Peter Boag: This scheme might actually achieve emissions reductions in Canada — by closing refineries
The federal government’s proposed carbon-pricing “backstop” requires large emitters like refiners to reduce their emissions by 30 per cent from their sector average or pay the federally mandated carbon price on excess emissions, starting in January 2019.
For now, refiners in provinces that already have a carbon-pricing system in place — Quebec, Ontario, Alberta and British Columbia — are exempt. Not so for refiners in other provinces like New Brunswick and Saskatchewan. A review in 2020 will determine the longer-term application of the backstop to refiners currently exempt.
What does a 30 per cent reduction mean for Canadian refiners? It’s an emissions-performance level that no refiner in the world has been able to achieve — by a wide margin. Comprehensive and credible global data shows that when compared with their peers in the developed world, Canadian refiners’ emissions performance is in the middle of the pack.
Some refiners are better than average, some are even in the top 10 per cent of performers in the world, and some are worse than average, with work underway to improve. The data also shows that the difference between top and poor performance is not large — emissions performance is a tight range.
That’s where the 30 per cent reduction becomes problematic — it requires a performance level that is literally “off the chart” — in territory that is the stuff of dreams, not reality.