I wrote a post recently in which I tried to understand just how much the carbon tax being proposed by Liberal Party leader Stephane Dion would reduce emissions. In his plan, he predicts $15 billion in revenue from a tax of $40 per tonne of carbon dioxide emissions paid on fuels.
After struggling with the numbers, and a couple of false starts, I came to the conclusion that the emissions predicted in Year 4 of Stephane Dion's new tax regime are not any different from the emissions today.
I thought that odd, but then maybe it was reasonable. Perhaps Stephane Dion figures that four years is not enough time to see the effect of a new universal tax on energy. It takes time for factories to shut down and move to Mexico.
But in an interview with the editorial board of Sun Media, Stephane Dion says there will be large reductions by 2012 (the impilicit assumption being that he can implement a tax in 2009).
That doesn't make sense.
You can read the post in which I worked at figuring out how Liberal Party leader Stephane Dion came up with the carbon tax numbers.
In summary, here is what I figured out:
Think my numbers are wrong? According to the World Resource Institute, in 1998, Canada emitted 467,223,000 tonnes of carbon dioxide from all sources, including gasoline, gas flaring, and cement manufacturing. The WRI pegged transportation as responsible for 151,000,000 tonnes of that. The WRI does not separate out car gasoline from other transportation fuels, but if you take out the transporation as a whole, you get 316,223,000 tonnes of emissions. Throw diesel and jet fuel and such back in, and the number goes up somewhat, but even without making that correction, you see that the numbers from 10 years ago are in very close agreement with my calculation (within 5%). Indeed, my numbers are a bit higher, which is what you'd expect, since our consumption and related emissions have grown year after year under the Liberals while Stephane Dion was environment minister.
So let's continue with my numbers. Given the rounding off here and there, I'm not going to quibble about the fact that the Liberal plan seems to indicate that emissions will go up by 50,000,000 tonnes because of the carbon tax. For this sort of rough calculation, any engineer would look at a 9% difference as essentially no difference at all.
What this means is that based on real numbers, I come to the conclusion that in Year 4, the revenue prediction from Stephane Dion's carbon tax plan is based on no decrease in emissions over the first four years of the plan.
Now that might be entirely reasonable. In four years, we might not yet have seen the major impact on the economy, especially since the tax rate starts at $10 per tonne in Year 1. The big reductions might start happening in Year 5 when industries begin to shut down and move out.
But my attempt at making the Liberal plan seem reasonable was undercut by Stephane Dion talking to the Sun Media editorial board about the effects of his carbon tax:
Stephane Dion's green shift plan will form the core of his party's election platform, but the Liberal Leader can't project what short-term impact a carbon tax would have on cutting emissions.
In a 75-minute session with Sun Media's editorial board in Toronto, Dion predicted his proposed carbon tax will trigger large reductions by 2012, building momentum that he hopes will reach a 20% drop by 2020. But he can't forecast how fast emissions will decrease in the short term.
"I'm confident we will have significant reductions. I'm not telling you specific numbers because you would not trust me," he said.
Large reductions by 2012? But my own calculations as well as calculations from other sources support the same conclusion. The revenue figures stated by the Liberals for Year 4 of their plan (which would be 2013 assuming the Liberals started the tax in 2009) show emissions at essentially the same level. Strictly speaking, the Liberal carbon tax plan seems to predict higher emissions, but I'll pass on that point since we're talking about numbers that are rounded this way and that.
But I'm certainly not seeing "large reductions" in emissions in 2012. Not even a hint of reductions. I see a carbon tax plan that assumes that emissions will remain steady, guaranteeing $15 billion in new revenue to support Liberal Party spending, and doing not one bit of good for the environment.
I'm surprised no one else seems to have picked up on this. Maybe I've done something grossly wrong with my calculations, but I've used multiple independent source to come up with numbers using different techniques, and they are all in agreement.
And they agree that Stephane Dion misspoke when he says his carbon tax plan is triggering large reductions in 2012. He says he doesn't want to offer "specific numbers" concerning the "significant reduction" because he's worried we won't trust those numbers.
Well, I'm sorry to say that trust in Stephane Dion is the only thing being significantly reduced as far as I can figure.
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