Nova Scotia's cap and trade needs targets to be effective, committee told

Nova Scotia's proposed cap and trade regime must have declining emissions caps in order to be effective, the legislature's law amendments committee was told Monday.

Proposed amendments to the province's Environment Act don't set caps yet, for a system that is expected to begin in late 2018.

"The caps must be declining and must represent a reduction in greenhouse gases when compared with the business as usual case here in Nova Scotia," said Stephen Thomas of the Ecology Action Centre.

The province has already met Canada's target of a 30-per-cent reduction in emissions from 2005 levels by 2030.

When it introduced the legislation last month, government officials said the goal would be to set declining greenhouse gas caps each year until 2022 that would correspond to projected emissions levels resulting from the federal government setting a carbon price that will rise to $50 a tonne by 2022.

That price will be set at $10 a tonne beginning next year.

"If we have caps that are set too high or that are not declining the system won't be effective," Thomas later told reporters.

Halifax renewable energy consultant Daniel Roscoe of Roswall Inc. agreed — and said caps should be set over and above 2030 targets.

"I think it is wise for us to continue to make improvements even if they are minor over time, and use a system like this so that our economy gets used to growth that is unhinged from emissions," said Roscoe, who was the only industry representative at the hearing.

The committee sent the bill back to the legislature, where it will now go through committee of the whole and third reading before becoming law.

It rejected proposed amendments from the Affordable Energy Coalition on the money raised through the Green Fund to be established through the legislation. The fund would support climate change initiatives and innovations.

The coalition asked that 20 per cent of the fund be used to support greenhouse gas reductions that directly benefit low- and moderate-income Nova Scotians, and that half the fund be used to assist low- and moderate-income households in offsetting the costs of the cap and trade program.

Brian Gifford, the coalition's chairman, told the committee that in order to do that, emission credits that are currently to be offered at no cost to industry through so-called allowances be auctioned off instead.

"Our belief is the only thing that will actually be effective in terms of generating funds for the Green Fund and also for creating incentives for lowering greenhouse gas emissions is to actually auction off the allowances," Gifford said.