The Supreme Court of Canada has given some provincial governments additional incentive to develop their own carbon plans.
In a 6-3 split decision on March 25, the high court ruled the 2018 law putting a floor price on carbon emissions is constitutional.
Prairie premiers upset with the decision will now have to develop and implement a carbon pricing regime in their own jurisdictions, or continue abiding by the backstop system put in by the federal government.
The federal system is causing issues for producers who argue they can’t pass on added carbon costs to buyers.
While most Canadians continue to favour the policy, producers, particularly those living on the Prairies, argue carbon pricing will keep increasing costs of inputs, transport, heating and grain drying.
Such complaints about the policy are part of the reason why Conservative governments continue to oppose carbon pricing.
Alberta Premier Jason Kenney contended the Supreme Court’s ruling eroded provincial powers. His Saskatchewan counterpart, Scott Moe, said the court’s decision won’t stop his opposition to a “costly and ineffective tax.”
But now the Supreme Court has rejected Kenney’s and Moe’s constitutional challenge and offered some clarity over the policy’s future.
Rather than spending energy criticizing the Liberal plan to combat climate change, Prairie premiers can now come up with their own plans.
Provinces can exempt agricultural activities altogether from carbon pricing if they want to, assuming they could appease the feds’ minimum requirements by finding equivalent ways to reduce or offset emissions.
As many readers know, there is legislation working its way through the House of Commons that would expand farm fuel exemptions to the federal backstop.
Its passage is no guarantee, but Moe and Kenney have the opportunity to ensure the law doesn’t need to apply.
They can simply design their own policy that exempts farm fuels from carbon pricing.
This was always an option, but instead Alberta and Saskatchewan chose to let Ottawa dictate the rules by not introducing credible plans to combat climate change.
They gambled that in the end, the country’s highest court would say the rules don’t have to apply.
In the immediate aftermath of the ruling, it wasn’t clear what Saskatchewan and Alberta would be doing as next steps.
Moe hinted Saskatchewan would aim to mimic New Brunswick’s climate strategy, while Kenney left reporters guessing.
Both premiers deserve criticism for not developing credible policy to reduce greenhouse gas emissions within their own jurisdictions. It’s how they ended up with federal backstop to begin with.
There are credible reasons to continue opposing the policy. A court saying the law is constitutional does not mean it is good policy.
Producers and Prairie governments have rightly pointed out carbon pricing puts farmers at a disadvantage.
Provinces can ensure carbon pricing doesn’t disadvantage farmers by creating credible climate change policy that offers broad exemptions to agriculture.
Now that there is clarity on the rules around carbon pricing, those governments have an opportunity to do away with the frustrations of the federal system, and employ their own exemptions to help farmers thrive in a world with carbon pricing.