Saving TransAlta: a demonstration of Canada's Clumsy Carbon Pricing

Canada’s Prime Minister announced aspects of a carbon pricing policy again last week. This time there were some details on how much more people in four provinces would pay for fossil fuels, the estimated revenues from those charges, and what is to be done with those revenues. Subsequently there’s much commentary on the content of announcement, and I’ll offer some more, but my attention was returned to a topic I prepared to write on quite some time ago: the impact of government actions in Alberta on a company owning much of the coal-fired generation in its province. I’ll use that company to demonstrate why I refer to the allegedly national policy as Canada’s Clumsy Carbon Pricing (CCCP).

The government’s website contains a section on “Ontario and pollution pricing” [sic] that describes the two main aspects of CCCP:

The federal carbon-pollution [sic] pricing system will be implemented in Ontario, under the federal Greenhouse Gas Pollution Pricing Act with the following features:

• For larger industrial facilities, an output-based pricing system for emissions-intensive trade-exposed industries will start applying in January 2019....
• A charge applied to fossil fuels, generally paid by registered distributors (fuel producers and distributors), as set out in the Greenhouse Gas Pollution Pricing Act, Part 1, will start applying in April 2019…

Because the 2019 pricing for provinces not deemed to have met federal pricing requirements is only now being finalized it will not be effective January 1st, but April 1st, while the Output Based Allocations (OBAs) that are still not finalized are still to be effective four months prior to that - on January 1st.

Clumsy - at best.