Why cap-and-trade schemes are little more than a cash grab

"Ontario Premier Kathleen Wynne announced Monday she's going to price industrial carbon dioxide emissions through a cap-and-trade market, without telling us the price.

She said it would be irresponsible to estimate how much more we're all going to have to pay for virtually all goods and services, because the Liberals haven't yet designed their cap-and-trade system.

This is very hard to believe.

The Liberals have been planning cap-and-trade for seven years.

It's true they can't come up with an exact price, because it depends on how quickly they plan to reduce emissions and what the market price of a carbon credit will be (more on that in a moment).

But for Wynne to claim she has no idea of the cost is absurd.

For heaven's sake, someone in her government told the Globe and Mail recently the Liberals expect increased government revenues of up to $2 billion annually.

Don't be fooled into thinking the one added cost the Liberals provided ' about three cents more per litre of gas ' is either accurate, or the only cost hike we'll face, or that it will stay at three cents.

Fossil fuel energy, produced by burning oil, natural gas and coal, is responsible for modern civilization.

Industrialized societies like ours use it to grow, manufacture, create, produce, power and transport virtually all goods and services.

That's why cap-and-trade increases the price of virtually everything, as opposed to a carbon tax which increases the tax on almost everything.

Under cap-and-trade theory - we'll get to reality in a moment - Wynne's government will set a gradually decreasing limit on annual carbon dioxide emissions from major Ontario industrial emitters.

It will then auction off carbon credits to these industries, permitting them to burn fossil fuels up to the limit their credits allow.

The government makes money by auctioning off the carbon credits to industry, who then pass this added cost along to consumers in higher prices.

These companies then buy and sell carbon credits among themselves in what amounts to a stock market, the theory being more energy efficient companies will have spare permits to sell to less efficient ones.

That's the theory. The reality is cap-and-trade is especially vulnerable to insider manipulation, political corruption, fraud and organized crime, all of which happened in the world's largest cap-and-trade market, the European Union's decade-old Emissions Trading Scheme.

Those problems caused the market price of carbon credits to repeatedly crash, making it cheaper for companies to buy permits than reduce emissions.

In Europe, governments exempted entire industries from cap-and-trade and gave out so many free credits they outnumbered actual emissions, which meant emissions initially went up.

Some industries jacked up their prices to consumers as if they'd paid for carbon credits when they'd received them for free.

Finally, there was widespread fraud - both tax fraud and cases where carbon credits were issued without any real reduction in emissions.

In Ontario, major industrial emitters will now be lining up to pressure the Liberal government to (a) exempt them from cap-and-trade, arguing they compete with companies in other jurisdictions that don't price emissions and/or (b) give them free carbon credits, the equivalent of free money.

In order to get favourable treatment from the government, they'll do what big business always does - hire lobbying firms with close connections to the government while making big donations to the governing party.

That's nothing new. It's how big business operates when it wants something from government, no matter which party is in power.

The problem in cap-and-trade is that every time the government excludes another industry, or gives away carbon credits for free, it undermines the purpose of cap-and-trade, which is to reduce emissions.

That's what happened in Europe and it's going to happen here."

http://www.torontosun.com/2015/04/13/wy ... -the-price

And it won't make a difference at all in the fight against climate change.

Ontario is such a small player. Canada is such a small player.

The only purpose of this plan is to drive more money into the government.

Don't see much i n the way of a solution offered by this guy. Straight regulation. Or just ignore it and see what happens?

Why are we focusing on a solution?

Canada and Ontario, even with these changes, won't even make a hint of a difference with respect to climate change.

Well first off, it's as much about cashing in on the energy trading market as the OP suggests. I called it on this site years ago back when Dalton made the first Samsung deal announcement....at the Toronto Stock Exchange, not some hippie green energy commune.

Secondly, I'm not sure that saying we can't change the world all on our own is a reason not to do anything. I mean the only way climate change could be addressed is if everybody does it. That's like saying 'the world will always have crime, so why should Ontario bother having laws?'

Why are we focusing on a solution?

Because in Canada, we have air and water and dirt. And we want these to be clean and not killing things. Like people, for example.

And they already are.

There's nothing wrong with taking steps to prevent our environment from being polluted but that's why we have a Ministry dedicated to that and laws to protect our Country.

This is just another tax under the guise of being a step to tackle climate change. Just like the Drive Clean program in Ontario.

And without any data based example of that actually happening all you're saying is "The end is nigh. Repent you Carbon Dioxide exhaling sinners against the great climate God."

And even if you could offer such an example OtI would still be correct (even though he makes the critical mistake above of allowing you to get away with the lie that CO2 is pollution), because of the bit you edited out of his quote.

"Canada and Ontario, even with these changes, won't even make a hint of a difference with respect to climate change."

LOL. This guy. This fucking guy.

I suppose that in some universe that makes sense (or, say, Germany) where efficiency is prized and is the main goal of any endeavour and not just a random offshoot of a politicians usual stunt-booking, something like cap-and-trade might actually work to fix a growing and destructive problem. Given that this is being attempted in Ontario (and Canada) though it's more though just more of the politicians jerking off all over themselves on stage and boldly exclaiming 'hey, look at me!' in anticipation of applause.

Not comparable.

Fighting crime has no side effects besides cost.

Having business's pay more, especially manufacturing, in a Country who's manufacturing sector has been decimated, will have effects to people, the economy and jobs.

And they already are.

Right. And that's why we should be looking for solutions.

http://www.thestar.com/news/canada/2008 ... eaths.html



Unless things like the Federal Waterways acts get amended in omnibus budget bills. (not directed at you, just the government in particular)



Not disagreeing with you there, just answering your question on why we should look for solutions.



Although I know it's your Pavlovian response, but we are speaking of pollution.

Not sure about that claim...

Odd how that formula from South Park keeps playing out so well in Canada, especially with the Ontario Liberals.

1) Bring in ever single tax-increasing, business-wrecking, and job-destroying policy under the sun that we can think up.
2) ???????
3) PROFIT $$$$$$$

Toronto and Ottawa and the other localities that keep voting the Liberals in might have to be kicked out of the province altogether just so the rest of the place can have half a chance at survival.