Most people believe that greenhouse gases cause climate change. Those who
doubt the science could take a “better safe than sorry” approach. A global carbon
tax is the answer to curb greenhouse gas emissions. So far 20% of emissions
are subject to carbon pricing (CT32) but that is not enough. The global
emissions still increase by 2.6 % per year.(CT63). China’s emissions rise by
almost 10 % per year.(CT64). Only when everybody pays the same tax for carbon
will it be possible to apply it to exports without unfair competition. It would
eliminate complicated duty arrangements presently discussed.(EP1 CT69-70).
China considers a carbon tax.(CT32) 70% of China’s primary energy comes from
coal.(CT58) With carbon capture and storage (CCS) the global warming potential
(GWP) can be reduced from 4.44 to .25.(CT24). With the help of Europe and
multinational companies China is further advanced in carbon capture and storage
than any other country.(CT60). That will eventually allow fueling of electric
cars and trains with much greener energy.
With tax free oil from Canada China's development will slow down. To stop additional future oil flows we have to
demand a universal carbon tax. Until a proper international agreement on carbon
tax has been reached, demand for oil will keep rising. It will make no
difference in the global greenhouse gas emission whether Canada supplies that extra
oil or we let other countries do it. When eventually our exports dwindle we
don’t lose because by collecting the tax we get more money for our oil, coal
and natural gas.
Two oil
companies, Shell and Statoil, one of the largest petrochemical companies,
Brakem and a majer airline, Cathay Pacific are among 100 multinationals who are frustrated with the lack of
political action in the UN climate talks. They want a firm carbon tax agreement
so they can plan for the future. They signed an important carbon price
communiqué.(EP17). The CEO of ExxonMobil is in favour of a carbon tax over cap
and trade. It would “achieve a uniform and predictable cost for carbon across
the economy”.(CT65). Study after study has shown that carbon pricing does not
harm the economy (EP15 CT18 CT32 CT45 CT48) and that a revenue neutral carbon
tax, like we have in BC is easy to implement and administer.(CT 31 CT50-52 CT66).
In BC it has reduced the use of petroleum products by 17% without loss of GDP, while
consumption rose by !% in the rest of the country.(CT48)
Opponents of the
carbon tax don’t realize that businesses and individuals get most of the direct and indirect carbon tax money back through reduced taxes and special credits. In BC the government must show how all of the carbon tax
revenue flows back to individuals and businesses as tax reductions. To ensure this
occurs, by law the government must table in the Legislature an annual
plan that
clearly outlines how every cent of carbon tax revenue will be returned to taxpayers
in tax reductions. That plan shows 16 specific tax reductions and credits for
2012, 2013 and the projection for 2014. The largest refunds in order of size are:
(CT73-74)
Carbon
tax revenue 1,241 1,172 1,261 Reduction of 5% in the first two personal
income tax rates (228) (244) (255)
Small business corporate income tax rate, 4.5%, reduced to 2.5% (205) (206) (210)
General corporate income tax rate reduced from 12% to !0% but now back at 11%
(374) (316) (209)
Low income climate action tax credit of
$115.50 per adult $34.50 per child (190) (190) (190)
Northern and Rural Homeowner benefit of up to
$200 (77) (79) (81)
Industrial Property Tax Credit of 60% of
school property tax (71) (73) (76)
When such details are not widely published
people look at carbon pricing as a tax grab rather than a tax shift to make
green energy more competitive. As long as there are so many opponents to carbon
pricing, governments will not change their stand. It is up to the
environmentalists, companies such as the 100 multinationals mentioned above,
the US carbon tax center, other organisations and individuals to force more publication
of the details and demand better international negotiations. The present
stumbling blocks in the negotiations are the tax level,(CT 45 CT51) the distribution
of the proceeds to help poorer nations (EP1 EP17 CT72) and punishment for
countries who break their commitment.(CT37)
In the US and in Canada many people are influenced by the
figures they see what the average household will pay for carbon pricing rather
than the actual loss of income. In the US that actual loss would be $ 150 per household. in BC it averages at $ 0 per household. (CT 15-!7 CT29-30). That confusion has created further
resistance to a carbon tax. So far the Canadian government has refused to
expand the BC tax to the rest of the country. In the US four bills for national
carbon pricing have been defeated (CT16) while they have successful carbon
pricing in 10 States.(CT18) This puts us in an awkward position.
Environmentalists rank Canada as # 58 and the US as #43 out of 61 countries
based on 5 criteria. Denmark, Sweden and Portugal are #1,2 and 3 (EP2) so it is
no wonder the Europeans want to stop our pipeline expansion. In London Mr Harper
was met by 30 protest organisations from both sides of the Atlantic while 6 MPs
tabled a motion to keep Alberta oil out of Europe.(CT37).
Insufficient
pipeline capacity means that we have to sell our oil at bargain prices, leading
to at least $20 billion dollars per year lost income in Alberta.(EP1), This
results in substantial lost tax revenue for Ottawa. Since we don’t want to ship
more oil by rail we have to look seriously at all pipeline proposals. There is
a lot of technical information about pipelines and marine transport available
on the internet. It is not published in newspapers but is essential information
to form an opinion about the Northern Gateway project. Enbridge has a very poor
operation and maintenance record (EP2-3 EP6 EP19-20) but as a result of past
disasters some rules have been changed (EP32) and their proposal exceeds
minimum requirements. The pipeline will have thicker walls than required, 50%
extra isolation valves and round the clock personnel in all pump stations.(EP8-9)
An Alaska pipeline was designed with lots of flexibility and withstood a 7.9
magnitude earthquake.(EP37) Enbridge describes their earthquake and tsunami
approach in one of their blogs which is worth looking at it.(EP50-51) A main problem is the customary leak detection
system used by pipeline companies. It relies on internal sensors which can’t
detect leaks smaller than 1 ½ % of the flow. There are so many false alarms
that signals for leaks are often misinterpreted.(EP11) This led to the 17 hour
delay of shut off in the Kalamazoo spill. It also explains why between 2002 and
2012 in the US only 5% of the spills were detected by instruments.(EP9) Any new
pipeline should be equipped with external sensors which can detect smaller
leaks and have been tested and will be tested regularly for proper operation. Also it should be assured that new pipelines
use the proper crack detection tools and that the new rules for crack repair
are strictly followed.
It appears that for
the Kinder Morgan project a lot more information will have to be released
before the public can accept that project. It should be of the same quality as Enbridge’s
proposal summarized above. Many of the affected
residents are against the project. Unless there will be a guarantee that far
more personnel will be made available to oversee all aspects of the construction
and operation of the pipeline, history will repeat itself. That could be
pipeline spills, loading problems and possibly tanker accidents. Note that some
aspects of tanker traffic are covered in post 4 and point 14h in the second article
of post 1. Fortunately there is a website www.http://nsnope.org/ which keeps the public well informed about
the dangers, the reservations of local politicians and many other aspects of
the project. This should help to get the media more involved in all the details
about pipelines and tanker transportation.
The EP and CT
references are page numbers of the supporting documents for 3 E mail exchanges
with the Federal Government and Enbridge, followed by 2 further exchanges with
Enbridge. Afterwards some more pages were added starting at EP57 and CT63. I can’t
download them to the blog but if you want to see them, please leave a comment on
the blog and I will email them and the correspondence with the government and Enbridge.
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