many, many years, which is do their fair share.”

“I don’t have the same legal levers at the end of the day, but I think we have a lot of strategies at our disposal,” she added.

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The Trudeau government must make a decision on Kinder Morgan’s planned expansion of its Trans Mountain pipeline to the Pacific coast by December.

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Notley said she isn’t linking Alberta’s support to any one project but if the federal cabinet approves a pipeline, that would start the conversation between the two levels of government on the higher carbon price.

“At that point, we would sit down and look at how we can best move forward with it,” she said.

Veterans Affairs Minister Kent Hehr, Calgary’s representative in the Liberal cabinet, believes Ottawa and the provinces can ultimately come to an accord over the carbon price, which is intended to give an incentive to reduce carbon dioxide emissions blamed for global climate change.

In an interview from Ottawa, Hehr would make no promises on specific pipeline projects but said the Alberta and Canadian governments are on the same page when it comes to the need for both climate action and access to tidewater for the province’s energy resources.

“There’s nothing new about federal-provincial wrangling and the like,” said Hehr.

The Liberal government’s plan calls for provinces to implement either a carbon tax or a cap-and-trade system by 2018 or the federal government will put in its own minimum price on carbon. Provinces will keep the revenue collected from within their jurisdiction.

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The announcement drew a furious response from Saskatchewan, Nova Scotia and Newfoundland and Labrador, whose representatives stormed out of a meeting of the country’s environment ministers in protest. However, Ontario and Quebec, which have cap-and-trade systems, and British Columbia, which has had a carbon tax since 2008, appear to be onside with Trudeau. 

University of Calgary political scientist Anthony Sayers said Notley is correct that the provinces have little legal ground to resist the Liberal plan.

But premiers can make Trudeau’s life difficult on other areas of federal-provincial jurisdiction, such as health care.

“We’ve forgotten just how much trouble provinces can make — and they can make an enormous amount of trouble by simply not agreeing to do stuff or not being willing to get along,” said Sayers.

“It’s not so much big sticks, it’s a lot of little sticks.”

The carbon tax being implemented by Notley’s NDP government on Jan. 1 has attracted fierce criticism on its own, with a recent poll showing nearly two-thirds of Albertans opposed to the levy. The tax will be based on the equivalent of $20 a tonne, rising to $30 in 2018, with no further increases planned at the moment.

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Notley said Alberta’s new carbon levy was preceded by intensive study by Alberta’s climate change panel and the government believes the economy — despite it being hammered the last two years by low oil prices — can incorporate a $30 a tonne tax. 

An additional $20 on top of the levy will have too big an economic impact, unless the province has a new pipeline to help grow the economy by opening new markets and accessing world prices, said the premier.

“The idea of moving to that higher price could be accommodated in the Alberta economy should we get a new pipeline to tidewater,” said Notley.

jwood@postmedia.com

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