CERI Touts EU ETS Over Carbon Tax to Cut Emissions (Ind. Report)
Canadian Energy Research Institute
A recent study from the Canadian Energy Research Institute (CERI) compared the province of British Columbia's $40 per tonne carbon tax and Alberta's Technology Innovation and Emissions Reduction (TIER) program taxing heavy emitters $30 a tonne, to the European emissions trading scheme (EU ETS) and Quebec's cap-and-trade agreement with California and noted that overall, the EU ETS policy was more effective at reducing greenhouse gas (GHG) emissions than the Carbon Tax policy or a Hybrid policy.
In keeping with the study findings, the CERI study proposed the following to lower emissions:
Both carbon tax and emissions trade systems have a great capacity to reduce GHG emissions; however, a level at which they are utilized is not adequate for significant change towards low carbon economies;
Strengthening existing and adding new carbon policies and actions, especially those that can deal with carbon leakage, is needed;
Current carbon prices in many jurisdictions remain insufficient to achieve the objectives of the Paris Agreement, even with extended carbon pricing policies in place to align with the specific GHG reduction targets;
Stronger complementary policies and actions are needed to achieve the total reductions in GHG emissions in a case of the BC carbon tax;
Lessons from ETS systems, especially California's cap-and-trade system, has revealed that the economy-wide approach can be more efficient than managing specific sectors differently;
Linkage of a cap-and-trade system with those in other jurisdictions (such as California's cap-and trade system linked with Quebec) could potentially reduce abatement costs, price volatility, and market power.
The Calgary-based Canadian Energy Research Institute is an independent, not-for-profit research establishment created through a partnership of industry, academia, and government in 1975. CERI aims to provide relevant, independent, objective economic research in energy and environmental issues to benefit business, government, academia and the public and to build bridges between scholarship and policy,combining the insights of scientific research, economic analysis, and practical experience.
(Source: Canadian Energy Research Institute, PR, Western Standard, Aug., 2020) Contact: Canadian Energy Research Institute, (403) 282-1231, firstname.lastname@example.org, www.ceri.ca
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