Emissions plan could mean higher electricity prices

TORONTO, ONTARIO - Ontarians should expect to pay higher electricity prices as greenhouse gas reduction plans take effect in Canada, Premier Dalton McGuinty warns.

Ratepayers could pay a penalty because the province relies on coal-fired generating stations for 16 per cent of its power. Those plants are a major source of greenhouse gas emissions and would be more costly to run under an emissions trading system needed to protect the environment, McGuinty acknowledged.

"That's a possibility. Let's understand we cannot shirk this responsibility, it falls to our generation," he told reporters as provincial and territorial leaders gathered at the Royal York Hotel to discuss joint action on climate change.

McGuinty went to the meeting touting his plan for the provinces to set up a national "cap and trade" system – perhaps centred at the Toronto Stock Exchange – that would limit greenhouse gas emissions.

Companies that exceed the caps would be able to buy pollution credits from companies whose emissions fall below the caps.

The problem is that a federal green plan released recently does not readily lend itself to such an emissions trading system, because it could allow emissions to rise initially before they begin to fall, claimed McGuinty, noting such trading is already taking place in Europe.

"It's like we're going to stick to Beta and the rest of the world has gone VHS."

The premiers did not reach agreement on any solutions, said Manitoba Premier Gary Doer, but will come forward with a renewable energy strategy at their Aug. 8-10 meeting in Moncton, N.B.

Doer was asked if it was worth having leaders fly to a meeting where no conclusions were reached, given the greenhouse gases their trips produced.

"No one has stood up here and acted holier than thou," said Doer, who arrived on a commercial airliner.

McGuinty took the subway for the short trip to and from Queen's Park.

Newfoundland and Labrador Premier Danny Williams, who chaired the meeting, said Canadians should not expect the plan they come up with in August to be "one size fits all" because each province will find different ways to address climate change and energy concerns.

"To say it's a patchwork, yeah you can use that term, but a patchwork in a good sense. A patchwork quilt keeps me warm," said Williams.

McGuinty won support from British Columbia Premier Gordon Campbell, who is talking with northwestern U.S. states about emissions trading in the same way Ontario is talking to northeastern states.

While Campbell said it might be a tough sell to ask Canadians to pay higher power bills, people may have little choice to curb climate change.

"I don't think anyone wants to pay more (for energy). I haven't found anyone saying please let me pay more for anything," said Campbell.

"I do think that people recognize we're all going to have to change some of our behaviours.

"Right now in Canada, we generate about 19 tonnes of greenhouse gases per capita (annually while) in France, they generate 6 tonnes per capita. That means we've got room for improvement."

Alberta Premier Ed Stelmach was outspoken against the McGuinty push for a national "cap and trade" system.

"I'm not one that looks forward to issuing licences allowing to pollute more, especially if we're going to be trading with other countries," he said.

Stelmach warned that McGuinty's proposal could see money leaving Alberta, which recently passed its own emission reduction targets that put a value on emission offsets, putting equalization payments to other provinces at risk.

Meanwhile, federal Environment Minister John Baird has written to McGuinty to scold him for causing "confusion" about Ottawa's plan to cut greenhouse gas emissions.

"As you are aware, my officials and my staff have now briefed your office on details of this plan on two occasions since April 26, including a day-long meeting (Monday) in Ottawa," wrote Baird, who was miffed the premier was attacking the Conservative government's plan as inadequate without apparently understanding it.

"This plan strikes a balance between the economic growth and environmental protection, a balance that is particularly important in Ontario, which is both Canada's industrial heartland and a major source of industrial greenhouse gas and air pollutant emissions," Baird added.